There are some out there now saying that the devastation in Japan is going to be a good thing for the nation’s economy. To say the least, this is counterintuitive, but some smart people are making the point including former Treasury Secretary Larry Summers. The problem is that the idea is totally wrong.

Bastiat, one of the greatest economic writers of all time, made the point succinctly in his pamphlet “The Broken Window.” Matt Kibbe from Freedomworks also does a nice job applying Bastiat’s points directly to Japan. So does Peter Schiff in this video.

The ultimate point of all this is that over the next months and years, we’ll plainly be able to see the rebuilding efforts in Japan. What we won’t see is what individual Japanese would have done with their resources in terms of both investment and consumption that would have raised their own living standards (and ours) at the same time. Also worth noting is that Japan’s government is already in bad shape in terms of debt (worse than even the US). How will this debt burden hinder Japan’s rebuilding? Only time will tell.

I have not blogged here about the situation in Japan because, unlike Rahm Emmanuel, I don’t believe that a good crisis is a terrible thing to waste. But, I was struck in reading today’s Albuquerque Journal by the incredible difference between Jonah Goldberg and Eugene Robinson in their views on the tsunami and subsequent nuclear crisis in Japan.

Goldberg recognizes that the situation in Japan is serious and sympathizes with the victims of the tragedy. But, he understands that every form of energy — just as nearly every human action — has some negative consequences. But, wind and solar are simply not capable of producing enough power to replace nuclear. We could use coal and other fossil fuels, but if global warming is real, that could be an even bigger problem. Goldberg grasps that there are no easy answers.

Robinson, on the other hand, seems to demand easy answers but is unable to come up with them, so he just sows fear. While acknowledging the same facts as Goldberg, Robinson asks a lot of questions that remain unanswerable at this point. Ultimately, he seems to demand total security which, as we know in this uncertain world, is simply not possible.

The conservative/free market side again projects calmness and rationality in the face of a threat while the left spreads fear…unfortunately, this is far too common.

Astute readers of this blog will note that we at the Rio Grande Foundation are consistent advocates for limited government. Sometimes, this means agreeing with folks that we have deep philosophical differences with on a wide variety of policy issues. One of those people would be liberal Rep. Mimi Stewart. Well, as this report from Capitol Report’s Rob Nikolewski today is one of those days for strange bedfellows.

Stewart has sponsored HB 644 which, as Nikolewski noted:

Calls for members of the Public Employees Retirement Association (PERA) and the Educational Retirement Board (ERB) who have less than five years’ service to work longer terms before becoming eligible for retirement in order for the PERA and ERB pension plans to become actuarially solvent.

Uniformed public employees — such as police officers and firefighters — are exempt from the changes.

The bill also calls for adjustments in the PERA cost of living adjustments — ending the current system in which PERA retirees receive a 3 percent annual cost of living raise and instead would tie the cost of living adjustment to the Consumer Price Index.

A former public school teacher, Stewart said unless something is done to the current pension plans, taxpayers could be on the hook for $1.2 billion in order to keep the plans solvent.

While I’d like to see more, deeper changes to New Mexico’s pension system, the fact is that Stewart’s bill was an important start. Thus the hostile reaction from AFSCME lobbyist Carter Bundy as discussed in the article.

Both House votes have been posted online with the first vote and second vote. Notably, several Republicans changed their votes to achieve passage in the second vote.

With time running out in the session, it is hard to say what (if anything) will happen in the Senate.

“Buying local” is all the rage these days in New Mexico. From this opinion piece in the Las Cruces Sun-News to this legislation introduced by Sen. Tim Keller which would require state agencies and the public schools to increase the amount of food purchased from in-state producers.

Now, I’m not opposed at all to people (or businesses) that want to purchase food from local producers wherever possible. But, the fact is that it is interstate and international trade that leads to better quality products, a wider variety of products, and less costly goods at our stores. Those who would stand in the way of a Traders Joe’s or would mandate that government agencies purchase from local producers will ultimately harm the citizens of New Mexico as a whole.

