On this week’s interview Paul sits down with UNM Finance Professor Reilly White to discuss issues in New Mexico’s “Energy Transition” relating to electricity. While the transition was touted as zero cost or even a financial benefit for ratepayers. White believes that the transition will cost real money and will have some profound impacts on ratepayers and the future of PNM as an independent company alike.

New Mexico is just one of 9 states that imposes a tax on Social Security. But, as we know, retirement is about more than “just” taxes. Of course, taxes DO matter, but how does New Mexico stack up overall as a retirement destination? A new Wallethub report ranks the Land of Enchantment 31st overall. The report included multiple variables including: affordability, quality of life, and health care.

On affordability, New Mexico ranked 20th, quality of life a disappointing 45th, and health care 35th. Not surprisingly, crime is a big drawback to our overall quality of life and not ALL variables apply to ALL retirees, but the report does a solid job of looking at various considerations that might impact retirees in their decision-making process.

And, while “affordability” may have been our best category analyzed in the report, doctors pay taxes too. Reducing tax burdens (including our gross receipts tax which burdens seniors with taxes on needed services) with our multi-billion dollar annual surpluses would seem like a wise move on both fronts.

Local control vs. centralized control is one of the most critical issues in American government. It is the justification for the US Constitution and efforts to centralize control often have resulted in politicians ignoring local control in order to accumulate more power. The case of Gov. Lujan Grisham’s push to force districts to adopt 5-day school weeks is only the latest example in this battle and notably, Lujan Grisham has NOT received support for her 5-day school week mandate from the Legislature. In fact, the Legislature explicitly rejected her plan during the 2024 session. 

But, MLG went ahead with the 5-day mandate and now she is being sued by 53 of the State’s 89 “real” school districts (some charter schools are organized as “districts”). From a legal perspective this will be an interesting case to watch, but the political impact is what we’re watching:

1. The Gov. touts the supposed impact of her proposal on outcomes, but with no evidence that forcing 5-day weeks improves outcomes;
2. The education bureaucracy is populated by people and groups (school officials and unions) that tend to be on her side politically. 4-day weeks are popular with nearly everyone involved, so it is hard to see why THIS is the hill to die on.
3. There is no political constituency for forcing 5-day school weeks on unwilling districts. This seems like just another way MLG is attempting to flex her political power.

The Rio Grande Foundation continues to work with legislators to reform New Mexico’s laws governing public health emergencies (both the subject matter and the Legislature’s involvement in them). Sadly, while bipartisan bills have been introduced repeatedly in Santa Fe to give the Legislature a seat at the table, a majority of Democrats have opposed any effort to restore the Legislature to the process.

No one worked harder to oppose the Gov.’s abusive and anti-scientific COVID “emergency” orders which lasted until March 31, 2023. The Gov. then declared a “public health emergency” last fall relating to “gun violence.” While the most radical aspects (like the outright ban on carrying a gun in Bernalillo County) were quickly voided by the courts, the Gov. has continued to renew her public health orders with little notice from the public. In fact, we were unsure what the latest was.

So, here’s the Gov.’s website where they list executive orders including public health emergencies. As it turns out, we now have TWO public health emergencies through May 17. One is the renewal of MLG’s “gun violence” order. A second order deals with drug abuse.

The first pages of both EO’s are below:

On this week’s Tipping Point conversation Paul and Wally discuss:

MLG calls a special session starting July 18. We don’t have an exact agenda, but initial statements seem to point to some actual crime reforms, not gun grabs. Time will tell.  RGF publishes a report on “The Viscolli Gun Loophole” Some friends of Michelle seem to receive preferential treatment.

A new federal education report highlights the need for dramatic improvements (even from the Federal Government’s perspective.

New Mexico has seen an uptick in preschool attendance, but no word on results.

NM has had some level of state support for pre-K in place since 2005.

Our politicians are betting on economic losers including Virgin Galactic and Maxeon Solar.

