HHS Secretary Kathleen Sebelius recently sat down with the folks at Channel 13 KRQE to discuss the massive expansion of Medicaid on the part of the states that is strongly encouraged under ObamaCare. The Secretary of course supports the expansion and we at the Rio Grande Foundation oppose it. View the story below:
I love this story. It shows how students can and are standing up, indirectly at least, to absurd, one-size-fits-all federal policies that are supposed to make them healthier and thinner. First Lady Michelle Obama is one of the leading protagonists in this effort.
And, while it would be great if obesity was ended and we were all paragons of health, it seems hard to believe that a federal government that has grown obese and irresponsible can put forth a set of policies to make this happen. Speaking of such irresponsibility and management incompetence, can we really expect the federal government to manage our health care system?
HT: Rob Nikolewski
One of the Rio Grande Foundation’s supporters, The Daniels Fund, has a limited number of tickets to the premier of the new pro-school choice film “Won’t Back Down.” The film is showing in wide release in many communities throughout New Mexico. Click here to get tickets. Check out a trailer for the movie below:
Needless to say, the film has stirred up opposition from the unions. I have not see this movie; I’ll be seeing it on the 27th along with some of you, but it is great to see Hollywood taking up the issue of education reform and our failing schools.
Mark Mix, president of the National Right to Work Legal Defense Foundation was in Albuquerque on Wednesday, September 12 to discuss Right to Work Laws and how such a law might benefit New Mexico. Mark spent a great deal of time working on the issue in New Mexico and has some great anecdotes to tell throughout his speech. Lt. Gov. John Sanchez attended and spoke on the importance of Right to Work as well. Plus, see this report from Rob Nikolewski of Capitol Report New Mexico on the protesters.
Mark Mix Part 1 from Paul Gessing on Vimeo.
Mark Mix Part 2 from Paul Gessing on Vimeo.
Our local NPR station, KUNM, has asked the Rio Grande Foundation to reach out to people who can provide fresh voices for an upcoming series relating to the 2012 election and how it will impact you and your family. The main goal is to find people with good stories who are willing to share what matters to them the most in the 2012 election. People who are on the more conservative side would be great to make sure that perspective is well represented in the series.
Serious inquiries only. Please Feel call Sarah Gustavus at KUNM at: 505-750-8049 if you are interested in participating in this project.
One of the constant refrains heard among New Mexico’s political leaders and the environmental community is that we need to more fully utilize our state’s abundant sunshine. The reality is that solar power accounts for a minuscule portion of US energy production.
But, even efforts to expand on that tiny amount, presumably by picking the “low-hanging fruit” of solar production, has drawn opposition from the enviros. Most of the major groups including the Sierra Club are suing the federal government to stop large-scale solar developments on certain public lands that have been deemed “environmentally-sensitive.” I’m not sure what lands the environmentalists consider not environmentally-sensitive….
Even more intriguing is a fact sheet on large scale solar projects from the environmental group Western Lands Project. Among the points made in the letter is the following:
No scientific evidence has been presented to support the claim that these projects reduce
greenhouse emissions. Indeed, recent evidence suggests that the opposite may be true. Recent
work at the Center for Conservation Biology, University of California, Riverside, suggests that soil
disturbance from large-scale solar development may disrupt Pleistocene-era caliche deposits
that release carbon to the atmosphere when exposed to the elements, thus “negat[ing] the
solar development C gains.”
So, now you tell us? Big solar projects are bad for the environment too? I guess that means we should toss New Mexico’s Renewable Portfolio Standard out the window, right? The enviros will undoubtedly say that solar is the way to go, but that we all just need to live off the grid with panels on our roofs. Good luck with that on the three consecutive rainy days we’ve had here in Albuquerque (Believe it or not, it happens).
With the release of polling data in the Albuquerque Journal today which show Gov. Martinez with an approval rating of an astonishing 69%, it is worth noting that a principled, center/right agenda can be very popular, even in a relatively liberal state like New Mexico.