For starters, how many tropical products just aren’t produced in New Mexico? Do you really want school children and their families to go without pineapples, coffee, and oranges (to name just a few of dozens of products that are not produced in significant quantities in New Mexico)?

Then there is water usage. In case you haven’t noticed, it has been really dry this year. New Mexico faces real water issues in the future if it does not conserve. But let’s be clear, the problem is NOT caused by the big cities. Agriculture uses an astonishing 90% of New Mexico’s water. Mandating that even more agricultural products are produced in New Mexico will only intensify agriculture’s water usage.

The answer, quite simply, is for both the federal and state governments to stop subsidizing agriculture and to allow a truly free market in food. If you want to purchase organic, free range, New Mexico-produced goods, that is your choice (and you’ll pay whatever premium there is), just don’t force the rest of us to adopt your “foodie” habits.

The talk in Santa Fe, Washington, and all over the nation is about jobs. How to get them, how to grow them, and how to keep one once you have one. As this interesting blog points out, one way to help the job situation would be to eliminate the minimum wage.

The point is to not have a bunch of heads-of-household supporting their families on less than $7.25 an hour, but with teenagers having an unemployment rate of 24%, it would be great to have more young people benefiting from learning the skills of work and obtaining some extra money rather than hanging around on the streets and hunting for a job.

This doesn’t even factor in what would be derived from taxes paid and the businesses that would gain from a new pool of workers.

I sat through a lengthy hearing of the House Business and Industry Committee on Thursday, March 10th. Floor session ran late, so the hearing did not get going until after 7pm. No problem.

I was there to testify on separate legislation, but during the hearing HB 99 sponsored by Rep. Nora Espinoza came up for discussion. The bill is very simple. It would have allowed “anesthesiologist assistants” to work at hospitals outside of UNM Hospital here in Albuquerque. Currently, anesthesiologist assistants (AA’s) are limited to working at one hospital while Certified Registered Nurse Anesthetists (CRNA’s) can work anywhere. Needless to say, the CRNA’s were out in force to testify against the bill — in order to protect their market monopoly — while the AA’s also were out in force to gain more employment opportunities. The testimony and questions were emotional on both sides.

The issue is about economic freedom plain and simple. Hospitals would not be forced to hire AA’s if they don’t want to. If you are concerned about rising health care costs, it only makes sense to expand the number of people who can work in a particular field.

But, in what I can only describe as a shocking but not entirely surprising vote, all six Republicans on the committee supported the effort while all six Democrats opposed it. Thus, the bill died. Simply put, the Republicans supported economic freedom while the Democrats seemed to believe that unless the AA’s could “prove” that their services were absolutely necessary, they should not have the right to work in the specific field. This is backwards thinking and is a major problem for New Mexico. Voters need to understand that this attitude keeps business and economic activity from coming here and causes New Mexicans to remain dependent on government….unfortunately, that may be the very reason these legislators oppose economic freedom.

APS Board Chair Martin Esquivel claims that we at the Rio Grande Foundation are all wrong about APS and that the school district is doing a great job. He also claims that the district’s buildings shouldn’t count as money spent per-pupil by the district. Sure, capital spending and annual appropriations are taken out of two different pots, but the fact is that money is money and in the real world, those dollars must be considered as part of what APS spends per pupil.

Esquivel does make one accurate claim and that is that the district must accept all kids that show up on their doorstep. Having disruptive “students” in the classroom is undoubtedly a problem for teachers in the classroom, but there are plenty of things APS could do differently and better. For starters, he should rent himself a copy of “Waiting for Superman” as I did this weekend. Esquivel could see in that movie how impoverished inner-city kids can learn and graduate at rates exceeding 90 percent. Compare that with APS where 23 of the 34 high schools are considered “dropout factories.”

Of course Esquivel does not mention exactly what APS’s graduation rate is, but according to the best information I have from the “Diplomas Count 2010,” New Mexico’s state graduation rate is 54.9%. I find it hard to believe that APS’s real graduation rate is much better.

Oh, and one important thing to note is that APS alone is not at fault. The federal government, state government, local school boards, teacher unions, and yes, even parents, all have a role to play in the ongoing failure. The problem is that the first step in solving a problem is recognizing that you have one. Esquivel clearly doesn’t think APS needs to change and improve.

