Media reports have been regularly lamenting the debacle that is the Congressional “Supercommittee.” This was supposed to be okay as Congress would then be “forced” to cut $1.1 trillion over the next ten years through a process known as “sequester.” Of course, these are not real cuts, but are instead cuts relative to the baseline budget as you can see from the chart below:

But, members on both sides of the aisle are now saying the “cuts” may not even happen. The main concern is defense spending, but the reality is that when the rubber hits the road, neither party in Washington really wants to cut spending if it means cutting their pet programs. So, America will slide further towards Greece and Republicans will be giving Obama a free ticket to a second term by showing themselves to not be serious about spending (but we’ve said this all before)….

And, yes, contrary to the views of many, America can stand to cut defense spending:

Albuquerque Public Schools have been in the news a lot this week. First, they made the decision to make employee payroll information publicly available on their website. Click here to find it. Notably, we at the Rio Grande Foundation had been in the process of attempting to obtain salary data from it and other school districts around the state (as this letter illustrates). I’d also complained about their lack of compliance with the request mere days before APS went ahead and posted the salary data.

Which leads me to the other major issue out there regarding APS this week and that is the decision to change district rules to allow administration to pay administrators while they are serving in the Legislature. Teachers are already allowed to continue receiving pay while they serve.

So, I think it was interesting timing that APS released the salary data in the first place. I’m pleased by the District’s move and think RGF had a great deal to do with it (they’ll never admit it). Also, I think the positive, heavily-publicized decision was timed to cover the district for ignoring its own clearly-stated rules on paying administrators to serve in the Legislature. Of course, I don’t blame them. Who wouldn’t want to have what amount to paid lobbyists working for you in Santa Fe (in addition to those you already pay)? It is just one more example of the vast difference (and advantages) available if you work for the government in this state rather than the private sector.

The Rio Grande Foundation has been New Mexico’s leading proponent of virtual education. Notably, New Mexico is a state that has done fairly well in the area of promoting virtual schooling, but like nearly all states, we have a ways to go before we are really maximizing the potential of these new technologies.

The group “Digital Learning Now” has been started by former Gov’s Jeb Bush (R-FL) and Bob Wise (D-WV) to push state policymakers to move forward on digital education and virtual schooling. To this end, they have issued a report card for each of the 50 states. The report card allows users to pair various states, so I have paired New Mexico and Florida (one of the nationwide leaders in virtual education) here.

Higher numbers indicate that the state is achieving a greater number of goals associated with virtual schooling. New Mexico certainly doesn’t perform at the level of Florida and Arizona, but we do okay in the report.

Read the full explanation of the 10 elements of high quality digital learning and how policymakers can work to improve them.

Much has been made over the “fact” that the Occupy movement is generally non-violent. And, while many of the protesters may have condemned the outright violence that occurred in Oakland, the same protesters have also shut down the port of Oakland. I’m sorry, but shutting down a port is not “non-violent.” On the international scale, a blockade is considered to be an act of war. On the micro level, if I barricade you in your own house and stop you from leaving, this is an act of aggression. This is aside from the fact that shutting down the port will inevitably cost jobs and harm the so-called 99% of us who benefit from free trade and the economic activity associated with the port.

Recently, for a Reason.TV video, Peter Schiff went out and tried to have a discussion with some protesters in New York. He too found that they were intellectually inconsistent, often ignorant, and all over the place when it comes to an agenda.

Lastly, to counteract the “Occupy” movement and its muddled/socialistic messages, the New Mexico Conservative Republicans are putting on a “teach in” at UNM next Tuesday, November 8. I’ll be taking part and information is as follows:

CONSERVATISM AND THE U.S. CONSTITION: ANTIDOTES TO TYRANNY

University of New Mexico
Tuesday, November 8, from 11 AM to 1:30 PM, in the SUB Atrium

