This is a great article about New Mexico’s taxpayer-financed Spaceport. It touches on several issues that we have brought up in the past that seem to have been completely ignored by Gov. Richardson and those who foisted the project on us, the taxpayer.

1) The liability issue as it currently stands, puts New Mexico’s Spaceport at a severe disadvantage. If the Legislature fails to act in this session, the unwillingness to protect businesses using the Spaceport could kill the project;

2) We are not alone or even the most advanced when it comes to the development of these projects around the country (and world).

3) Even if the Spaceport suddenly does a 180 and becomes a big success, how many rich people like Richard Branson and Ashton Kutcher are going to want to stay at the Holiday Inn Express in Truth or Consequences or will stay in New Mexico long enough to drive the kind of economic developed that Richardson and others promised?

Only time will tell, but there is no doubt that the Spaceport is very much at risk more than 7 years after the Legislature went along with Big Bill’s big idea.

If you don’t read the great reporting over at New Mexico Watchdog, you should. Recently, our watchdog, Scarantino, reported that a local member of the New Mexico House of Representatives, Miguel Garcia, has been reimbursed for some unusual “campaign expenditures” and dubious travel expenses to and from Santa Fe. KRQE Channel 13 picked up the story and did a great in-depth interview with Jim on last night’s 10pm broadcast.

Representative bills for massages, miles

The Rio Grande Foundation primarily focuses on economic and education issues, but government transparency and accountability are integral to our efforts as well. Yesterday, I was interviewed by Channel 4, KOB TV regarding efforts to preserve the integrity of elections and a study that claims mass-disenfranchisement will result from well-intended efforts to ensure the accuracy of voter rolls.

Check out the report below:

There has been a spate of “legislator gone bad” behavior among New Mexico’s political class. Sure, there were Pat Rogers’ ill-advised remarks about Gen. Custer in a private email and Gov. Martinez’s Chief of Staff Keith Gardner explained how he doesn’t use his government email address to avoid (ironically since the phone conversation was, unknown to Gardner, being taped) having to submit such email correspondence to public records’ requests. The statements by Rogers and Gardner were questionable to say the least and generated a firestorm in the media, but they are not illegal and no taxpayers were harmed.

That’s not the case with three other cases which involved at least serious ethical breaches and potentially-illegal activity.

1) Sen. Lisa Curtis’ campaign gave the La Cueva soccer team $500 to hand out campaign literature.

2) Rep. Ray Begaye was (at least seemingly) fraudulently reimbursed by taxpayers for a conference that he was already paid to attend.

3) Rep. Miguel Garcia seems to have had many problems similar to those of Rep. Begaye in keeping track of his mileage and expenses.

So, it seems that New Mexico’s legislators have either some serious ethical and legal problems or some big problems with preparing simple expense reports and keeping track of financial documents. In their own way, these issues highlight why New Mexico’s Legislature is the ultimate stumbling block to improving our state. Will anyone — Attorney General King or the voters — hold them accountable?

Election Day 2012 is just around the corner. While the current zeitgeist in American politics is that we vote for “the person we’d rather have a beer with” (if so, Romney is in trouble), we at the Rio Grande Foundation prefer that voters choose their preferred candidate based on who they actually agree with on various important policy issues.

To that end, I recommend this website. Whether you vote for the candidate you actually agree with is another story, but it is worth cutting through the media’s filters and actually figuring out with whom you agree. For example, my mother who typically votes Democrat was quite surprised to find that she agrees with Gary Johnson and, to a lesser extent, Mitt Romney far more than the other candidates in the race.

The map below presents an interesting analysis from an organization called BillTrack50 (more on BillTrack50 closer to the 2013 legislative session) of the bills passed during the most recent legislative session. The map illustrates which states have the most and least partisan in terms of legislation that passes. New Mexico’s Legislature, which is controlled by Democrats, is not surprisingly a highly-partisan body. According to the report, the only more partisan Democrat legislatures in the nation were California and West Virginia. Several states had more partisan Republican legislatures.

We don’t have historical analysis in terms of this trend, but it would be interesting to see and compare/contrast with economic growth data.

The show “Seinfeld” was said to be “the show about nothing.” In terms of the federal election, this election cycle might be called the campaign about nothing. The issue being avoided on a bi-partisan basis by most of the candidates of both major parties is our nation’s precarious fiscal condition driven by out-of-control spending.

