Errors of Enchantment

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Obama’s Economic Advisers Agree with Milton Friedman on government licensing

07.31.2015

Today would have been Milton Friedman’s 103rd birthday. The Rio Grande Foundation celebrated this morning (look for details on that shortly), but I thought this story from earlier in the week was interesting as it shows that the issues Friedman discussed — in this case professional licensing — remain important today.

As the article notes, Obama’s Council of Economic Advisers has published a new report critiquing professional licensing:

Burdensome occupational licensing requirements can create barriers for workers and add costs to consumers, a White House report released Tuesday found.

The state-issued licenses required to carry out certain jobs should be used only to address legitimate public health and safety concerns, the report recommended.

Friedman was a strong opponent of government licensing including of medical professionals. Needless to say, he would have opposed the myriad regulations imposed by governments like New Mexico which places the 9th most onerous professional licensing regulations among the 50 states according to the Institute for Justice.

A White Elephant Stalks the Motherland’s Taxpayers

07.29.2015

vostochny

Model of launch complex for Soyuz-2 rocket in Vostochny Cosmodrome. Credit: Vitaly V. Kuzmin (http://vitalykuzmin.net).

It turns out, “spaceport” and “boondoggle” go together beyond New Mexico’s borders.

The Vostochny Cosmodrome, under construction in Russia’s Far East, is in trouble. The project’s purpose, according to Anatoly Medetsky of the The Moscow Times, is “to ease the country’s dependence on the Soviet-era Baikonur launch site, located in the wind-swept steppe of neighboring Kazakhstan and which Russia is leasing through 2050.”

But the cosmodore is behind schedule — manned flights are now projected to take place three years later than originally planned — and corruption at the site is rampant.

In June, The Siberian Times reported that a senior director “suspected of embezzling funds … has been arrested after going on the run. The 45-year-old Georgian national, whose name has not been disclosed, had fled Russia after being accused of taking four million roubles ($75,000). … Police in the Amur region put the shamed director on the international wanted list and he was located in Minsk, where he drove a luxury Mercedes car decorated with Swarovski diamonds. According to local media, it cost $300,000 (16 million roubles) to have the vehicle covered.”

A few days ago, Prosecutor General Yury Chaika announced that his probe of 250 cosmodrome contractors had uncovered “theft that caused 7.5 billion rubles in damages.”

It’s all an unfortunate mess for Russia’s taxpayers. But unlike “Spaceport America,” the “public investment” made in the cosmodrome could eventually produce significant revenue. Relations with Kazakhstan have been testy lately. And Russia has a long history of lofting payloads — launch vehicles in the R-7 and Proton families alone have flown over 2,000 times.

ABQ City Council’s Fair Workweek Act is Extreme, will kill local business

07.28.2015

The Fair Workweek Act will be heard before Albuquerque’s City Council on August 10. The legislation, sponsored by Councilors Benton and Peña was written by outside organizations but that is not what makes it a bad idea. The proposal has a number of extreme provisions that would have tremendous, negative impacts on local businesses, especially small ones.

As written, the proposal would require employers to:

  • Set work schedules three weeks in advance or pay compensation (predictability pay);
  • Provide paid sick leave;
  • Allow for a secret ballot to be held among employees to decide on “alternate schedule” (such as four-10 hour shifts or three 12 hour shifts);
  • An employer must offer additional hours of work to existing employees before hiring additional employees or subcontractors;
  • Employees will be able to trade shifts regardless of job descriptions or skill sets.

Like arbitrary mandated minimum wages, but far more radical, this proposal is yet another intrusion into the relationship between workers and employers. All of the regulations seem well-intended, but they all are based on the premise that a bunch of city councilors know what is better for a worker than they do. After all, if I don’t like the requirements of a particular job, I can always go elsewhere….of course that is assuming that there are other jobs out there.

The proposal’s negative impacts would most likely be felt in construction, retail, and restaurants as well as customer-service-oriented industries, especially those that have to deal with weather issues.

