All this week, KUNM has been airing interviews (available on their website) with various Richcardson-watchers during its afternoon “All Things Considered” program. I (Paul Gessing, President of the Rio Grande Foundation) took part in this effort. I was interviewed for stories on scandals and energy and environment which have been posted.

More will be available here as they are uploaded to the site.

Congressional Republicans are now running for office on a platform of repealing the recent federal takeover of the US health care system. Unfortunately, while repeal would undo a great deal of harm, positive reforms are needed in the health care sector. Rio Grande Foundation board member and physician Deane Waldman wonders what will happen and outlines some positive reforms in a new article "If Obamacare Is Repealed, What Then?"

The Rio Grande Foundation has previously analyzed and criticized higher education spending. While this sector is particularly bloated in New Mexico, the problem is not limited to our state. In fact, the cost of college is rising nationwide.

That’s why the National Center for Policy Analysis recently studied the cost of higher ed and found some interesting facts:

Where Is the Money Going? Much of the increased spending is going outside the classroom. For example, according to economist Richard Vedder, at four-year U.S. colleges and universities:

The ratio of teachers to students remained relatively stable, at about seven teachers per 100 students from 1976 to 2000.
In contrast, the ratio of nonteaching staff members to students doubled from three to six per 100 students from 1976 to 2000.

This suggests that less money is being spent on students’ education and more is being spent on noninstructional activities, such as administration and faculty research.

Also,

Institutional spending per fulltime equivalent student for student services – such as student organizations, intramural athletics and career counseling – rose more than 36 percent at private research universities from 1998 to 2008, after adjusting for inflation.

By contrast, institutional spending on instruction increased only 22.4 percent at private universities.
At public research universities, student services spending increased 20.1 percent and instructional spending rose just 10.1 percent over the same time period.

The reason I (and many others) believe higher education to be in a “bubble,” much like the real estate bubble is that students are being forced to take on ever-greater levels of debt:

The average amount of a federal student loan increased 180 percent from 1990 to 2008, after adjusting for inflation.
Students borrowed $1,637 in federal loans (in 2008 dollars) during the 1990-1991 school year, on the average.
By contrast, students borrowed an average of $4,585 during the 2008-2009 school year.

In case you haven’t seen it, Congressional Republicans have released their “Pledge to America.” It has a few very nice, solid ideas in it, specifically:

Repeal and Replace ObamaCare;

Cut Government Spending to Pre-Stimulus, Pre-Bailout Levels (2008 levels);

End TARP Once And For All;

End Government Control of Fannie Mae and Freddie Mac;

Those are all very good ideas as far as they go, but as Gene Healy of the Cato Institute writes, there is a lot of work needed — going far beyond the ideas contained in “The Pledge” — needed to turn around the US economy.

Whether it is mandated 401k’s, ObamaCare, or his latest, nationwide renewable mandate, it would seem that New Mexico’s senior senator’s best and only idea for turning our nation’s economy around is for the federal government to mandate economic growth.

Of course, the real-world economy doesn’t work like that. Mandates are necessary because the behavior that government force is used to dictate is not the most efficient or least expensive way to do things. Paul Chesser writing in the Washington Times As Chesser writes:

A study by the Washington-based Institute for Energy Research found that states with their own binding renewable electricity standards have 40 percent higher electricity prices than do states without such mandates.

The full impact of these renewable energy mandates at the state level has not yet been realized as most of them (like New Mexico’s, which goes fully into effect in 2020) are not fully-implemented. If Bingaman and his allies in Congress really want to turn the economy around, perhaps they will consider repealing some mandates. I’m not holding my breath though.

Governor Richardson's big-spending ways have often drawn the ire of fiscal conservatives (like the Rio Grande Foundation), but there is no doubt that the 2003 tax cuts which he pushed through the Legislature that year have resulted in a burst of economic prosperity for New Mexicans, especially when compared to other states.

In fact, as personal income data from the U.S. Dept. of Commerce, Bureau of Economic Analysis and compiled online by New Mexico’s own Bureau of Business & Economic Research clearly shows the upward trend that started after 2003.

Read the full text of the new study here.

I found this article from today’s Albuquerque Journal fascinating. It was written by 32-year educator Del Hansen. It would seem to me that Mr. Hansen and his ilk are a big part of the problem in New Mexico education.

