According to recent news reports including this one from the New Mexico Watchdog, there is broad, bi-partisan support for an expanded $50 million “closing fund” for New Mexico to attract businesses.
Interestingly, the fact that New Mexico’s economy will be among those most harmed by falling gasoline prices is being used by advocates to justify “diversifying” New Mexico’s economy through the use of gas taxes (nearly 1/3rd of which were generated by oil and gas in the first place). Obviously, falling revenues mean that there is less revenue left to be spent on New Mexico’s fast-growing Medicaid program or on an expanded “closing fund.”
As I make clear in the Watchdog piece, we at RGF are free market first and pro-business second. We’re not fans of spending money to bring businesses here. We’d rather do the basics like adopt a “right to work” law and reform regulatory and tax policies in order to attract businesses. Taxing productive citizens and businesses in order to transfer that to attract new businesses is a losing proposition.
Interestingly enough, for Republicans in particular the $50 million closing ideas is fraught with political peril. Liberal Democrats who support the idea could easily cite support for the idea in the future and say that they worked on a bi-partisan basis to grow New Mexico’s economy. Unfortunately, a Republican embrace of the idea absent broader economic reforms will saddle the GOP with responsibility for the economy and free liberals from the “obstructionist” label.