Ultimately, because it is so new and so radical, we don’t know exactly how this proposal will impact our local economy. We do know that it will further drive up the cost of doing business and make Albuquerque a less attractive destination for business expansion. That will harm the very workers you say you want to help.

The Fair Workweek Act is the most ambitious and comprehensive that we’ve seen, but several cities/states demand paid sick leave. A full description of those laws can be found here.

Details on Seattle’s experience can be found below:

In September 2012, Seattle became the fourth U.S. city to require employers to provide paid leave to their employees as a condition of doing business in the city. Of the 301 service-industry businesses surveyed, 191 of them—or nearly two-thirds—had started providing paid sick leave to comply with the law. Another 67 businesses already provided the benefit. (Note that the law in Seattle exempts businesses with fewer than five employees.)

Survey results suggest that issues of sickness are overstated by activists/supporters. Among businesses that started providing leave, 83 percent—or more than 8 in 10 businesses—said that sickness in the workplace was “not serious at all” prior to the law taking effect. Just 10 percent described it as a serious problem.

Two thirds of those who started providing paid leave said that they did not anticipate the law would reduce turnover in their workplace. One-third of surveyed Seattle businesses also anticipated that the law would increase unscheduled absences in the workplace that may not be connected to an illness.

Among those service-industry businesses that started providing leave to comply with the law, roughly 56 percent said it would increase their cost of doing business in Seattle. More than one in four said it would cause a big increase in their business costs.

15.7 percent of employers raised prices in response to the new law. • 18.3 percent of employers reduced hours and staff in response to the new law. • 17.3 percent of employers either increased the cost to employees of their current benefits, or eliminated the benefits they used to offer.

New Mexico and Albuquerque economies face serious problems

In fact, in March of 2007 we had 399,400. That’s down to 382,300 as of May 2015, a decline of 4.28 percent. If we want to improve pay and benefits for workers, let’s have more jobs for them to choose from and more competition for those workers. What follows is a historical listing of Albuquerque’s April non-farm employment (thousands):

2008 398.6
2009 380.4
2010 373.9
2011 373.6
2012 369.6
2013 374.9
2014 375.4
2015 382.9

* May, the most recent data available: 382.3 (even lower)

* Albuquerque has lost 16,300 since the April 2008 peak

* No jobs recovery for more than seven years

New Mexico also ranks poorly on many indices of economic competitiveness/growth:
Federation of Tax Administrators; 9th highest in tax burden as percent of personal income
American Economic Development Institute: 35th
Institute for Justice (Occupational Licensing): 39th
John Locke Foundation “First in Freedom”: 42nd
Fraser-NCPA “Economic Freedom of North America”: 52nd (of 60)
Kauffman Foundation/Thumbtack.com Small Business Friendliness: D+

Working the Land in the Land of Enchantment

07.28.2015

green_chile

The New Mexico Farm & Livestock Bureau invited the Rio Grande Foundation to contribute to its summer conference, held in Taos last week. We participated in a panel discussion on how the agriculture community can more effectively communicate with state legislators.

It was clear, both during the panel and chatting with individuals afterward, that New Mexico’s agriculture community feels besieged. Radical environmentalists were a common complaint. Electricity costs, “renewable” fuels, and the EPA’s “Clean Water Rule” were specific concerns.

In 2013, cash receipts for New Mexico farms totaled $3.8 billion. Livestock products — primarily milk, cattle, and calves — represented the bulk of the sum. Contrary to common misconception, green chile isn’t the state’s biggest cash crop — that would be hay. Pecans landed in the second slot, with green chile in third and greenhouse/nursery products in fourth.

New Mexico desperately needs more manufacturing, IT, logistics, finance, energy, and biotech jobs. But agricultural operations remain an important part of the state’s economy. With the growth of the buy-local movement and the opening of foreign markets to U.S. farmers, the bureau’s members have new opportunities to expand their enterprises. In New Mexico, agriculture needs low taxes, reasonable regulations, and affordable energy as much as any industry.