11:00 AM – Introduction
11:10 AM – Donald Gluck, UNM Conservative Republicans
– CONSERVATISM: PRINCIPLES & HISTORY
11:40 AM – Conrad James, Representative House District 24
– GOVERNMENT POLICY & THE FINANCIAL MELTDOWN
12:10 PM – Greg Sowards, Republican Candidate for U.S. Senate
– RESTORING THE PROMISE OF PROSPERITY FOR NEW MEXICO
12:30 PM – Mike Blessing, President Libertarian Party of Bernalillo County
– CAPITALISM & MERCANTILISM
1:00 PM – Paul Gessing, President Rio Grande Foundation
– THE U.S. CONSTITUTION

The latest National Assessment of Educational Progress (NAEP) scores are out. Remember that the Florida Model is based on that state’s success in improving reading scores among all students, but especially poor ones. There is some useful data to point out regarding Florida and New Mexico. I’ve posted two charts (thanks to Matt Ladner and Jay Greene). First, the chart below shows 4th grade NAEP reading scores for free and reduced lunch kids (a measure of poverty). Notice that Florida’s poor kids perform 5th best in the nation. Among states, New Mexico is 3rd worst (thank God for California!).

Interestingly, New Mexico’s educational under-performance is not limited to the poor. Middle and upper income whites perform relatively poorly in our state while Florida is again among the best-performing states in the nation.

As I’ve written before, many in the New Mexico Legislature seem all too happy with the status quo.

If you were not already aware, New Mexico has high crime rates. According to the US Census, we are 5th highest for violent offenses (per capita) and 8th highest on property crimes.

The Rio Grande Foundation and the Drug Policy Alliance recently teamed up to exchange ideas and attempt to come to an agreement on non-partisan ways to address criminal justice issues in a cost-effective manner. Several states have been active in reforming criminal justice in their states and there is a conservative group called “Right on Crime” that advocates for reasonable reforms.

Marc Levin of the Texas Public Policy Foundation (our sister think tank in Texas, a state that has actively pursued reforms) presented at the recent conference in Albuquerque. His presentation is available here.

The Washington, DC-based Competitive Enterprise Institute (CEI) and the New Mexico-based Rio Grande Foundation have released a new report on the Environmental Protection Agency’s (EPA’s) rampant abuse of power in enforcing the “Regional Haze Provision” of the federal Clean Air Act.

Full text of the new report is available online.

The specific target of the EPA in this unfolding debacle is the San Juan Generating Station in the Four Corners region of New Mexico. Author William Yeatman, Assistant Director, Center for Energy and Environment, at CEI, describes in detail how the EPA ran roughshod over New Mexico’s rightful authority under the Clean Air Act, at a cost of almost $340 million to New Mexico ratepayers.

As Yeatman writes in the paper, “New Mexico proposed a plan in full compliance with federal and state laws and regulations. In a contortion of logic, the EPA is rejecting New Mexico’s cost-effective analysis for a plan that achieves the EPA’s own target for cost-effectiveness. It is the only state subject to this bizarre reasoning.”

While overreach on the part of the EPA is not uncommon, Yeatman explains in detail that “New Mexico is being treated differently than every other state, in order to justify $700 million in costs beyond what the EPA’s own rules stipulate are necessary.”

Said Paul Gessing, President of the Rio Grande Foundation, “In New Mexico, we care deeply about both clean air and economic growth. Our own policymakers in the Environmental Department came up with a cost-effective solution that fully-complied with the EPA’s own guidelines, but that was completely ignored by the out-of-control federal agency.”

Concluded Yeatman, “New Mexico lawmakers should send a strong message to the EPA that its actions are unacceptable. They should enact a resolution condemning the EPA’s arbitrary regulations and demand that New Mexico be treated like its peers. In so doing, they would be governing in the best interest of the nearly 500,000 New Mexicans who face a $120 per year electricity tax to pay for invisible benefits.”

Unfortunately, as is so often the case with things New Mexico scores “highly” in, second place is not a good thing. Check out page 3 of this document (the rest of it is interesting as well) which ranks the states based on government workers per 1,000 private workers. We are the highest in the nation aside from Wyoming.

