Rio Grande Foundation president Paul Gessing appeared on Channel 5’s “In Focus” public affairs show a few weeks ago to discuss , the Rail Runner, transportation, and other important topics. The show can be accessed at the following link. There are three windows that you may click on and my appearance is in the third (bottom) window. The first two windows were a prelude to the show with a discussion between Transportation Commission Chair Johnny Cope and Rep. Patricia Lundstrom, Vice Chair of the Transportation committee. Neither of these two individuals inspire much confidence in those who believe that innovative thinking is necessary to solve New Mexico’s transportation problems. Enjoy the show!

An organization called Blognet News is now ranking political blogs around New Mexico. Based on their criterion and given slight variations from week to week, Errors of Enchantment consistently ranks in the top 10 as far as influence is concerned. View the rankings here. Considering that in the most recent rankings we’re ahead of two commonly read blogs, Joe Monahan and Heath Haussamen, I’d say that we’re pretty influential and having an impact. Hopefully, with a little luck and continued hard work, we can work our way into the top five and eventually to number one.

(Albuquerque) On Tuesday, December 4th at 7pm, the Rio Grande Foundation will host the New Mexico premier of the new film “The Call of the Entrepreneur.” This is a free event.
This short (approximately one hour long), dynamic documentary presented by Acton Media and the Rio Grande Foundation tells the story of free enterprise by following the lives of three very different entrepreneurs. These entrepreneurs risk it all to make a better future for their families and fellow citizens. Why do their stories matter? Because how we view entrepreneurs—as greedy or altruistic, as virtuous or vicious—shapes the destinies of individuals and nations.
A short trailer and some additional information on the movie is available here: http://www.calloftheentrepreneur.com/
With premieres from Houston to Kenya, this film has been met with enthusiastic responses as its message of liberty spreads across the globe. The Washington Times recently called the premiere “an emotionally powerful film experience.”
The film will be shown in Albuquerque in the main auditorium of the New Mexico Bar Association which is located at 5121 Masthead NE, Albuquerque, NM 87109 (near Jefferson and I-25). Admission is free, but in order to best accommodate our guests, please RSVP to: info@riograndefoundation.org or simply call us at 505-264-6090.
The schedule is as follows:
6:30 p.m. Light Snacks
7:00 p.m. The Call of the Entrepreneur Film Premiere
8:00 p.m. Brief Discussion (optional)
So come out after work and don’t miss this opportunity to see the message of liberty portrayed in such a compelling format. This is an excellent opportunity to introduce your friends and colleagues to these ideas and to renew your passion for liberty!

New Mexico Senator and Chairman of the Senate Energy Committee Jeff Bingaman made headlines (subscription required) in today’s Albuquerque Journal with comments that the public is ahead of Congress on issues of climate change and increased use of renewable energy.
With a barrel of gas at nearly $100 and a gallon of gas going for over $3.00 a gallon here in New Mexico, Bingaman’s concerns are understandable. The problem is that he is complaining about high gas prices which are the very tool needed if alternative energy sources are to become competitive. Only when consumers demand alternatives in the marketplace will we actually switch from oil and gas to alternatives. Bingaman and his cronies on the Energy Committee can mandate higher fuel efficiency and ethanol usage, but as Jerry Taylor of the Cato Institute points out, until some energy source comes along that is as cheap and portable as gasoline, nothing is on the horizon.
It would be nice if Bingaman and the rest of his Committee would leave the energy marketplace alone so that we can make our own decisions about the price of gasoline and alternatives, but that is not the way of Washington.

No, I’m not saying that EVERYONE in Santa Fe is a whiner, but the public comments made at a recent meeting held by the County to discuss potential oil and gas drilling in the county by Houston-based Tecton Energy company certainly brought out the worst in NIMBY types. One member of the throng, a Dennis Marker, stated, “I see it as your job to make Santa Fe the most business unfriendly, unreasonable environment for oil and gas exploration in the history of the United States.” Without citing all the comments, the 500 or so people who attended the hearing were almost universally opposed to drilling.
To the average wealthy Santa Fean it would seem that oil and gas drilling are good enough to support their kid’s education and for the hicks in Roswell, Hobbs and Farmington, but heaven forbid they have to see an oil and gas well on their way to and from their favorite art gallery.
I might add that I’ve been to Santa Fe (city and county) many times and I have seen many cars on the roads, not to mention petroleum-based asphalt covering the roads, and plastic bottles and cups in wide usage. It would seem to me that New Mexico would be better off if the bulk of oil and gas taxes were directed to local governments as opposed to being sent to Santa Fe. Perhaps then at least the same people who bear the relatively minor “costs” associated with oil and gas drilling would reap the benefits and the folks in Santa Fe could rely on movie stars like Julie Roberts for their livelihoods.