Gessing and Rep. Bill McCamley discuss 2015 Legislative activities on KRWG TV

07.28.2015

I was recently in Las Cruces and had a chance to sit down with Fred Martino of KRWG (the public television station in Las Cruces) to discuss what happened in the 2015 legislative session and special session. Las Cruces area state Representative Bill McCamley, a Democrat, was also on the air and, believe it or not, we found a few areas of agreement.

What makes a city attractive as a relocation destination?

07.27.2015

As we have discussed on numerous occasions, New Mexico’s economy is struggling. That includes large numbers of people moving out of our state and our state’s largest city.

Some advocates for bus rapid transit believe that such a system will give Albuquerque the “cool factor” that makes at least New Mexico’s largest city attractive as a relocation destination for the young.

A Wall Street Journal article from Friday throws water on the concept that “amenities” (like transit or recreational activities) are what people look for when moving to a new place…and what is it people look for? No surprise: JOBS, JOBS, JOBS.

The article is full of some great quotes and charts.

“You don’t move just because some place is cool,” said Aaron Duke, a 39-year-old San Francisco transplant and CirrusMD employee. “You’ve also got to be able to earn a buck.”

Public improvements to lure millennials, such as building bike paths and revitalizing neighborhoods, can result in a nicer place to live, economists say, but for an economy to thrive, more fundamental investments are needed, including a well-connected airport, universities to train workers and a business base that attracts people from around the region, they note.

As the chart below taken directly from the WSJ piece shows, 9 of the top 10 cities to which Americans are flocking are in “Right to Work” states (only Denver is not). Also, none of the cities in the top 10 in growth are big on mass transit. Atlanta, the most transit-reliant, ranks 30th among US cities in transit usage. In fact, most of the fast-growing cities are, like Albuquerque, spread out auto-centric cities. Perhaps transit isn’t really high on the “cool-factor” list?

More Advocacy on Your Dime

07.23.2015

tomb_taxpayer

Earlier this week, at the monthly meeting of the Albuquerque Tea Party, Johnny Luévano gave a presentation on how one left-wing group funds its activities with taxpayer subsidies.

The “Partnership for Community Action,” located in southwest Albuquerque, “focuses on critical community issues like education, economic sustainability, wellness and immigrant rights.” Founded it 1990, it raises “awareness” and pursues “advocacy opportunities.”

According to an IRS filing, in 2013, of the organization’s $1,144,450 revenue take, $1,055,053 — 92 percent — came from “government grants.”

Leaving Albuquerque

07.22.2015

losers

Once again, New Mexico ranks among the losers.

Bloomberg News analyzed U.S. Census Bureau data to determine “the 20 metropolitan areas that lost the greatest share of local people to other parts of the country between July 2013 and July 2014.”

You don’t have to sit down for this: Albuquerque was on the list. Ranking 19th, the region lost 0.38 percent of its residents during the period studied.

Nationally, losers were concentrated in the Rust Belt and Northeast, with Honolulu and Los Angeles also making the list. (Strangely, while most of Texas’s urban areas are booming, El Paso fared poorly, with a 1.02 percent decline.)

Great weather, friendly people, a rich history and culture — how can Albuquerque be losing population?

New Mexico needs aggressive and effective economic-development policies, implemented yesterday.

A third approach to the San Juan Generating Station for New Mexico policymakers

07.21.2015

The discussion over the San Juan Generating Station, a coal-fired power plant near Farmington in Northwest New Mexico, has been centered on whether to shut down half of the plant as PNM wants to do or all of the plant as the environmentalists want to do.

All of this is being forced upon New Mexico electric rate-payers not for health or real environmental benefits, but to comply with the Obama EPA’s new “regional haze” regulation that is supposed to improve visibility in National Parks here in the West.

There is a third way. Our friend William Yeatman, an energy expert at the free market Competitive Enterprise Institute (CEI) has outlined such in the Albuquerque Journal. As Yeatman notes in his article, shutting down San Juan Generating Station will fail on its own merits because “Computer modeling demonstrates that the emissions reductions due to the regulation wouldn’t have a perceptible impact on visibility.”

Worse, argues Yeatman, “the proposed settlement would force PNM customers to pay $115 million for electricity generators they won’t use.”

