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 Courses

Albuquerque’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).

I explained a few reasons why readers of the Alibi might want to support the Wal Mart proposed for Coors and Montaño. The letter is a response to this column which ran in the paper.

It is a challenge to argue in support of Wal-Mart to a relatively left-wing Alibi readership, but there are some sound even arguments in support of the new store location at Coors and Montaño. For starters, I live less than 1 mile from the proposed site and can vouch for the fact that many other neighbors of the site support Wal-Mart and the jobs and increased options it would bring to our area.

If the store were a Whole Foods or Trader Joe’s, it is hard to imagine the same level of opposition. The land is zoned commercial, so regardless of Antoine Predock’s vision for the area, city planners always intended for some major development to be located at that spot. The area, by the way, has been a vacant lot and hardly “natural” for many years.

In terms of the site itself, it is worth nothing that Bosque School already backs up to the Bosque as would the proposed Wal Mart. To my knowledge, no one has complained about the school location. There is also a small park with a parking lot between the Bosque and the proposed Wal Mart.

Lastly, while Wal Mart is hated by most self-described “progressives,” Sebastian Mallaby of The Washington Post pointed out in a 2005 column that “The average Wal-Mart customer earns $35,000 a year, compared with $50,000 at Target and $74,000 at Costco. Moreover, Wal-Mart’s ‘every day low prices’ make the biggest difference to the poor, since they spend a higher proportion of income on food and other basics.”

On August 22nd, Paul Gessing, president of the Rio Grande Foundation, Dr. Deane Waldman, a pediatric cardiologist at UNMH and an adjunct scholar at Rio Grande Foundation, and former US Rep. Bill Redmond, appeared on a panel discussion to discuss the health care law known as “ObamaCare.”

The event was hosted by Libre Initiative and the panel is introduced by Michael Barrera of Libre.

8-22-12 Health care forum from Paul Gessing on Vimeo.

You can listen to Romney’s speech here. Overall, his proposals strike me as reasonable and dedicated to embracing the free market energy sources as opposed to a government-managed and controlled energy sector. This provides a stark contrast to Obama on energy.

Unfortunately, as is so often the case with Romney, he steals a measure of defeat from the jaws of victory. The theme of his Hobbs speech (complete with banners) was “Energy Independence by 2020.” This is silly. Robert Bryce, an excellent free market energy analyst has written a book on the topic.

Energy is no different from any other item that is traded across national boundaries. Even if America is “self-sufficient” in terms of energy insofar as it can produce as much energy as is necessary, the idea of “independence” makes it sound like trade in energy is a bad thing to be avoided when it actually helps us all.

In terms of his specific policies, Romney is right on in urging completion of the Keystone XL pipeline, reforming the federal permitting process, and eliminating the wasteful subsidization of wishful energy technologies. For more on Romney’s speech and the reaction to it among attendees, check out Capitol Report New Mexico.

One of many signs of Congressional ineptitude is its willingness to continue shoveling money into Amtrak (about $1.5 billion annually at last count), the government-owned (socialized) rail monopoly. Obviously, cutting $1.5 billion is not going to solve our national deficit which runs at approximately 100 times that amount, but it is symbolic and you have to start somewhere.

Recently, it was reported that Amtrak lost $834 million in the last 10 years selling hamburgers, drinks, and other food to a captive audience on its trains.

It is long-past time to sell Amtrak off to the highest bidder or, where no one will buy the railroad, simply abandon rail service. I do know that I don’t want any more of this “government efficiency” brought to my health care and other, more complicated areas of the economy.

President of National Right to Work Foundation to
Speak at Rio Grande Foundation Event!

Mark Mix, President of the National Right to Work Legal Defense Foundation and National Right to Work Committee will speak on the importance of Right to Work legislation for economic development and its potential for New Mexico at a Rio Grande Foundation-sponsored luncheon.

The event will be held on Wednesday, September 12, 2012 from noon to 1:00PM at the Marriott Pyramid which is located at 5151 San Francisco Road NE in Albuquerque.

Because of the importance of Mr. Mix's message, the luncheon is being offered at the discounted price of $25 per seat. After September 5th, the price will rise to $35.

Reserve your seat today by calling 505-264-6090 or by mail at: P.O. Box 40336, Albuquerque, NM  87196 (just note "Right to Work" on the envelope) or online here. Reserve your seat for this important event today!

