Errors of Enchantment

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RGF Opinion piece: This election: Change or more of the same?

11.04.2024

The following appeared on November 2nd, 2024 in Eastern New Mexico News.

By a 2-1 margin, according to polling done this fall by the Albuquerque Journal, New Mexicans are not thrilled with current economic conditions. The poll found 38% of respondents called the economy “poor” while just 19% said “good.” The rest either said “fair” or had no strong opinions on the matter.

New Mexicans are not alone in having negative views on the economy. Americans have felt the negative impact of inflation and are not happy about their personal or family finances this election season. The economy is widely considered the top issue in the 2024 campaign.

And, while the presidential and congressional races are extremely important, no races are more important to the economic future of New Mexico than the 112 legislative races that are on ballots across our state. The Legislature makes the laws of New Mexico including the setting of tax rates and spending along with all manner of other policies on topics from education to infrastructure.

New Mexico’s Legislature has been largely a one-party affair since 1931. For nearly 100 years the Republican Party has never had both houses of the Legislature. In fact, as has been the case for a majority of New Mexico’s last 100 years, Democrats control governor and both the House and Senate in the Legislature.

New Mexicans’ downbeat view of the economy is driven by many things, but unlike many other states (thanks to the ongoing oil and gas boom) New Mexico has had years of multi-billion-dollar surpluses that could have been used to benefit New Mexicans and help them through these hard times. Instead, state government spending has grown rapidly and most of the rest of this wealth has been locked up in various funds controlled by the state.

Sadly, the lack of a plan to turn around New Mexico has led to more of the same. If you drove down the highways or streets of our state, there would be no evidence that our state is amid an economic boom the likes of which we have never seen and may never see again.

Instead, crime and homelessness are out of control in our biggest cities. New Mexico’s roads were recently ranked worst in the nation. Our education system is consistently ranked worst in the nation (despite rapid spending growth and a new universal pre-K program). And, while New Mexico is awash in money and sitting on $54.7 billion with an additional $6 billion in unspent capital outlay, our citizens are the poorest in the nation and our economy is more reliant on oil and gas than ever.

With massive resources at the Legislature’s disposal and big problems that need to be addressed right now, it is hard to watch the current Democrat-controlled Legislature and governor repeatedly squander opportunities to turn New Mexico around.

Instead of discussing how to grow the economy and get our kids to stay home rather than leaving the state for jobs, recent legislative hearings focused on bringing high-speed rail to New Mexico and elevated rail to Albuquerque.

New Mexico’s elected leaders can no longer cry poverty. It is time to change our state for the better. Vote accordingly.

Paul Gessing is president of New Mexico’s Rio Grande Foundation, which promotes limited government, economic freedom and individual responsibility. Contact him at: pgessing@riograndefoundation.org

 

You simply can’t rely on JPEC for judicial recommendations

11.04.2024

If it weren’t so funny it would just be sad. Some status quo judicial advocates wrote an opinion piece in the Albuquerque Journal recently argued that the Judicial Performance Evaluation Commission recently advocated for keeping ALL 35 judges evaluated. The opinion piece actually takes the Journal to task for arguing “discernment” in picking judges to retain (or not). You can read their editorial and recommendations here. 

But their arguments are dubious at best. One statement particularly caught our attention: “The Journal disregards sociological research and abundant other evidence that totally undermines the faulty premise that criminal court judges’ decisions have any meaningful impact on whether people commit crimes.”

Nobody has ever said that judges cause crime, but what is left unsaid is how judicial decisions can impact crime by either keeping crooks behind bars or letting them back on the streets. We had our own views on ONE judge (Cindy Leos). While we cited the JPEC in our analysis, they actually recommended retention despite numerous issues.

The opinion piece blindly supporting JPEC concludes with the following: “Asking (the Journal’s) readers to disregard the work of JPEC and substitute its own bias and unqualified opinion is irresponsible.” If voters’ opinions are to be ignored then why are they being asked to vote on judges in the first place? Do judges REALLY not have an impact on crime? How about reforming our judicial election system to allow judges to run for office the same way as other candidates for public office?

