The op-ed below appeared in the Farmington Daily Times on December 11th.

New Mexico’s economy has fewer jobs today than it did in early 2008. As employment grows nationally, it’s shrinking in the Land of Enchantment. Our jobless rate is now the highest in the contiguous states. Incomes are stagnant, the food-stamp rolls have risen for 29 months in a row, and Millennials continue to flee for abundant opportunities elsewhere.

Sounds like a spectacularly bad time to raise taxes, doesn’t it?

Not to New Mexico’s Big Government lobby.

When the legislature convenes for a 60-day session next month, the state’s liberal establishment will be pushing to raise taxes on everything from gasoline to personal income, alcohol to corporate profits, electronic cigarettes to capital gains. Only “revenue enhancement,” the narrative holds, can solve New Mexico’s persistent budget deficits.

The left’s campaign for tax hikes is founded on rate cuts adopted by Governor Susana Martinez, a Republican, and her predecessor, Democrat Bill Richardson. In 2007, Forbes praised the latter as a “tax cutter” who “whacked New Mexico’s top income-tax rate by 40 percent and capital gains by 50 percent.” In 2013, as part of a legislative package that she claimed would be “good for New Mexico’s economy,” the former signed a phased-in reduction of the top corporate-tax rate, from 7.6 percent to 5.9 percent.

Bill Jordan, of the ultra-liberal New Mexico Voices for Children, believes the state’s in a fiscal crisis “because we cut taxes in the hopes that it would bring wealthy people and profitable corporations to New Mexico, which would create jobs. We lost that bet.” But Jordan, and his ideological allies, have incomplete memories. Taking a broader view, it becomes quite clear that while some taxes have been cut during the Richardson-Martinez era, others have been hiked.

The gross receipts tax (GRT) is the dominant revenue-raising mechanism at both the state, county, and municipal levels of government. The state’s GRT has risen by just 2.5 percent since 2003, when Richardson was inaugurated. But during the same period, local governments have engaged in an orgy of GRT-hiking. In Albuquerque, the levy’s burden has risen by 25.8 percent. In Santa Fe, the increase has been 24.3 percent. But among major municipalities, none can top Las Cruces, which has seen its GRT rise by 27.9 percent. Other cities and towns with big hikes include Alamogordo (26.7 percent), Clovis (26.5 percent), Farmington (25.8 percent), and Silver City (23.1 percent).

The tax-corporations-more crowd should remember that the GRT is a kind of “super sales tax.” It doesn’t solely impact transactions involving final consumption. Business that sell to businesses are affected, too, causing “pyramiding,” which the Tax Foundation describes as taxes piling “on top of one another as [a] good or service moves through production.” It’s likely that many of the enterprises that benefitted from Governor Martinez’s pursuit of lower corporate taxes would gladly make the trade for lower GRT rates. And as economist and former state revenue official Thomas Clifford put it, “The likelihood is high that most of the ultimate burden of [GRT pyramiding] is borne by New Mexico households, a hidden tax with regressive implications.”

The levy placed on property is another issue that New Mexico’s tax-hikers would like to ignore. The statewide mill rate has risen by 21.1 percent since 2003. In many communities, property-tax bills have gotten far more expensive. For example, the inflation-adjusted revenue Las Cruces extracted from its total tax levy rose by 128 percent between 2003 and 2015 — a boost far in excess of population growth.

It’s certainly true that by themselves, lower individual and corporate taxes have not generated much job- and wealth-creation in New Mexico. But conveniently neglecting the substantial increases in GRT rates and property taxes does not produce a healthy debate over the state’s dire fiscal condition.

Look at all the taxes that individuals, families, and business pay in New Mexico, and it’s clear that the relief adopted under the present and former governor has proven largely illusory. Add that harsh reality to a state economy that’s arguably the worst in the nation, and the case for hiking taxes during the 2017 legislative session vanishes.

D. Dowd Muska (dmuska@riograndefoundation.org) is research director of the Rio Grande Foundation, 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.

The center-left Brookings Institute (a Washington-based think tank) has a new report available which details on a state-by-state basis how fast economic growth has grown relative to carbon emissions.

The full array of state-by-state charts is available at the link above while New Mexico’s chart is below. The gist of the chart is that New Mexico’s REAL GDP grew from the baseline of 100 in the year 2000 to 123.3 (23.3%) while carbon emitted due to the State’s economic activity fell from a baseline of 100 to 86.8 (a drop of 13.2%).

In other words, from a carbon “efficiency” standpoint, over the past 16 years, New Mexicans are engaging in more economic activity while carbon emissions are declining. We rank 18th-best in this according to Brookings. This decoupling SHOULD be good news for those who actually want to see wealth/prosperity AND who are concerned about the environmental impact of CO2 emissions.

Yesterday, “New Mexico’s largest electric utility asked state regulators … for an average system rate increase of 14 percent — two months after the most recent increase showed up on consumer bills.”

The request is hardly good news for a state with a crumbling economy. But the good news, especially in an era of endless deficits, is that a no-cost solution is available. Deregulation, when implemented properly, remains a powerful tool for power affordability.