We have previously reported on New Mexico’s high rate of government employment. The AFSCME union has also “taken us to task” for allegedly misrepresenting the data. But, the fact remains that New Mexico has an outsized government work force relative to neighboring and not altogether dis-similar states like Arizona, Colorado, and Oklahoma. Facts are facts.

KRQE’s Larry Barker has blown the whistle on legislator and APS administrator Sheryl Williams-Stapleton who has been paid her full salary at APS (and her legislative per diem) even though APS rules expressly prohibit this practice. APS teachers are able to receive their salaries while they are at the session and this is questionable, but at least legal. Rather than disciplining Stapleton for breaking the rules, APS Superintendent Winston Brooks just changed district policy.

Financial woes plague legislative service: krqe.com

Oh, and as if that were not enough, APS has not fulfilled Rio Grande Foundation information requests for the district’s 2011 payroll. While other school districts have complied, APS has not done so after more than a month.

At the Rio Grande Foundation, we’ve been focusing attention on the need for Right to Work legislation to turn New Mexico’s economy around. Interestingly, a bordering state, Oklahoma, has a recent experience with having adopted such legislation.

According to this analysis from Scott Moody and Wendy Warcholik who have done work for RGF as well, since 2003, “Oklahoma’s manufacturing GDP has grown 45 percent…outstripping that of the average manufacturing growth in in non-Right To Work states (22 percent).”

Also, according to the same report, the economic growth associated with Right to Work has led to more people and economic growth happening in the Sooner State: “between 1995 and 2002, Oklahoma lost 10,681 households, 3,461 people, and more than $1 billion in income. From 2003 to 2008, however, Oklahoma has gained 13,215 households, 40,693 people, and $99 million in income.

If you live in the Albuquerque area, you may have never heard of News New Mexico. It is a radio show that airs throughout the state, but not in Albuquerque. The show is hosted by conservatives that frequently have RGF president Paul Gessing, capitol reporter Rob Nikolewski, and watchdog David Collins on the air.

I have been told that News New Mexico has a great chance to get on 1550 KIVA AM live weekday mornings, but management of the station needs to be convinced. Give KIVA a call at: 505-899-5029. Tell them that you want to hear News New Mexico during the week.

This video explains why the federal government can’t tax its way out of the current budget problem:

Equally interesting is this excellent article by Veronique de Rugy of the Mercatus Center who explains that countries that successfully solve large budget deficits overwhelmingly rely on cutting spending rather than raising taxes. The following chart illustrates the point nicely:

ObamaCare continues to be a dead weight holding the economy back. Worse, if it is not overturned, it will cause major, negative changes for America’s health care system. Rather than merely predicting how Americans will be hurt by increased government involvement in their health care, film maker Logan Darrow Clements went to Canada to see how their health care system works (or fails to work) for himself. The result was the film “Sick and Sicker.”

The Rio Grande Foundation is working to bring this informative movie to Albuquerque (and eventually other parts of the state). If you want to help us out, go to this page and pledge to purchase a few DVD’s. If we hit $700, we’ll show the movie in Albuquerque this fall. If we don’t hit $700, you won’t pay a dime. Thank you in advance for your support!

They say that it is always darkest right before the sunrise. And, while there are a few signs of life out there economically, the fact is that most Americans are pretty pessimistic these days. Brad Lips over at the Atlas Economic Research Foundation, an organization that works with organizations like RGF overseas, views the situation in a more optimistic light.

He makes his case over at the American Thinker.

Energy expert Robert Bradley is speaking at an upcoming Rio Grande Foundation-sponsored luncheon on November 10 (more information here). Bradley has a very interesting article on the Keystone XL Pipeline over at the Cato Institute’s website.

According to Bradley, “A new influx of up to 700,000 bpd from Canada will dramatically increase U.S supplies and in turn drive gas prices down. A study from Energy Policy Research Foundation found a greater supply of Canadian oil could save Gulf Coast refiners almost $500 million annually in transport costs, which, in turn, would mean lower prices for consumers at the pump.”