Liberals love to say that Social Security is “the most popular government program.” There is an element of truth to this statement as the people who will be bearing the burden for the system and not receiving much in the way of “benefits” are either young or not born yet.

But, I’d love to see the folks who defend the popularity of the program show some confidence in their statement by making it optional. I would be thrilled to take them (and the federal government) up on this. I just received my “Social Security Statement.” According to the number crunchers over at SSA, I have paid more than $35,000 in Social Security taxes and more than $8,000 in Medicare taxes.

I have a grand bargain. I’ll allow the federal government to hold onto my $44,000 (actually it is more than that since the statement only covers earnings through 2009). I’ll sign a document stating that I’ll never take Social Security or Medicare if I can hold on to — and invest on my own — the money that my employer and I would pay for Social Security. Heck, I’ll even sign another document saying that I’ll invest the money and won’t touch it until I’m 65. The way I figure it, the feds are coming out way ahead.

Perhaps I am in the minority in my willingness to take such drastic action, but I’d rather control my own financial future than rely on the benevolence of the federal government. After all, my wonderful “statement” from the government also contains this fine line which states “Your estimated benefits are based on current law. Congress has made changes to the law in the past and can do so at any time.” Not exactly reassuring.

If Social Security is so popular, let’s make it optional or let workers “buy out” of the system and invest for themselves.

After weeks of protest and unrest, Wisconsin is moving forward with Gov. Scott Walker’s efforts to balance his state’s budget and eliminate collective bargaining for government workers. This is a win for Gov. Scott Walker and Wisconsin taxpayers.

Dealing with the unsustainable budgets and spending on government workers is important to making state budgets sustainable. It is also why other states are looking to reform their agreements with government workers.

As Thomas Sowell writes, “there is no such thing as a free lunch,” but in a competitive, free market economy, “government unions continue to thrive while private sector unions decline because taxpayers provide their free lunch.”

Only time will tell how the battles in Wisconsin and so many other states ultimately turns out, but Gov. Walker deserves credit for taking a difficult stand.

Today, a former APS teacher responded to Elisabeth Keen’s recent opinion piece on education and spending at APS. He said that comparing per pupil spending at The Academy and APS is not “apples to apples.” I tend to agree with him.

The Academy is one of the most expensive private schools in the nation and it has a large endowment including private donations and land. It also is selective in which students are allowed to enter. So, yes, the two are clearly different.

But, the Academy is not the only private school in the City. As Keen noted, there are other, much less-costly schools in town. Like the Academy, those schools also have graduation rates upwards of 90%. And, that is the biggest non apples-to-apples comparison of all: graduation rates and learning.

The private options succeed where APS fails, so comparing the two is really not fair. Of course, the Rio Grande Foundation and others have proposed initiatives that would allow kids currently trapped in failing public schools to attend private schools, but the education establishment has opposed them. As a writer from LULAC noted in a recent column, there are bills introduced in the session, but they face stiff opposition.

So, if and when kids in APS are allowed the choice of attending private schools, I think they’ll perform very well. If APS and their supporters are so confident that they are delivering a good product at a reasonable cost, they shouldn’t be worried about a little competition, should they?

The Rio Grande Foundation released a report on the costs to New Mexico utility customers of the state’s Renewable Portfolio Standard (RPS).

Paul Chesser of the American Tradition Institute had an article in the Santa Fe New Mexican and Marita Noon of CARE had her own article in Energy Tribune.

If New Mexico’s elected leaders are serious about creating jobs and making our state more economically-competitive and ultimately wealthier, the RPS must be addressed.

The Rio Grande Foundation’s capitol reporter Rob Nikolewski has done a great deal of research over at Capitol Report New Mexico on the naming of public facilities after sitting elected officials. There are many reasons for NOT allowing this practice to continue including the need to remove Manny Aragon’s name from the Torreon at the National Hispanic Cultural Center.

