You can listen to the podcast of this and other episodes of “Speaking Freely” here.

On Saturday’s episode, Jim and Paul discussed Diane Denish’s recent pronouncements on government transparency and whether her ties to the corruption of the Richardson Administration and silence regarding ongoing scandals detracts from her forward-looking stance on the issue. Then, Jim and Paul discuss plans for “high speed rail” being put forth by President Obama, Governor Richardson, and Sen. Udall and whether the plans make sense for New Mexico.

Brian Colón, the Chairman of the Democratic Party of New Mexico, and I took part in an online health care debate for the Albuquerque Journal last week. He essentially re-stated his opening remarks in an opinion piece on health care that appeared yesterday in the Journal.

Unfortunately, while Colón is good at providing talking points as to why we need health care reform, he does a lot of writing without actually suggesting any specific ways in which Americans in general and New Mexicans in general can obtain less costly, better health care. This is not a surprise since Colón is not a policy expert, rather he is a party builder, and he may not want to step on any toes. After all, not all elected Democrats support “universal,” let alone single-payer, health care.

Unlike Brian, I have actually proposed some specific health care reforms that will, if adopted, reduce costs and lead to better health care. The problem I have with most advocates of so-called “reform” is that they are working under the assumption that the politicians can get together and Washington and come up with a government system that will please everyone. Unfortunately (for them), as Obama and Congressional leadership have been forced to come up with specifics, the various interest groups have started fighting and the plan seems to be stalling.

The simple fact is that we live in a world of limited resources. While everyone thinks they can get their way when they sit down at the lobbying table, the fact is that someone ultimately loses in a zero-sum game.

While New Mexicans have been led to believe that their economic futures are tied to the New Mexico Spaceport now being built near Truth or Consequences, the truth is that spaceports are already under development across the nation.

With an already-crowded spaceport field, I read over the weekend in the Albuquerque Journal that Hawaii is the next state that may be entering the fray. According to the report:

If the plan goes forward, tourists would pay $200,000 for a weeklong package including spaceflight training, resort accommodations and short test flights to simulate weightlessness.

At the vacation’s finale, five voyagers would embark on a horizontal takeoff aboard a special rocket plane, climb to 40,000 feet before rockets fire, accelerate to 3,500 mph, coast for a few minutes of weightlessness 62 miles above the Earth, flip over and then return to ground.

While New Mexico’s spaceport will undoubtedly be an early entrant into , it seems highly unlikely that the space industry will be very lucrative for the Land of Enchantment given the ever-increasing number of competitors. Perhaps Hawaii Governor Linda Lingle will give Hawaii taxpayers a break by not releasing funding for that State’s spaceport. Unfortunately, spaceport fever seems to be spreading among elected officials nationwide.

In case you missed it, as I blogged earlier this week, I took part in an online debate on health care that was sponsored by the Albuquerque Journal. Day four of the debate postings and comments are available here.

If you enjoyed this, please let the Journal know and ask them to continue to invite the Rio Grande Foundation to take part in these discussions.

Lt. Governor Diane Denish is running for the state’s top office in 2010. She will be a formidable candidate, there is no doubt about it. Her biggest hurdle is most likely to be the time she has spent closely associated with current Gov. Bill Richardson. And, while it is true that they did not run as a ticket, there is no doubt that voters and the public will wonder why she didn’t do more to stop corruption and ethics violations that have run rampant in Santa Fe.

That said, Denish is due some credit for her recent public pledge to make transparency a centerpiece of her campaign. According to this story in Forbes, Denish has proposed creating a Web-based “sunshine portal” that would allow New Mexicans to track state expenditures, check on scheduled meetings, learn more about high-level state employees and their salaries, check out laws and regulations and offer opinions.

While I’m not sure what to make of one of her other proposals, that being for a powerful statewide ethics commission that “could investigate ethics complaints, launch its own probes, impose fines, refer cases for criminal prosecution, and establish a code of ethics and training for state workers and appointees,” the sunshine portal really is newsworthy and I think the Rio Grande Foundation can take some credit for this. In fact, we introduced Denish (and many other legislators in Santa Fe) this session to Robert Wood of the Texas Comptroller’s office. Texas’s comptroller Susan Combs has been a national leader in promoting government transparency and would be a great model for Denish and/or others who want to improve government transparency to follow.

