Solve New Mexico’s Budget Crisis Without Tax Hikes or Draconian Cuts

The Legislature meets this Saturday, and possibly for longer depending on how reasonable Governor Richardson plans to be, New Mexico’s Legislature must act now to solve the state’s significant budget deficit. The Rio Grande Foundation has put forth a number of ideas and today, the Albuquerque Journal ran an article by two RGF economists showing how government employment needs to be reduced as part of the Legislature’s efforts.

As such, the budget cuts should fundamentally restructure the way government does business. One such area of spending that they should look closely at is the state and local government workforce.

For too long the government workforce has grown out-of-control with few, if any, constraints. For example, since the current recession began in January 2008 to August 2009, the private sector has lost 33,200 jobs, a decline of 5.2 percent. For these workers their lives have been turned upside-down. State and local governments, on the other hand, have added 1,300 jobs, an increase of 1.2 percent.

Moody and Warcholik continue:

Unfortunately, Richardson was recently quoted as saying: “I will not cut schools or education….”

Is he serious? State and local education spending is the single largest expenditure at $5.2 billion out of $16.4 billion total (32 percent) FY 2006 spending according to the Census Bureau. If you can’t find budget savings in education, then where else are you going to find budget savings?

There are cuts to be had and permanently reducing government employment in the areas in which we have a surplus is an essential part of solving the current budget crisis and improving New Mexico governance for the long haul.

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