Prior to the conventions, I sat down with Sarah Gustavus at KUNM for a national interview for the program “Latino USA” centered on Gov. Martinez and her efforts here in New Mexico. Listen to the interview here. Sen. Majority Leader and Martinez opponent Sen. Majority Leader Michael Sanchez was also interviewed. Interview is about 6 minutes.
Some advocates of mandated increases in the minimum wage have argued that Santa Fe, the city with the highest minimum wage in the nation, provides a counter-argument to opponents of such laws who say that high minimum wage laws cost low-skilled workers their jobs. Yet, Santa Fe’s overall unemployment rate is relatively low and at 5.8 percent as of July 2012, far below the federal rate which exceeds 8 percent.
What does this mean? Could high minimum wages have little, no, or even a positive impact on unemployment? Not so fast. First and foremost, local labor markets are unique in their own way. Santa Fe has a population of only 70,000 and is unique within New Mexico as an international tourism destination, hub for the arts, and center of state government.
However, minimum wage laws DO impact young people disproportionately. So, what has the impact been in Santa Fe?
According to data obtained from the Employment Policies Institute, for 16-24 year-olds, as of July, the unemployment rate for this group was averaging 20.3 percent in Santa Fe, NM. Nationally, this figure was averaging 16.6 percent in July. So, it’s roughly four percentage points higher in Santa Fe, NM, than it is nationally.
In other words, Santa Fe has a low unemployment rate for middle and high-skilled workers, but if you are looking for a low-skilled, entry-level job, you should go elsewhere. That’s not surprising, but it is worth pointing out as the minimum wage issue works its way through the Courts.
(Albuquerque) New Mexico subsidizes hospitals, specifically UNMH, through both a tax exemption and outright tax dollar expenditures of nearly $100 million annually.
While such subsidies might be reasonable were they narrowly-targeted at indigent care and the needy, but a planned $146 million expansion currently under consideration for UNMH would not be targeted at indigent care, rather it is designed to attract middle and upper-income patients to a taxpayer subsidized facility. Worse, due to a lack of transparency at UNMH, no one knows where this money will come from.
As Scott Moody and Wendy Warcholik, Ph.D, the authors of the new Rio Grande Foundation report, “Lack of Transparency for New Mexico’s Not-For-Profit Hospitals Cost Taxpayers Dearly,” economic theory predicts this type of behavior by not-for-profit hospitals since the tax exemptions and subsidies encourage “vertical integration…” As a consequence, for-profit health care providers are “crowded-out” of the marketplace by not-for-profit health care providers.
Moody and Warcholik argue that policymakers need to be vigilant about the potential for not-for-profit hospitals to creep into for-profit medical services through the aggressive use of their tax-exempt status and note that over time, this tax advantage will result in an over-population of not-for-profits which is bad for the economy and state and local coffers.
In the short-term, policymakers should put a stop to this and other questionable expansions of New Mexico’s fast-growing, taxpayer-subsidized hospital network. In the longer run, New Mexico policymakers should consider ways to prevent such hospitals from growing beyond their original intent.
One possible solution put forth by Moody and Warcholik is a piece of legislation considered by the New Hampshire legislature during 2012. The bill, (HB 1482), would have limited tax exempt activities to a hospital’s main campus. This would at least give local governments the final say on expansions of such tax-exempt facilities in their communities.
In the longer-term, Moody and Warcholik argue that New Mexico policymakers might want to consider tying indigent health care expenditures to the individual patient as opposed to funding institutions themselves.
I blogged earlier this year on some polling which showed strong support for school choice among New Mexicans.
Some new polling which focuses on the views of Latinos in five “swing states” including New Mexico, show that Latinos are even more supportive of school choice than is the general population!
Among the findings:
69% of Latinos support vouchers compared with 57% of the general population;
78% of Latinos support “school choice options” compared with 74% of the general population;
71% of Latinos support tax credit scholarships compared with 65% of the general population.
Perhaps it is their strong desire for educational options and an improved education for their children that causes Gov. Martinez to garner strong support from Democrats and Republicans alike? This, of course, defies the “ownership attitude” of Bernalillo County’s Democratic Party Chair Ana Canales who said recently of Gov. Martinez’s speech at the RNC, “I’m appalled that a woman, a Hispanic woman would even be at a Republican function, she’s Hispanic, she’s a woman and she has turned on us.”
