The latest unemployment rates for states are out (full list can be found here). New Mexico remains in the top 10 with a rate (9.4%) that is higher than all of its neighbors.
The Rio Grande Foundation continues its effort to get Gov. Lujan Grisham to forego her salary until New Mexico drops out of the worst 10 unemployment rates among US states.
On this week’s discussion podcast, Paul and Wally discuss the rising number of COVID19 infections in New Mexico. The Gov. has planned a press conference later today. Paul argues that this rise is a result of the Gov.’s failed lockdown strategy and he expects more shutdowns.
While the number of cases has grown rapidly, the number of deaths has not…at least not yet. Paul argues that this may be due to more effective treatment techniques and suggests a mitigation strategy may be better than a lockdown strategy. He also notes that while hospitals are full, according to UNMH COVID-positive patients represented less than 10% of overall patient cases.
In economic-related news:
NM unemployment rate is among the slowest in the nation to recover
And, according to the Legislative Finance Committee, job losses are dominated by a few major sectors of New Mexico’s economy while government has seen minimal losses.
Finally, Paul and Wally discuss the constitutional amendments on the ballot as well as the bond issues. Reminder: get out to vote!
In the best of times (pre-COVID19) New Mexico has not done enough to overcome its serious inherent challenges in improving student outcomes. That has become an even bigger challenge with the emphasis on “virtual” learning by the State and districts like APS and Las Cruces (to name two big ones).
The Center for Education Reform is a national education reform organization that advocates across the board for “choice” as well as teacher quality and innovation. In the group’s “Parent Power Index” New Mexico (as usual) under-performs its neighbors. Notably, Arizona, which obtains better results form similarly at-risk students for less money, is the top-ranked state in the nation. You can find the entire, interactive index below. 
In the same vein, the Center for Education Reform created a separate report card that just considers and ranks all 50 states based on their charter school laws environments. Again, Arizona takes the top slot while New Mexico ranks as a low-C in the rankings.
The fact is that New Mexico inherently has challenges in improving educational outcomes. Spending more money hasn’t achieved success. It would be nice if the Gov. or the Legislature defied their allies in the unions and focused on improving the State’s charter law and expanding school choice.
According to a recent Pew Center report New Mexico has very volatile tax revenues when compared to other states. That report was discussed in some detail in this Center Square story. New Mexico had the fourth highest volatility in tax revenue collection over the past 20 years.
What can be done? At the Rio Grande Foundation we have argued regularly for economic diversification through the introduction of more economic freedom, but Democrats who control the Legislature and Governor’s mansions have stood steadfastly against serious economic reforms including, but not limited to, gross receipts tax reform.
The following chart taken from the Pew chart directly shows that NM has the greatest volatility among its neighbors.
Some recent presentations by New Mexico’s Legislative Finance Committee (see chart below) truly show how we are NOT all in this together during the Gov.’s COVID 19 lockdown.
While an overwhelming majority of government workers (a huge sector of New Mexico’s economy relative to other states) are doing just fine, many areas of the private sector have been devastated by the Gov.’s lockdown policies. New Mexico’s oil and gas industry and its leisure/hospitality (tourism) are down massively while others are also way down in terms of employment. The full report is linked above while the relevant chart is below:
As Gov. MLG prepares further lockdown measures for New Mexico’s economy, a new Wallethub report shows that New Mexico (which is already poor and suffers from relatively elevated unemployment) is not recovering from the COVID 19 economic interruption as fast as other states.
In fact, since the start of 2020 NM is as seen the 2nd-worst recovery in unemployment claims since January.
The following shows NM’s performance on unemployment last week vs the same week in 2019.
Given the Gov.’s approach to the Virus and increasing spread (but not deaths), we expect further restrictions on New Mexico’s economy to be imposed this afternoon in addition to what she’s already done this week.
The following is a guest article from Carol Wight, CEO of the NM Restaurant Association.
So much has changed for all of us in the last six months. It is time to take a look at the raw numbers of the restaurant industry.
To be sure, restaurants are taking the virus seriously. They are cleaning, sanitizing, social distancing, following the CSP’s, and wearing masks. The safety of restaurant employees and customers has been and always will be our top priority in restaurants.
