RGF’s Paul Gessing recently had the chance to sit down with two experts in the oil and gas industry who have different takes on plans (put forth by Gov. Lujan Grisham and supported by some in the Legislature and some in industry) for hydrogen and hydrogen hubs.

We at the Rio Grande Foundation had lots of questions and wanted to hear both sides of the issue. You can do the same with the interviews posted below. In support is George Sharpe of Merrion Oil and Gas based in Farmington.

In opposition is Larry Scott a Republican legislator and industry executive from Hobbs.

When it comes to issues surrounding oil and gas, the Rio Grande Foundation supports the industry. This is NOT because of the billions it provides our State every year or even the thousands of jobs it creates. We support the industry because we support human flourishing and energy allows humanity to flourish.

So, we support policies that allow energy development throughout the nation and even the world, including drilling in the Gulf of Mexico. The Bureau of Ocean Energy Management (BOEM), under the Department of Interior, is currently collecting comments on a proposed lease sale (environmental groups are opposed to any new sales).

Click here for details and if you’d like to comment, please do (no later than October 6, 2022). Rio Grande Foundation’s comments can be found below (they are also available on BOEM’s website: l8n-a2s4-dvbe.

The following comments are on behalf of the Rio Grande Foundation, a public policy research organization based in Albuquerque, NM and working to make New Mexico more economically prosperous.

The Bureau of Ocean Energy Management (BOEM) recently released plans for offshore energy development for the next five years. Currently, BOEM’s plan only includes 10 lease sales over a 5-year period in the Gulf of Mexico and does NOT guarantee those sales will take place.

BOEM does not have an active leasing plan for the Gulf of Mexico and will be unable to hold any lease sales until the new plan is finalized. This will leave a multi-year gap in lease sales in the Gulf. The proposed plan needs to be finalized ASAP to help protect consumers and businesses from high energy prices!

The Gulf of Mexico produces 15% of our nation’s energy. The Rio Grande Foundation supports BOEM’s planned lease sale specifically and encourages opening the Gulf to ensure energy prices stay affordable for consumers.

New Mexico is the nation’s 2^nd-biggest oil producing state. Nearly half of that oil is produced on federally managed land. So, while a New Mexican might be expected to oppose drilling in the Gulf in hopes of making New Mexico’s product more valuable, the reality is that we truly ARE all in this together. The federal government needs to expand, not contract, the ability of energy producers to bring oil and gas to Americans and potentially Western European nations as well who are dealing with shortages driven by Russia’s invasion.

Here are a few facts:

• In FY2021, revenues totaled $4.1 Billion from OCS oil and gas activities.
• If drilling in the Gulf is stopped, western states like New Mexico are likely to see a decline in lease sales on federal lands located within the state in the future; negatively impacting our state’s budget and infrastructure funding.
• Oil produced in the Gulf of Mexico is some of the least carbon intensive oil produce anywhere in the world and will play a key role in reducing global carbon emissions.
• The Gulf of Mexico funds conservation efforts across the country, including our national parks.
• Producing American oil and gas in the Gulf of Mexico helps protect consumers from instability in global markets.
• If drilling in the Gulf is stopped, western states like New Mexico are likely to see a decline in lease sales on federal lands located within the state in the future; negatively impacting our state’s budget and infrastructure funding.

Energy abundance is critical to our way of life. The Gulf of Mexico is a big part of America’s energy picture. I urge you to approve this plan.

We have MASSIVE policy disagreements with New Energy Economy (NEE) which self-describes as a “radical” environmental group.

But, they deserve praise for filing a complaint with New Mexico’s Public Regulation Commission over PNM’s sudden move to start co-branding with Avangrid which began a few months back and was noticed and discussed by RGF in early August. While RGF fully expects the merger (denied by the PRC) to be approved once Gov. Lujan Grisham gets to nominate her own PRC members under New Mexico’s new constitutional amendment, we (like NEE) question how the utility has been co-branding with a purchaser that has thus far been denied.

How will this play out? We have no idea? Does this mean RGF and NEE have some kind of “meeting of the minds?” Hardly. These folks (like us) opposed Lujan Grisham’s 2019 Energy Transition Act as well, but we HARDLY see eye-to-eye.