 

Tipping Point New Mexico episode 654: Redistricting, Demographics, and Election Security with Rod Adair

11.01.2024

On this week’s interview Paul interviews former New Mexico Senator, demographer, and election official, Rod Adair. They discuss the role of demography in redistricting, the redistricting process itself, and whether New Mexico’s Congressional and legislative districts are “fair.” Then Paul and Rod moved on to discussing the 2024 election including the Secretary of State’s recent mailing that generated controversy, how to better secure New Mexico elections, and whether the election results themselves will be “fair.” With Election Day looming you don’t want to miss this important conversation!

ABQ Journal editorial nails it on “fundamental change”

11.01.2024

From a variety of polling data and plenty of public statements made by Republicans and Democrats alike about crime and the economy (not to mention New Mexico’s worst-in-the-nation education results despite massive funding increases), this SHOULD be a “change” election for New Mexico.

The Albuquerque Journal recently issued a scathing editorial highlighting the myriad failures of New Mexico’s Democratic Party establishment on the crime issue. We couldn’t agree more, the status quo is untenable in New Mexico. BUT, crime is only ONE issue that policymakers have abjectly failed to address.

What about New Mexico’s economy which remains entirely dependent on the very oil and gas industry loathed by its “progressive” legislative majority? Yet, even with this boom we trail our neighbors badly.

And of course New Mexico’s education system remains dead-last and shows no signs of improving.

So, the Albuquerque Journal is spot-on, but we only wish they’d have gone a bit further in highlighting why “more of the same” is untenable in the Land of Enchantment.

Tax Foundation ranks New Mexico 31st for “tax competitiveness”

10.31.2024

The Tax Foundation is a center/right tax research and advocacy organization. For a broadly free market organization they and their information are actually able to get a respectable hearing in New Mexico’s Legislature. Sadly, the Tax Foundation’s views don’t necessarily result in public policy changes, but it is good to be invited to share your views.

Tax Foundation has a new “State Tax Competitiveness” report and sadly, but not surprisingly, New Mexico’s performance leaves a lot to be desired at 31st overall. While 31st is not entirely awful, it is worse than most of neighbors. More importantly, New Mexico’s oil and gas boom has generated enough revenue to allow the Legislature and Gov. to address our tax code issues.

Sadly, that has not happened in any substantive way. Yes, New Mexico COULD be worse than 31st, but with the self-inflicted crime and education issues impacting the willingness of businesses and people to relocate (or stay in) New Mexico, we need our political leadership to do better.

You can see (and click on) New Mexico’s tax competitiveness page below:

Tipping Point New Mexico Episode 653: Trump Coming to New Mexico, ABQ Journal Calls for Change, Election Predictions

10.30.2024

Trump is coming to New Mexico. What are the details and what does it mean for the election and New Mexico?

Paul voted this week. No lines but it was busy. We’re in the 2nd week of early voting. You can vote through Saturday.

The ABQ Journal comes out hard for change in New Mexico. This is welcome, but Paul wishes they’d say the same thing about the economy and education.

Mandating setbacks for oil and gas development would cost New Mexico big $$$ according to a new report by the Legislative Finance Committee.

The National Association of Manufacturers has a new report touting the economic impact of LNG exports and highlighting problems with the Biden/Harris pause.

O’Neill’s owner says ART and COVID cost him his business.

Think New Mexico produces plan to (further) address the State’s medical provider shortage.

Finally, Paul and Wally offer some predictions for the election including who wins the presidency, US Senate races, and other critical races.

Santa Fe Public Schools Enrollment Plummets

10.30.2024

RGF has commented in the recent past about the steep decline in the number of students at the State’s largest school district (Albuquerque Public Schools). But, APS is by no means the only school district in New Mexico that has seen a steep decline in its student population. Santa Fe’s public schools have as well as a recent article in the Santa Fe New Mexican highlighted. We put the data in a handy chart (below) and made a quick calculation to find that the District has seen a 25% drop in student population since 2013.