Not much surprises me when I read the paper. But the signatories of this opinion piece really threw me for a loop. Sure, we know that Sec. Skandera supports teacher evaluation, but the head of the National Education Association teachers union here in New Mexico? That was a shock, especially these union-driven protests over the policy that were held this summer. The fact that they would pen an op-ed together was even more surprising.
There is no doubt that the current evaluation system (in name only) is in dire need of repair. We need to encourage and incentivize greatness, not “meets competency.” And, we need to identify the not-so-great teachers and either re-train them or get rid of them. That a teachers union would support such efforts is nothing short of amazing given the way unions typically look at teachers as little more than widgets, all of whom are, as in Lake Wobegone, “above average.” Thus, union-backed standards tend to revise standards towards the lowest common denominator while attempting to increase membership and payroll as much as possible.
Has a new leaf been turned over in New Mexico? We’ll see, but if this is not a misprint, we might just have our first reform-minded teachers’ union right here in New Mexico. Contrast that with Chicago where the unions are on strike demanding 30% pay raises…
I’m not sure how the dozens of people involved in circulating and thousands of people who signed the petition demanding an increase in the minimum wage in Albuquerque missed it, but the effort is on the verge of being sunk by some faulty language in the petition itself. This article comes from Yahoo! news.
Now, if there was merely a letter out of place or a minor punctuation issue, I could see the courts going along with the ballot measure for the fall election, but the issue here is far more profound and alters the actual meaning of the measure to the point where it is unworkable. We already know that raising the minimum wage is bad policy, but the decision to include or not include it on the ballot must be made quickly, by Tuesday the 11th of September. This snafu, unless the courts bend over backwards for this liberal cause, could at least force the groups to collect accurate petitions and submit them for a future election. I have no doubt that they’ll be back.
The Fraser Institute is a Canadian free market think tank. They recently published a study measuring labor market performance in US States and Canadian provinces. States and provinces were ranked on a variety of performance measures that are contained in the report, but that I’ll share with you relating to New Mexico below:
Index of Labour Market Performance, 2007–2011: 34th, top state North Dakota, bottom state Michigan;
Average total employment growth, 2007–2011: 34th, top state Texas, bottom state Michigan;
Average private-sector employment growth, 2007–2011: 48th, top state North Dakota, bottom state Rhode Island;
Average GDP per worker, 2006–2010: 37th, top state Delaware, bottom state Vermont;
Full report is an interesting read. Perhaps most telling, aside from New Mexico’s performance, is the performance of Canadian provinces like Alberta and Saskatchewan. Perhaps this has something to do with Canada’s embrace of economic freedom relative to the US? I’m just sayin’.
Bill Clinton may be the only politician that talks like just another “silver-tongued” politician, but governed like a free market, fiscal conservative. If you haven’t seen his speech from the DNC, check it out here. I have to admit that seeing Bill up there made me yearn for the days of 4.2% unemployment and a federal government that consumed “only” 18.2% of the overall economy. For reference, the federal government now consumes more than 24% of the US economy (perhaps that is why we all feel so poor these days?)
Anyway, there Clinton was, slumming for Obama and his big-government policies last night when, in reality, his ACTUAL GOVERNANCE saw a smaller government (relative to the overall economy) than the “radical” Paul Ryan has proposed (getting spending down to 20% of GDP).
Oh, and as if the contrast between Clinton’s very good record and his big-government rhetoric (which EJ Dionne gets wrong, of course) were not enough, there is successful welfare reform which Clinton signed and Obama has undermined, and NAFTA which Clinton pushed through Congress and signed, while Obama has been a major obstacle to expanded free trade.
Clinton may genuinely believe what he says both in terms of his policy pronouncements and his support for Obama, but faced with conservative opposition to his health care proposal, Clinton chose to govern from the middle or even the right. Obama, when faced with opposition to his policies has dug in and moved further left while the economy has continued to falter. Whether Obama wins re-election or not, that is the message that both parties need to take from Bill Clinton.