So, rather than going along with either proposed solution, Yeatman argues that New Mexico’s elected officials should reject the proposed settlement and instead sue the Obama EPA’s outrageous Regional Haze regulation as the overreach that it is. A successful lawsuit would stop the EPA in their tracks and save New Mexicans at least $115 million on their utility bills.

Federal Government Should Take a Pass on Albuquerque’s Proposed Bus Rapid Transit System

07.20.2015

(Albuquerque) The proposed bus rapid transit (BRT) line is a solution in search of a problem, and our bankrupt federal government should steer clear of providing 80 percent of the infrastructure costs for this unnecessary project. That’s the conclusion of a new Rio Grande Foundation report, “Throwing Taxpayers under the Bus,” which analyzes the case for bus rapid transit along Central Avenue in New Mexico’s largest city.

“Throwing Taxpayers under the Bus,” authored by Rio Grande Foundation Research Director Dowd Muska, argues that the current Rapid Ride bus system along Central has been quite successful in generating ridership. Muska wonders what benefits, in terms of mobility, the new system will provide that the current system does not.

In fact, as Muska argues, in addition to the temporary construction which would tie up traffic throughout the Central corridor, the BRT would limit motorists’ left turns onto Central while removing two traffic lanes to make way for buses. The loss of traffic lanes would result in the elimination of parking along some of Central’s busiest corridors.

The cost estimate being put forth by the city today is likely to rise once construction gets underway, argues Muska. “Throwing Taxpayers under the Bus” cites Willie Brown, a former California politician, who once said, “In the world of civic projects, the first budget is really just a down payment. If people knew the real cost from the start, nothing would ever be approved. The idea is to get going. Start digging a hole and make it so big, there’s no alternative to coming up with the money to fill it in.”

Ultimately, as Muska notes, BRT advocates are less concerned about mobility within the Central Corridor than they are about “redevelopment” in the area. Advocates claim that so-called “Millennials” are avoiding Albuquerque in search of more densely packed urban areas.

This claim simply doesn’t hold water. As Muska points out, sprawling Western cities such as Oklahoma City, Phoenix, and Dallas are growing rapidly and attracting young people. Albuquerque’s poor job growth is the likeliest reason for the city’s ongoing struggles to draw and keep Millennials.

With Washington trillions of dollars in debt, “Throwing Taxpayers under the Bus” concludes that an Albuquerque transit project in need of a purpose is unworthy of federal taxpayer dollars.

When did “work” become a “four-letter-word” for liberals? (including Gessing testimony on Martinez food stamp proposal)

07.17.2015

I spent July 16 driving down and back to Las Cruces to testify before the Legislative Health and Human Services Committee hearing on the Martinez Administration’s proposal to re-impose work, volunteer, or education attainment requirements for able-bodied adults without children and adults without small children.

Somehow, we have gotten to the point that asking able-bodied adults to improve their standing is simply beyond the pale because the liberal advocates that testified and all the Democrat legislators who attended spoke against the proposal.

An article from the Las Cruces Sun-News details the issue and Democrats’ opposition nicely.

Ironically, one of the main points the opponents of the work requirements repeatedly brought up was that New Mexico’s job growth is lagging its neighbors. While a true statement, one wonders if they realize that it is their policies that have put New Mexico in this sorry position. My testimony in support of the Administration’s work requirement is below:

Testimony on New Mexico’s Plan to Re-impose Work Requirement on Food Stamp (SNAP) Recipients
By Paul J. Gessing

Since 2009, New Mexico has waived federal work requirements tied to the Supplemental Nutrition Assistance Program (SNAP).

The Martinez Administration’s proposal is to reinstate the rules limiting able-bodied people to three months of SNAP benefits unless they work or attend job training classes at least 20 hours per week. The new requirements would be imposed on parents of children older than six-years to complete up to 80-hours a month of activities such as community work to continue to receive the SNAP benefits. It would also apply to teens who are not in school.

Over 21 percent of all New Mexicans receive food stamps, behind only Mississippi.
Somewhere between 26,000 and 80,000 people could be impacted by the proposal. According to a September 2014 report from the Pew Center, no fewer than 17 states were working to re-instate their work requirements.