But, as Rob reports, legislation sponsored by Sen. Mark Boitano to stop the practice (at least at the state level), was recently killed. While it may or may not actually corrupt a lawmaker’s decision on a given project or piece of legislation, the fact is that these people are supposed to be public servants. Allowing them to name things after themselves leads to ego inflation and arrogance. That is the real problem with “Monuments to Me.”

It is great to see LULAC coming out in favor of school choice as they did in this recent opinion piece. School choice tax credits work and are popular with parents and students as the writer notes has happened in Utah.

New Mexico’s education system is failing ALL New Mexico kids and a majority of those kids are Hispanic. As the author notes, legislation is moving forward right now that would provide tax credit scholarships for low-income and special needs children. His organization “strongly supports HB 510 and HB 427, to give our special needs kids and lower-income students a chance at success.”

Before the legislative session, we at the Rio Grande Foundation recommended that spending on higher education be cut. The University of New Mexico has experienced some cuts (totaling approximately 12 percent) since the recession began, but that doesn’t mean they have a “lean and mean” operation by any stretch of the imagination.

For starters, there is the lobbying. While we have not previously commented on this specific issue, it seems rather unfair that taxpayers are paying the salaries of these officials who (at taxpayer expense) ply elected officials with drinks, and ultimately are lobbying for more of our taxpayer money. Where are the taxpayer-funded lobbyists for LESS government spending???

Oh, and, in what might be the worst idea since Michael Weiner advocated buying the County Line Restaurant and turning it into a community center, today the Albuquerque Journal reports that the University wants to spend $3 million on a new baseball stadium because Isotopes Park is “inadequate.” Complaints include “too many empty seats” and that the park “doesn’t feel like our home.”

Wow. Is this a university or a sports franchise? Certainly, there are efficiencies to be had throughout the UNM budget (including academics), but asking for a $3 million stadium when you have a perfectly fine (even professional grade) facility right next door takes some real gall. If UNM’s regents have any brains at all, they’ll turn this ridiculous proposal down.

Over at NMPolitics.net, I address some points made in a recent column by AFSCME’s Carter Bundy. I also explain that despite the lack of Wisconsin or Ohio-style unrest over government employee pensions, New Mexico still has a serious problem that must be dealt with sooner than later and that liberals should be at least as conservatives are about the problem.

It has been a big couple of days for the Rio Grande Foundation board. Elisabeth Keen took APS to task for its ineffectiveness and lack of transparency, now Board Member Deane Waldman and former Rep. Martin Heinrich health care town hall panelist Dr. John Vigil wrote an excellent article explaining why health care is not and should not be a “right.”

Trying to find out what is going on at APS can be quite a challenge. Rio Grande Foundation board member Elisabeth Keen takes on the education bureaucracy in this excellent opinion piece that appeared in the Albuquerque Journal.

I’m not sure where Leslie Linthicum was during the eight years of the Richardson Administration when education spending skyrocketed and graduation rates actually declined in New Mexico (while rising nationwide), but she has turned her “Upfront” column into a platform for attacking the Martinez Administration’s education reforms. Today’s represents her third straight column attacking either PED Secretary Skandera or some aspect of Florida’s successful education reforms.

Today’s column was an attack on Florida’s 3rd grade retention policy which is ONE COMPONENT of the comprehensive Florida model. She cites numerous studies on the topic and concludes that the retention model is a failure in Florida and will fail here in New Mexico. Of course, other studies suggest otherwise.

If the extent of Martinez’s plans for education reform was simply to expand retention, I’d be in agreement with Linthicum, but the Florida reforms took time (six or so years) to implement and start working and there were several facets to the program. We need to walk before we can run. Give Martinez and Skandera a chance to implement their agenda!

If you want to see the raw data that show Florida’s success in math, science, and reading, check out the NAEP score data here and compare them with New Mexico’s results over the same time period.

Former New Mexico Gov. Bill Richardson had an article in the New York Times recently defending New Mexico’s economically-silly film subsidies. Liberal columnist Michael Kinsley, having more than enough of Richardson’s absurd ideas, lit into him in the Los Angeles Times.