Here is part two of our analysis (find part one here) of the two main gubernatorial candidates’ answers to questions posed by the Albuquerque Journal in their questionnaire: 

10) Do you support or oppose the proposed constitutional amendment on the November ballot that would withdraw more money from the state’s permanent school fund to increase funding for early childhood services and K-12 education?

MLG: Yes.

Ronchetti: Given the extraordinary revenues coming to New Mexico, and the now-massive (and still growing) early childhood trust fund, it’s not necessary to raid the permanent fund too.

RGF’s take: A few aspects of this amendment like home visits could have positive impacts, but a bulk of this money will be used in wasteful and unaccountable ways.

11. Do you support requiring the state achieve net-zero emissions by 2050?

MLG: Yes.

Ronchetti: No.

RGF’s take: Net-zero is an astonishingly bad public policy concept. The idea is to make New Mexico’s carbon emissions zero by 2050. If undertaken this would destroy New Mexico’s economy while doing nothing at all for the climate. According to the McKinsey Consulting firm, if enacted on a global basis net-zero would require $9.2 trillion in annual average spending on physical assets. That increase is equivalent to half of global corporate profits and one-quarter of total tax revenue in 2020.

This is a foolhardy effort especially when one considers that China continues to build coal power plants and increase its already world-leading CO2 emissions.

12. Do you believe changes should be made to the emergency powers held by a governor during a pandemic or other time of crisis.

MLG: No.

Ronchetti: Yes.

RGF’s take: More than 900 days after she declared COVID 19 an emergency in March of 2020 New Mexico remains in an emergency. No one is saying that for some period of time (30 days perhaps) that a governor shouldn’t have emergency powers, but we are LONG past any realistic definition of an emergency.

13. Would you support a merit-based evaluation system to determine how the state spends its capital outlay funding?

MLG: No answer.

Ronchetti: Yes.

RGF’s take: New Mexico’s capital outlay process is often ridiculed as taking a “Christmas Tree” approach to handing out money. All manner of groups supporting good government agree that New Mexico’s current system is broken.

It would be funny if it weren’t so stupid. The San Juan Generating Station, thanks to Gov. Lujan Grisham’s 2019 Energy Transition Act, will shut down on Friday (September 30). That is 555 MegaWatts of relatively clean coal-fired power (thanks to scrubbers installed just a few years ago) that New Mexico will lose (and struggle to replace) by next summer.

If you think that will have any impact whatsoever on climate change, you can forget about it. Here is a news report out of China:

China approved 15 gigawatts of new coal-fired power capacity and another 30 million tonnes of coal-based iron-making capacity in the first half of this year.

That’s an investment of $26-33 billion in coal power and steel sectors in the first six months of this year ALONE! And, if you are confused (as we were) about how many MegaWatts are in a GigaWatt, those 555 MW being eliminated in New Mexico come to .555 of one GW (click for Google’s handy calculator). So, in New Mexico we are closing about 1/30th of the generating capacity that China is bringing online IN JUST SIX MONTHS. Want to bet which country’s power plants are cleaner?

There will be two debates for Gov. While all debates are important, this one is especially so as MLG has so few details about her future plans. The first debate will take place Sept. 30 and will be hosted by KOB-TV. The second hourlong debate is being hosted by KOAT-TV, along with the Journal and KKOB Radio, and is set for Oct. 12.

Opinion piece runs statewide: MLG is trying to win reelection on abortion. What about other important issues?

So far, the most forthcoming remarks MLG has made on her future policy plans have been to the Albuquerque Journal. We compare and contrast the candidates stated views on the issues.

MLG fibs again, this time on COVID numbers. Paul really wishes the media would challenge her on some of these basic questions, but it will fall to Ronchetti to do so in the upcoming debates.

PNM tells policymakers and media (again) that New Mexicans are likely to experience blackouts and brownouts next summer. Again, the media fail to connect this to the Gov.’s Energy Transition Act. California is of course experiencing many of the same issue and will continue to do so until policies change.

Like anyone who lives in or visits the Albuquerque area, it is clear that homelessness is a serious problem. At a recent conference attended by the Rio Grande Foundation, we were able to hear experts from the Austin-based Cicero Institute discuss the situation.