I missed this story when it originally ran, but actor Johnny Depp decided to move back to the USA to avoid the socialist government’s planned 75% income tax rate.
The US is no “tax haven” by any stretch of the imagination, but the more important point is that wealthy Hollywood types and business tycoons have the capacity to choose where they want to live. The rest of us don’t. The same goes for US States. Businesses and the wealthy will move to where they can keep more of their money and generate the best returns on their investments. Note the case of Maryland and Virginia, two states that have seen tax and regulatory policies diverge in recent years.
I recently saw this story from KOB TV Channel 4:
It discussed these reports (state level and local level) from the Associated General Contractors of America. According to the report, New Mexico is lagging regionally in terms of construction jobs. Is it? The answer is complicated. For starters, the state level report, linked to again here, covers only one year worth of data. It is tough to confirm a long-term trend over just one year. Also, while New Mexico does not perform particularly well relative to the regional economy, it is 26th on the list in terms of construction jobs gained/lost. That’s not great, but not terrible either. More importantly, it is only a short time period and a specific sector of the economy (construction).
If you want a better employment-related description of state economies in one simple table, try this one and look for the states that have grown private sector employment more than state and local government employment since the onset of the recession (January 2008 for the purposes of this report). Only three states, North Dakota, Texas, and Louisiana fit the bill. New Mexico, unfortunately, has cut 1.32 percent from the state and local work force, but has lost 5 percent of its private sector jobs. Rather than lagging behind, New Mexico is just one of many states hemorrhaging private sector jobs.
I appeared on KNAT TV to discuss the potential benefits of Right to Work for New Mexico. You can see the 15 minute interview below:
Paul Gessing, president of the Rio Grande Foundation discusses “Right to Work” on the show “Joy in Our Town” from Paul Gessing on Vimeo.
If you are interested in finding out more on the topic from a national expert, be sure to attend our luncheon with Mark Mix, the head of the National Right to Work Foundation on Wednesday, September 12. Ticket prices rise from $25 to $35 after Wednesday.
Rio Grande Foundation and its investigative arm, the New Mexico Watchdog, were recently the subject of a syndicated opinion piece that decried our efforts to re-create New Mexico’s Sunshine Portal by posting our own website with the names and salaries of all state government workers.
I responded with a letter to the editor of several papers that ran the column. It can be found below:
I appreciate columnist Merilee Dannemann’s concern over efforts by both Gov. Martinez’s office and the Rio Grande Foundation to post government employee pay on the Internet and to keep it there despite opposition from government employee unions.
The reason we have been so determined to keep this information available is that unlike traditional businesses where shareholders are the owners, in government, the ultimate “owners” are the people at large. In no other business do the owners have no idea what their workers are making. Ideally, in addition to simple pay, taxpayers would also be able to find out details on the pensions and benefits available to government workers.
If, as a government worker, you don’t like this, you don’t have to work in public service.
It is worth noting that New Mexico is by no means the only state to post public employee salaries on the Internet. Dozens of states do this and, as Dannemann mentioned, the information is already publicly-available upon request. I have not heard of one reported incident of identity theft nationwide.
From a “good government” perspective, transparency in compensation can lead to better understanding of how compensation is determined, whether it is indeed fair, and whether government workers are paid more or less than their private-sector counterparts. This is valuable information and can lead to more efficient government.
This is the 21st Century. It is an information century. My salary, like that of other non-profit CEO’s is available online as well. Check Guidestar.org.
Arnold Schwarzenegger is out of office and back in the movies, so he doesn’t have to act like he cares about the environment any more. How else can you explain his recent, $250,000 purchase of the monstrous Mercedes Unimog (photos at the link).
This is the same guy who single-handedly raised Californnia’s Renewable Portfolio Standard to an astonishing 33% just three years ago.
It is just funny to me how all of these environmentalists and politicians want middle and low-income Americans (not to mention Chinese) to pay up and live a lower standard of living by eliminating carbon emissions from their lives, but very few of them are willing to give up the joys of private jets and massive cars.