The decline in student numbers is not unique to New Mexico, but with New Mexico having a stagnant population overall and a rapidly-aging one, don’t look for this trend to change anytime soon. Of course COVID and the Gov.’s lockdowns, poor performance of New Mexico schools, and a growing home school movement have all contributed to the declining student population in government schools.

A focus on school choice would help. Growing New Mexico’s economy and thus our State’s population would also. But, these are anathema to New Mexico’s left-wing legislative majorities and Gov. Lujan Grisham. So, unless things change New Mexico’s well-funded but failing government schools will continue to see a steep drop in student numbers.

The Legislature’s craziest idea yet?

10.29.2024

In a State with $6 billion in unspent capital outlay money and (according to one study) the worst roads in the nation, one might think that the relevant legislative committees would be focused like a laser on addressing our State’s myriad road issues and figuring out a way to get unused capital outlay $$ allocated to much-needed projects across our State. Sadly, that’s not what is happening at the Transportation Infrastructure Revenue Subcommitee in the Legislature.

Instead, the agenda included a presentation about high speed rail (the LFC just reported that the Rail Runner which hardly qualifies as “high speed” is actually BAD for the environment). Of course, the train is also a HUGE waste of our tax dollars. And even in Albuquerque, the bus system’s ridership remains BELOW pre-pandemic levels despite the buses no longer charging fares. Nationally, transit ridership remains well below pre-pandemic levels and shows no sign of returning to those levels.

But even high speed rail may not be the worst idea discussed at the Subcommittee’s recent meeting. They had an honest-to-goodness discussion about putting an elevated rail system totaling 70 stations, 7 lines, and 103 miles of ELEVATED rail throughout Albuquerque. You can read more details including remarkably detailed presentations here. You can check out the graphic below.

Where would the money come from? The report cites the Land Grant Permanent Fund and Public Employee Retirement Association (PERA) as likely sources.

Thankfully, this is unlikely to happen even in New Mexico’s “progressive” Legislature, but it is a clear indicator that reconsidering the expensive and polluting Rail Runner is not “on the table.” Instead they are talking about a new elevated train for Albuquerque.

Much to like in Think New Mexico’s plans to address medical provider shortage

10.28.2024

New Mexico’s medical provider shortage remains a critical issue. While many changes were undertaken during the 2023 legislative session to address the shortage of medical providers, the fact is that New Mexico continues to suffer from a relative lack of medical providers. To be sure, New Mexico is NOT alone in this matter. For a variety of reasons there is a national shortage. And, to be clear the Rio Grande Foundation has spent considerable time on the topic with an analysis of the shortage here and our own report on some solutions (including a handful that were enacted in 2023) here.

Think New Mexico’s report is a useful addition to the conversation about how to further build on 2023’s important reforms (and make sure those gains are locked in). Ideas include:

  • Further reforms to New Mexico’s medical malpractice law;
  • Join All Ten Major Interstate Health Care Worker Compacts;
  • Create a Centralized Credentialing System;
  • Make New Mexico’s Tax Policy More Friendly to Health Care Workers (this includes making the gross receipts tax exemption for medical providers permanent, a policy RGF has long-supported);
  • Enhance Medicaid Reimbursement & Reduce Claim Denial Rates;
  • Increase the number of medical professionals through internal development as well as bringing them in from abroad;
  • Create a “permanent fund” for health care.

Overall, RGF supports an overwhelming majority of this report. We have written about and argued for several of these ideas in our own papers which are linked in this post. Our critiques are as follows:

Medical licensing should be limited and often eliminated entirely. Compacts and centralized credentialing are 2nd-best options.

Medicaid should be reduced as a force in New Mexico’s health care system by encouraging people to work and by making the system less generous relative to other health care options. That said, increasing reimbursements to medical professionals will have a positive impact on medical providers.

We DO NOT like the idea of a permanent fund for health care and have a very different view of existing permanent funds from that outlined in this report.

Overall, there is a lot of good information in this report.