Other states have seen dramatic effects in terms of reduced dependency from re-imposing food stamp work requirements. In 2014, for example, Maine re-imposed a three-month limit (out of every three-year period) on food stamps for a group often known as Abawds — able-bodied adults without minor dependents — unless they work 20 hours per week, take state job-training courses or volunteer for about six hours per week. The number of Abawds receiving food stamps in Maine has dropped nearly 80 percent since the rule kicked in, to 2,530 from about 12,000.

Maine’s requirement has been in effect for about a year now and I have heard no reports of even a single person starving as a result of this policy change.

The truth is that food stamps were meant to provide a bridge for people who are between jobs or have fallen on hard times. They are not a way of life. Completely removing oneself from the work or volunteer forces hurts the very people that SNAP is supposed to help. Sitting at home watching television or waiting for the phone to ring is no way to look for work.

Indeed, while unemployment rates in New Mexico remain somewhat higher than the national average at 6.2%, the rate in neighboring Texas is currently 4.2% which economists consider to be “full employment.” Even New Mexico’s largest cities have reasonably-low unemployment rates with Albuquerque at 4.9%, Santa Fe at 4.2% and Las Cruces at 5.2%.

It would seem that the only thing one truly needs to do to get a job in New Mexico is to move to one of her major cities. Absent that, there are opportunities aplenty in neighboring Texas.

The Martinez Administration’s proposal is eminently reasonable and encourages self-reliance rather than dependency which is very important. What doesn’t work is spending $80 billion a year on a rapidly-expanding program and imposing little or nothing in the way of requirements.

Lastly, food stamps are not an economic stimulus. The money has to come from somewhere and dollars that are taxed away and spent on food stamps can no longer be invested in our economy. Welfare programs do not stimulate the economy. Average New Mexicans working every day and honing their skills will make our state better and more prosperous.

Thank you for your time.

‘Celebrating’ Nine Years of Choo-Choo Craziness

07.17.2015

july_2006

The New Mexico Rail Runner Express threw itself a birthday party today. Riders in Albuquerque and Santa Fe enjoyed “snacks and giveaways,” as the rail line marked its ninth anniversary.

trax1

“Trax” was at the Downtown ABQ Station, distributing hugs.

luggage

“Free” luggage tags!

In a press release announcing the festivities, the Rio Metro Regional Transit District listed some “fun facts” about the Rail Runner, including the “number of bicycle lockers at NMRX stations” and “Veterans Annual Passes issued to VA veterans from November 11, 2014 to July 1, 2015.”

One number that went unmentioned: 9.9. That’s the percentage of the Rail Runner’s 2014 operating costs that were covered by fares.

Who paid for the rest of the expenditures? Look in the mirror.

It’s Not the Costs — So What Is It?

07.14.2015

100_bucks

The Tax Foundation’s latest look at “the real value of $100 in each state” should generate more frustration for New Mexico’s economic-development establishment.

Costs in the Land of Enchantment are 21 percent cheaper than in New York, 18 percent cheaper than in California, and 8 percent cheaper than in Virginia. With the exception of Oklahoma, a hundred bucks goes further in New Mexico than it does in each of its neighbors.

Great weather, friendly folks, stunning scenery, a strategic location, and low costs — the Rio Grande Foundation has long maintained that New Mexico has the potential to be an economic powerhouse.

But excessive occupational licensing, an all-powerful PRC, no right-to-work law, a cumbersome tax on gross receipts, a work-ethic-sapping welfare complex, too much federal control over land and employment, and trendiness-driven corporate welfare as economic development? It all adds up to a spectacularly ineffective prescription for wealth creation and job growth.

New Mexico County Payroll Listing 2014

07.14.2015

(Albuquerque) In an effort to improve government transparency throughout New Mexico, the Rio Grande Foundation has requested and published payroll data for all New Mexico Counties.

Unfortunately, several counties were unable or unwilling to comply with the request. We hope that residents of those counties will put pressure on them to make information available to the public. New Mexico’s largest county, Bernalillo, is a leader in providing transparency.