According to a recent Rio Grande Foundation report (download here), New Mexico could see more than 42,000 jobs created between now and 2020 with the adoption of Right to Work legislation? Mix will explain what such a law does (and doesn’t do) and why states like Indiana and Oklahoma have adopted such laws (and why other states are considering them).

Under the leadership of Mr. Mix, the National Right to Work Legal Defense Foundation has continued to provide unparalleled free legal assistance to workers and has utilized cutting-edge legal strategies to protect workers from the abuses of compulsory unionism.

Mr. Mix frequently appears on national television shows including Fox News Channel's Your World: With Neil Cavuto, Glenn Beck and Fox & Friends, and has also appeared on multiple times on CNBC and CNN. Mr. Mix also often serves as a guest on nationally-syndicated radio shows such as the The Lars Larson Show, Jason Lewis Show, Michael Reagan Show and the Jim Bohannon Show.

Similarly, Mr. Mix's writings have appeared in national outlets such as the Wall Street Journal, Washington Times, Investors Business Daily, Washington Examiner and National Review. His pieces have also been featured in widely-read regional publications across the country including the Detroit Free Press, the Orange County Register and the Detroit News.

Mark Mix holds a BA in Finance from James Madison University and an Associates Degree in Marketing from the State University of New York. Prior to joining the National Right to Work Committee in 1990, Mr. Mix worked for several state-level Right to Work groups. He joined the National Right to Work Legal Defense Foundation in 1999.

(Albuquerque) One of the most important decisions facing state policymakers in the months ahead is whether or not to expand their Medicaid programs. Under President Obama’s health care law – as originally written – known as the “Affordable Care Act” or “ObamaCare,” the states would have been required to expand their Medicaid programs to 138 percent of poverty level.

This requirement was struck down by the US Supreme Court, but states are being strongly incentivized to expand Medicaid with the “carrot” of federal matching grants of up to 100% initially. Advocates say that New Mexico should take the “free” money and eagerly expand their Medicaid programs.

Dr. Deane Waldman, an adjunct scholar with the Rio Grande Foundation and a practicing pediatric cardiologist, has a different perspective. In his new report, “What Should New Mexico Do About Medicaid,” which is available here, he explains the issues with Medicaid from both the doctors’ and patients’ perspectives.

Waldman explains the major differences between Medicare and Medicaid, outlines some of the serious problems with Medicaid, and gives examples of Medicaid reforms that have worked in other states like Florida.

Argues Waldman of the Medicaid expansion decision, it “may look like free money, but we all know: a) there is no such thing; b) who will not get the money – providers; and c) who will not get services – patients. Medicaid will follow the same path as Medicare. More and more money will go to the bureaucracy, while less and less will go to people who actually care for patients.”

Sam Bregman is clueless. His cluelessness on economics drives me nuts. The latest exhibit is this piece in the Albuquerque Journal in which he again takes Gov. Martinez to task for “not creating jobs.”

I have debunked Bregman in the past, but I’ll take this opportunity to do it once again.

1) Politicians and government don’t create jobs. Yes, I know, plenty of people bring home paychecks from the government, but everything government does requires it to take resources from other parts of the economy. It merely shifts resources, usually to less economical/efficient uses;

2) Governors are not kings/queens. Gov. Martinez heads up one branch of New Mexico’s government (the executive). The Legislature and the Courts are dominated by Democrats. If Republicans held all three branches and the economy was in terrible shape, Bregman might have a leg to stand on, but he doesn’t;

3) New Mexico’s unemployment rate is 6.6 percent. That is too high, but it is lower than that in 33 other states and lower than the national average of 8.3 percent. The national economy, lest Bregman forget, is governed by a federal government that is headed up by President Obama. As I noted in a previous blog posting, Obama’s record on jobs is terrible. What is Bregman’s excuse for that?

4) On a more personal note, I suppose Bregman would know something about killing jobs in New Mexico. He has personally done it and no, I’m not referring to his career as a lawyer. Rather, he used to own the New Mexico Thunderbirds basketball team, but sold them to an out-of-state interest that moved them out of New Mexico, thus costing several people their jobs or at least moving them out of state. Do I blame Bregman for this? Not really. I went to a few T-birds games and enjoyed them, but if he was losing gobs of money on the deal, I don’t expect him to continue pouring money into it. But, it is bit silly for him to keep making such silly points in the newspaper.