 

The economic impact of LNG exports (and the Biden/Harris “pause”)

10.25.2024

The Rio Grande Foundation has long touted the economic and environmental benefits of American exports of liquefied natural gas (LNG). We share that perspective with the National Association of Manufacturers which recently came out with a study highlighting the benefits of exporting LNG and the drawbacks of the Biden/Harris Administration’s current “pause” on LNG export permits.

As the graphic below highlights, Americans (including of course New Mexicans) are benefiting from LNG exports via good paying jobs, economic growth, and increased taxes paid. If the Biden/Harris policy of limiting LNG exports is not addressed all of that will be negatively and dramatically impacted.

Mandating setbacks from oil/gas development would cost New Mexico Big $$$

10.24.2024

In 2023 New Mexico Land Commissioner Stephanie Garcia Richard issued an executive order that places a moratorium on oil and gas leasing on state trust lands within one mile of schools or other educational facilities. In 2024 legislation was proposed that would have mandated a 2,250-foot setback — just under a half-mile — from homes, schools, health care facilities and jails, and a requirement for wells to be 350 to 600 feet from water features.

Not surprisingly the health research (such as it is) on setbacks is spotty and entirely inadequate for responsible policymaking. There are oil and gas wells throughout New Mexico currently operating that are a short distance from residences and other heavily-trafficked areas. A decent study is needed to establish whether setbacks are necessary in the first place. 

Now, the Legislative Finance Committee has found that, if setbacks are imposed on a statewide basis, New Mexico could lose billions of dollars in oil and gas revenues. Read the report for yourself here. As the chart below highlights, the State would lose an estimated $800 million ANNUALLY within just a few years if setbacks similar to the 2024 legislative proposal were adopted.

As reported by the New Mexican, Committee economist Ismael Torres said in a presentation to the committee Tuesday “the $800 million figure is likely low. It doesn’t include other indirect revenue losses, such as taxes collected from trucking or other ancillary services, or lost income taxes from workers.

Setbacks for habitat protection could also drive up the price tag.

There are other costs to consider, too.”

All of this means that setbacks will likely be used as a tool by the far left to attack the oil and gas industry. But, big setbacks as some in the Legislature would like to see implemented would have

652 Germaine Chappelle – Update on Impacts of Energy Transition Act in Four Corners Region

10.24.2024

On this week’s interview Paul talks to Attorney Germaine Chappelle about the Energy Transition Act and some of its real-world impacts in the Four Corners area (current and prospective). Specifically, Chappelle is working on behalf of the Central Consolidated School District (a heavily Navajo district) to make good on the law’s requirements that certain power generation be located within the District’s boundaries for purposes of helping the District’s property tax revenues which saw a 60% reduction due to the closure of San Juan Generating Station.

With early voting underway New Mexico Legislative Democrats outline tax hike plans for 2025

10.23.2024

With more than a week still left in early voting and Election Day right around the corner, New Mexico’s legislative Democrats are already touting the “need” to raise taxes on New Mexicans next year. Check out the Santa Fe New Mexican for details.

In recent years attempts have been made to raise New Mexico’s taxes on alcohol. As the information here highlights, New Mexico’s taxes on alcohol are NOT low. And, while increased treatment would be welcome that could easily be taken out of existing alcohol taxes. A move to allocate more of the alcohol excise taxes to treatment was attempted but failed in the 2024 session.

There is simply no reason to hit average New Mexicans with a tax hike when the State remains flush with cash.

Of course, no discussion of personal responsibility, the lack of productive work in preventing bad behavior, and other potential policy changes.

But, if you think tax hikes aren’t “on the table” for 2025 (especially if Democrats keep or expand their legislative majorities) you are simply wrong.

Las Cruces gross receipts tax explained

10.22.2024

The Rio Grande Foundation has steadfastly opposed the tax hike which appears on Las Cruces voters’ ballots this year. As we’ve noted, this tax hike would be quite significant and harmful to citizens and businesses alike.

RGF’s president recorded a brief explainer video on the tax hike and the many reasons for voters to reject it. You can find early voting sites around Las Cruces here.