College athletics are indirectly (and sometimes directly) subsidized by the taxpayers. The USA Today recently put together a very interesting report showing which public universities’ athletic departments are the most heavily-subsidized and which pay their own freight. Hint, big schools with very successful college football teams tend to have athletic programs that pay for themselves while it appears that college basketball powerhouses with mediocre or bad football programs are able to make up a little bit of football-driven losses, but not all. Most schools subsidize their athletic programs to the tune of millions of dollars annually which ultimately, must increase student fees and/or taxpayer outlays.
According to the report, UNM received a total subsidy of $16,605,866 from 2006-2011 which comes to a total subsidy rate of 41.2%.
NMSU performed slightly worse with its athletic program receiving a total subsidy of $18,811,475 at a rate of 69.7%. Both subsidy rates were in the middle of the pack nationwide with rates ranging from zero to 90 percent.
HT: Patrick Leonard
A few weeks ago, we outlined a situation involving a partisan political group using the Roundhouse (aka, the Capitol). It was our position that the group should at least pay a fee for using the facility. This would include any security needed for the event.
Unfortunately, as Rob Nikolewski over at Capitol Report New Mexico reports, the Legislative Council Service has decided to not even ask for the $700 needed for additional security. This is just silly and it will open the floodgates to any and all partisan group that wants to hold their events in the “People’s House.” Of course, it is also unfair to taxpayers who will be asked to pick up the bill and could be asked to pick up bills far bigger than just $700.
Imagine if ALEC, an organization that is not actually partisan, were to have a function at the Roundhouse. The added security burden would undoubtedly be heavy and costly to taxpayers. Yes, according to these rules, ALEC wouldn’t have to pay a dime.
Surprise, surprise, another player in the local film industry wants to public to stop scrutinizing the generous subsidies given to it. That’s the message from Dana Arnold, CEO at Albuquerque Studios. I find it rich that the head of a company that is propped up by about $50 million annually from the taxpayer would say “stop the politics.” This is a well-connected, politically-savvy industry that has extracted subsidies from dozens of states across the nation. That’s as bad as the “Get the Government out of my Medicare” message that surfaced at a few tea party gatherings.
Specifically, the author argues that taxpayer subsidies create jobs for New Mexicans. Of course, spending $50 million or more annually (or, better yet, returning that money to taxpayers) would generate jobs and, because individual businesses and entrepreneurs are better at allocating scarce resources than government, New Mexico would see greater prosperity by allowing average New Mexicans to have their money back.
Rather than continuing to subsidize this (or any other industry), New Mexico policymakers should wean them off subsidies and instead focus on adopting low, fair, and transparent tax policies along with rules and regulations that increase fairness and opportunities for businesses and entrepreneurs. In terms of specifics, I think New Mexico should reduce the percentage subsidy by one percentage point annually, starting at 25%, down to 24%, then to 23%, and so on. That will free up limited resources to a larger number of projects in the short-term and will ultimately lead to this industry-specific subsidy program being phased out.
If you haven’t already done so, check out the New Mexico Breeze. It is a news source available both online and in a print format. The Rio Grande Foundation has agreed to provide original content to the paper on at least a monthly basis. One such article that ran in a recent edition of the paper came from RGF Policy Analyst Marcos Portillo. He explained how policymakers in Albuquerque could have used the private sector to avoid the recent green fee increase at Albuquerque’s public golf courses. Read the full article below:
More Efficient Management, not Higher Prices, the Answer at City Golf CoursesAlbuquerque’s city-owned golf courses recently raised their rates by $2.50 per round. The primary reason for the increased rates is that the golf program had been underperforming and was not self-sustaining. Last year there was a shortfall of nearly $500,000 and the program required a bailout from the city’s taxpayers to cover it.
The fee increase may temporarily fill the gap (although it could reduce play and thus harm revenue), but a rate increase isn’t going to solve the long-term problem of government-managed golf courses.
What if there’s another financial crunch in the future? We’ll be back to where we started with more rate hikes and golf bailouts. The city should take a hard look at the option of privatizing management, an option that has proven successful for many municipalities across the country.