Many environmentalists including Al Gore who have decided that planetary climate change is the single most important issue facing humanity believe that government is the only entity that can really address the issue. In this excellent article, John Stossel points out that regardless of whether warming is a crisis or not, government may be ill-equipped to handle the response.

Determining whether global warming is happening or not may seem to be a simple problem: simply measure temperature changes over time. What has tended to be more problematic is determining whether warming has been caused by humans or whether it was occurring naturally, or some combination of the two. It turns out that much of the climate data we have may be wildly inaccurate with a bias towards warming. Why? Simply put, weather monitoring stations have been located in areas that violate the most basic needs of accurate measurement.
According to Anthony Watts, a veteran meteorologist from Chico, California:

Far more stations fail to meet prescribed standards than are properly maintained. Using a scale from 1 to 5, by which stations that are properly maintained receive a rating of 1 and stations that are severely compromised by artificial temperature signatures (being located adjacent to an artificial heating source, such as a building, rooftop, parking lot, or concrete surface, for example) receive a 5 while fully 70 percent of official temperature stations receive a 4 or 5 rating, and only 4 percent receive a 1.

For more information on Watts and his work to ensure that weather monitoring stations are as accurate as possible, go to http://www.surfacestations.org/.

Guess what? You as a New Mexico taxpayer are now part owner (subscription required) of an $11 million supercomputer with a total cost of $42 million to get it up and running. Another free article is available here.
So, what use might you have for such a computer? None as I pointed out recently in the NM Business Weekly. Most of us will do just fine with our PC’s and Mac’s which are getting more powerful and better all the time. The computer is nothing more than corporate welfare with a side of inflated ego.
With roads and bridges in dire need of money and taxpayers in Bernalillo facing tax hikes to pay for the jail and other needs, it seems hard to believe that a supercomputer is the greatest priority for New Mexicans. It will be interesting to see if any claims of economic impact/business attraction are made or if the whole thing is merely swept under the carpet.

While the case can easily be made that the Albuquerque Public Schools are broken beyond repair and that we should simply start over with heavy doses of school choice, that is a tough, long-term struggle. In the more immediate future, the system is faced with a decision to make over who should lead the school system.
In a recent letter to the editor of The Alibi, I make the case that APS more closely resembles a large business than anything else and that executive experience is more important than teaching experience. Unfortunately, it would seem that the majority of the public wants an educator to fill the role. Of course, it would seem that the majority of the public might not necessarily know exactly what it takes to run a public school system.

New Mexico is one of the largest oil and gas producing states in the country. Unfortunately, the industry — and other economic activities — are regulated by politicians who are totally ignorant of how wealth is generated and destroyed. That is why, despite record-setting oil and gas prices, the number of rigs operating in the state (according to the Albuquerque Journal) has dropped by 23 percent from last year (90 to 69).
Why would the number of rigs be dropping at a time of record prices? The answer is regulation, specifically new regulations that drive up the costs associated with drilling for oil and gas by as much as $200,000 at each well site.
With the road budget $500 million short and tax increases under consideration, one might think that the powers-that-be would like to keep money flowing into the state’s coffers, but in this state you never know.

Long story short, New Mexico’s doctors don’t like Governor Richardson’s health care proposal. Apparently, they don’t like the idea of a government agency determining how much they can charge. The shocking thing to me isn’t that the doctors have finally decided to oppose Richardson’s plan, but that they supported it in the first place. Outside of the licensing issue — a big deal — doctors have historically been some of the strongest advocates for limited government involvement in health care.
Richardson’s plan, like all government health care models, relies on the principle that someone else pays. Doctors of course are one of the major groups who face reduced payments under a government-run health care system. Perhaps New Mexico’s doctors can become part of the free market solution instead of going along with the big-government problem.