Also, “by 2019 employment directly related to Keystone XL could grow from 80,000 jobs to 179,000. If the flow of Canadian oil through the United States remains unchanged, however, total employment from the Keystone line will peak at 94,000 in 2019.”

This would seem to be exactly what the doctor ordered for the US economy. For more information on the proposed pipeline and a petition on it, go to this link.

The Washington-based Tax Foundation has an excellent new report on unemployment insurance. It explains the history of unemployment insurance, the problems that have arisen over the years, and includes many charts and graphs with specific comparisons among the states. It also includes some ideas for restoring/reforming state unemployment systems.

With all of the discussion in New Mexico on the need to reform unemployment insurance, this would seem to be an important paper for legislators to take a look at.

Rob Nikolewski over at Capitol Report has a great summary of the paper and some potential reform ideas for New Mexico’s elected leaders.  The South American nation of Chile has already implemented something called “individual unemployment accounts.”

Here’s how they do it in Santiago:

• Workers pay 0.6 of their wages into individual accounts, and employers pay a further 1.6 percent of the worker’s wages into the account.
• Employers pay a 0.8 percent payroll tax into a “solidarity fund” that pays benefits to new or low-wage workers when their accounts are exhausted.
• Accounts are conservatively invested in a variety of securities by managing funds that also operate the workers’ retirement funds.
• After a worker’s account has accumulated sufficient funds to pay five months’ worth of benefits, no further contributions occur.
• The worker’s individual account pays out when the worker becomes unemployed or retires. Unemployed individuals can withdraw 30 to 50 percent of their previous wages each week for up to five months

This letter of mine appeared in the Albuquerque Business Journal on Monday:

I read with great interest Winthrop Quigley’s recent column on the anxiety New Mexico’s small bankers are having in relation to the latest, costly regulation coming from Washington.

Most salient was the point made by Lordsburg banker Michael Martin who has concerns about compliance costs and worries that smaller banks with small legal staffs are less able to comply with reams of new regulations than are some of America’s banking behemoths. This is the single biggest issue with all government regulations and it is why Dodd-Frank, far from solving the “too big to fail” problem will actually exacerbate the issue.

Of course, these regulations come on top of untold billions of dollars in bailouts provided by the federal government to the big banks that did so much (along with Fannie and Freddie which are left unaddressed in Dodd-Frank) to cause the current financial crisis.

When it comes to picking winners and losers, governments have a long track record of doing a terrible job. The Solyndra solar subsidy scandal and the banking bailout boondoggle illustrate the top-down, statist thinking that has kept the US economy in the doldrums for more than four years now.

The most important “law” in Washington is the law of unintended consequences. At least, I hope they are unintended, but it surely seems that when the left in particular desires some government action, the result has the opposite result of what was originally intended.

I wish policymakers would be consistent: if land is zoned for retail and big-box (whether that be Whole Foods, Trader Joe’s, or, heaven forbid, Wal-Mart), they should get out of the way if such development comes about. On the other hand, it shouldn’t be necessary for taxpayers to put up money for big box retail as is currently under discussion before Bernalillo County Commission in the case of a proposed shopping center at Coors and Rio Bravo.

The developers of this South Valley project are asking for $1.5 million from the County for infrastructure needs in something called a “LEDA” grant. Unfortunately (at least for the developers), according to the County’s own data, is not clear that the project fits under that type of grant (retail is not a permitted application for LEDA grants).

There is no doubt that the South Valley is “underserved” from a shopping perspective. That being the case, this development should be a very profitable opportunity for developers and thus, will likely move forward regardless of subsidies.

RGF President Paul Gessing recently appeared on “In Focus” on KNME Channel 5. The discussion covered Afghanistan, the “Occupy” movement, San Juan County’s junk ordinance, and several other timely issues. View the full show below:

Watch October 14, 2011 (s5e16) on PBS. See more from New Mexico In Focus.