Unfortunately, the economics are not in our favor. According to the New Mexico Economic Development Department’s quarterly summary, the accommodation and food service industries have lost $574 million since January. This is a 31% decrease from 2019.
The leisure and hospitality industries continue to report the most massive employment losses in the State, with a drop of 25,200 jobs—a 24 percent decrease from last year. It’s heartbreaking. Our employees are like our family. Layoffs may be the hardest thing we have had to do throughout this disaster. These layoffs don’t just affect our workers. They include their families that rely on their income for support.
A national survey of restaurant owners shows that we stand to lose one-third of our restaurants by the end of the year. That’s 1,155 New Mexico Restaurants. It’s heartbreaking to see life-long restaurateurs like Edna and Rudy Ortega of Ortega’s in Albuquerque walk away from their business of 30 years through no fault of their own. This virus takes no prisoners. There are far too many stories like the Ortega’s even to begin to share them here.
Despite meeting many of the (ever moving) gating criteria, NM continues to have some of the most economically restrictive policies during this pandemic. New Mexico is surrounded by states with indoor dining capacities, much more generous than NM.
At this time, NM only has a COVID policy with an intermittent economic policy. As a small business, you can’t succeed and grow, much less survive, without an economic plan. We need to know what is going to happen next, and it has to happen fast. Financial assistance and safeguards need to be a part of our State’s plan if our industry will ever be able to “come back.”
We are not in tune with the rest of the country. Before moving our indoor dining capacity to 25%, only two other states were closed. New Jersey and California have a much more robust economy to begin with and a better chance for recovery. As it stands now, only one other State is at a 25% capacity for indoor dining. If you look at the remaining 48 states, ALL are open to at least 50% capacity, with half of those being open at full capacity.
According to a recent survey of New Mexico restaurants, 54% reported sales being down from 20 to 70%. 16% of restaurants noted sales down over 70%.
Most restaurants reported that they could only accommodate 30% of the previous year’s customers due to social distancing and restrictions.
In a recent survey done by the New Mexico Restaurant Association, one-third of restaurants only have three months until they will have to close permanently, and another 30 percent would have to close permanently in six months.
Where does that leave us? Winter is coming. Survival on 25% capacity is near impossible. Increased costs as a result of the pandemic have hit all of us hard. We have asked, through channels, that the Governor open restaurants at 50%. We are doing our part by offering that with this increase, restaurants will close at 10:00 pm and we will support that all restaurants will need to get the NM Safe Certified Training as a prerequisite to open at 50%.
What can YOU do?
Follow the CSPs. Wear your mask. Contact the Governor to let her know you and your family are ready and willing to get back to our dining rooms.
Support the restaurants in your area NOW at this reduced capacity so that they can survive long enough to have hope that our state leaders will increase capacity to 50% sooner rather than later.
Gary Hays’ family has owned and operated Cliff’s (once upon a time it was Uncle Cliffs) Amusement Park in Albuquerque since the 1950s. Gary shares a few stories about the Park and its history (including dropping ‘Uncle’), but mostly they discuss the impact of the current lockdown policies being imposed by Gov. Lujan Grisham, it impacts on the company’s employees, how his industry is dealing with COVID-19 in states where they ARE allowed to open, and he talks candidly about the future of his family’s business. Gary also shares a few details about other policies (like the minimum wage hike) that impact his company.
When the Legislature reconvenes in January many, including some economists, will push for higher taxes. The Rio Grande Foundation has received pledges from dozens of legislative candidates that they WILL NOT raise taxes and you can find that pledge and the list of signatories here.
While Gov. Lujan Grisham has shut the economy down and that will soon impact tax revenues in a negative direction (absent another big federal stimulus), the reality is that many in New Mexico wish to raise taxes regardless of supposed budget shortfalls. A big tax hike, HB 6 was passed in 2019 when New Mexico was experiencing a major budget surplus.
But New Mexico is already a high-tax state. Don’t believe us, check our the chart below from the Federation of Tax Administrators. When compared to our neighbors (and adjusted for incomes) New Mexico has a heavy tax burden, far heavier than any of our neighbors.
Rather than raising taxes on hard-pressed New Mexico families and businesses, we are proud to stand with those who believe that our State taxes us enough already.
The following appeared in the Farmington Daily-Times on October 7 and several other newspapers.