The Rio Grande Foundation actually maintains a “Sunshine Page.” We call it Sunshine Review. Check out various transparency-related legislation here.

As I wrote yesterday, I was going to be on Channel 4 to discuss a high speed rail proposal that Governor Richardson and Sen. Tom Udall are eying. The story led off the 6pm news and my interview was the bulk of the story.

Check it out here.

Governor Richardson and Sen. Tom Udall held a press conference today to discuss efforts to bring “high speed rail” to New Mexico. According to the two of them, “New Mexico, Colorado and Texas could receive up to $5 million from the Federal Railroad Administration under the Passenger Rail Investment and Improvement Act of 2008 to study the viability of the El Paso to Denver High-Speed Rail Corridor.” Watch the 6pm news on Channel 4 as I was interviewed on the high speed rail issue earlier today.

While using taxpayer money to study these issues is minor in the scope of the overall federal budget, the Rio Grande Foundation has produced a study on the issue that throws cold water on the idea of high speed rail. The release is available here and the full paper can be found here.

As author Randal O’Toole points out in the study:

The administration’s proposed high-speed rail plan will cost $1,000 for every federal income taxpayer, yet the average American will ride high-speed trains less than 60 miles a year, says a new report from the Rio Grande Foundation. The report says that the average New Mexico resident will rarely use high-speed trains.

The federal government is proposing to build true high-speed rail lines—with trains going faster than 120 miles per hour—only in California and Florida. In most of the rest of the country, it is merely proposing to upgrade existing freight tracks to boost top Amtrak speeds from 79 to 110 mph.

Trains with a top speed of 110 mph will have average speeds of just 55 to 75 mph. Not only will that attract few people out of their cars, says the report, such trains will actually be less energy efficient and more polluting than driving.

The federal government left New Mexico out of its plans entirely. But New Mexico’s share of local proposals for moderate-speed trains Albuquerque to Denver are likely to cost $400 for every New Mexico resident—and true high-speed trains would cost at least $7,500 for every New Mexican.

Seems like we could save that $5 million and use it for something a bit more useful than another study, but if the study is done honestly, it will likely show that the costs of moderately high speed rail far outweigh the benefits.

My apologies for not getting last week’s episode up more quickly, but the show from July 27 is now up as is the July 4 show.

On the 27th, Jim and I interview Tina with the Albuquerque Tea Party about the 4th of July Tea Party (video of event here), then Jim and Paul discuss the difficulties of doing business in the oil and gas industries in New Mexico with the author of a new international study on the topic. Lastly, Jim and Paul interview 1st district (Albuquerque-area) Republican Congressional candidate Jon Barela.

On the 4th of July show Jim Scarantino revisited the Declaration of Independence and it’s world-changing proclamations of fundamental human rights. Jim also discussed political corruption in New Mexico with Harvey Yates, the GOP’s new chairman, who has a personal story to tell of how he stood up to a shake down by the Valencia County attorney.

All speaking freely podcasts are available here.

If you have ever been to this blog before, it should be readily apparent that the site has been changed quite dramatically. We have shifted from MoveAble Type to WordPress which I’m told is better and more modern. I certainly think the site’s appearance has been improved dramatically. I’d be interested in your thoughts, so please feel free to leave a comment.

Thanks to our intern Jason Foral and to Pat Riley at Ovationsolutions, our internet provider and technological advisors.

This week the Albuquerque Journal is holding an online debate over the various health care issues now being debated in Congress. I was asked to participate along with Brian Colón, the Chairman of the Democratic Party of New Mexico, Todd Sandman of Presbyterian Healthcare Services, Dr. Vicki L. Perrigo, and lefty blogger Barbara Wold.
Check out the first round of questions and answers here. Check back at the Journal’s “City Seeker” blog site to follow the debate all week long.

There are so many stories out there about rail systems that over-promise, under-deliver, and go way over budget. Denver is one major city that unwisely passed major tax hikes (with voter approval) to pay for a train system. In that city’s case, the train is called FasTracks. Unfortunately, although not unpredictably, as was written up recently in the Denver Post, the system is costing way more to build than originally anticipated — or at least what the politicians were willing to tell the voters to get the system approved.
According to the article:

Voters approved a $4.7 billion FasTracks plan in 2004, agreeing to pay an additional 0.4 percent sales tax for RTD to build 119 miles of rail throughout the metro area by 2017. RTD says it needs an additional 0.4 percent sales tax — which would bring its total to 1.4 percent.