In a rather resounding vote on Tuesday, Utah voters killed the nation’s first statewide school voucher program that promised tax dollars for private tuition, no matter how much a family earned or whether kids were in bad schools. For supporters of school choice, this was a major setback, more so because the legislation that had originally been passed by one vote in the Utah Legislature was easily the broadest school choice program in the nation.
Utah is exactly the kind of state that might support school choice, but it looks like even in a friendly state, broad-based voucher programs are vulnerable. So, what is the solution? I believe that tax credits are a better option than vouchers. Rather than relying on the government to divert tax dollars to private schools, tax credits enable individuals to decide how to divert their money to school choice efforts while taking a credit against their taxes. This provides an additional “check” against wasteful or problematic scholarship organizations that don’t fulfill their missions or serve the public. Vouchers are just another government program that lack the level of community ownership found with credits.
Tax credits also poll much better than vouchers and should be the focus of reform efforts. Even left-wing New York Governor Eliot Spitzer is on board with tax credits. Vouchers just don’t seem viable outside of Milwaukee and a few other limited programs.
Thankfully, the Rio Grande Foundation and other education reform advocates have united around tax credits as the best available solution to New Mexico’s education woes.

New Mexico is facing a well-documented transportation crisis. Everything from raising taxes to shifting existing revenues around has been discussed as a means of bridging the gap.
While stopping the Rail Runner must be seen as a bare minimum in the effort to resolve this crisis and shifting transportation revenues back to transportation must also be considered, the fact is that new revenue sources are needed. The question is, do we want to keep funneling transportation money through the government or can the role of the free market be expanded. As transportation expert Bob Poole writes in today’s Albuquerque Journal, toll roads, if done correctly, can be a part of the solution here in New Mexico. At the very least, enabling legislation should be enacted to make such efforts possible.

Recently, I wrote in the Albuquerque Tribune about the impending lab cuts and whether they might be a good thing in the long run for New Mexico’s economy. I argued in part that it is the private sector, not the government that creates wealth and I stand by my point.
Nonetheless, I was attacked in a letter to the letter by a reader who argued that government does indeed create wealth. He argues that, “His (Gessing’s) condemnation of government as not producing wealth is baseless,” and that “I equate profit with wealth.”
Unfortunately for the letter writer, what government does is simply take money from productive citizens and use it for something that people may or may not really want. With government, it is not easy to tell because there is no pricing mechanism. Sure, roads are important, but the government also shifts money away from roads to build the Rail Runner. That is sucking wealth out of society.
The public schools, particularly APS, may be better than nothing (although that’s debatable), but are they creating wealth for our society in an efficient manner? Might it be better for the private sector (not necessarily for-profit) to take over?
The fact is that government may create wealth for you if you happen to want what the government is providing, but real wealth is provided when government is small and doesn’t interfere with the rest of us who are producing real wealth in the marketplace.

In 2005, a narrow majority of Colorado residents voted to allow their state government to keep all tax revenues it took in for the next 5 years. In most states, politicians are always allowed to spend whatever they can convince taxpayers to give them, but something called the Taxpayers’ Bill of Rights made Colorado different and its citizens wealthier. As Michael New points out here, in giving the state more of their hard-earned money, the average Colorado taxpayer has missed out on 910 dollars in tax rebates during the past two fiscal years.
Other states, including my home of New Mexico, should emulate Colorado’s economic success by adopting Taxpayer Bill of Rights-style spending limits. Unfortunately, as Paul Jacob experienced in Oklahoma, the establishment (conservative or liberal) doesn’t like limited government.

