Chuck Muth comments today on how Colorado voters are like New Mexican voters. They have been fooled:

It was only a little over a month ago that voters in Colorado, spooked by “the sky is falling” rhetoric of the left and a few misguided souls on the right, decided to suspend the spending restraints imposed by the state’s TABOR law (Taxpayer Bill of Rights) and allow the government to keep budget surpluses for the next five years. Voters were warned in ominous terms that unless they loosened TABOR’s restrictions, critical and necessary government operations would have to be cut.
Voters bought it, proving once again that it IS possible to fool a majority of the voters a lot of the time. And as Brendan Miniter points out in Monday’s Political Diary, “The state is now allowed to keep an estimated $3.7 billion in revenue it otherwise would have had to give back to the people.”
So what are the politicians planning to do with their share of the loot?
Well, in Boulder, Colorado, local officials intend to use some of the new-found dough to fund efforts to make their county “climate neutral” by 2025. As Miniter explains, this means “offsetting any greenhouse gases (the county) creates by planting trees and funding other ‘green’ programs.” One of those other “green” programs already being discussed is requiring “contractors to use both sides of the paper they use to submit bids.”
Good grief.
Your tax dollars are the football. The politicians are “Lucy.” And the taxpayers are “Charlie Brown.” The TABOR referendum in November was Lucy telling Charlie Brown to “trust her,” that she wouldn’t yank the football away at the last minute as Charlie Brown tries to kick it.
And once again voters are finding themselves flat on their backs. Will we never learn?

On December 15, 1791, the Fourth Amendment to the United States Constitution was ratified. It read:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Two hundred and fourteen years and one day later, we learn this.
The President may not be familiar with this part of the Constituiton. I wonder if he is familiar with Article II, Section 1 which requires him to:

solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.

(Need I mention Article II, Section 4?)

Here is a good article on the politics of immigration. Despite the recent hardline rhetoric, there is hope for a bipartisan consensus that immigration is good for the country. Putting up our own iron curtain is not an effective and efficient way to combat terrorism.

Why does a poor state like NM rank among the highest in mortgage closing costs? Could it be excessive regulation?
HT: Craig Newmark

New Mexico has its train to nowhere, and now it looks like Alaska is actually going to get its bridge to nowhere! Wouldn’t it be cool if the train to nowhere could take passengers to the bridge to nowhere (we have already bought some track in Colorado)? And while we are making such wise use of the taxpayers money, let’s not forget the run the nowhere train down to the spaceport that takes passengers to nowhere.
Update 12/23/05: Alaska is actually getting its BRIDGES to nowhere. At least Alaska is in the national news with its taxpayer ripoff. In New Mexico we ripoff the taxpayer while managing to keep the train to nowhere under the radar.

The new spaceport will cost our taxpayers an estimated $225 million. The recipient of this corporate welfare will be Virgin Galactic. Virgin Galactic estimates that up to 2300 jobs will be created as a result of them receiving the welfare. That estimate is somewhat vague since we don’t know whether that is all for direct employment or some of it is for businesses that would have sprung up somewhere else absent the welfare. Also, we are told that 100 “founders” have paid $200,000 each for the cost of a flight. In any event, let’s take the 2300 jobs estimate and ask the following questions:
1.) How much is it costing our taxpayers for each job “created?”
2.) How much are our taxpayers subsidizing each founder for his/her flight?

Answers:
1.) Almost $98,000 per job! Isn’t it wonderful that we can afford such a payment to bring in those poor, unemployed rocket scientists.
2.) $2.25 million per founder! Is that enough to put you into orbit?
I am glad to see at least one other person thinks this is too inconsequential a payload for our taxpayers.

The know-it-alls have decided to spend the taxpayers’ $225 million on a new spaceport rather than an NFL stadium. But they have ignored an important complement that we already have for the new stadium: a blimp.