RGF sent postcards like these to Las Cruces “swing” voters (not staunch Republicans or Democrats) immediately prior to early voting getting started.

Early voting is in full swing: find out where to vote (and some good advice on judges from ABQ Journal editorial board)

10.21.2024

Expanded early voting is in full swing and turnout has been heavy so far from all the reports we’ve seen. NOW is the time to get out and vote in person and bring a friend or two or family member to the polls. Here is a useful tool for finding voting locations near you. 

When you DO go vote, don’t forget about the judges. The Albuquerque Journal had a great Sunday editorial about judges and the article makes a compelling case for NOT retaining Judge Emeterio L. Rudolfo. It also makes a good case against trusting the Judicial Performance Evaluation Commission which operates as a rubber stamp for incumbent judges. We DO believe that the Journal should have highlighted Bernalillo County’s Cindy Leos as a poor judge as well although she was rated a “yes” for retention by the Journal.

Regardless of that disagreement, kudos to the Journal for advocating voters take a closer look at the judiciary as a means of addressing our crime issues!

Here are further recommendations from the Journal’s editorial:

Justice of the Supreme Court Briana H. Zamora — Yes on retention

Court of Appeals Judge Jennifer L. Attrep — No recommendation

Court of Appeals Judge Shammara H. Henderson — Yes on retention

Court of Appeals Judge Megan P. Duffy — No recommendation

Second Judicial District Court Judge Brett R. Loveless, Division 03 — Yes on retention

Second Judicial District Court Judge Dan E. Ramczyk, Division 06 — Yes on retention

Second Judicial District Court Judge Cindy Leos, Division 09 — Yes on retention

Second Judicial District Court Judge Elaine P. Lujan, Division 12 — No recommendation

Second Judicial District Court Judge Courtney Bryn Weaks, Division 15 — No on retention

Second Judicial District Court Judge Denise Barela Shepherd, Division 18 — Yes on retention

Second Judicial District Court Judge Emeterio L. Rudolfo, Division 21 — No on retention

Second Judicial District Court Judge Victor S. Lopez, Division 27 — No on retention

Second Judicial District Court Judge David Allen Murphy, Division 30 — Yes on retention

Metropolitan Court Judge Asra I. Elliott, Division 1 — No on retention

Metropolitan Court Judge Renee Torres, Division 3 — No on retention

Metropolitan Court Judge Rosemary Cosgrove-Aguilar, Division 7 — No on retention

Metropolitan Court Judge Yvette K. Gonzales, Division 9 — Yes on retention

Metropolitan Court Judge Michelle Castillo Dowler, Division 13 — Yes on retention

Metropolitan Court Judge Felicia R. Blea-Rivera, Division 15 — Yes on retention

Metropolitan Court Judge Nina Aviva Safier, Division 17 — Yes on retention

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New Mexico’s Rail Runner: bad for the environment

10.21.2024

The Rio Grande Foundation has been implacably opposed to the heavily-subsidized New Mexico RailRunner Express since its inception during the Richardson Administration. Mostly this is due to the high cost of the train system which has seen ridership decline over time and then plummet during and in the wake of the COVID 19 pandemic.

While we have long questioned the outrageous waste of tax dollars and urged policymakers to shut the train down, the Legislative Finance Committee recently reported (as did the Santa Fe New Mexican) recently reported that the train needs to increase ridership by 23% to BREAK EVEN in terms of CO2 emissions. In other words, as it stands now and until ridership increases dramatically, the Rail Runner is bad for the environment.  Of course, even that calculation fails to consider the emissions that went into building the train sets, laying the track, and more cost (and carbon) effective alternatives like commuter buses (which we advocated for at the time).

While exact comparisons are difficult to make because the report strictly considers weekday ridership, we believe that the train would need to return to 2019 levels just to break even on CO2 emissions.