Wallethub: NM employers face 4th biggest challenge finding workers. Meanwhile the LFC tackles workforce participation issues (again):

Paul’s op-ed on Biden’s horrible LNG policies hits papers over the weekend.

In New Mexico government the spending or expansion of government is often viewed as the “success.” Actual outcomes are an afterthought or not even a consideration. The State’s massive spending on pre-K is a great example. A new report cited here by the Santa Fe New Mexican touts the number of kids participating in the “free” program. Elizabeth Groginsky, cabinet secretary of the newly formed “Early Childhood Education and Care Department” noted in the article, “We’re excited because we keep the investment and we keep increasing the amount that we’re paying for pre-K so that those salaries can be competitive and that we can make sure that our children are supported in high quality settings.”

But New Mexico began ramping up spending on pre-K back in 2005. There are young people who went through the program who may have graduated college at this point (or have entered the workforce full time). We haven’t seen a high quality study of the students that went through the program starting in 2006 or any time since then. We DO know that New Mexico suffered from the VERY worst scores on all reading and math areas studied on the Nation’s Report Card (NAEP).

MLG’s COVID lockdowns undoubtedly had a massive, negative impact on student achievement, but it is impossible to see any positive influence from the State’s growing spending on pre-K. Will the LFC or the Early Childhood Department EVER do a credible study on the program’s outcomes?

The following appeared in the Albuquerque Journal on April 21st, 2024.

What if I told you that one federal government policy could do the following:

• Undermine Russia’s war against Ukraine (without the US spending a dime);
• Strengthen economic ties between the US and Asian and European nations;
• Reduce CO2 emissions;
• Increase US tax revenues and American jobs (including in New Mexico).

The policy I’m referring to is to allow American exports of liquefied natural gas (LNG). Thanks to American technological prowess the US is producing enough energy not only for itself, but for the world as well.

Sadly, that runs contrary to the Biden Administration’s efforts to undermine American energy dominance. Since January the Administration has maintained a moratorium on permits for US LNG export facilities. Reversing that policy is essential and would help to achieve each of the goals outlined above.

In 2014 none other than Democrat New Mexico Sen. Tom Udall wrote in a letter to President Obama, “a strong market signal from the United States that it is a willing future supplier of LNG, even if those supplies are not immediately available, would have profound, positive and immediate strategic implications.” That same year Udall co-sponsored legislation to speed up the review of LNG export facilities.

Not only was Udall a visionary, but his national security concerns have become more relevant with the ongoing Russian invasion of Ukraine and the fact that they are funding their war with energy revenues. Russia’s war effort could be hindered by reduced energy prices and reliable energy supplies from the US.

LNG isn’t just an issue for America’s allies in Europe. A recent story from Nikkei Asia highlights how completely off-base Biden’s policy is. According to the article, “Massive volumes of coal must be displaced through the 2030s and beyond across emerging Asia to achieve the region’s net-zero aspirations. This inevitably will mean substantial gas imports.”

“India, Vietnam, and the Philippines are among the fast-growing Asian nations that plan to increase the role of gas in their economies through LNG imports as a reliable complement to renewable energy investment.” On his recent visit to the United States one of the primary objectives of Japan’s prime minister was to restore US LNG exports.

According to one report, the cumulative contribution to US economic growth from the addition of more LNG plants will range from $716 billion to $1.267 trillion between 2013 and 2050. This revenue and job growth that comes with it has had no discernable impact on the price Americans pay for natural gas to heat their homes and operate their stoves.

In fact, since New Mexico is among the biggest natural gas producing states in the nation (8^th-largest), our State is one that will benefit the most from growing LNG exports and that will lose the most if Biden continues with this senseless policy.

Of course, it is also worth noting just how far we’ve come in the past decade. Tom Udall was seen as one of the Senate’s foremost advocates for pro-environment policies. He not only tolerated LNG exports, he advocated for them.