Recently, California Gov. Gavin Newsom made headlines with his announcement that by 2035 his State will ban the sale of gas-powered vehicles. That is an ambitious goal, but given the time line, it is hard to say what compliance will look like.
But for another, arguably even more ambitious car mileage proposal, one need look no further than New Mexico. Las September New Mexico Gov. Lujan Grisham announced that by just model year 2022 New Mexico would be increasing its fuel economy requirement for new cars to 52 MPG. The current average fuel economy rate is 25.1 MPG according to the EPA.
As we noted at the time, Gov. Lujan Grisham (at the time) had “out California-ed California” by adopting even more stringent fuel economy standards than those on the books in California.
Will California’s decision spur Lujan Grisham to action? Perhaps more importantly, is New Mexico REALLY going through with the Gov.’s 52 MPG standard? This was put forth at a time of a record (oil-driven) economic boom in New Mexico. That boom has evaporated thanks to COVID 19 and the Gov.’s lockdown of the State’s economy. She MAY not be as enthusiastic about such radical plans at a time of serious economic challenges.
If you’re expecting to find legislation on this topic from the 2020 legislative session, don’t worry, nothing was even introduced. We have never even seen a formal executive order from the Gov. formalizing this requirement. In fact, after the initial round of media discussion (led off by the New York Times) the issue has been completely forgotten about.
And just to be clear, if the Gov. completely backed away from her plan, we would be more than happy to support such a move. The number of automobiles on the market right now that achieve such a standard is limited to about a dozen or so hybrid models. Considering that “light trucks” now account for 69 percent of the new car market, getting to that 52 MPG average is going to require one or more of the following:
As much as our Governor desperately wants to virtue signal to radical environmental groups who so strongly support her, attaining 52 MPG is simply not realistic by 2022. California’s Gov. at least had the good sense to impose his regulations long after he will be out of office, but unless Biden wins the White House and picks her for a position in his Administration, she will have to make some hard decisions about whether to comply with this mandate (or not).
Perhaps it is already a forgotten promise that she never intended to honor in the first place? If so, that is certainly fine with us, but it would seem that New Mexicans should be given an honest explanation so they know what to plan for or expect the next time they walk into a car dealership.
Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility
On this week’s episode Paul and Wally discuss the elections which are ongoing, but early voting which starts on Saturday, October 17.
They discuss the latest on the shutdown, the fact that cases are growing despite lockdown. NM one of four states to cancel high school sports. Impacted students protested. Gov. Lujan Grisham didn’t impose additional measures beyond the sports cancellation, but Wally and Paul explain what they think the Gov. will do later this week when she has her next press conference?
The Great Barrington Declaration urges a more reasonable response to COVID-19.
According to a liberal think tank, 39% of New Mexicans can’t pay their regular bills.
Will Joe Biden pack the court if he’s elected? The Amy Coney Barrett hearing gets rolling Paul discusses his recent KOB TV interview on contact tracing and lawsuit the company working here in NM has had in Texas.
ABQ Mayor Keller wants to eliminate City golf courses as an enterprise fund in order to hide the subsidies. Paul discusses.
Finally, the Mayor’s proposed budget includes a 5.5% increase for trash pickup. This is driven by a poorly-considered recycling program. Paul discusses.
On this week’s podcast interview Paul sits down with NMSU economist Jim Peach. Peach recently testified to the Legislative Finance Committee on challenges facing New Mexico’s economy. That testimony is recounted in an Albuquerque Journal story.
Professor Peach and Paul begin by discussing New Mexico’s economy broadly. Why are we not competitive with our neighbors and what can be done to change that? Then, Peach and Gessing discuss the oil and gas industry and its outsized role in New Mexico’s economy and what the professor sees in store for it. Finally, Peach and Gessing discuss the COVID 19 situation and both the near and long-term challenges it creates for New Mexico’s economy and whether the federal government should provide additional bailouts to New Mexico and other states.
The Lujan Grisham Administration has contracted with a company that has been involved in a lawsuit for not fulfilling its end of a contract with the State of Texas.
The Rio Grande Foundation studiously focuses on state and local issues in New Mexico, but we are now two debates in to the presidential election and it has become clear that Joe Biden and Kamala Harris plan to expand the number of US Supreme Court Justices in order to swamp what COULD be a conservative majority on the Court if Amy Coney Barrett.