I await Bregman’s opinion pieces on the job-killing aspects of minimum wage increases.

AFL-CIO affiliate Working America and associated organizations are currently pursuing an effort to raise the minimum wage in Albuquerque from $7.50 an hour to $8.50. Unlike past hikes in the mandated wage, this proposal would also increase the wage annually to mirror the rate of inflation.

The cause of improving low-income workers living standards is surely a noble one, but the rationale behind the proposed wage hike is riddled with misconceptions concerning the economics of labor. Well-intended policies do not necessarily generate positive outcomes, rather unintended consequences are inevitable.

Consider the purported beneficiaries of a higher minimum wage. While often portrayed as single moms with children, the reality is that only about 20 percent of those currently earning the minimum wage in New Mexico are the breadwinners in families with children. More than 50 percent either live with their families, a spouse, or have some other family support structure in place to pay a majority of the bills.

Additionally, the average family income of families with a minimum-wage earner exceeds $55,000 and the median exceeds $43,000 annually. It is far more likely that a minimum wage earner is part of a family unit with higher-paid members than it is that they are using a minimum wage job to support a family. Even in that stereotypical situation, that family is not living on a minimum wage salary. There are dozens of programs including the Earned Income Tax Credit, food stamps, and Medicaid to help pay the bills and provide needed goods and services.

Roughly half of New Mexicans who are currently working at the minimum wage have either just recently entered the workforce or are working “odd jobs” for extra income. This is affirmed by data from the Census Bureau which shows that approximately half of all minimum wage workers are what might be called their “prime working years (26-65). The other half are aged 25 or less or are older than 65.

Of course, mandated wage laws overlook the fact that different people have different skills and do work that is worth more or less in the marketplace. These laws disregard this fact and force employers to pay higher prices for labor despite massive differences in quality. The increase in the price of labor inevitably forces employers to make tradeoffs. These can include demands for the increase of worker productivity, cutting or abolishing non-mandated fringe benefits, decreasing work hours, and the firing (or non-hiring) of low-productivity employees i.e. marginal workers who often consist of the working poor and teenagers.

Already, in today’s weak economy, New Mexico’s teen unemployment rate is 22.6 percent – a dramatic increase from 13.2 percent in 2002 (prior to the last Congressionally-mandated bump in the minimum wage and the recent economic downturn). Increasing Albuquerque’s minimum wage could push even more young people out of the work force entirely.

Laws which artificially raise the price of labor send signals to entrepreneurs who view such interventions as just one more obstacle placed upon starting a small business. It is reasonable to consider that a mandated price hike on labor may very well turn away individuals who would have otherwise proceeded with entering the market. Increasing the expenses associated with starting a business will not benefit the populace of Albuquerque, but instead create barriers to entry for the aspiring entrepreneur.

Raising the minimum wage rate in Albuquerque is not the correct solution to improve the city’s economy or help those struggling to get by. The answer is to provide an environment whereby businesses can operate free of undue and harmful regulations, where individuals are free to competitively pursue employment, and private entrepreneurs are given the freedom to actualize their ideas and create value within the society. Economic liberty, not the coercive actions of the state, is what is necessary for the citizens of Albuquerque to prosper.

Ben Sugg 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.

I wrote a few weeks back about the notable decline in US carbon emissions in recent years. The mainstream media picked up on it and gave a few details in a recent story which stated that US carbon emissions are at 20 year lows.

Great news, right? Huzzah for the environment and the positive impact such emissions reductions will have on global warming. Yeah, right. As Rob Nikolewski points out over at  Capitol Report New Mexico, enviros are not exactly dancing in the streets. Rather, they are instead attacking the “fracking” process which has freed up so much cheap, clean, natural gas, thus reducing carbon emissions and frustrating their efforts to mislead Americans into believing that hare-brained, government schemes are the only possible way to achieve a cleaner environment (assuming that we are to believe carbon dioxide is a pollutant). Oh, and if you believe that the recent, hot summer is the result of global warming as many enviros do, it would appear that US efforts to turn the tide may not have the significance many would desire.

There is no pleasing some people.

If you aren’t already aware, the Rio Grande Foundation has a weekly radio show on AM 1550 KIVA. This week’s show which airs Sunday afternoon from 3-4pm is available online now due to the time-sensitive nature of an upcoming opportunity for New Mexicans to demand this new option.