Of course, while the Rail Runner continues losing millions of taxpayer dollars annually and spewing unnecessary carbon into the atmosphere SOME would like to EXPAND the system even further. Left wing State Senator Bill Soules has for years been pushing a taxpayer-funded train from the Mexican city of Chihuahua to Denver, Colorado. While Soules would undoubtedly describe himself as an “environmentalist” (as would the vast majority of Democrats in the Legislature who gave us and keep funding the Rail Runner) what Soules and others fail to understand is that trains like the Rail Runner are only “green” if they are ridden by large numbers of people.

Will New Mexico’s political leadership do anything useful with this information? It’s highly unlikely. Barring a major budget crisis it is hard to see anyone addressing the environmental or budgetary harm of the Rail Runner. But, we have yet another thing to say “we told you so” about.

Photo I snagged earlier today : r/Albuquerque

Tipping Point New Mexico Episode 650: Erik Billinger of ACE Scholarships

10.18.2024

ACE’s mission is to advance K-12 educational freedom, with a focus on securing financial support for families so they may access the quality education of their choice. Erik and Paul have a wide ranging conversation on helping families access high quality education including the exciting economic achievement data from ACE’s scholarship recipients.  Learn more about how you can apply for New Mexico Scholarships from ACE.

Sen. Heinrich expresses opposition to charter schools

10.18.2024

As a sitting US senator who has never been either a legislator or governor, Martin Heinrich has not had much to say about state-level policymaking in New Mexico. Albuquerque City Council does not impact education and Congress’ role in education is rather limited as well.

So, why would Heinrich take time specifically to Tweet that he is opposed to charter schools? See below:

It is hard to say exactly, but what it DOES show is that Heinrich embraces New Mexico’s monopolistic and failing government K-12 system. While disappointing, it is not surprising that Heinrich has embraced such a strong anti-choice approach. The education system’s unions remain a top special interest in the Democratic Party and they don’t like charter schools. Besides, Heinrich is generally NOT a freedom guy when it comes to your ability to buy a gas stove or the car you want (and many, many others).

In 2019 Gov. Lujan Grisham attempted to limit the number of charter schools in New Mexico and failed due to bipartisan opposition. The issue has not come up since. We’ll see what the future holds for Sen. Heinrich.

Tipping Point New Mexico Episode 649 What is a “Fair Share” of Taxes?, The Leftist “Freedom Agenda” and more

10.18.2024

Paul and Wally discuss RGF’s op-ed. The “rich” already pay more than their “fair share” of taxes. Deconstructing the leftist “freedom” agenda. City of ABQ Ballot measures, what’s the point? New Mexico EV shares rise slightly to 4.78%. Evolution of economic freedom in New Mexico. Sen. Martin Heinrich accepted campaign donations from both Avangrid and PNM. How this is both relevant and not. Unions encapsulated in longshoremen’s strike.

Cato Institute Ranks Lujan Grisham “D” for fiscal policy

10.16.2024

Every two years the Cato Institute ranks all 50 governors in America in its Fiscal Report Card. Cato identifies as “libertarian,” but they focus on spending and taxes in this report. Former New Mexico Gov. Susana Martinez (a Republican) received the top score in the report in 2018. Alas, Michelle Lujan Grisham is no Susana Martinez.

Instead, while the report acknowledges MLG’s willingness to reduce taxes somewhat (they don’t acknowledge the State’s gusher of oil and gas revenues as the cause of this fiscal opportunity) they also note that: “Spending has soared under Lujan Grisham, which pushed down her score on this report. The general fund budget increased from $7.5 billion in 2019 to $12.4 billion in 2024, which is a 10 percent average annual increase.” Her spending growth was the highest among US governors (Table A1).

Regardless of her dramatic spending growth New Mexico remains flush with cash and thus has stuffed billions of dollars into its permanent funds (rather than reducing taxes).  This would be reasonable if New Mexico’s economy were diversified and strong, but that is simply not the case.

Could Lujan Grisham be worse?  Perhaps, but no other state in America has as many needs or as much money as does New Mexico. Sadly, MLG has failed miserably to “move the needle” on education, crime, or economic diversification.