To find the data for your county, just click on the link below:

Bernalillo County

Catron County

Chaves County

Cibola County

Colfax County (not available)

Curry County

De Baca County (not online)

Doña Ana County

Eddy County

Grant County

Guadalupe County

Harding County

Hidalgo County

Lea County

Los Alamos

Lincoln County

Luna County

McKinley County

Mora County

Otero County

Quay County

Rio Arriba County

Roosevelt County

Sandoval County

San Juan County

San Miguel County

Santa Fe County

Sierra County

Socorro County

Taos County

Torrance County

Union County

Valencia County

 

Friedman Legacy Day 2015 – New Mexico’s Demographic Dilemma

07.13.2015

milton_friedman_day_2015

Rio Grande Foundation's Friedman Day 2015

Breakfast Discussion of New Mexico's
Impending Demographic Challenges
and How Policymakers Can Cope
Presentation by Matthew Ladner

Free Registration Form

New Mexico's elderly population is set to explode in the years ahead according to new demographic research by Dr. Matthew Ladner. According to Ladner, New Mexico's working age will shrink as a percentage of the total population, with the Land of Enchantment projected to have the highest total age dependency ratio in the nation in 2030.

In New Mexico's case the increase in the total age dependency ratio projects to be entirely due to a near doubling of the elderly population between 2010 and 2030.

Unfortunately, despite reforms enacted under Gov. Susana Martinez and some modest improvements in students' educational performance, New Mexico's school age population continues to under-perform.

What does New Mexico's demographic situation – driven by an aging population – mean for the state in the years ahead? Is New Mexico's workforce adequately trained to support a growing group of dependents? What can realistically be done to eases this demographic transition?

Celebrate Dr. Milton Friedman's birthday with us at a special breakfast event on what would have been Dr. Friedman's birthday, Friday, July 31.

  • Where: Auditorium of the Albuquerque Museum which is located at 2000 Mountain Road NW.
  • When: 7:30am to 8:30am.
  • Cost: There is no charge for this event and we will have coffee and donuts. Please register online by clicking here. It's quick and it's free!
  • Who: Dr. Matthew Ladner is Senior Advisor of Policy and Research with the Foundation for Excellence in Education. He previously worked with the Rio Grande Foundation to bring the “Florida Model” for education reform to New Mexico.

matthew_ladnerDr. Matthew Ladner is the Senior Adviser of Policy and Research for the Foundation for Excellence in Education. He previously served as Vice President of Research and Goldwater Institute. Prior to joining Goldwater, Dr. Ladner was director of state projects at the Alliance for School Choice.

Dr. Ladner has written numerous studies on school choice, charter schools and special education reform. Most recently, Dr. Ladner authored the groundbreaking, original research Turn and Face the Strain: Age Demographic Change and the Near Future of American Education, outlining the future funding crisis facing America's K-12 public education funding. He also coauthors the American Legislative Exchange Council's annual Report Card on American Education: Ranking State K-12 Performance, Progress and Reform.

Dr. Ladner has testified before Congress, the United States Commission of Civil Rights and numerous state legislative committees. He is a graduate of the University of Texas at Austin and received both a Masters and a Ph.D. in political science from the University of Houston. Dr. Ladner is a Senior Fellow with the Foundation for Educational Choice. He lives in Phoenix, Arizona.

Free Registration Form

Checking in on New Mexico’s Electricity Architecture

07.13.2015

power_pole

Natural gas may now be the most common fuel for electricity generation nationally, but in New Mexico, coal is still king. (Don’t tell the Sierra Club.)

Last week, the U.S. Energy Information Administration released 2013 data for state-level electricity pricing, generation, and fuel sources.

Slightly more than two-thirds of all power generated in New Mexico in 2013 originated in coal-fired plants. Natural gas supplied 25 percent of our juice. Wind produced 6.1 percent. The contribution of solar, in the fourth-sunniest state? A whopping 1.1 percent.