As I looked through the paper this morning, I noticed the Parade Magazine cover story “Can We Save Our Trains?” While I don’t expect stellar journalism from such a fluff-oriented magazine, I was astonished by the biased nature of the article. For the record, I like trains and enjoy riding them when it is the sensible thing to do, but the article read more like it was written by Amtrak than a genuine news story.
For starters, the author states that our national rail system is “inadequate, relying on aging equipment and a shrinking route map.” Of course, these woes are the result of “inadequate government support.” So, why aren’t the airlines facing the same problems? The answer, quite simply, is that they buy their own equipment and don’t rely on the federal government because airlines can actually make money. Amtrak, on the other hand, is a politically-designed train system that diverts resources away from popular routes in the Northeast in order to fund routes in sparsely-populated areas (like New Mexico!)
The so-called underinvestment problem is further discussed in the Parade article when the author states that Amtrak received $1.3 billion while highways got $40 billion and the airlines $14 billion. Of course the difference is that much of that money allocated to roads and airlines is in the form of user fees. Amtrak on the other hand is funded out of general revenue.
The fact is that long-haul passenger trains are viable in densely-populated regions like the Northeast Corridor, some places in California, and perhaps Florida. Unfortunately, until we kill Amtrak and sell its assets to private investors, we’ll never know and America will never have a viable rail system. Iin the meantime, Congress will continue to waste taxpayer money on a socialist railroad ignorantly advocated for by the media.

Utah voters on Tuesday face the most important choice on the ballot anywhere in the nation this year. The issue is whether parents and children should receive any of their tax money back when they opt out of government-run schools or whether their choices are limited to just those schools that are indeed run by the government. The law was signed back in February, but the teachers’ unions, true conservatives in the sense that they have no forward-looking agenda only opposition to change as George Will describes, have done everything in their power to strangle the program in the crib.
While it is true that Utah’s voucher program is a more difficult sell than the tax credit program we’re working on here in New Mexico, the Utah vote will be an important measuring stick to see where voters are on school choice.

Los Alamos and Sandia Labs are on the chopping block in Congress. That is a fact and it has many of the Labs’ employees and local economic officials in a panic. But is it such a bad thing for New Mexico’s long-term economic future? In a recent opinion piece in the Albuquerque Tribune, I argue that cuts at the Labs might be an opportunity to ween New Mexico’s economy from the federal teat and adjust our tax policies in ways that will generate long-term economic growth.
After all, New Mexico has long received more federal largesse relative to what its taxpayers pay than any other state, but it hasn’t done much to improve our economic picture or poverty levels. As the economic impact of these layoffs is felt, our political leaders would be wise to enact some pro-growth reforms (like cutting the income tax or reducing the regulatory burden) in an effort to bring businesses to the state.

According to a new study by researchers at Johns Hopkins University studies high school dropout rates and terms schools that graduate no more than 6 in 10 of incoming freshman a “dropout factory” that is failing far too many students.
According to an article about the study in the Albuquerque Journal, the New Mexico Public Education Department says that in New Mexico, 66 percent of incoming freshman make it to their senior years. That’s bad enough, but in Albuquerque’s Public Schools, only 61 percent of incoming freshmen make it to their senior years. This almost qualifies all of APS as a “dropout factory” according to the Johns Hopkins study.
Of course, APS has its own data which show that not nearly that not nearly so many of its students are dropping out, but New Mexico has already been shown to have fudged graduation data in the past. Who are you going to believe, objective researchers at Johns Hopkins or bureaucrats with a decided self interest who have misled in the past?

For the average politically-unconnected Albuquerque-area developer, dealing with local governments is a nightmare of red tape. Anti-development politicians and anti-“sprawl” and/or “not in my backyard” citizens have passed numerous laws that make it a wonder anything is built. Out-of-control impact fees, high taxes, opaque zoning laws, capricious government officials (see Wal Mart’s experience in Vista del Norte), and onerous “green” building codes all make the process difficult and time-consuming.
On one hand we now have policies that stifle new development and contribute to the decline of existing areas? But, on the other hand we have Tax Increment Financing (TIF) laws here known as TIDD which are targeted at massive new developments that seem designed to help Albuquerque area to grow as rapidly as possible. In these seemingly-conflicting issues seems to be control. Massive new developments are okay, but only if they are acceptable to politicians. New legislation introduced by supposed foe of TIDD, Michael Cadigan, is a perfect example. It’s okay…if you do things my way.
Unfortunately, TIF or TIDD is all about political control as development expert Randal O’Toole points out in this podcast. Opponents of TIDD should remain principled in their opposition and work to make Albuquerque an easier place to build rather than extending political control even further. Unfortunately, that is not the tendency of politicians.