Notably, Katie Hobbs of AZ received a D, Utah’s Spencer Cox a “C,” Colorado’s Jared Polis a “B,” and Greg Abbott of TX a “C.”

Republican Kim Reynolds of Iowa received the top overall score while Democrat (and VP candidate) Tim Walz of Minnesota was the worst performing Gov. in the nation.

 

Details on Arizona’s successful Education Savings Account program

10.15.2024

Since the Arizona Legislature adopted universal education savings accounts in 2022. After two years the impacts of the program are becoming clear. Our friends at the Arizona-based Goldwater Institute recently shared the following fact sheet. Overall, the program serves a diverse spectrum of Arizona students and cost much less than the Arizona government school system. Arizona dramatically outperforms New Mexico in education outcomes despite similar demographics.

New Mexico needs innovative education reform solutions considering its dead-last ranking and lack of improvement. Alas, Michelle Lujan Grisham and the union-dominated Democrat Legislature have failed to enact needed reforms like those in Arizona.

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OPINION: The rich already pay more than their fair share of taxes

10.14.2024

“It’s not what you don’t know that gets you into trouble. It’s what you know for sure that just isn’t so.” — Mark Twain

The rich don’t pay their fair share of taxes. This has been said or written by politicians from Joe Biden to Kamala Harris, Sen. Martin Heinrich, to Rep. Melanie Stansbury and many others. “Soak the rich” forms the basis of “progressive” economic thinking in the United States.

What constitutes “fair” in the world of taxation is an open question, but many of these politicians make the unfounded claim that the rich pay taxes at a lower rate than do low- and moderate-income taxpayers.

That is simply not the case. For starters, I’d encourage anyone who does believe the rich pay lower taxes than the poor to check out the latest “tax burden” distribution chart from the Joint Committee on Taxation.

The chart shows that at the federal level, combined employment income and excise taxes consume 2.2% of the earnings of those making $15,000 annually or less. Those earning between $80,000 and $100,000 pay 14.7%, while those earning more than $1 million pay an average tax rate of 30.4%. All income levels are included, but the trend is for those at higher incomes to pay a higher percentage of their incomes in the form of taxes.

That’s because the United States has a “progressive” tax code. This means that individuals who earn more pay higher tax rates, not just more overall taxes, than do those who make less. Sadly, the media rarely call politicians like President Biden out for their assertions that “a schoolteacher in West Virginia paid higher taxes than Elon Musk.”

To address the supposed issue of the wealthy paying inadequate taxes, Biden proposed — and Kamala Harris has endorsed — a plan to tax “unrealized” earnings. What is an “unrealized” earning you might ask? In the case of Elon Musk, it would be stock in Tesla, the company he began, which makes electric vehicles.

Those shares of stock rise and fall with every trade on the stock market, but until Musk sells those shares, he is not taxed on them.

Another case of interest to more Americans is that this scheme would allow the federal government to tax the increased value of your home. So, if your home went from $250,000 to $300,000 over the past few years, the federal government could tax that $50,000 “unrealized gain” without you selling your home.

Where would you come up with the money to pay those taxes, and keep your home? Why should you be taxed on “gains” that are largely the result of government-driven inflation in the first place? These are worthwhile questions, but ones that have seemingly never been asked of proponents of this plan.

There is no question that the nation’s fiscal imbalance is a dire problem. The federal debt is at $36 trillion and shows no signs of dropping anytime soon. But, it is federal spending, not inadequate taxes, that have caused the problem.

Even after adjusting for inflation, federal spending has risen from $4,333 per-person back in 1965 to $19,594 in 2022. This is a bipartisan problem, and both the recent Biden and Trump administrations, and Congresses, have been guilty of allowing the federal government to grow uncontrollably.

No matter who wins the presidency, fiscal restraint is a necessity. Imposing an unfair new tax on “unrealized” capital gains will both harm the U.S. economy and “solve” a problem that really isn’t one at all.

Paul Gessing is president of New Mexico’s Rio Grande Foundation.