As for regional competitiveness, the retail price for a kilowatt hour in New Mexico was 9.25¢. Not the costliest, but there’s room for improvement. Neighbors Oklahoma (7.87¢), Utah (8.15¢), and Texas (8.66¢) were cheaper, while Colorado (9.88¢) and Arizona (10.14¢) were more expensive.

New Mexico’s Fiscal Fitness: Not Impressive

07.10.2015

overall_fiscal

“Ranking the States by Fiscal Condition,” just issued by George Mason University’s Meractus Center, offers a valuable survey of revenue and expenditures in New Mexico. As one might expect, the news isn’t pretty. The state isn’t in the company of such perennial deadbeats as New York, Connecticut, New Jersey, and Illinois, but there’s plenty of room for improvement.

Author Eileen Norcross analyzed five “dimensions of solvency” in order to determine overall fiscal condition:

* Cash solvency looks at whether a state can “pay bills that are due over a 30-to-60-day horizon.” New Mexico fares well in this category, ranking 19th.

* Budget solvency examines “whether the state can meet its fiscal year obligations.” The Land of Enchantment performs quite poorly here, landing in 46th place.

* Long-run solvency is determined by three metrics: net asset ratio, long-term liability ratio, and long-term liabilities per capita. New Mexico achieves it best score in this category: 14th.

* Service-level solvency “attempts to capture how much ‘fiscal slack’ states have by measuring the size of taxes, expenses, and revenues relative to state personal income.” The results for New Mexico are abysmal — only two states fare worse.

* Trust fund solvency is an estimate of “total indebtedness in the form of bonded debt, risk-adjusted pension liabilities, and [other post-employment benefits]. Ditto here, with a downright scary rank of 48th.

Overall, New Mexico ranks 36th in fiscal condition. Not surprisingly, each of our neighbors posted a superior score: Arizona (32nd), Colorado (22nd), Texas (19th), Utah (11th), and Oklahoma (9th).

Tell Your Senator: Make New Mexico the 26th Right to Work state in 2016!

07.08.2015

New Mexico’s economy faces serious issues, but we know one tool that has led to job creation nationwide at no cost to taxpayers: adoption of a “right to work” law.

The 30-day session kicks off on January 19, but we know that “right to work” will be on the Legislature’s agenda. It passed the House on a bi-partisan vote in 2015, but the Democrat-held Senate refused to even vote on it!

Click here to search for your Senator or click on their picture/name to send them an email with the simple message: Support “right to work” and at the very least New Mexicans deserve an “up or down” vote on the issue of “right to work.”

“Right to work” is not anti-union, it simply means that you cannot be required to be a member of a union or pay union dues to one. New Mexico is one of 25 non-“right to work” states. Right to work is strongly associated with stronger job growth among states where it is adopted:

The Rio Grande Foundation tracked announcements of expansions, relocations, and greenfield investments published on Area Development‘s website between January 2015 and August 2015. “Right to work” states attracted 80% of the new jobs.

Methodology notes:

* All job estimates — “up to,” “as many as,” “about” — were taken at face value, for RTW and non-RTW states alike.

* If an announcement did not make an employment projection, efforts were made to obtain an estimate from newspaper articles and/or press releases by elected officials and economic-development bureaucracies.

* If no job figure could be found anywhere, the project was not counted, whether it was a RTW or non-RTW state.

* Intrastate relocations were not counted, interstate relocations were.

Further thoughts on “free trade” and the recent debate over “Trade Promotion Authority”

07.07.2015

I recently wrote this article in which I made the case for free trade (broadly-speaking) as well as the export of crude oil and liquefied natural gas. The case for crude exports is relatively simple and I should have mentioned that New Mexico Congressman Steve Pearce has been an outspoken advocate for ending the decades’-old ban on exporting American crude. President Obama could, with the use of his pen, end the ban on crude exports.

The recent votes on behalf of “Trade Promotion Authority” was quite a bit more nuanced. As I noted, Congressman Pearce voted against it, but that does not make him hostile to free trade. Rather, Pearce and 53 of the most conservative Republicans joined most Democrats in opposing the bill which passed the House narrowly. Final vote here. The split was significant among conservative policy organizations with Americans for Tax Reform and National Taxpayers Union supporting TPA and the respected Heritage Foundation and some “Tea Party” groups opposed giving President Obama such negotiating authority.