Hansen spends more than 800 words complaining about parents and our society and how it molds students into what they are. In Hansen’s world, schools have little to no impact over the 12 (or more) years of schooling because if parents don’t do the job, teachers and schools are doomed to fail. Ben Chavis, who I blogged about yesterday, is just one prominent example of an educator who, regardless of society and parents, pushed his students to succeed. I’m not blaming teachers for not always succeeding, but until we have a school system that is designed with success in mind, mediocrity will be the norm.

Speaking of mediocrity, I found the comments of Houston Texans running back (and Albuquerque native) Arian Foster very interesting. An article about him appeared in the paper as well.

Said Foster: “Looking back, it’s easy to see why so many Albuquerque kids fail. It’s the attitude out here, and that’s terrible,” says Foster, who says he still visits at least three times a year and is in the process of creating programs to help straighten out troubled teens. “I will do anything to help the kids there. But there’s just kind of this attitude where people accept mediocrity.

Strong stuff, especially to tell your home-town newspaper, but I find his statement compelling and accurate. Until our schools demand excellence and our government’s policies reward (rather than discourage) hard work and individual initiative, New Mexico and its citizens will be achieving far less than they should.

John Stossel recently had an excellent education special on his show “Stossel” which appears on Fox Business Channel. Recently, he had a great show on education reform that included previous RGF event speaker and educator Ben Chavis and DC schools Chancellor Michelle Rhee..

Check out the Chavis interview below with links to other segments here.

The Daily Show with Jon Stewart certainly tilts to the left, but when unions hire non-union, minimum wage workers to do their protesting dirty work for them (sound familiar?), the hypocrisy is too rich to pass up.

Warning, laughs ahead!

As you may already know, the Rio Grande Foundation has released its government transparency website, www.newmexicospending.com. I wrote an article for The Alibi which discusses the benefits of government transparency and our experiences with some school districts that were more (and less) willing to release supposedly-public data.

I have been honored to work these past two years with the Rio Grande Foundation.  But I’m off to other adventures.  My farewell from New Mexico Watchdog is here.

The Rio Grande Foundation has been at the forefront of efforts to put the government employee pension problem on the agenda. Look for writings by “Scott Moody” in the search box on our website. It is a good thing we’re on the ball because the more data that comes out on this, the worse New Mexico’s pension problems look.

For starters, there is a new study which Capitol Report New Mexico has written on showing that New Mexico’s pension plan for state employees will run out of money in the year 2023.

Among the other findings of the report are that New Mexico will be expected to pay out $2.6 billion in state employee pensions in 2024.

That $2.6 billion figure represents an estimated 46 percent of the entire state tax revenue for a given year

In other words, if the Rauh/Novy-Marx model holds true, in less than 15 years, New Mexico will have pension obligations that equal nearly one-half of the state’s entire annual intake of taxes.

To put New Mexico’s pension issues in perspective, a table I found (displayed below) from Moody and Warcholik shows that New Mexico’s maximum pension liabilities as a percentage of state GDP is third-highest in the nation:

The view from the left is that the Rio Grande Foundation is a mammoth organization, well-funded by oil companies, the health insurance industry, and other unpopular and self-evidently-corrupt industries. Little do they know. We are a “lean and mean” organization. In part, this means relying on volunteers. Two volunteers with whom we sometimes work are economists Micha Gisser and Kenneth Brown. These two wrote an opinion piece under their own, not an RGF, byline recently, that appeared in the ABQ Journal explaining their views on the upcoming election. Needless to say, this greatly upset the folks over at ABQ Journal Watch and even led to a letter to the editor that appeared on September 13th, “outing” the two as working with the Rio Grande Foundation.

Leaving aside the obvious right of Brown and Gisser to write a column and submit whatever they want to the paper, I want to actually discuss the piece itself. Gisser and Brown essentially argue that voters who are frustrated with the floundering economy should vote for Republicans. They have a valid point, but not really for the reasons they state. The primary justification for voting for Republicans to take over at least one branch of Congress is to slow the growth of government. As William Niskanen has written, over the past 50 years, “Government spending has increased an average of only 1.73 percent annually during periods of divided government. This number more than triples, to 5.26 percent, for periods of unified government. That’s a hefty premium to pay for a bit of unity.