The group offers basic solutions:

1) Ban street camping.

2) Instituting pay-for-performance contracts for those paid by the government to provide services to homeless.

3) Reform mental health admission criteria to allow for 72 hour holds;

4) Provide affordable shelter and service alternatives.

The organization has put out a short documentary on the issue here:

We have criticized Gov. Lujan Grisham for not clearly outlining an economic or education policy agenda in advance of the election. And, while the Albuquerque Journal article about her did little to illuminate her positions, the Journal HAS surveyed the candidates.

Here are MLG’s survey responses and here are Ronchetti’s. We’ll break them down (on issues RGF works on) below.

1) What steps should the Legislature take to diversify the state’s economy and revenue base?

MLG: We must continue diversifying the economy and invest in education to develop New Mexico’s workforce. (basically, continue spending more money on education).

Ronchetti: We must diversify the economy by growing the private sector and revitalizing our small businesses through a competitive tax structure, less regulation and stronger workforce. We make things too difficult for small businesses and don’t empower them to grow. (RGF Take: Ronchetti, few specific policies, but an emphasis on tax/regulatory reform and attracting small business.

7) What changes, if any, should New Mexico make to its gross receipts tax code?

MLG: I signed the first GRT cut in 40 years, delivering tax relief to New Mexico families while making our businesses more competitive. This is in addition to other tax cuts we have implemented. As we grow our economy, we should continue to look at ways to save New Mexicans money. (the Gov. leaves the door open to tax reduction, but oddly has never shared specific ideas)

Ronchetti: Level the playing field for small businesses, who get hammered by layers of gross receipts taxes that big corporations don’t have to pay. We’ll also reduce the GRT every year and not allow local governments to raise the GRT without going to the voters (RGF take: Ronchetti has a detailed plan) and has made it clear that addressing both “pyramiding” and rates on the GRT are critical)

9) Education?

MLG: I increased spending/teacher pay and will focus on early childhood and bilingual education.

Ronchetti: Our education system is ranked last for all children. It’s critical that we help our kids catch up from the lost learning they suffered as a result of school shutdowns, which disproportionately hurt minority children. Chronic absenteeism and lost-learning are completely unacceptable. (RGF take: Ronchetti has a detailed education plan as well. It doesn’t focus as much as we’d like on choice, but it has lots of worthy ideas)

Virtually alone among public policy organizations (only the radical left wing New Energy Economy (for differing reasons) opposed it at the time the Rio Grande Foundation stood against the Energy Transition Act which passed the New Mexico Legislature in 2019.

We are now just FOUR DAYS from the (likely permanent) shuttering of San Juan Generating Station which means PNM loses 26 percent of base load (24/7) electricity and will lose another 5% when the utility exits its Palo Verde (nuclear plant) lease in 2023.

The media has regularly reported on PNM’s comments (here, here, and here) about not being able to keep the lights on next summer. The only question not being discussed or even mentioned in the articles is “why is this happening?” The 2019 Energy Transition Act championed by Gov. Lujan Grisham is directly responsible, but it goes unmentioned in the media coverage.

There are no easy solutions at this point, but New Mexico is going to find out what it’s like to not have enough power to keep the lights on.

The following appeared in the Las Cruces Sun News on Sunday, September 25, 2022 (and in several other papers).

With just a few weeks before early voting, what issues will motivate how New Mexicans vote? According to one recent poll the top issue this fall is inflation/the economy (at 59%). Crime was right behind at 58% followed by immigration and health care. Abortion was down the list at just 29%.

Surprisingly, the poll (done by KOB-TV) fails to even ask about education. In a state that consistently ranks at the very bottom in the nation on numerous (and bipartisan) education reports, serious education reforms should be at least on the radar. This is especially true as education is an inherently state issue (unlike immigration or inflation).

But, if you follow Gov. Lujan Grisham’s campaign’s public messaging you might believe abortion is the only important issue facing New Mexicans. Because we believe the New Mexico economy and education system are two critically important issues, the Rio Grande Foundation looked carefully at both candidates’ websites for details on their plans.