Where are New Mexico’s current senators, especially Sen. Heinrich who sees himself as the heir to Udall’s environmental vision? Heinrich has been silent on the issue at least his actively updated Twitter feed has been. That’s not a surprise because Heinrich actively opposes New Mexico’s oil and gas industries. Instead Heinrich chairs the “bi-cameral electrification caucus” in Congress and spends a great deal of his time attacking gas stoves while advocating for complete electrification of transportation (and the rest of our economy).

Sadly, while the US continues to reduce its CO2 emissions, Biden and Heinrich are willing to ignore ways the United States can use its LNG-production prowess to help Asian nations lower their CO2 emissions as well while buttressing America’s allies in both Europe and Asia.

The Biden Administration and Sen. Heinrich should, like Sen. Udall, be tireless advocates for LNG exports for environmental, foreign policy, and economic reasons because exports are a “win, win, win” for America and New Mexico.

Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

We at the Rio Grande Foundation aren’t big fans of the federal government’s involvement in education policy on principle, but their report (you can read it here) has some useful nuggets. The following chart highlights serious issues with New Mexico schools regarding their accountability systems and fiscal controls. Seems like improving upon these would have helped avoid having federal and state taxpayers from having been ripped off by former Democrat Rep. (and APS administrator) Sheryl Williams Stapleton. 

Hot on the heels of RGF’s posting of a Wallethub report which cited the challenges of New Mexico businesses in finding workers. Almost simultaneously the Legislative Finance Committee produced an 80-page report addressing issues with New Mexico’s low workforce participation rate.  It is another worthwhile report from the LFC which has taken up the issue of New Mexico’s poor workforce participation.

Here are some findings:

• There are 206 thousand able-bodied prime working-age people in New Mexico who are not formally employed.
• New Mexico, which had the third-lowest male labor force participation rate in 2023. Low male workforce participation is particularly concerning for New Mexico because it negatively affects individual happiness and productivity, family formation, and household income.
• New Mexicans across all levels of educational attainment are less likely to participate in the labor force, but the difference between the state and national averages are most pronounced for those with only a high school degree or equivalent.
• Labor force participation correlates with economic growth, crime reduction, and increased average per capita earned income.

As the report notes right in its title, “New Mexico’s Workforce System is Not Effectively Reaching the State’s Disengaged Population.” Sadly, while the report discusses ways to shift around bureaucratic resources in ways that may (or may not) improve New Mexico’s workforce participation rate, it doesn’t tackle the bigger issues. And, perhaps since this is a legislatively produced report, it couldn’t.

Here are some ideas we’d like to see tried:

1. Reduce New Mexico’s generous welfare programs, especially for able bodied working age adults.
2. Remove unnecessary barriers to work in the form of taxation and occupational licensure.
3. New Mexico’s broken education must be reformed. RGF has LONG advocated for school choice and increased accountability in education. 1

There’s more, but if New Mexico policymakers even began to get serious about reforming these policies they could push more New Mexicans into gainful employment and off of government benefits.

The leader of a powerful anti-gun special interest group recently, publicly broke numerous federal and state gun laws. Those include:

• Failure to conduct a background check on a private firearm sale in NM (State)
• Possession of a firearm on public school property (Federal, State)
• Creating an unregistered NFA-regulated short-barrel rifle (Federal)
• Possibly transporting short-barrel rifles across state lines to Colorado without notifying the ATF (Federal).

Yet, this individual has not been punished for their actions. Read our latest policy brief to see why RGF board member Steve Dodson calls this “The Viscolli Loophole” Read this policy brief here.

According to a new report from Wallethub New Mexico employers face a significant challenge to find workers (ranking 4th in a recent report). This sounds like a good problem to have and it is in the sense that jobs remain plentiful in New Mexico and around the nation.