The leftist “freedom” agenda

10.11.2024

For the first time in recent history leftist candidates have embraced rhetoric that attempts to embrace “freedom.” Presidential candidate Kamala Harris has done it. Michelle Lujan Grisham did it. And at least one prominent left-wing candidate for the New Mexico Legislature has done it.

Of course, when the left talks about “freedom” they usually just mean abortion. We believe that abortion is a complex issue, but as a starting point there should be no tax dollars spent on abortion. Very few left-wing candidates (and certainly not Gov. Lujan Grisham) care to address the “freedom” of those who wish NOT to fund a procedure they find immoral.

In a recent op-ed, legislative candidate Sarah Silva talks about “freedom from school shootings,” but she makes no mention of HOW to preserve that freedom. One can imagine it is some form of gun control, but the details are left vague.

And, of course, the freedoms left without discussion by the political left include (but are by no means limited to):

  • Freedom to keep your earnings;
  • to choose the best educational option for YOUR child;
  • which could also include freedom to NOT have your child indoctrinated into radical gender theory (among others);
  • freedom to choose weather or not to take an experimental vaccine, wear a mask, and whether to remain open or otherwise manage your business in a public health scare;
  • freedom to speak (including online) without government censorship;
  • freedom to drive the car you want (without subsidizing someone else’s purchase) and use the energy from reliable sources;
  • freedom from crime and rampant lawbreaking.

Whatever your priorities are when it comes to YOUR freedoms, it is hard to see how leftist “progressives” who see government power as being nearly unlimited will defend your freedom. What do you think? Send us an email to info@riograndefoundation.org if we missed a freedom you care about. Or, if you think freedom begins and ends with abortion, let us know why that is so critical to your outlook.

City of Albuquerque ballot measures: what’s the point?

10.11.2024

For City of Albuquerque voters there are two ballot measures that, if adopted, would change the City of Albuquerque’s charter. While there are numerous serious challenges facing the City of Albuquerque (and we’re not supporting or opposing these specific proposals) we find the dedication of time and energy to these relatively trivial matters in a time of crisis to be a head-scratcher. The following information is taken from the League of Women Voters’ breakdown of the two charter amendements:

  1. Shall the City of Albuquerque Charter be amended to modify the procedures to appoint city administrative officers and appoint and remove the Chief of Police and Fire Chief?

The proposed amendment would require the mayor to reappoint, and the council to approve all city administrative officers, the Chief of Police and the Fire chief at the beginning of each new term. It limits the time city administrative officers may serve without council approval. It would also allow the council to terminate employment agreements of the Chief of
Police and the Fire Chief with a two-thirds plus one of the membership of the council (that means seven councilors).

Notably, as the LWV points out CURRENTLY “Council may terminate the police or fire chief at any time within the terms of the employment contract without giving a reason by a vote of seven councilors.”

Our Analysis: We agree with critics who believe Police Chief Harold Medina is doing a poor job and we’d like to see him replaced. This amendment does nothing of significance to increase accountability.

2. Shall the City of Albuquerque Charter be amended to modify the procedures for determination of separation of powers issues under the city charter?

Our analysis: Talk about opaque and unclear! This ballot language says absolutely nothing of substance about the actual proposal.

To understand what is going on, we check with the LWV. The current charter establishes a committee of three with one appointment by the mayor, one by the council, and a third member chosen by the two appointees. If either the mayor or the council fails to make an appointment, as has happened in the past, then the negotiation process is stalled. This amendment requires that these committee members by appointed within 60 days and effectively would allow either the mayor or the council to appoint all three committee members if one of the parties fails to make a committee appointment within the set time.

Our overall analysis: Tim Keller is not a good Mayor. He is soft on crime and his policies are generally ineffective. City Council is somewhat more reasonable, but they are unable to garner 6-vote majorities to push back against the Mayor in any coherent way. So, efforts to hold the Mayor accountable or impose policies preferred by the majority of City Council are often watered down to the point of irrelevancy. That seems to be the case with these amendments.

A brief article appeared in the Albuquerque Journal describing the potential changes.