This story (subscription) by Rosalie Rayburn questions why New Mexico’s gasoline prices are mostly higher than in other states. She misses the main reason: gasoline in not a fungible commodity because of EPA rules. Refineries must produce gasoline with specific formulations for specific areas, thereby eliminating the possibility of transport from one region to another when there is increased scarcity in a region such as NM:

Presently, the motor fuels industry has to separately refine, transport, and store as many as 18 different so-called boutique fuels for different markets. Some of these blends are more expensive to make, and the logistical burden of having to simultaneously provide all of them adds to costs and causes localized shortages and price spikes.

Higher prices result when when gasoline becomes relatively more scarce compared to other regions. You can be sure that refineries would have plenty of incentive to transport more gasoline to NM absent the EPA rules.
BTW: I spent the first weekend in December in Tucson and the second weekend in Cincinnati. My first hand observation is that Albuquerque’s average gasoline price is roughly 10 cents per gallon less than in those two cities.

I really dislike using the word “idiot.” This is supposed to be a civil forum. But what better description is there? First it was the bridge to nowhere; and now this. For you wishful thinkers: does this do anything to alter your trust in government? Just curious.

Quebec’s Pre-K initiative costs 33 times more than it was projected to cost; and it has not increased preschoolers readiness for school. I wonder when New Mexico will stop its wishful thinking and do something useful for the kids.
Hat tip: NCPA.

I am no fan of Newsweek. It frequently gets a lot wrong; but to the extent that this story about our president is accurate, it is quite distressing. Bruce Barlett weighs in here.

Anybody for a $9.50 “living” wage? Then we can really do some damage!
Check this for damage already done by the $8.50 “living” wage (thanks to NCPA for alerting us):
Aaron Yelowitz of the University of Kentucky found that Santa Fe’s
minimum wage had significant and negative effects on the labor market.
Even more troubling, he found that the negative effects of the wage
hike were concentrated on the least-skilled members of the economy —
the very individuals the increase was intended to help.
He found:
o The likelihood of unemployment for employees in Santa Fe
went up by 3.3 percent.
o For less-educated employees, however, the results were much
higher, with their likelihood of unemployment
increasing 8.3 percentage points.
o The usual hours of work fell by 1.0 hours for the full
sample and 3.2 hours for less-educated individuals.
o There was significant evidence to suggest the displacement
of adult employees by unmarried high school age
employees.
These are all unintended consequences that should give pause to
any claims of success of the ordinance, says Yelowitz.
Source: Aaron S. Yelowitz, “How Did the $8.50 Citywide Minimum Wage
Affect the Santa Fe Labor Market? A Comprehensive Examination,”
Employment Policies Institute, December 6, 2005.
We told you so.

http://riograndefoundation.org/papers/living_wage_misguided.htm

Alaska has (or had) its bridge to nowhere; New Mexico has its train to nowhere. It will be interesting to compute how much this ultimately costs the taxpayer per rider.

Unfortunately for NM taxpayers our Guv is poised for an enormous increase in spending during the 30-day session that begins next month. Among the proposals is a big expansion of the pre-kindergarten program. Our public schools don’t work very well. Why do we think that pre-k will work? It hasn’t worked in Georgia. It won’t work in New Mexico. See Reason Foundation’s commentary on a similar proposal for California here.

Here is a great idea for New Mexico. If you don’t think eligibility requirements for various welfare programs are complex, then you should spend a little time navigating around here and here and here. Get the idea about the cumbersome system that Texas’s streamlining is attempting to reduce?
As an added benefit Texas style streamlining may give us insights into how to fix incentive problems. For more on welfare incentives look here (pp. 12-19).

Check out this perspective in January 1999 — no mention of price “gouging.”

Two great posts today on the latest big governement proposals by the chairman of the FCC: One post is local and the other national.

We know our Guv had presidential ambitions; and he thinks he is quite important. But doesn’t this sound like a bit much?
HT: Mickey Barnett

Do you think this will put the global warmers into hibernation?