But, it also highlights New Mexico’s abysmally-low workforce participation rate. Getting more New Mexicans to work and pay taxes is critical to improving New Mexico as a state. It’s not just a necessity for filling jobs and growing the economy, but it will also reduce crime and reduce spending on government welfare programs (to name just two positive outcomes).

Source: WalletHub

While New Mexico is indeed blessed to have plentiful jobs, getting people off the employment sidelines remains a critical issue for the state.

Nobody LIKES to lose, do they? Sometimes it seems that New Mexico’s politicians enjoy putting taxpayer dollars behind losing businesses. Of course, we remember Eclipse Aviation of the Richardson years which went belly-up after blowing through taxpayer subsidies valued at $100 million.

The latest favored enterprise in danger of disappearing may be Virgin Galactic. The company for which Spaceport America was built (and expanded) at $275 million in taxpayer expense and counting, recently saw its stock price drop to $1.00 per share. The company’s stock had been as high as $55/share back in 2021, but it has now suspended manned flights and is “hoping” to construct a new spacecraft to help it turn a profit. The company is now in litigation with Boeing and there are real concerns over its future.

Enough about boondoggles past. The latest prospective boondoggle remains ahead of us. Maxeon Solar has announced plans for a massive factory based in Albuquerque. The plan is for New Mexico to provide a $2.4 billion industrial revenue bond and $20 million in LEDA funding for the facility (this is in addition to federal subsidies and state/local mandates). The facility is expected to cost $1 billion.

Maxeon’s stock has also been crushed in recent years with the share price having dropped from over $50 back in 2021. The current share price is below $2.00 per share. The solar industry is of course a darling of the Biden Administration and MLG, but would Trump keep the subsidies flowing and mandates in place to help solar companies like Maxeon? Are those even enough given the collapse of the company’s valuation in the last few years?

Only time will tell, but RGF has long opposed government subsidies for specific companies or industries. We support improving New Mexico’s tax policy by reducing taxes, improving our education system, and reducing crime. Those can be challenging, but they will actually succeed if seriously attempted.

Recently a long-time NPR executive made waves with his story of how NPR “lost its way” ideologically. Of course, while media outlets can choose to be liberal, conservative, or as centrist as possible, we know NPR receives federal funding. One of the local NPR stations KUNM is housed at University of New Mexico while KANW is owned by Albuquerque Public Schools. KSFR (Santa Fe’s NPR station) is housed at Santa Fe Community College. 

RGF is philosophically opposed to federal, state, or local tax dollars being used to fund media outlets, but we also believe that over the years their left-wing bent as grown more pronounced. RGF used to do a great deal with KUNM, sometimes KSFR would request interviews, and we’ve appeared in public forums at KANW.

KUNM had a weekly call-in show for years (maybe they still do) in which RGF would often serve as the “token” conservative voice among 2-3 other panelists (and moderator). Here’s one of those which discussed “net neutrality.” But for a time at KUNM RGF had the opportunity to do brief commentaries on issues we were working on. We discussed: capital outlay, corporate welfare, and the federal government’s finances.

Sadly, KUNM hasn’t called us in years and while we have had an opportunity to do election night coverage for KSFR in Santa Fe, we haven’t heard from them in awhile for a news story either. Again, we don’t NEED to have public media call on us, but they ARE taxpayer-supported and should be balanced in their reporting. The recent story about NPR highlights the leftward drift we’ve seen in New Mexico.

A few months ago in this space we commented on the relative lack of problems associated with the massive influx of illegal immigrants that has taken place during the Biden Administration. Now, according to a new Census Bureau report, capably covered by Newsweek, New Mexico appears to be the ONLY state in the nation to have seen a drop in the number of immigrants living here.

Of course, it is important to differentiate illegal from legal immigrants. Like native born Americans legal immigrants have plenty of choices as to where to live and work. As the story notes:

Newsweek spoke to Christopher A. Erickson, the director of New Mexico State University’s Center for Border Economic Development, about the reasons behind the decrease in the state’s foreign-born population.