Trade Promotion Authority is a tool that Congress has granted presidents dating back to 1975 for the purpose of negotiating trade agreements with Congress having an “up or down” vote on the issue (as opposed to individual members of Congress “negotiating” the agreement by tacking special interest provisions onto each agreement, thus killing them. Of course, the Obama Administration has been less-than forthcoming about a wide variety of uses of executive power and conservative opponents of TPA including Pearce expressed concern over Obama’s “near reckless disregard for the rule of law.”

So, to be clear, Congressman Pearce had a significant portion of the conservative community with him in opposing TPA. It is a close call. We at the Rio Grande Foundation certainly appreciate the fact that conservatives don’t have a lot of faith in President Obama negotiating an agreement that benefits American businesses and consumers, especially when he has sat on the crude export issue for so long. We applaud Congressman Pearce for his principled stand regardless.

Fearing Another BRAC Attack

07.07.2015

Air crews from Hurlburt Field, Fla., secure their aircraft at Cannon Air Force Base, N.M. Oct. 3, 2013. Air frames from the 1st Special Operations wing were relocated to Cannon in an effort to protect government assets in the wake of Tropical Storm Karen. (U.S. Air Force photo/ Staff Sgt. Matthew Plew)

New Mexico’s heavy — and unsustainable — reliance on federal largesse was well illustrated by Curry County Commissioner Tim Ashley’s recent trip to D.C. for “At a Crossroads: The Future of Defense Communities and Installations.”

The three-day conference was sponsored by the Association of Defense Communities, a taxpayer-subsidized organization that “unites the diverse interests of communities, state governments, the private sector and the military on issues of base closure and realignment, community-military partnerships, defense real estate, mission growth, mission sustainment, military privatization, military families/veteran support and base redevelopment.”

Before leaving for Washington, Ashley told the Clovis News Journal that the association was “instrumental” in helping Cannon Air Force Base escape the last round of the Base Realignment and Closure (BRAC) process. The Pentagon wants another dose of BRAC, but eternally vigilant about preserving their fiefdoms, politicians in the Senate and House of Representatives have been able to block the proposal.

As government expenses go, Ashley’s trip wasn’t large. It cost taxpayers $2,673.03 in total, including $1,127 for airfare and $1,325.91 for three nights of lodging. But it did reveal that a reflexive desire to preserve — if not expand — federal facilities continues to infect New Mexico’s elected officials.

Fighting the military’s desire to unload surplus and/or duplicative installations is useful for securing votes and boosting the image of economic-development bureaucracies. But it’s a disappointing distraction from the need to pursue policies that foster a vibrant, growing private sector in the Land of Enchantment.

More Gloom for the Boondoggle-in-the-Desert

07.06.2015

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If it weren’t for bad news, Spaceport America wouldn’t have any news at all.

June brought a number of dismal developments for the taxpayer-funded facility:

1) A KRQE report found that New Mexico’s boondoggle-in-the-desert has “a serious competitor chomping at [its] heels from a private spaceport in far West Texas.” After years of secrecy, Jeff Bezos, the Amazon billionaire, is promoting “his personal rocket company, Blue Origin.”

2) Alabama’s governor announced “a series of preliminary studies to assess the feasibility of landing Sierra Nevada Corporation’s Dream Chaser spacecraft at Huntsville International Airport.”

3) Houston Spaceport earned licensing approval from the FAA, and the city’s airport bureaucracy “now turns its attention toward securing partnership opportunities with leading companies operating within the aerospace industry.”

4) Diana Alba Soular of the Las Cruces Sun-News reported that the yet-to-be-completed southern road to Spaceport America “will be delayed because surveying work … didn’t align with the corridor studied in a key environmental review.”

Isn’t it time for New Mexico’s politicians to admit that Spaceport America is a failure, and hire a liquidator to get taxpayers back some of their “investment”?