According to the Tax Foundation’s exhaustive analysis of business taxes nationwide, New Mexico, the state ranks in the middle of the pack (23rd overall). There is a lot of great information and analysis in the paper, but the following quote summarizes the study’s findings with regard to New Mexico:

New Mexico has improved several aspects of its tax system in recent years, most advantageously cutting the top income tax rate, with the result that its sales tax system is practically the only thing dragging its overall ranking down to a middle-of-the-pack ranking of 23rd best. Although the almost 6% rate (when including local add-ons) is not excessive, its application to business-to-business transactions is among the most extensive in the nation. This results in several layers of sales taxation, which distorts the economy against sectors that rely on multiple stages of production to bring their products to market.

I have a few quibbles with even this quote, however. First and foremost, the reason we have such an all-encompassing sales tax is that we have a gross receipts tax with lots of exemptions written in. The analysis contained in the paper is correct, but New Mexicans call the tax “gross receipts,” not “sales.” More importantly, few places in New Mexico have sub-six percent gross receipts tax rates. In fact, the statewide average is 6.65 percent and the average rate of New Mexico’s 10 largest cities is in excess of 7 percent. Clearly, the gross receipts tax is an even bigger problem than the Tax Foundation’s report lets on.
New Mexico has improved somewhat in recent years, but we still have a long way to go. Reforming the GRT is a must for the economic future of the state.

Check out this hilarious video which hammers home the point that funding health care programs “for the children” by raising taxes on smokers is pretty ridiculous.

By most accounts, Albuquerque Mayor Martin Chavez is one of the most pro-environment mayors in the nation. We at the Rio Grande Foundation have not always agreed with him on some of his environmental initiatives, most notably the “modern streetcar” which was supposedly designed to get cars off Albuquerque streets.
Of course, there are always some on the extreme fringes for whom even major “green” initiatives are simply not enough. One of those voices, a Dr. John Fogarty who runs a group called Physicians for Social Responsibility, but who has also served on New Mexico’s Climate Change Advisory Group and Gov. Bill Richardson’s Green Building Task Force. To Fogarty, all the green building codes in the world are not enough because they still have that dirty little word “building.”
You see, while Fogarty decries “sprawl” and global warming, and our need for foreign oil, he offers no real solutions to the problem. Fogarty’s regional transportation plans are simply an attempt to impose Portland, OR style policies on New Mexico residents who do not want them. The sad thing is that while Portlanders have grown increasingly resentful of the heavy-handed nature of regional planning bodies, sprawl has increased and so has automobile usage. Portland doesn’t work.
Fogarty and others are trying to impose land use policies in direct opposition to the wishes and desires of New Mexicans. After all, if people wanted to live downtown, wouldn’t the condos down there be selling?

Governor Bill Richardson wants “universal coverage” passed in the upcoming legislative session. That is no secret. What has been secret up til now has been details of his plan. A broad outline was released this week and unfortunately although not unexpectedly, there is nothing new or innovative there and costs are unknown. According to an article in the Albuquerque Tribune

By 2010, everyone in the state would be required to have health insurance or show they have the means to fund their own care, under a four-phase plan Richardson will pitch to lawmakers in the 2008 legislative session. The governor today also is expected to say he wants the Legislature to mandate health insurance companies to spend 85 percent of premiums on direct services to patients, including disease prevention and management.
Officials were still working Wednesday night on the projected costs of the plan.
Richardson’s plan also would require insurance carriers to offer coverage to anyone who wants it, and would prohibit them from excluding patients with pre-existing conditions.

In other words, everyone would have to have health insurance, just like in Massachusetts where Mitt Romney’s similar mandate plan is failing. Is it any wonder that Richardson is postponing this mandate until 2010 when he’ll safely be out of office? Since New Mexico has twice as many uninsured as Massachusetts, the task of insuring everyone will be even more difficult.
Also, insurance companies will be forced to offer insurance in a costly scheme known as “guaranteed issue.”
In other words, there is no innovation, no outside the box thinking, just bigger government. The only thing to do now is to kill it.