Before sharing more about that option, check out this incredible story from USA Today of a 14 year-old girl from Florida who attends an online school so she can manage her burgeoning small business. It’s just one of many ways in which online schooling can be tailored to the needs of students with diverse interests. So, if you want similar options for New Mexico kids….

A public hearing on New Mexico Connections Academy is scheduled on Monday, August 20th!

Come show your support for school choice and for New Mexico Connections Academy by attending the Community Input Hearing on Monday, August 20th at 2 p.m. The hearing will be held at Mabry Hall, Public Education Department, 300 Don Gaspar, Santa Fe. This is your opportunity to share your story about why your family and New Mexico need this high-quality full time virtual educational option. We really need you to come out and show your support for this proposed school! Please plan to attend.

New Mexico Connections Academy will be:

• tuition-free, public school;
• grades K-12;
• available for students throughout New Mexico;
• providing instruction from New Mexico-certified teachers experienced in online instruction;
• providing instruction from New Mexico-certified teachers experienced in online instruction;

If you can’t make it to the hearing, please write to the Commissioners of the Public Education Commission. We need interested families to attend the hearing and also write a short note to the Public Education Commission asking them to approve our application. A “yes” vote on our application is a “yes” vote for your children and other children across our great state!

Public input should be sent electronically by clicking here and written input should be sent to Public Education Commission, c/o Beverly Friedman at 300 Don Gaspar Ave., Santa Fe, NM. The deadline to receive your comments is 5:00PM. on August 23rd.

Please email infoNM@connectionseducation.com if you have any questions or comments about our charter application, the public hearing, or the Founding Board.

A final decision on our charter school application is expected no later than September 30, 2012.

I guess if I were Barbara Couture and I got my paychecks from the higher education establishment, I’d be willing to say anything to keep the money flowing, but the reality of higher education is far different than she portrayed it to be in her recent column.

For starters, yes, people with a college degree do indeed tend to earn more, but there are a number of things to consider:

College tends to attract the most intelligent and ambitious. They are going to tend to rise to the top regardless of a college degree;
Four/five years of foregone earning combined with thousands of dollars spent and potentially-untold piles of debt;
A few extremely-high earners like Bill Gates skew the earnings picture;
There are wide differences in earning power between various degrees of study. Engineers are going to make more than arts majors (by and large).

By all means, go to college if it is right for you, but ambitious and intelligent people can make a good living no matter what as John Stossel recently found:

Of course, the President of NMSU cares even more about keeping the spigot of public money flowing to higher education than she does about the success or failure of individual students. As the chart below illustrates, the price of a college education had been rising for decades, long before the recent economic downturn:

What Couture and the higher education establishment refuse to admit is that the easy money in the form of federally-subsidized student loans and capital projects paid for by the states have inflated the higher ed bubble and increased the cost of college. Reducing the amount of taxpayer dollars flowing into higher ed would reduce costs in the long-term as universities were forced to respond to market reality, not “free” money. Unfortunately, Obama and his crew seem hell-bent on blowing more air into the higher ed bubble.

Politicians rarely talk about economic freedom, but one New Mexico elected official who “gets it” is Rep. Dennis Kintigh of Roswell. His opinion piece from today’s Albuquerque Journal explains some of the ways in which New Mexico falls short and explains how tax and regulatory policies have negatively impacted our economy.

The article is worth the read, but it is imperative that New Mexico elects more public officials at all levels that understand the importance of economic freedom and the steps we need to take to achieve it and greater wealth.

(Albuquerque) In response to efforts underway to raise the minimum wage in Albuquerque from $7.50 to $8.50 and indexing it to inflation, the Rio Grande Foundation has released a new report detailing the negative impacts of minimum wage hikes. The report, “Raising Albuquerque’s Minimum Wage: A Misguided Anti-Poverty Measure at Best, A Cruel Impediment to Work at Worst,” is available on the Rio Grande Foundation’s website.

Among the items to be found in the report is the fact that any increase in the minimum wage would be poorly-targeted in terms of reaching those who is supposed to benefit from the bump in wages.