I do not share Brown and Gisser’s belief that if we could wave a magic wand tomorrow to put the Republicans in power of the federal government that they would do much to shrink government. After all, many of these Republicans served while Bush was taking spending to ever-higher levels as President.

Brown and Gisser are welcome to their views and they provide welcome help to the Rio Grande Foundation, but there is no conspiracy. If they write on something that is too “political” or inappropriate for the Foundation, they are welcome to do so. Claiming that this amounts to a conspiracy of any sort is downright silly.

The New Mexico Environmental Improvement Board’s latest hearings on a cap-and-trade scheme for New Mexico only began last night. As reported by Rob Nikolewski, the EIB will be holding public hearings starting at 7pm in Santa Fe from now until October 1. If you care about New Mexico’s economy and don’t want an un-elected board to make such an important decision, I urge you to go up to Santa Fe and make your views known.

I testified last night on the many conflicts of interest on the board and called for the recusal of several members of the board who are on the payroll of environmental groups (or the oil and gas industry), none of which are likely to view the issues in an objective manner.

Constitutional Crisis is Appellate Attorney’s Topic at SFCC

Appellate attorney Rebecca O’Dell, will be holding a 45 minute presentation on “Our Current Constitutional Crisis” on Thursday, September 23 at 7 PM in the Jemez Rooms of the Santa Fe Community College. Odell will discuss the Constitution, each branch’s role within the Constitution, and how American citizens can regain control of their government.

Ms O’Dell has been traveling the country with this event to overwhelmingly positive reception. Rebecca O’Dell is an appellate attorney, practicing full-time before the U.S. Supreme Court and other federal and state appellate courts. She is an Alliance Defense Fund allied attorney and a member of its honor corps. She has filed several briefs to the U.S. Supreme Court which are awaiting a decision to be heard.

Tickets for the presentation are $10, payable at the door (Jemez Rooms, Santa Fe Community College). Space is limited to 200 on a first come basis.

Vic Bruno has worked in commercial real estate in Albuquerque for 40 years. With such long-term experience in Albuquerque and paying attention to real estate issues, he has a unique perspective to offer on past efforts to spur downtown development through major investments of taxpayer dollars.

Vic’s column in Sunday’s Albuquerque Journal is a must-read for those who think the latest and greatest in central-planning is the key to Albuquerque’s future economic success.

Today is Constitution Day, so celebrate that founding document and its many blessings of liberty for Americans. By way of actually restoring the Constitution, the Cato Institute has taken out ads in newspapers across the nation explaining to President Obama some tangible, specific ways that he could fulfill his pledge to:

“go through our federal budget–page by page, line by line–eliminating those programs we don’t need.”

Giving a national audience some insights as to what is happening in New Mexico, our Capitol Reporter, Rob Nikolewski recently wrote an article for the Washington Times that gave an update about the 2010 election in the Land of Enchantment.

While most New Mexicans are undoubtedly knowledgeable of the facts in the article, look for regular columns from Rob on the political scene in New Mexico to appear in The Times.

In today’s Albuquerque Journal, I am quoted on the issue of President Bush’s tax cuts and Congressional Democrats’ moves to raise taxes by allowing some or all of those cuts to expire. Simply put, as I’ve written before, the main issue is out-of-control spending, but raising taxes will not help our economy and is simply a cover for higher spending.

Left-wing New Mexico-based economist, Larry Waldman, senior research scientist at the University of New Mexico’s Bureau of Business and Economic Research, is all for higher taxes. He “thinks wealthier Americans can afford to pay more taxes — and the cash-strapped federal government could use the money. It’s more of an equity issue than an economic issue,” Waldman said. “The rich are not suffering nearly as much as the middle and lower classes.” Waldman seems unconcerned about spending or the fact that higher taxes will stifle economic growth, thus harming the very middle and lower-income taxpayers he claims to defend.

Unfortunate advice in support of bigger government and reduced economic prosperity from a guy who is supposed to “contribute to the economic well-being of New Mexico residents.”

Recently, Barry Massey of the AP wrote about the massive, 15% growth in federal spending last year alone. This 15% growth is just the tip of the iceberg. New Mexico receives more federal money per capita than all states but Alaska, Virginia, Hawaii and Maryland. As we’ve cited in the past, New Mexico is the most reliant state on the feds relative to what we pay in taxes.