Jon Hendry of the New Mexico Federation of Labor recently defended the Obama “Jobs” bill in the Albuquerque Journal. His rhetoric repeated several supposed justifications for more federal spending that don’t hold up under closer scrutiny:

Claim 1: Obama’s “Jobs Bill” will rebuild our infrastructure. Of course, that was the justification for the original $800 billion “stimulus.” How much of it was used on infrastructure? Not much as the chart below illustrates. Essentials like infrastructure are often used to sell more spending and waste. And, not all infrastructure is created equal:

Claim 2: We need to “revive manufacturing”: the fact is that US manufacturing is producing more economic value than ever. Sure, we could do even better, but protectionism is not the answer. Ironically, the recently-passed free trade agreements could indeed be a major boon for US manufacturing.

Claim 3: We must provide the funds to end state and local government layoffs that cut essential public services: I’m not sure what “essential” services have been cut and who the “we” is. At least in New Mexico, I can’t point to any major layoffs by governments.

Claim 4: Our elected leaders should extend unemployment benefits and work much harder to keep homeowners in their homes: Extending unemployment benefits will lead to people staying unemployed for longer periods of time. People need to stay in the work force to keep their skills sharp though there are some specific, free market ideas for making the jobs market better. In terms of working to keep homeowners in their homes, this is a reasonable idea depending on the specifics.

Rather than raising taxes on some in order to foist another “stimulus” on the American economy, Obama and Congress need to cut spending and regulations to put the economy back on a firm footing. The signing of these trade agreements is the best thing to happen to the US economy since Obama became President. Hopefully he builds on that.

I saw the Sunday Albuquerque Journal on the supposed “rise of the independent voter” in New Mexico.

And, while I found the article informative on the whole, I think it missed the point. See the chart below. What it shows to me is a rapid decline in the number of registered Democrats in New Mexico while the number of Republicans has held steady during the last three decades.

The tenor of the article, rather than focusing on the massive shift of Democrat to independent, seemed to imply that both parties are losing influence. The reality is, however, that large numbers of voters have clearly expressed their frustration with one party, that being the Democrats.

So, what does that mean to an independent, free market think tank? Simply put, as I’ve written before, when it comes to education, the reformers fighting for progress include Gov. Martinez and supporters of her reforms which includes nearly all Republicans and some, but by no means all, Democrats. Also, if you haven’t noticed, Democrats, the party that generally supports bigger government, laws supporting unions, and more government spending, have controlled the Legislature for nearly the entirety of New Mexico’s 100 years of statehood. New Mexico has also been poor for decades (and as far as I can tell has never been among the wealthy states).

Is the relative decline of the Democratic Party in New Mexico a good thing? One-party rule of any kind is dangerous and inevitably leads to corruption and a lack of intellectual openness. To me, this is the story behind the story. With any luck it sets the table for a more economically and educationally-competitive New Mexico. Perhaps it will also lead to larger numbers of Democrats bucking the “old party line” and becoming Clinton-esque “New Democrats?”

I discussed education reform and its prospects with union boss Ellen Bernstein and Arlie Woodrum of the UNM Department of Education last week. During the discussion, Bernstein adamantly denied that K-12 teachers in New Mexico are given tenure and said the policy was eliminated in the 1980s.

I based my statement that New Mexico teachers are given tenure after three years on this critical report by the liberal Center for American Progress. So, what’s the truth? Well, I found this and this, both of which assert that tenure for New Mexico teachers comes after three years.

Debating not one, but two education “experts” is tough enough, but debating them when even the most basic of facts is not acknowledged is nearly impossible. It also makes substantive progress on the issues a real challenge.

With all of the talk about another so-called “stimulus,” could it be that out-of-control spending is the cause of our economic problems, not the solution to them?

The Rio Grande Foundation is co-sponsoring an upcoming luncheon on energy policy with Robert L. Bradley Jr., the CEO and founder of the Institute for Energy Research. Bradley is also the author of a new book: “From Edison to Enron: Energy Markets and Political Strategies.”

Bradley is one of the most knowledgeable commentators of the day on a wide variety of energy policy issues. The luncheon is in Albuquerque on November 10, 2011. More information and a link to the event registration site can be found here.