Also, as I mentioned earlier, unrealistic assumptions were integral to getting voter approval:

RTD used relatively aggressive projections for long-term growth of sales-tax revenues in its 2004 FasTracks plan. Lower revenue forecasts might have forced RTD to scale back the project or seek a bigger tax increase, hurting its chances at the polls. The Post found that RTD’s revenue growth projections were among the highest of eight transit and planning agencies in the West and Midwest. Only planners in Phoenix used a higher average long-term growth projection.

Thankfully, at least to date, Albuquerque has not followed Denver to streetcar hell. Hopefully stories from Denver deter politicians and voters alike from going down the same track.
HT: Harold Morgan

Have a great Independence Day (while remembering the principles that made America a great nation in the first place) and a successful tea party.

Obama and the other advocates for massive new taxes and regulations on energy usage are claiming that their legislation will result in the creation of millions of new “green jobs.” Unfortunately, the reality is not so rosy.
As our friends at the Property and Environment Research Center (PERC) write in their report “7 Myths of Green Jobs,” there is no agreed upon example of “green jobs,” many supposedly “green” jobs are simply clerical positions that are necessary only to handle the red tape and regulations associated with dealing with government rules, regulations, and subsidies. There are several other myths associated with the supposed creation of “green jobs.” Hopefully all 100 members of the United States Senate read a copy of this report before voting on Waxman-Markey.

I’ll give him credit, John R. Hall, writing in today’s Albuquerque Journal, knows how to push people’s buttons in support of universal health care. His argument goes something like this: Obama supports it, doctors support it, the American people support it. The only ones who don’t support “universal” health care are the big, nasty insurance and drug companies, not to mention the media. Oh, and by the way, our current health care system is killing us and our babies and free market capitalism is a failure.
Hall has his polling data correct as far as I can tell. Of course, if enough people sell a given product (even socialized health care!) as a cure for all our problems, large numbers of people will begin to believe. Especially when they never see the drawbacks to the system they are being sold. But, Hall is flat out wrong when he says “America’s statistics on life expectancy and infant mortality are approaching Third World standards.” According to this table, we are on par with Ireland, Denmark, Finland, and several other decidedly 1st world nations when it comes to life expectancy and our infant mortality is rate is far better than third world nations, especially when you account for the fact that there are significant differences in the way the nations collect this data which make the US look worse than it really is.
But these two data sets are largely irrelevant when it comes to socialized medicine and the system proposed by Mr. Hall. Can capitalism work in health care? Hall argues that it cannot, but he does not provide a single shred of data as to how socialized medicine will improve our current system. We at the Rio Grande Foundation always provide real, specific, market-based solutions to our problems.
Socialized medicine’s advocates seem to think that the government has magical powers to allocate resources in an ideal manner that will make everyone happy and will do this all in a more efficient manner than exists now — or could possibly exist were we to pursue market-based reforms. Fortunately, even Obama realizes that reality is in conflict with that fantasy. Hopefully political reality finishes the job in killing a drastic move towards further socialization of our health care.

As I blogged recently, New Mexico’s government employees are suing the state in an attempt to head-off reduced pension benefits and longer work requirements prior to retirement. The Rio Grande Foundation has previously exposed New Mexico’s bloated state and local government bureaucracy. I pull the items together in this new opinion piece.

The Rio Grande Foundation has introduced a new study from prominent transportation expert Randal O’Toole who has analyzed the limited positive impact high speed rail will have on Americans and New Mexicans in particular in terms of mobility and the tremendous impact such “investments” will have on taxpayers. Read more in the study release here.
The full study is available here.

Professor Allen Parkman is a Professor of Management at University of New Mexico. In a recently-published opinion piece that appeared in the Albuquerque Journal, he explains in simple, clear detail, why health care costs have spiraled out of control over the years. As he puts it with regards to Obama’s proposed reform of our health care sector, “History suggests that any cost reductions will be hard to obtain and expanded coverage will be very expensive.”
Parkman rightly points to the tax treatment of health care and how it influences consumer behavior as the single most-important flaw with America’s health care system:

On closer scrutiny, the problems with this industry should be viewed differently, as purchases of health care are often inefficient with unnecessary transaction costs. Let me explain. They can be inefficient because consumers are not exposed to the true cost of the services they are receiving and, consequently, the benefits may not justify the costs. In addition, there are unnecessary costs associated with each transaction. In contrast to a simple credit card purchase at a grocery store, health care expenses covered by insurance require additional paperwork for the provider and then administrative scrutiny from the insurance company.
Both of these problems exist because of the inappropriate use of insurance with regard to health care. Normally, we buy insurance to convert uncertainty into certainty. For example, we pay a predictable premium for fire insurance with the understanding that we will be reimbursed if our house burns down. We have converted an uncertain event (the burning of our house) into a predictable event (a premium and reimbursement if there is a fire). Fire insurance is fairly inexpensive — because it is seldom used.

As Parkman concludes, “With more realistic prices, some of the problems facing the working uninsured will be reduced. There still may be a role for the government providing catastrophic coverage for those individuals and families…real health care reform does not come from promising cost reductions and expanding coverage. It comes from making processes more efficient.”

All too often, those who want to increase the amount of regulations and level of government in the health care sector are considered to be “reformers,” a term generally associated with improving on the flaws of a current, broken system. Several recent articles and letters appeared in the West Side edition of the Albuquerque Journal arguing on behalf of such policies. In my response to these big-government advocates, I argue that moving toward a free market in health care would represent a set of “reforms” that is far more likely to address the flaws inherent in our current system.

This week on “Speaking Freely” on AM 1550 from 9am to 10am on Saturday, Jim and Paul will be interviewing the leaders of the Albuquerque Tea Party movement about the July 4 tea party being planned. In addition, we will be discussing this new study which I recently blogged about on New Mexico’s difficult climate for those who would like to drill for oil and gas within the state’s borders.
Also up for discussion is renewable energy and the “cap and trade” bill moving through Congress. Call in at 505-265-1550 and make your voice heard. As usual, the podcast will be available in podcast format on Monday if not sooner.

Rio Grande Foundation board member and commercial real estate expert Vic Bruno recently presented his thoughts on the intersection of public policy and the Albuquerque commercial real estate market. His presentation focused on the current economic situation as it is affecting Albuquerque and how past events and policy decisions led us to where we are today. He also addressed how we move forward and ways that policymakers and individuals acting in the commercial real estate market can thrive in this new paradigm.
The slides used in Bruno’s presenation can be found here
Video of the presentation is posted below:

As oil and gas prices rise, theoretically, New Mexico’s oil and gas industry should be booming and bringing a great deal of revenue to the state. Unfortunately, with an ever-increasing regulatory burden, the industry is moving elsewhere (particularly to Texas) where taxes, regulations, and corruption do not place such a heavy burden on those attempting to do business. Finally, a study has been undertaken to prove what operators in New Mexico’s oil and gas industry have been saying. The Canada-based Fraser Institute has done an international, provincial, and inter-state analysis of the barriers to investment in oil and gas exploration and production. The report is available here.
New Mexico fares poorly in the study beating out only Colorado, California, Alaska, West Virginia, and Pennsylvania in terns of the overall Extent of Investment Barriers (chart on page 30). Since the study relied on survey data, comments from those who actually do business in the various jurisdictions were a part of the data. Comments about New Mexico included:

Corrupt government. Furthermore, politicians want to stop development but they still want the income.
The state should rely on one agency to police the oil and gas industry rather than every agency,
county, and city, having a separate permitting procedure.
State government is extremely ‘anti-oil’; very hard to make a profit.

The study is an interesting read. Even more interesting will be the impact New Mexico’s increasing regulatory burden will have on one of the state’s most important industries and tax revenues over time.
Jim Scarantino and I will be discussing the findings of this study with its author Gerry Angevine on Saturday’s show at KIVA AM 1550 starting at approximately 9:15.

There have been several opinion pieces in the Albuquerque Journal recently on the issue of health care (such as this one from New Mexico Sen. Jeff Bingaman or this one). That is why it was so refreshing to see this article in today’s paper from a doctor who explains why nationalized health care is doomed to failure.
Writes Dr. Torre Near:

We, as individuals, can do more to improve our lives, but the way the current system is set-up, we have no incentive. The person who exercises every day, is in the normal weight range, doesn’t smoke, has less than two drinks a day and sees a doctor once every two years pays the same as the person who is fat, smokes, drinks, (who’s) exercise is working the remote and (who) sees the doctor every two weeks and is in the ER four times a year.
It doesn’t make sense. We have to change the system, and a national health care plan won’t do that. There have to be incentives to be healthy, just like there are incentives in car insurance to buy a lower cost car, avoid tickets and stay out of accidents.