• “According to data from the Census Bureau, approximately half of all minimum wage workers are in what might be called their “prime working years (26-65).” Said Gessing, author of the report, “As one would expect, about half of New Mexicans working at the minimum wage are either just getting started in the workforce or are working “odd-jobs” that allow them to make some extra money as the move towards full retirement”;

• Also, only approximately 20 percent of those currently earning the minimum wage in New Mexico are the breadwinner in their families and supporting children. More than 50 percent either live with their families, a spouse, or have some other family support structure in place to pay a majority of the bills;

• The average family income of families with a minimum-wage earner exceeds $55,000 and the median exceeds $43,000 annually. Clearly, the archetypical single mom supporting kids on a minimum wage salary is not the norm.

• Advocates assume no negative externalities of their preferred policies, but New Mexico’s teen unemployment rate is currently 22.6 percent – up dramatically from 13.2 percent in 2002 (prior to the last Congressionally-mandated bump in the minimum wage and the recent economic downturn). Increasing Albuquerque’s minimum wage could push even more young people out of the work force entirely.

Concluded Gessing, “Even if we assume nothing but benefits will accrue to those at the bottom rung of the employment ladder, an increase in the minimum wage is a poorly-targeted anti-poverty policy. After accounting for the fact that some otherwise employed individuals will lose their jobs as a result, a hike in the minimum wage becomes an impediment to the skills, discipline, and self-esteem associated with holding down a first job.”

As readers of this space know, we’ve covered Gov. Johnson’s campaign for president relatively closely here and here for starters. So, it was with great interest that I read this article about a dispute between “Michigan Rep. Justin Amash, aka: the next Ron Paul” and our own former Gov. The issue is none other than New Mexico’s film subsidy program which Johnson inaugurated and Richardson expanded.

I have to agree with Rep. Amash on this one. The worst thing about Johnson’s statements on the film subsidy program he started is his fundamental misunderstanding of the difference between “tax breaks” and outright “government subsidies.” As I’ve said before in this space, there is a big economic and moral difference between government deciding not to collect taxes on a particular, favored activity (often morally acceptable, sometimes economically logical) and taxing one group of taxpayers to then turn around and hand money to another group (neither morally acceptable, nor economically logical).

The latter is what New Mexico’s film subsidy program does and Gary should know better.

The Sierra Club is the latest environmental group attacking PNM for having the temerity to produce reliable, inexpensive, electricity. Their ad which appeared on my sports page in the ABQ Journal yesterday (August 12) claims “PNM’s Coal-Burning Power Plant Gives us More than Just Energy” and shows a kid with an inhaler. It also claims: “more than 1 in 5 New Mexico middle school students has suffered from asthma.”

Unfortunately, their claims just don’t hold up under scrutiny. They are more of a feeble attempt to spread fear. As this report and map from the Centers for Disease Control shows, the real percentage of children with asthma is less than 10 percent in New Mexico.

Now, compare that map with this one which shows the states that produce most of America’s coal-fired electricity.

Not exactly a “cause and effect” if I may say so. Texas, for example, is a serious coal state, but it has lower childhood asthma rates than we do. And, not surprisingly, New Mexico is not that big of a coal burning state. Oklahoma, like us, is not a big coal-burner, but has high asthma rates. Correlation between coal and asthma on a statewide basis is tough to come by, much less causation. Scientists don’t even know what causes asthma and what, if any role is played by air pollution (some in the linked article say more air pollution may REDUCE asthma rates).

Is coal without its problems? No, no energy including wind and solar comes without a price. But, environmentalist scare-tactics are not contributing to the debate over energy usage and sources.

I like the pick of Rep. Paul Ryan as Mitt Romney’s vice presidential candidate. Given where Romney comes from ideologically, I think it was the best pick he could make. But the media coverage of Ryan is going to be skewed badly because both Republicans and Democrats share a desire to portray Ryan as some sort of free market purist who believes in “slashing” government. He is nothing of the sort.

As Jesse Walker over at Reason points out, “On the economic front, he has backed the bank and auto bailouts, Medicare Part D, even Davis-Bacon. His reputation as a free-market stalwart rests on his exaggerated reputation as a budget hawk and his habit of praising Ayn Rand.” Of course, on the positive side of the ledger, of course, Ryan is one of the only politicians in Washington who seems to grasp the serious nature of our entitlement problem and is willing to propose specific reforms that address it.

Ryan, unlike myself, is no free market ideologue. Of course, he’s a politician and has to run for office. As a moderate reformer, he has outlined specific plans to return the United States to solvency (eventually). Unfortunately, he’s at the bottom of the ticket, not the top. The real question is whether Romney shares his VP-candidates views on reforming entitlements or whether he’s just throwing a bone to conservatives.