Look through the websites and public pronouncements of the Republican and Democratic presidential candidates (Gary Johnson being the exception), New Mexico’s senate candidates, and even those running for the House of Representatives. You will find plenty of platitudes and talk of “cutting waste.” You will, among Democrats, at least, find plenty of willingness to raise taxes on “the wealthy.” Republicans, on the other hand, will talk about overturning “ObamaCare,” but you find few specific ideas for dramatically-reducing the $1.3 trillion annual federal deficit.

It is hard to argue that any issue can compare in importance to the deficit and the $16 trillion federal debt. Unfortunately, even Paul Ryan’s plan, which is better than Obama’s non-plan, hardly qualifies as “conservative.”

Obama’s budget would mean a 2021 budget that spends $2 trillion more than we do today, increase debt held by the public from 62 percent to 77 percent of Gross Domestic Product (GDP), and maintain massive annual deficits. This is a patently irresponsible proposal which is perhaps why few of either party in Congress have signed on to it.

Ryan’s plan comes in at more than a trillion dollars less, around $4.7 trillion. That sounds great, but aside from his much-criticized plan to reduce Medicare spending through the use of vouchers (probably the most specific and well-though-out-proposal in the document) his plan offers few details in terms of what to cut and what to keep in the federal budget.

Even that modest plan has not been embraced by the GOP’s candidate Romney.

Politicians have a problem with offering specific cuts because every program in the budget was put there to placate a powerful special interest. If you as a politician target specific programs for elimination, you likely alienate an entire special interest group that votes based on that single issue without necessarily picking up support from the average voter.

There are some tough discussions to be had about entitlement reform, but there are also some “easy” cuts that could save billions of dollars annually. All prospective members of Congress should support the end of the ethanol mandate that forces Americans to pay $40 billion a year in higher food prices and costs taxpayers $1.78 in subsidies for each gallon of gasoline that corn-based ethanol replaces.

Another boondoggle from the energy sector is the $24 billion that the Congressional Budget Office says is spent annually energy subsidies and special tax breaks. Liberals decry subsidies for “dirty fossil fuels” and conservatives oppose subsidies for so-called “renewables.” Why don’t we put them on a level playing field by cutting all energy subsidies and industry-specific tax breaks? If states want to subsidize or mandate “green” energy, they can do so, but get the federal government out of it.

Lastly, there is the issue of “corporate welfare.” This involves forcing average taxpayers to pay freight for big business. According to the Cato Institute, the cost of nine programs and with the sole purpose of distributing tax dollars to corporations include the recently renewed Export-Import Bank, International Trade Commission, the Small Business Administration, and the Overseas Private Investment Corporation. Annual subsidies come to $20.4 billion.

Cutting $50 billion or so in obvious waste won’t solve our $1.3 trillion annual budget deficit. In fact, the relatively small number of obviously-wasteful programs illustrates the reality that most of the programs driving our budget problems – like entitlements and an overweening national security state – are perceived as “sacred cows” by wide swaths of the American populace.

The left’s talk about balancing the budget by taxing the wealthy is just silly and will drive businesses and the wealthy overseas or out of business. Tax reform that lowers rates and eliminates deductions and loopholes like those for home ownership and employer-purchased health insurance would raise some revenues and eliminate distortions in our economy, but, like so many spending programs, these ideas are politically-challenging to enact.

Our candidates and elected officials won’t campaign on cuts to even the most wasteful federal programs until they benefit politically from the decision to do so. It is up to us, the American people, to demand specific cuts and a return to balanced budgets. Anything else takes America takes another step down the road to ruin.

Paul Gessing is the President of 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.

We’re number 18! We’re number 18! Doesn’t exactly have a great ring to it, does it? Check out the newly-released report (full ranking is on page 10 of the downloaded document) from our friends at the Fraser Institute. Not surprisingly, while the Obama Administration’s policies has hastened our fall from number 3 back in 2000, President George W. Bush played a big role in the downfall of the US on this all-encompassing report on economic freedom.

A few countries that have surpassed us in terms of economic freedom followed by their ranking:

Hong Kong 1
Canada 5
Mauritius 8
Chile 10
Estonia 14
Qatar 17

If you are interested in finding out more about this index and the decline of the US economy, check out this podcast interview with one of the authors from Cato Institute.

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:

N.M. asks clarity on Medicaid expansion

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.