We have already expressed our reservations about the New Mexico Legislature’s “favorite” consultant PFM and their recommendations. But, in yet another recent Albuquerque Journal article we (and the Legislature) are told again that if New Mexico’s oil and gas industry “go bust” the State will face dire budgetary and economic conditions.
New Mexico is indeed over-reliant on oil and gas, but as I point out below, that’s not the State’s biggest issue. Rio Grande Foundation is at the forefront of researching and advocating for policies that would diversify our economy, here are a few points PFM is missing.
1). See the chart below, oil and gas in New Mexico is being driven by new discoveries. Prices could go down for a sustained period of time and that would be a challenge, but oil and gas are not “going away” anytime soon. Stop the fearmongering.
2). With serious social and economic issues New Mexico policymakers should be considering ways to improve conditions right away. Unfortunately, the big-government approach that have been relied on for decades in New Mexico have ALREADY failed. PFM should recognize that fact.
3). Diversifying the economy and diversifying government revenue sources are not the same thing. It’s no surprise that their recommendations are so “off” given the consulting is funded by the left-wing Rockefeller Family Foundation.