“The primary motivation for foreigners to immigrate is to find a good paying job,” he said. “New Mexico is a low-income state with relatively slow job growth. This makes it less appealing for foreigners.”

The annual employment growth between 2012 and 2022 was 6.8 percent on average, added Erickson. The state also ranks 44^th for per capita disposable income, according to research by Statista.

We couldn’t have said it better ourselves. In terms of illegal immigrants, they certainly ALSO look for job opportunities, but often must live in the shadows. From a policy perspective the US needs to address both border security and immigration policy, but overall this report simply reinforces what we already know: New Mexico’s economy is not particularly attractive to native born and immigrant alike.

The annual Rich States, Poor States report analyzes all 50 states based on dozens of economic data points. It is arguably the most thorough analysis and ranking of both past data and future economic prospects for all 50 states. Check out the report here and New Mexico’s data here. It is no surprise that New Mexico badly lags each of its neighbors in the report. Sadly, New Mexico’s economic outlook remains mired at 38th despite the ongoing oil and gas boom. Here are the ranks for outlook among the states neighboring New Mexico:

Utah: 1
Arizona: 3
Colorado: 17
Texas: 6
Oklahoma: 9
New Mexico: 38

There is a lot of data in the report, but the following chart shows what went in to compiling New Mexico’s current economic outlook.

The following compares New Mexico’s economic performance with neighboring Arizona. Not surprisingly Arizona outperformed New Mexico on 17 of the 19 metrics studied.

On this week’s interview Paul talks to Nella Domenici. Domenici is the Republican Party candidate for US Senate in New Mexico. She is longtime Senator Pete Domenici’s daughter. Paul and Nella discuss what that was like and what formed her politics, her activism and efforts to reform education in New Mexico, and her candidacy for the US Senate and the issues she has with the incumbent.

New Mexico’s House Republicans have elected new leaders. Paul and Wally know the players and discuss.

While I-40 crumbles NM asks feds for $250 million to reduce emissions on I-25.

The left doubles down on EV mandates. MLG touts EV mandates (the transition is “inevitable” but must be subsidized and mandated). Tesla’s dropping sales, MLG/Biden mandates outstrip estimates.

NM ranks 30th overall in Wallethub tax burden report.

APD garners national headlines for wrong reasons but the City Council fails to hold Chief Medina accountable as the department continues to languish…due to lack of accountability.

RGF hosts an upcoming luncheon in Albuquerque and a dinner event in Roswell on April 22nd. Find out more about the book being discussed here.

Sometimes even the New York Times figures out that government wastes big bucks on “economic development” schemes. A recent story from the Times a few paragraphs of which are highlighted below makes the point:

“(Film subsidy) programs are actually huge money losers for states. Studies show that these efforts typically return a quarter or even a dime on every dollar given to studios.” New Mexico is not mentioned in the story, but is among the US states with the very most generous subsidy programs. The Rio Grande Foundation has often criticized New Mexico’s largesse to the millionaires and billionaires that primarily benefit from film subsidies, but with plenty of oil and gas money to throw around and little accountability from the populace in terms of bringing actual economic growth and prosperity to the state, the program has expanded dramatically since the days of Bill Richardson.

As we’ve written before in this space the Biden Administration’s policy failures are frequent and often conflict with their stated policy objectives. Perhaps no other single policy move by the Biden Administration has as many downsides and fewer upsides associated with it than his decision to pause permits for LNG export exporters.

The following story from Nikkei Asia highlights how completely insane Biden’s policy is:

In Japan, South Korea, Singapore, Taiwan and Thailand, LNG has an established role ensuring energy security and economic stability, while also providing the foundations for a low-carbon future.

Massive volumes of coal must be displaced through the 2030s and beyond across emerging Asia to achieve the region’s net-zero aspirations. This inevitably will mean substantial gas imports.