Lujan Grisham’s campaign website is: michellefornewmexico.com. There she touts policies she and the Democrat Legislature have enacted. And, she does have some significant economic policy accomplishments. These include a slight gross receipts tax reduction as well as Social Security and military pension tax reductions passed earlier this year.

In terms of education policy, she focuses her attention on various new programs, teacher raises, and generally spending more money. But recently released state test scores were abysmal. The “moon shot” simply hasn’t moved the needle, and what data we have indicate that New Mexico students suffered greatly during the year of lost in-person learning of the pandemic. New Mexico was one of the states that lost the most classroom time thanks to Lujan Grisham’s COVID policies.

More importantly, the governor offers no specific policies moving forward in either area. How, for example, will she use the $2.5 billion budget surplus the state is expected to have when the Legislature convenes next January? With state spending having already risen by 30% under this governor and voters likely to provide permanent fund dollars to pre-K, is the governor planning to push for long-overdue gross receipts tax reform, more spending, or something else entirely?

We know New Mexico still faces significant economic challenges. The state lost thousands of businesses thanks to the pandemic lockdowns and there are fewer employed New Mexicans today than before the pandemic. New Mexico also remains among the most impoverished states in the union and one that is heavily dependent on the volatile oil and gas industry.

Mark Ronchetti, on the other hand, has released detailed and thorough plans (available at markronchetti.com) explaining exactly what he would like to do on both the economy and education. At the Rio Grande Foundation we agree with him on eliminating “pyramiding” of the gross receipts tax and providing stipends for low-income families to help students catch up to COVID learning loss. He plans to reduce income taxes for middle- and low-income New Mexicans. He also wants to emphasize school leadership and vocational learning along with apprenticeships. He has very detailed plans that are worth considering. We’d do some things differently, but it stands in stark comparison to Lujan Grisham’s non-plan.

We are less than a month away from the start of early voting. Hopefully by then voters will have more information on what Gov. Lujan Grisham plans to do in a second term so they can compare that plan to what Mark Ronchetti has already put forth.

Abortion is an important issue to many people, but the economy and our struggling education system impact us all and on a daily basis. They form the basis of what state policymaking is all about and will be the most important issues discussed in the upcoming 60-day session. Voters need to be able to make an informed decision.

While Gov. Lujan Grisham continues to campaign as if abortion is the only issue on the ballot this November, there are numerous important issues that voters should consider as they head to the polls. One of those is the Gov.’s handling of COVID.

On her campaign website (below) Lujan Grisham claims that New Mexico had “lower case numbers and fewer deaths than Arizona and Texas.” She is correct about Arizona which (according to the World o Meters COVID tracking site) has the 2nd-highest COVID death rate. New Mexico has the 5th-highest rate. Texas, on the other hand, has the 29th-highest death rate (and a lower infection rate as well), see chart below.

Is MLG lying? Is she simply relying on the fact that New Mexico has a MUCH smaller population than Texas and thus has a smaller number of infections? It is hard to say for sure, but clearly New Mexico did not perform as well as Texas on COVID or particularly well in general under her leadership.

Whatever you think of electric vehicles, politicians including most prominent Democrats (and our Gov.) believe that EV’s are worth heavy taxpayer subsidies and mandates for their use. A recent Yahoo News article quotes mining experts (including CEO of a lithium mining company) as saying:

“There’s going to be a real crunch to get the material. We don’t have enough in the world to turn that much [lithium] production in the world by 2035.”

Whatever the year, the challenge is a big one and it will require dramatic increases in mining in the US and around the globe. By 2050 it is estimated that 5X more lithium will be needed. Cobalt and graphite production will also have to ramp up dramatically.

Below is what a lithium extraction field looks like (from this article). Will the Biden Administration or some future Democrat really allow widespread development of these?

The Rio Grande Foundation recently drew attention to New Mexico’s shortage of medical providers. One of the ongoing trends that will make this situation more challenging to deal with is the State’s aging population.

According to the webite USA Facts, New Mexico was one of five states that saw the fastest increase in its share of residents aged 65+. The state’s youthful population is not only not growing. It is shrinking.

America is aging, but New Mexico in particular has made itself more attractive to older people (Social Security tax reduction) while remaining unattractive to younger people (crime, lack of economic diversity, bad schools).