Famously, in 1937, Franklin Roosevelt threatened to “pack the court” in order to get his transformative New Deal through a skeptical Court. Those threats alone seem to have convinced the Court to embrace Roosevelt’s radical expansion of government. With both Biden AND Harris refusing to publicly disavow such efforts in each of their debates, there can be no doubt that court-packing will be seriously considered should they be elected AND have Democrat majorities in the Senate.
Combined with complete elimination of the Senate Filibuster and even plans by some Democrats to add several left-leaning states (Washington, DC and Puerto Rico to name two) these are perilous times indeed. These issues should be dominant topics of conversation in this election.
COVID 19 update: Trump has it, the Gov. has been self-quarantined after being exposed to it. The Gov. updated us last week but didn’t change anything. She says the virus is spreading as part of another uptick.
Also, the Gov. recently presented to NAIOP on how businesses can help kick start the NM economy. Paul takes issue with that.
What’s OUR plan to reopen New Mexico? We’ve had one since April! https://errorsofenchantment.com/whats-our-plan-to-reopen-new-mexico-weve-had-once-since-april/
We jumped the gun. Bowling alleys aren’t open for everyone, just leagues. And while the Penguin exhibit is open the Biopark’s aquarium is not. Makes perfect sense, right?
A federal Judge supports Gov. Lujan Grisham’s seemingly arbitrary limits on private schools.
The MLG Administration argues that “There is no fundamental right to in-person education.” Paul and Wally discuss the meaning of “adequate” and how it always seems to be about inputs (more money) as opposed to outputs (results).
With California’s Gov. banning gas-powered cars, what about the Gov.’s plan to go to 52MPG?
MLG recently stated that New Mexico “should transition out of fossil fuels.”
The minimum wage is set to rise at the end of 2020. Probably couldn’t happen at a worse time.
RGF has a petition asking MLG to return her salary to the taxpayers until NM’s unemployment rate drops.
NMSU Economist Jim Peach offers his thoughts on New Mexico’s economy and recovery.
Yesterday I posted an article about private management of City of Albuquerque golf courses rather than the Mayor’s plan to allow them to suck up more subsidies. I received the following (which reflects my own information) from an informed insider. As usually is the case with poor/costly provision of government services, the issue lies with government labor unions:
The reason the city courses are struggling is the pay and benefits given to city employees who maintain the facilities. Benefits kill the “pay roll”. City employees maintaining the facility also makes for terrible course conditions.
And if you saw the contract the “concessionaires” sign (private business owners DO operate the “pro shops” and food sales at city golf courses) it’s embarrassing. They give over 16% of revenue back to city which makes it nearly impossible for them to make any money. The national average is 8% back to the city.
Normal golf courses pay the super (80k), assistant (35-40k) the rest are hourly laborers. City is all union/salaried employees with full benefits. Getting them to improve golf course conditions is nearly impossible.
City of Albuquerque golf courses theoretically operate as “enterprise funds.” That means that they are supposed to be self-sustaining from a budget perspective. As the Albuquerque Journal points out, that has not been the case in recent years with golf running big deficits due to declining play.
The decline in play has at least temporarily been reversed due to the COVID 19 lockdowns as golfers (including yours truly) flock to the golf courses in search for outdoor recreation options, but in his new budget Mayor Keller has proposed placing golf courses back in the general budget where they won’t face the pressure of attempting to “break even.”
There ARE worthwhile approaches to improving the financial management at municipal golf courses. These ideas have been implemented in cities all over the nation including New York, Los Angeles, and Cincinnati (as this report from Reason Foundation points out).
To say that there are deep issues on Native American lands and reservations is an understatement. As with many challenges faced by various racial and ethnic groups in this country, there are real, historical reasons for the issues.
But history cannot be changed. What can be done to improve upon the situation in the here and now? A new video from Turning Point USA addresses some of these issues with appearances from some prominent Navajo women Karen Bedonie and Elisa Martinez. The stories and statistics discussed here are personal and powerful, but hopefully can lead to a much-needed discussion of reforms to use free markets, property rights, and the rule of law to improve conditions on tribal lands.
In many ways Albuquerque Mayor Tim Keller are two peas in the same “progressive” pod. But at times even the Mayor has at least been somewhat realistic about the response to COVID 19 while the Gov. issues all kinds of orders that fail to hold up to even the most cursory scrutiny.