In 2007, Tulsa Oklahoma’s golf program was in a much worse position. The city was projected to subsidize their golf courses by approximately $1 million in fiscal 2008. As a result, the city entered into a contract with Billy Casper Golf Inc. The company assumed management in January 2008 and for the first year of operation cut the city’s subsidy nearly in half to $610,000. The next year it was cut to $200,000 and Billy Casper Golf submitted a five-year plan that would cut the subsidy to zero. In less than two years, rounds played grew by 39% and net operating income increased by over $1 million.
To be clear, “privatizing” management will not make Albuquerque golf courses any less open to the public. In fact, under private management operating with a profit motive, these courses could provide service equal to or better than is offered now, without the costs to taxpayers or higher fees for golfers.
In Cincinnati, the city privatized their golf courses in 1998 after a mid-90’s scandal that resulted in operating losses that totaled $1.3 million over two years. After a private management company took over, they were able to expand outreach programs for children and disabled golfers, and certified four city courses under an Audubon Society program that promotes wildlife preservation strategies, all while operating at a profit since privatization.
Even after this rate increase, Albuquerque taxpayers remain on the hook for capital improvements to City courses. Ladera golf course has recently been going through a significant irrigation renovation of its 18-holes (which should be completed by July 30th). This project cost nearly $2 million and did not come from the revenues of its own operations but from the capital improvement fund that is primarily funded by property taxes.
Let a private management company worry about improvements and allocate the taxpayers’ money towards more important core services and infrastructure improvement. In Indianapolis where former Mayor Goldsmith awarded the first privatization contract for a city golf course to R.H. West Company in 1993, the company expanded the facility from a 9-hole course to an 18-hole course, and unlike Albuquerque, $1.6 million in capital improvement investments were made to the course without the need for taxpayer money. The city pays nothing to operate and maintain the golf courses and saves the cost of paying salaries and benefits to the employees, as well as all capital improvements to the facilities. The private operators returned about $1.25 million to the city on total golf course sales of approximately $9.2 million in 2009 alone.
By giving up the reins to private entrepreneurs and the discipline of the market, the performance of many of publicly-owned golf courses has dramatically changed. In many cases, the private managers ended up expanding operations, renovating facilities, and even returning a percentage of revenue back to the city.
In New Jersey, Governor Christie contracted Atlantic Golf Management to take over operations of Spring Meadow Golf Course in April 2011. It was committed to paying the state 15 percent of the revenue it received exceeding $1 million per year. It took just over six months to reach that benchmark. Let’s get our golf courses to make our city money, not cost it money.
Why should non-golfers subsidize a luxury for a small number of the population that are golfers when another provider can provide such services at no cost (if not, a profit) to the public? Golf is but one of many services that the government provides that can be turned over to the private sector for better management.
Marcos Portillo is a policy analyst with New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility.
Albuquerque voters will be asked to vote — possibly in November — on whether to raise the minimum wage from the statewide $7.50 to $8.50 with future increases indexed to inflation. Interestingly the issue of minimum wages has caused a great deal of economic turmoil in the US protectorate Samoa. According to minimum wage expert Michael Saltsman:
In 2007, Congress passed legislation to increase the federal minimum wage by approximately 40 percent in three steps, from $5.15 to $7.25. American Samoa, a U.S. territory in the Pacific, also was required to increase its minimum wage to $7.25 per hour, raising the rate by 50 cents every year. The territory previously set separate minimum wages for different industries, ranging from $2.68 to $4.09 per hour.
Flash forward five years: The territory’s unemployment rate now stands at nearly 30 percent. The economy relies primarily on exports of canned tuna, and one of the island’s two canneries shut down in 2009, citing increases in the minimum wage as a significant factor in the plant’s closure. Other island employers have reported to the Government Accountability Office that they plan to leave American Samoa, again naming the minimum-wage increases as the culprit.
There’s a nice, short video on the issue from “60 Minutes” here.
As if to reinforce the point that minimum wage laws kill jobs, Australia’s recently-increased minimum wage has increased unemployment among that nation’s youth (despite Australia’s strong economy overall).