While the specifics recommended by Dr. Near are somewhat lacking in specifics, there are plenty of ideas in New Mexico and nationally. Hopefully, Congress will kill proposals for government-run or socialized health care and then focus on recommendations that increase individual freedom and personal responsibility in health care.

The Rio Grande Foundation’s investigative journalist, Jim Scarantino, continues to uncover problems at New Mexico’s State Investment Council. The tale of Earthstone and the SIC’s $9 million investment in that company — in part the taxpayer investment was supposed to be used to build a factory in Santa Theresa, New Mexico that was never built (Scarantino reported on this here).
The unique aspect of Scarantino’s latest article, “Friends in High Places,” Anatomy of the SIC’s Bad Investment in Earthstone International” (which is available here) is that the SIC’s analysts actually tried to stop this investment from happening, but they were overruled by the Governor who had a strong desire to get the owners of Earthstone (well-heeled political donors to the Governor) some significant funding. As Scarantino reports:

The SIC knew that Earthstone was a bad bet. But only two months later, on January 27, 2004, the SIC announced that it would extend Earthstone $9 million in a convertible loan. What happened?
Documents in the SIC’s files reveal that promptly after being turned down by the SIC, Earthstone’s representatives began contacting other members of Richardson’s administration, particularly Rick Homans, who was then Richardson’s Economic Development Secretary. So, Governor Richardson, who exerts total control over the SIC, an entity that manages billions of New Mexicans’ taxpayer dollars, forced the SIC to go along with the Earthstone investment.
Unfortunately, as Scarantino reports, the story does not end with the loss of 9 million taxpayer dollars. Despite having not built its factory and not providing any new jobs for New Mexicans, Earthstone recently received another $3.5 million from the SIC.

New Mexico Sen. Jeff Bingaman, the only member of the Senate who will have a seat on both committees that are dealing with President Obama’s health care reform plan (Finance and Health, Education, Labor, and Pensions), had an article in Sunday’s Albuquerque Journal in which he laid out what he sees as some of the problems of our current health care system and solutions that he and his Democratic allies in Washington would recommend. So, what of the Bingaman plan? I’ll cite passages and analyze below:
1) “Health care costs are out of control because our system rewards more care, not better care.” Sure, resources in our current system are not allocated in an optimal manner, but Hayek pointed out the information problem more than 60 years ago. Will government do a better job at allocating resources than our current system under which more than 50 percent of health care spending is already done by the government?
2) “Uninsured rates are high, especially in New Mexico.” So, how about reducing mandates or allowing consumers to purchase care across state lines?
3) “We must clearly define what a basic insurance plan must cover. We must also end the practice of insurance companies denying coverage for pre-existing conditions.” I’m not sure where Bingaman gets off telling the rest of us what kind of health insurance options we should be able to choose from, but that mentality seems to pervade Washington and has for years. If I’m a college kid who wants just a catastrophic policy, is that “acceptable?” How about health savings accounts? Also, “guaranteed issue” will dramatically increase prices.
4) “Part of reform is making sure younger and healthier people are buying coverage.” Of course, guaranteed issue will force these younger, healthier people to subsidize those who take less good care of themselves and are older. How do you force these people into the system and is it really fair?
5) “The bill we send to Congress should shift us from a system that emphasizes ‘sick care’ to one that emphasizes prevention.” Of course this is a good idea. Perhaps if we deregulated the system so doctors and patients could contract with each other as one doctor tried in New York, we could achieve some of these laudable goals, but with insurance companies playing such an outsized role, this is not going to happen under any of the plans now under consideration.
6) Bingaman then argues for “Evidence-Based Medicine” but Twila Brase has demolished the case for that particular form of social control under which doctors are nothing more than assembly-line workers taking orders from the state.
7) Lastly, Bingaman argues that we need a “public option” to compete with private health insurance. This simply means that we will move quickly to fully socialized medicine over time. After all, government, subsidized with taxpayer dollars, does not “compete” on an even playing field with industry. Like Fannie Mae and Freddie Mac, the taxpayer-subsidized option has many advantages and will ultimately “crowd out” the competition.