On this week’s conversation Paul and Wally take a look at the forward looking agendas of gubernatorial candidates Mark Ronchetti and Michelle Lujan Grisham for New Mexico’s education system, MLG doesn’t have any (she literally doesn’t lay out ANY priorities):

 You can compare Ronchetti’s education plan with MLG’s  

Furthermore, MLG claims she is “a product of New Mexico’s public school system” when she actually graduated from St. Michael’s in Santa Fe.

Paul and Wally discuss the Heritage Foundation’s new report on education choice. 

New Mexico outpaces the nation on welfare recipients (and it’s not even close). 

It’s almost as if New Mexico government is ineffective or something.

The Washington, DC-based Heritage Foundation has released its first-ever “Education Freedom Report Card.”

While New Mexico does better than dead-last in educational freedom due to the existence of charter schools and the freedom of parents to home school, New Mexico’s overall ranking is 38th in educational freedom. As is usually the case New Mexico trails its neighbors including:

Arizona: ranked #2
Utah ranked #11
Texas ranked #12
Oklahoma ranked #18
Colorado ranked #33

Click on the link above to see the report, but you can see how states shake out overall below. New Mexico’s ranking page is below that and then we use a neat tool within the study to compare Arizona (one of the nation’s true leaders on education choice) vs. New Mexico (which is modest to mediocre).

Two stories in Albuquerque Journal, one from Sunday, the other from Monday.

On Sunday the ABQ Journal editorialized that New Mexico’s “education moonshot” has not shown academic results. Then, on Monday a story shows that after 7 years of collecting a new gross receipts tax Bernalillo County’s effort has suffered from “disorganization, waning engagement with the community and a lack of clear cut performance standards.

It is hard for New Mexico’s big-government-addled politicians to understand, but government tends to do a poor job no matter how much money is poured into the next “solution.” So, we’ll be right back here in a few years when the pre-K constitutional amendment passes and (again) fails to move the needle on education outcomes.

Wallethub ranks New Mexico 49th on “ROI” per taxpayer dollar invested. Is this any surprise?

The following chart was recently published in the Wall Street Journal.  While Biden (and Interior Secretary Deb Haaland) hasn’t completely banned oil and gas leases on federal lands as he pledged during the campaign, he certainly has been excessively stingy.

Gas prices have come down from their early summer highs, but the Biden Administration has done nothing to help the cause. As I wrote when the leasing moratorium was first announced, the lack of federal leasing will impact New Mexico more than any other state (over time).

On this week’s interview Paul talks to Albuquerque area ophthalmologist Kenneth Adams about New Mexico’s doctor shortage. We discuss what attracted him to New Mexico from Texas in the first place. What keeps him here? What are some things that make New Mexico an unattractive state to practice medicine in? What could make things better? Don’t miss this timely conversation!

Sometimes statistics on New Mexico just blow you away. A report from World Population Review highlights states based on welfare recipients per population for 2022. The surprising thing isn’t that New Mexico is at the top of the list. What’s amazing is how big it’s lead is relative to states.

In fact, based on the data below New Mexico’s rate of welfare receipt is 23% higher than the next highest state. Rarely do such massive differences exist when comparing the 50 states, let alone on a critical issue like welfare.

If there is one statistic that highlights the difficulty Republicans face in gaining traction here in New Mexico, this might be it. With such an outsized proportion of the population receiving government handouts, who wants limited government?

As the report notes, the United States has six major welfare programs: Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Programs (SNAP), Supplemental Security Income, Earned Income Tax Credit, Housing Assistance, and Medicaid. These six welfare programs are not to be confused with the four entitlement programs: Social Security, Medicare, unemployment insurance, and worker’s compensation.

If you haven’t figured it out by now, Mark Ronchetti is a policy wonk. His education plan spans six pages of detailed proposals. We’ll discuss some of it here in this post.

Incumbent Gov. Lujan Grisham apparently believes she can win another four years in office without telling people what she intends to do. She offers a bit of information on what she’s done in education but fails to account for the numerous challenges of the last four years or New Mexico’s pitiful performance in education.