With all the Wal-Mart bashing going around can you believe that the Washington Post is defending Wal-Mart?
About 8 years ago my daughter was really having difficulty making ends meet. I remember well when she said, “dad, I just don’t know what I would do without the Wal-Mart Supercenter.” Bottom line: Wal-Mart overwhelmingly helps the poor. Read all about it.
Update 11/30/05: Article is in today’s ABQ Journal. Be sure to read it.

Did you see yesterday’s Albuquerque Journal Op-Ed by Rosabeth Moss Kanter entitled “Poverty:
Capitalism’s Powder Keg?” In the Miami Herald it was entitled “Why Socialism is back in vogue in some places.” Excerpt”

Socialism is back in vogue in Latin America. Whatever one thinks about Venezuelan president Hugo Chávez’s outrageous politics, he enjoys support from poor barrios because he has expanded access to educational and social services. Chávez called Mexican President Vincente Fox a ”lapdog” of U.S. imperialism for backing Washington’s trade policies at the summit. Perhaps Chávez’s example reinforced Cuba’s socialist stubbornness, as the government raided farmers’ markets in what Reuters called an “anti-capitalist crackdown.”
Some large companies in the region are rising to the challenge of finding solutions to poverty. ABN AMRO Banco Real in Brazil is offering micro-finance to poor entrepreneurs in urban shanty-towns. Cemex in Mexico created an innovative program to finance housing materials in rural areas, bringing jobs as well as better housing to poor villages.
Believers in a free-market economy (and I’m among them) had better be prepared to do even more to help lift the poor out of misery. Otherwise, markets will not be free enough or our cities safe enough, for any of us.

Capitalists themselves often do not “believe” in the free-market. But one thing is for sure: they have every incentive to help the more poverty stricken nations as long as those nations have reasonable regulatory and tax regimes, they enforce property rights and they enforce the rule of law. Captitalists help by engaging in trade with the people and businesses of those nations. When trade occurs everyone is better off.
Be careful, though, because there is one thing that will not work: foreign aid. New Mexico itself is proof of that. If foreign aid does not work why not encourage dictators to try some economic freedom? That really does work!
Update 11/29/05: MARY ANASTASIA O’GRADY in Friday’s WSJ(subscription):

…despite persistent claims that the region has tried the “free-market” model and found it wanting, Latin America is stubbornly stuck in a statist time warp.
When it comes to burdensome government and weak property rights, Latins don’t fare as badly as Africans but their freedoms lag behind those in much of Asia and the former Soviet satellites of Europe.

She concludes:

Rich-country bureaucrats also often tie their handouts to objectives favored by rich-country pressure groups, such as environmental and labor “protections” that in the name of “social justice” add more red tape and further destroy individual initiative. All the while, Godzilla government is leaving Latin America’s underclass living in the shantytowns and favelas with little opportunity or hope.

New Mexico is a poor state. We need “bold” changes to improve education if we are to keep it from getting poorer. How do we implement these bold changes? Throw a lot more money at education is the answer according to the Journal. And money from windfall energy revenue is available for the throwing. That is the essence of yesterday’s editorial (subscription).
This is wishful thinking in the extreme. Education “reforms” have not worked in the past. And they will not work in the future as long as K-12 education is a socialistic, one-size-fits-all, union-run monopoly. Real per capita spending on education has increased well over 20 percent in the past 15 years and what do we have to show for it? Nothing! But if we have more bold reforms and throw more money at it things will get better? Give me a break.
I wonder if anyone at the Journal has ever heard of school choice? Let’s empower parents instead of the union monopoly. Parents can make better decisions for their kids than education bureaucrats in Washington and Santa Fe.