We at the Rio Grande Foundation have long argued for tax and economic incentives that are fair, simple, and available to all comers. As we’ve seen in recent years with the pullout of Schott Solar (incentives cost NM taxpayers $16 million) and the collapse of Eclipse Aviation which cost us $19 million, “investments” of taxpayer dollars in specific companies is a risky business (for taxpayers at least).

Now, we have Hewlett Packard which set up shop in Rio Rancho a few years ago and received $2.2 million in incentives, but is experiencing significant (albeit undisclosed) layoffs. The good news is that unlike the other deals, a majority of the incentives involved foregone government revenues that may or may not have been collected absent HP. Little of the money was in the form of outright expenditures. Of course, if you’re not HP and you’re just a regular resident or business in Rio Rancho, you are paying taxes that HP is not paying for services that benefit HP. That is certainly not fair. Worse, it is proving to be ineffective in actually developing the economy.

A better way to do economic development is to lower barriers to job creation across the board by reducing tax rates or enacting laws like “Right to Work.” Chasing the latest big-name company and offering them the sweetest incentives possible is ultimately a losing game.

Oh, and for those who opposed the Union Pacific deal, the fuel tax cut applies to any railroad.

As the scandal at the New Mexico Finance Authority continues to unfold, we at the Rio Grande Foundation attempted to answer the question “What is the NMFA and what does it do?” Our follow-up question, asked of any government agency is, “Why does the government need to do this or could the private sector handle it better?”

On the first point, NMFA acts as a bank for government agencies in New Mexico and as the article discusses, this is not the first time it has been at the center of a scandal. The primary mission, although by no means the only job of NMFA, tends to center on accessing capital (bond) markets for government agencies throughout New Mexico. The particular beneficiaries of this activity are smaller cities and governments.

Of course, when the NMFA was organized in 1992, the bond market was concentrated in a few major cities like New York. You can now find people willing to buy and sell bonds here in New Mexico and even if you are in New York, through the use of technology, you can likely undertake the groundwork necessary to underwrite government bonds.

The questions I have regarding NMFA are: “Does New Mexico really need the NMFA as currently organized? How much is this entity costing taxpayers? It would seem that the bond markets are pretty efficient these days and, with return rates depressed, there will be plenty of lenders eager to sell bonds to New Mexico’s cities, counties, and other governing entities. Am I wrong? Why not privatize the NMFA?

The chart below shows just how terrible Obama’s record is:

A few more points.

1) Presidents obviously don’t operate in a vaccum (Congress and world events play a role), but the deficit was the lowest under Clinton of any modern president, thus defying critics of spending cuts on the left and right.

2) Presidents don’t create or destroy a single job, but the policies that they and Congress enact have a tremendous impact on the long-term health of the economy.

3) George W. Bush was a terrible president (saved only by Obama’s even more pitiful record) who makes Jimmy Carter look great by comparison. Sorry folks, Carter deregulated the airlines, trucking, and not-to-be forgotten, the craft beer industry. Bush’s tax cuts, while nice at the time (and I support their preservation), have, along with Obama’s subsequent health care and regulatory policies like Dodd/Frank, contributed to greater economic uncertainty as their renewal is debated on a monthly basis. Of course, they don’t make up for his terrible record on spending and regulation.

4) As the years wear on, Bill Clinton looks better and better.

Wednesday, August 22nd 12:00 Noon to 2:00 PM Luncheon

The Albuquerque Marriott Pyramid North

5151 San Francisco Rd. NE  87109

A panel discussion on the new law and how it will affect you, your family and your business. As implementation draws near, what you need to know about compliance with expert analysis from the medical, legal, and faith community.

Confirmed panelists include:

Former U.S. Congressman Bill Redmond

Rio Grande Foundation President Paul Gessing

Rio Grande Foundation Scholar Dr. Deane Waldman

This is a free event and space is limited:

RSVP by August 20th to:

elisa@thelibreinitiative.net

505-717-9868

In the spirit of transparency and open government, the Rio Grande Foundation and its arm, the New Mexico Watchdog, have posted all public employee data that was previously available on New Mexico’s Sunshine Portal including pay for all employees (which is a public record). The site is available here. Jim Scarantino, our New Mexico Watchdog, has a story on the topic and efforts by the unions to undermine the Sunshine Portal here.

The Washington Examiner picked up the story nationally.