Just last week the City had to backtrack on reopening the aquarium at the BioPark. But the relatively new “Penguin Chill” exhibit has been allowed to reopen. Having small children and having spent time in both facilities, it is impossible to justify this situation. The penguin exhibit is literally an aquarium for penguins.
We are certainly NOT making the case to close the penguin exhibit down. Rather, we’d like to see these and other, non-government facilities, reopened.
Recently, RGF president Paul Gessing wrote an article that appeared in several papers around the State including the Santa Fe New Mexican taking Gov. Lujan Grisham to task for keeping New Mexico’s economy shut down for more than 6 months. A letter-writer to the paper responded, asking for the RGF’s plan. Basically, they asked “What’s our plan?”
Funny you should ask; RGF (and our friends at Power the Future) have had a plan since back in April. We STILL think our plan, called Fairly Open New Mexico is relevant. Here’s the core of it:
We haven’t seen this.
Instead, New Mexico’s reopening has been painfully slow and haphazard despite the fact that we are now coming up on our 7 months of being locked down (it basically started on March 11). The problem was highlighted in our confusion over the reopening (or lack thereof) of bowling alleys in New Mexico and the Gov.’s pledge (made in her September 10 news conference) to keep bars and movie theaters shut down until we have a vaccine. Remember when movie theaters, bars, and casinos were supposed to reopen in June? (some tribal casinos are open, but only because they are outside the Gov.’s control)
Of course, if business reopening has been haphazard, the same is true for New Mexico’s schools.
On this week’s podcast interview Paul talks with Brian Riedl, a senior fellow at the Manhattan Institute. Paul and Brian go back to Paul’s time in Washington with the National Taxpayers Union and Brian was with the Heritage Foundation. Brian is an expert on the federal budget and specifically studies and writes on government entitlement programs, federal debt, and the budget. Brian and Paul discuss numerous issues relating to the federal budget situation and the challenges (both political and numerical) that our nation faces and what the consequences of inaction could be.
The Rio Grande Foundation recently joined Power the Future NM and the New Mexico Business Coalition to call for Gov. Lujan Grisham to give up her salary until New Mexico’s unemployment rate is out of the bottom (worst 10) in the nation. Those groups are now working together to circulate a petition via Change.org
Gov. Lujan Grisham has kept New Mexico locked down for far too long. Businesses are struggling as are too many families who rely on those paychecks. Not surprisingly New Mexico’s unemployment rate (11.3%) is among the worst in the nation. We are supposed to ALL be in this together, yet the Gov. and many government employees have not given up much during this long economic shutdown. Gov. Lujan Grisham should give up her taxpayer-funded paycheck until New Mexico’s unemployment rate is no longer among the 10 worst in the nation.
In case anyone ever thought that Gov. Michelle Lujan Grisham was a “friend” to New Mexico’s number one industry (which pays 40% of the State’s budget), she appeared on a webinar put on by the U.S. Climate Alliance.
While Lujan Grisham has often portrayed herself as an “ally” of the industry and a supporter of an “all of the above” energy strategy, that was when the industry was booming and revenues were growing. With (potentially) a new, “progressive”-dominated Legislature taking over this coming January, watch out for the Gov. to play to her radical environmental base by taking on the industry.
Western Wire covered the webinar and Lujan Grisham’s comments here.
The key statement comes at the 2 hour 2 minute mark of the video below:
On this week’s discussion podcast Paul and Wally discuss the latest on COVID 19 from Gov. Lujan Grisham.
Paul discusses his recent op-ed on the Gov.’s lockdown and its economic/virus impact.
In a bit of good news, the Gov. reopens bowling in NM and is allowing college football to play this season. Only the Lobos will be playing, however.
Amy Coney Barrett is nominated by Trump to Supreme Court.
Paul discusses the booklet the Foundation is distributing both online and physical copies of The Indispensable Electoral College.
Bernalillo County embraces PLA’s on a 4-1 vote.
New Mexico’s unemployment fund runs out.
The outgoing Albuquerque Police Chief (Geier) had a bad breakup with Albuquerque Mayor Tim Keller.
RGF and others ask Gov. to give up her paycheck.
New Mexico minimum wage set to increase in January from $9 to $10.50.