Kinsley’s cites one of the many studies that have shown film subsidies to be bad policy, like this study on film subsidies put out by the liberal Center for Budget and Policy Priorities. But his most effective blow comes when he compares studies (like the one done by Ernst & Young) which have been used to justify the subsidies to Enron:

Even after our recent experience with gullible or mendacious accountants in financial scandals like Enron’s, it’s actually shocking that reputable accounting firms would pull some of these stunts, such as counting the allowances film crews get paid for expenses as a benefit to the state, then counting the same money again when it is spent. Or assuming without explanation that the average film crew member makes $82,400 a year, when the Bureau of Labor Statistics sets that figure at $35,000. The most outrageous double counting, of course, is telling one state after another that it can bring in billions by enticing the same movies away from other states.

Kudos to Kinsley for calling out Richardson and this wasteful program.

New Mexico’s maximum estimated pension liabilities are 59.8 percent of GDP. That may not mean much, but how about the fact that they are third greatest in the nation? How about the fact that only Wisconsin and Ohio have greater pension burdens as a percentage of GDP?

Bill Gates has an outstanding article in today’s Albuquerque Journal on education. Gates hits on many of the Rio Grande Foundation’s points on education reform, specifically the out of control spending of the last few decades with little in the way of results.

Gates then points out that the correlation between small class sizes and learning is very weak, that hiring, measuring, and keeping excellent teachers is key, and that money spent to get teachers additional certifications and degrees is largely wasted.

Oh, and even though he has probably spent more of his time and money on the issue than anyone else in America to look at education reform issues, if Gates miraculously wanted to come to New Mexico and become our PED Secretary, he couldn’t. He’s not an educator. Duh!

Along with RGF Board member Doug Turner, Rep. Conrad James, and Rep. Alonzo Baldonado, RGF President Paul Gessing debated the liberals on whether New Mexico should raise taxes or cut services. As Turner points out in his opening remarks, this is a false dichotomy, but the debate was fun and I look forward to participating in more of them. Total length is about an hour:

In today’s Albuquerque Journal, readers received a lesson in the “butterfly theory” and its application to K-12 education. I’m not sure if the author is simply an education bureaucrat and part of the establishment who views any and all reforms as harmful to his own power or if he has an alternative (unstated set of reforms), but his claims that Gov. Martinez’s proposed reforms “won’t work” are all wet.

For starters, he claims that the “A-F” grading mechanism is not useful because it is a “reductionist approach.” There is really nothing that can be said about that except that any and all tools used to measure success/failure found in this world are “reductionist” by definition. If your kid gets an “F” in a particular class, that doesn’t mean that they don’t know ANY of the material in that class. Instead, it means that on the whole, there is a major problem that must be addressed.

It’s the same thing with a movie’s rating. A movie may have had some nifty special effects or a really great plot, but if some aspect of the movie just didn’t make sense, it is not going to get a “5 star” rating. The “reductionist” approach is not perfect, but it is the only way to analyze the situation without having parents actually sit through every class with their child. That is the point.

Anyway, the fact is that the reforms making up the so-called “Florida Model” go far beyond the “A-F” grading system and stopping social promotion. Increased school choice, virtual schools, and an increased focus on literacy all contributed to its success. Rather than throwing stones, Mr. Bower should try proposing some specific reform ideas.

There was an excellent article on the Waste Isolation Pilot Plant (WIPP) in the Albuquerque Journal today. The author mostly defends the safety of the project which is located between Hobbs and Carlsbad, but he also explains that “hot” nuclear waste is already stored at the facility.

The big question that is being asked now is whether another facility located near WIPP could serve as the nation’s primary storage site for waste from America’s nuclear power plants. With the Obama Administration having (unwisely in my opinion) shut down Yucca Mountain in Nevada, there is most definitely a need to get nuclear waste stored in a more secure location than is now available on-site at numerous nuclear facilities nationwide. It would seem that New Mexicans, particularly those from Southeastern New Mexico, have seen that nuclear waste can be contained effectively and that having it stored in their community is an economic boon that provides high-paying jobs.

So, it would seem that it is definitely worth looking into. The waste must be stored somewhere, why not here?