Steve Moore’s article yesterday does a superb job of dissecting John McCain’s economic philosophy from a market liberal perspective.
On limited government he frequently looks quite good:

“Look at my National Taxpayers Union rating. I’m near 100% every year.” (I do. He is.) Then he fumes: “I’m so disgusted with the way my party is wasting money. It’s an embarrassment.”
It is on this issue that Mr. McCain has struck the mother lode. More than any other first-tier GOP candidate in 2008, Mr. McCain has shrewdly tapped into the rage that conservatives are feeling over President Bush’s $800 billion Medicare drug bill (which he voted against), the highway bill with its 6,000 earmarked white-elephant projects (which he also voted against), and the infamous $500 million Alaska Bridge to Nowhere (which he led the crusade to defund). Mr. McCain whips out a spreadsheet detailing the legislation he drafted with Oklahoma Sen. Tom Coburn to cut the budget by $100 billion by canceling the highway pork, delaying the prescription drug bill, establishing a commission to end worthless government programs, and so on. Give the man his due: He has monopolized the anti-big government Reaganite message of late.

In addition he defends free trade, school choice, and a sensible immigration policy that

involves a three-step process: better border enforcement, a guest worker program, and an earned legalization program with a $2,000 fine for those who are here already. Anyone who has heard Mr. McCain on the stump lately knows that this is an issue he feels passionately about. “America must remain a beacon of hope and opportunity. The most wonderful thing about our country is that this is the one place in the world that anyone — through ambition and hard work — can get as far as their ambition will take them,” he says, in optimistic rhetoric that is somewhat reminiscent of Ronald Reagan.

Unfortunately, McCain also displays many nanny statist tendencies that are emphatically not market liberal:
He is against most tax cuts. His campaign finance “reform” demonstrates his unbelievably naive view of political process. He wants us to do something (regulate, regulate, regulate) about global warming. He wants to tax greedy profiteers. He thinks its the state’s job to regulate steroid use in sports.
Maybe, if we can teach him some more economics, we can reduce these statist tendencies and have a fine presidential contender on our hands. But I don’t want to get my hopes up. I wonder how someone who was part of the Keating Five (and seems to recognize his mistake) can have such a naive view of political process.
Update 11/28/05: Jane Galt’s take

http://www.janegalt.net/

I’m uncomfortable with a president who looks for a villain to pillory every time people are unhappy. Moreover, the senator’s evident belief that any and all ills can be fixed with a sufficiently complex law make me wonder why one would vote for him instead of the democrat saying the same thing.

It is hard to believe that we have a brand new entitlement mess on our hands. We can’t even fix the Social Security mess we’ve already got. The new mess is the Medicare Prescription Drug Benefit entitlement.
In its editorial yesterday the Wall Street Journal correctly points out that the political process is sure to make things even worse:

…the new benefit will be a poor substitute for the drug coverage that some three-quarters of seniors already have, and which it will undoubtedly do much to replace.
In particular, seniors are nonplussed by the “donut hole” they see in the new coverage. The benefit envisaged by our Capitol Hill solons has coverage starting after a $250 deductible and continuing until annual drug expenses reach $2,250, after which it will disappear again until total costs reach $5,100. That means that if you spend $2,000 annually on drugs, Medicare will cover 66%. But if you spend $5,000, Medicare’s share will be only about 30%.

It goes on:

We also can’t forget how damaging the shifting cost estimates for this program have already been to the Administration’s credibility. Everybody knew the original 10-year, $400 billion figure that Congress was shooting for was a polite fiction. But that figure is now more than $700 billion, and both parties did their best to cover that fact up during the debate that led to the benefit’s passing the House by a single vote in 2003.

Do you know how your representative voted? There cannot be any ducking of responsibility on this one, Heather.
Finally:

Politically, the worst is probably yet to come as private employers start ditching retiree drug coverage and throwing more people into the government system. And as costs for the program inexorably increase, so will the pressure to raise taxes.

And don’t forget about pressure to do something in the form of price controls.
In a few years we will be in for an intergenerational battle royal as old fogies like me seek to tax our working kids to pay for our government goodies.