India, Vietnam and the Philippines are among the fast-growing Asian nations that plan to increase the role of gas in their economies through LNG imports as a reliable complement to renewable energy investment.

Biden’s policy is harmful to the environment, the US economy, and to our foreign policy efforts especially as relates to the Russia/Ukraine conflict. The US House took a vote on legislation to overturn the Biden Administration ban. Not surprisingly New Mexico’s extreme leftist delegation all voted against the State’s (and nation’s) best interests. New Mexico is a top natural gas producing state.

Who supports the ban? Of course, radical environmental groups which form the most powerful interest group in the Democratic Party coalition.

Are Albuquerque’s police to be held accountable or not? Over the span of nearly a decade James Ginger has been paid handsomely to “monitor” reforms to Albuquerque’s Police Department. The idea is to provide accountability and oversight for APD’s reform process. Police accountability has been a watchword on the left leading so far as to left-wing voices here (as they have nationally) to call for “defunding the police.”

Sadly, the left’s push for police accountability seems highly situational. In fact, when Police Chief Harold Medina caused a near-fatal accident, the Albuquerque City Council on a 5-4 vote (with all the “progressives” and Democrats joined by Councilor Brook Bassan opposed) killed a proposal to have an outside third party investigate the incident. So, instead of an outside agency like New Mexico State Police or Bernalillo County Sheriff’s Office investigating Medina’s dangerous behavior and crash we’ll get an internal investigation carried out by APD.

Jacob Sullum of Reason takes a closer look at the situation and ongoing concerns about Medina’s behavior both during the crash incident and in other areas (like the DWI scandal) in an excellent article.

In a move that was hardly surprising, New Mexico’s unelected Environmental Improvement Board and the even more radical (also unelected) ABQ/Bernalillo County Air Quality Board chose to move forward with the EV mandates they adopted back in November. Those mandates are for 43% of new vehicles sold in New Mexico to be electric starting in the summer of 2026 (just over 2 years from now).

Those mandates are widely seen as unattainable by auto industry insiders and car dealers alike as interest in EV’s wanes among consumers. But, Gov. Lujan Grisham and her cadre of radical environmentalists and left-wing advocates remain dedicated to pushing forward no matter what it costs consumers, taxpayers, or how many job losses are inflicted on auto dealers.

According to the most recent information available EV sales in New Mexico now account for 4.82 percent of all vehicles sold in the state. That means a nearly ten-fold increase in EV sales must occur over the next two years.

Yesterday, MLG and some of her radical friends like Jim DesJardins, the executive director of the Renewable Energy Industries Association, held an event at which (according to KOB TV) they “discussed green energy and how the state can become less dependent on the oil and gas industry.”

If they are talking limiting usage of oil and gas in New Mexico, they may be able to move the needle slightly, but if they mean making New Mexico government and the economy less dependent on oil and gas, that’s not going to happen anytime soon.

But, mostly the Gov. and her allies talked subsidies and mandates for EV’s. According to the article, here are just a few of the subsidies and mandates for EV’s:

$100 million for EV charging.

$20 billion being distributed by the EPA for renewable energy initiatives.

The Inflation Reduction Act will provide $369 billion for states and how NM can get some of that cash.

As usual, the “transition” was deemed “inevitable” which in a sane world would preclude the need for massive subsidies and mandates. But, we don’t live in a sane world, so Jim DesJardin said, “it is going to happen so we need to plan for it, we need to take advantage of it, we need to do everything we can to make it so it can be done as best as possible for the state of NM.”

On this week’s interview Paul talks to William L. Kovacs. Kovacs was senior vice president for environment, technology & regulatory affairs for the U.S. Chamber of Commerce and a chief counsel on Capitol Hill. Kovacs has written three books including his newest, “Devolution of Power: Rolling Back the Federal State to Preserve the Republic.” In this book Kovacs asks a basic question: Can a mismanaged federal government unite a polarized nation? If not, how do we divide? Check out this informative conversation with a former political insider.