Gerry Bradley of New Mexico Voices for Children thinks this is just grand and complained that “It’s very strange to see people railing against government when the federal government props up the whole economy here.” While the federal government may be propping New Mexico up right now, the pace of spending growth is both unsustainable and of dubious actual benefit to New Mexico. After all, we remain one of the poorest states in the nation.

Contrary to Bradley’s thoughts on the matter, there is now empirical evidence that increased federal spending in a particular state displaces rather than augments economic growth. The full-length research paper is available here and a shorter blog posting on the study can be found here.

Recently, our colleagues at the free market Center of the American Experiment, based in Minnesota, hosted a symposium on the topic of “How Can We Better Encourage and
Reinforce the Most Entrepreneurial and Talented Among Us?” I participated in this and my response, along with those of others — including Grover Norquist of Americans for Tax Reform, and other free market advocates — and that document is available here.

The fact is that, while much time and attention are (justifiably) focused on helping out those who need the most help, not much discussion occurs on the topic of how we all benefit from the efforts and innovations of the most talented among us.

There has been a fair amount of discussion recently about NM Senator Bingaman’s mandatory IRA proposal in Congress. If passed, this legislation would place yet another burden on businesses that would have to take their employees’ money and set up the retirement programs. I will be the first to admit that the Rio Grande Foundation does not offer such programs because they are expensive and costly to manage for a small organization. Instead, I take advantage of Roth IRAs.

As Rob Nikolewski with Capitol Report notes, Bingaman’s plan was developed with the help of the Heritage Foundation, an organization that we usually see eye-to-eye with, but not this time. My view is that if Congress wants to mandate that we save for retirement, they need to transform Social Security into a sustainable, ownership-based program rather than a Ponzi Scheme that is destined to go broke and disappoint those (at least of my generation) who expect to rely on it in their old age.

If you didn’t see it, on Monday of this week (Labor Day), the Albuquerque Journal had a great article about efforts by the Los Angeles Times to shed some light on the impact teachers have on student performance. The Times article can be found here.

Basically, the newspaper in LA is doing work that the education departments, the labor unions, and other education entities either won’t or don’t want to do. Among the basic findings were:

• Highly effective teachers routinely propel students from below grade level to advanced in a single year. There is a substantial gap at year’s end between students whose teachers were in the top 10 percent in effectiveness and the bottom 10 percent. The fortunate students ranked 17 percentile points higher in English and 25 points higher in math.

• Contrary to popular belief, the best teachers were not concentrated in schools in the most affluent neighborhoods, nor were the weakest instructors bunched in poor areas.

• Although many parents fixate on picking the right school for their child, it matters far more which teacher the child gets. Teachers had three times as much influence on students’ academic development as the school they attend. Yet parents have no access to objective information about individual instructors.

• Many of the factors commonly assumed to be important to teachers’ effectiveness were not. Although teachers are paid more for experience, education and training, none of this had much bearing on whether they improved their students’ performance.

The fact is that excellent teachers matter tremendously and they can overcome bad parents and many other problems, but they don’t share the traits for which teachers are rewarded and that teachers unions push as important. Our own Tom Molitor has written in support of greater transparency and grading of teachers in New Mexico. Read the full story from Tom here.

This might as well be the crux of Karl Holme’s opinion piece that appeared in the ABQ Journal today. Most of his arguments are the same as those of the other advocates for this project.

Such catch-words as “new revenue streams,” “investment,” and “direct spending” proliferate throughout the piece which is designed both to justify the current convention center and its further expansion. If he thinks this project is such a great idea, I’d love to see Mr. Holme get some private investors to put it in place. I’m not sure why he needs MY money for his pet project. After all, these projects have a long track record of leaving mountains of debt for taxpayers long after they’re obsolete or even demolished.

And, before you say, “oh, but don’t you see that it’ll create jobs,” I’d say two things. 1) In places where large-scale conventions are economically-viable, hotels will step up and build the facilities that the market will bear. Las Vegas, with its plethora of large hotels is one example. 2) Figures like “$36 million in direct spending” imply that local residents realize some defined monetary gain as a result, but the truth is that that the convention business is in a long term decline and this figure is merely pulled out of thin air with nothing to back it up.