Ronchetti on the other hand spends 1.5 pages discussing the importance of education, then he addresses learning loss during COVID and some ideas for making up that gap. He wants to cut administration so $$ flow to the classroom, he wants to tangibly increase parental involvement, he wants to enhance intra-district choice although limited to public and charter schools.

Ronchetti further focuses on vocational learning and apprenticeships, emphasizing recruitment and retention of school leaders. He addresses early reading preparation and even pre-K. In conclusion he discusses ways to improve school safety.

We’d like to see Ronchetti focus more attention on funding students directly rather than bureaucracies, but no matter what you think ideologically, Ronchetti and his team have clearly studied NM’s education issues and have put together a detailed plan. MLG offers no serious ideas for getting New Mexico out of 50th (or 51st) in education.

On this week’s conversation Paul and Wally discuss President Biden’s dark and disturbing speech against Trump and his supporters

Gov. MLG spends $10 million capital outlay dollars for a new abortion clinic in Southern NM:  Also, while Paul reiterates that RGF takes no position on abortion in New Mexico, he frames this move within the context of a new ABQ Journal poll on abortion.

Less than a week after banning gas powered cars California tells Californians NOT to charge their cars due to electricity shortages. As Wally and Paul have recently discussed, 2% of all vehicles on the road in CA are electric. Notably, New Mexico is following these policies, but California recently decided to keep the Diablo Canyon nuclear plant open. To date New Mexico appears to have no inclination to keep power flowing from the Palo Verde nuclear plant. 

Dismal education news this week came from two sources.

Lawmakers discuss NM Spaceport and the pipe dream of financial “self-sufficiency” at the facility while Las Cruces area Cervantes contrasts Spaceport w/ Rail Runner and asks the state of New Mexico to pick up the tab.

A new ABQ Journal poll highlights support for a pre-K amendment on the ballot this November, but this is hardly a surprise given the choices.

RGF is participating in an “open house” for the new Moms for Liberty chapter in Bernalillo County. Information can be found below:

Several weeks ago we took a detailed look at Mark Ronchetti’s economic plan. Overall it was very good although we had a few thoughts on improving it (like tackling New Mexico’s top income tax rate).

Admittedly, while we have spent a great deal of time talking about what the incumbent, Michelle Lujan Grisham has done and not done, we hadn’t really thought much about her plans for the economy for a second term. So, we checked out her website. You can click on the graphic below which is what you’ll see if you go to her site.

Alas, but not surprisingly, there’s no “there” there. Clicking on the “economy and jobs” and “money for families and business” gets you a cursory defense of a small sample of what she has done, but ZERO discussion of what she plans to do if re-elected. We have a $2.5 billion surplus, does she want to spend it all or cut taxes? Any plans to FINALLY address the GRT? How about the oil and gas industry that has provided those recent mega-surpluses?

As the campaign for governor heads into its home stretch, what is MLG’s forward-looking plan for New Mexico’s economy?

In this conversation Paul talks to Sarah Jane Allen. Sarah Jane is involved in the formation of a new Moms for Liberty chapter in Bernalillo County. We discuss what the organization is trying to do and some of the important policies they want to address.

Sarah Jane is also involved with New Mexico Alive which brings regular speakers from the State in order for them to share ways they are working to improve life in the Land of Enchantment.

September 1 was a big day for education data. For starters, the Lujan Grisham Administration released data based on its new assessment (which replaced Susana Martinez’s assessment and then was delayed due to COVID). The results are not pretty. A writeup from the Santa Fe New Mexican both highlights the way the test has evolved and the disappointing results.

APS does a decent breakdown by school here, but results are not easy to find on the Public Education Department website. The charts below WERE released by PED, but the full report was hard to find.

In MORE education news, the National Assessment of Educational Progress (NAEP) released  nationwide data for 9 year olds. Sadly, “Average scores for age 9 students in 2022 declined 5 points in reading and 7 points in mathematics compared to 2020. This is the largest average score decline in reading since 1990, and the first ever score decline in mathematics.” (see below NM data).

Though (sadly) not broken out by state the NAEP report highlights how COVID lockdowns and chaos impacted students across the country. Since New Mexico students were locked out of their schools by MLG for over a year (6th-most in the nation) there is no doubt that New Mexico students suffered disproportionately due to lost time in the classroom.