That’s what a large majority of Nevada’s voters decided one month ago today. More than seven in ten favored Question 3, which requires the “Legislature to provide by law for the establishment of an open, competitive retail electric energy market that prohibits the granting of monopolies and exclusive franchises for the generation of electricity.”

In a pro-Question 3 op-ed in the Las Vegas Sun, John Hanger, former head of the Pennsylvania Department of Environmental Protection and a onetime member of the Keystone State’s public utility commission, described the benefits:

After 20 years of allowing customers to choose their generation supplier and competitive power markets with appropriate oversight, customers in the Philadelphia and Pittsburgh regions are paying much less for power generation than they were in 1996. In real or inflation-adjusted dollars, those residential customers are paying about 50 percent less. And Pennsylvania’s statewide average electricity price is at the national average as opposed to well above it.

Thanks to competition for customers, power plants don’t earn revenues for their owners unless they operate, unlike during the monopoly era, when ratepayers typically paid for power plants even when they did not operate. As a result, power plants today are much more efficient and burn much less fuel to produce the same amount of power. The pressure to run more efficiently means they pollute less.

Errors of Enchantment has argued before that it’s time for New Mexico to revisit the Electric Utility Restructuring Act, which was passed in 1999 but repealed four years later. (In 2003, the Foundation presciently warned that the retreat from competition portended “nothing but high prices in the long run.”) As the charts below indicate, the price of juice in the Land of Enchantment is somewhat competitive for industrial customers, but is second-worst for commercial enterprises and most expensive for homeowners.

Stephen Moore (who spoke at an RGF luncheon a few years back) has an interesting article called Blue State Depression. In his article, Moore contrasts the economies of the “bluest” states and the “reddest” states in America.

For starters, notes Moore:

Of the 10 blue states that Hillary Clinton won by the largest percentage margins — California, Massachusetts, Vermont, Hawaii, Maryland, New York, Illinois, Rhode Island, New Jersey, and Connecticut — every single one of them lost domestic migration (excluding immigration) over the last 10 years (2004-14). Nearly 2.75 million more Americans left California and New York than entered these states.

Now let’s look at the 10 states that had the largest percentage vote for Donald Trump. Everyone of them — Wyoming, West Virginia, Oklahoma, North Dakota, Kentucky, Tennessee, South Dakota, and Idaho — was a net population gainer.

Where does that leave New Mexico? Well, as usual, The Land of Enchantment doesn’t quite fit in. Aside from California and Hawaii, the “bluest” states according to Moore are all relatively high income, high cost, industrialized states with populations centers in the North (read cold weather). New Mexico is a poor western state with plenty of sunshine and great weather. Thus, our population is not falling, but growth is much slower than it is in any mountain state.

We DO have one big thing in common with the rest of those “blue” states: our sluggish economy. In fact, New Mexico is in the unique position of being a poor blue state that never industrialized, certainly not like those Northern states. And, unlike even some of those “blue” states, New Mexico actually got more blue this election by reverting to total Democrat control of the Legislature.

There’s an enormous pile of required reading for legislators making the trip to Santa Fe for the 2017 session. But “No Recovery: An Analysis of Long-Term U.S. Productivity Decline” should be near the top.

“[P]repared by Gallup to celebrate the 30th anniversary of the U.S. Council on Competitiveness,” the report argues that “America is dangerously running on empty,” with “productivity growth … in a serious multi-decade-long slump.”

Written by economist Jonathan Rothwell, “No Recovery” finds that the healthcare, housing, and education sectors “account for 36% of national spending and could hold the key to reversing this structural productivity decline and reinvigorating American growth and high-value job creation.” But red tape imposed by state and local governments, not just Washington’s regulatory madness, constrain such a rebound.

For example, 41 states, including New Mexico, have adopted the “implied-contract” doctrine for “almost any employer-employee relationship,” which mandates “termination only for cause.” Land-use control is another villain, with “zoning boards and planning agencies” having “almost complete discretion over what gets built where.” (In 2015, Albuquerque’s planning director told reporter Dan McKay: “Nobody has a true sense of what’s allowed and what’s not allowed. It’s not very predictable. … I had developers calling and saying, ‘I will never do a development in your city again.’”) And occupational-licensing overkill, a New Mexico specialty, boosts “costs for primary healthcare and dental care services.”

While our neighbors are, for the most part, thriving, Big Government is strangling New Mexico’s entrepreneurs, workers, and families. Deregulation of the state’s healthcare, housing, and education sectors is imperative. Legislators, read up.

Just 1 percent of New Mexico’s oil is produced on tribal lands. For natural gas, the figure 3 is percent.

That’s why a recent Reuters report offers hope for economic development on pueblos and reservations, as well as New Mexico’s struggling oil-and-gas industry.

Two advisors to the president-elect told the news service that they’re pushing to free Indian resource development “from what they call a suffocating federal bureaucracy.” U.S. Rep. Markwayne Mullin (R-OK), a co-chair of Donald Trump’s Native American Affairs Coalition, is seeking to “take tribal land away from public treatment,” and predicts that doing so will enjoy “broad support around Indian country.” Mark Fox, chairman of the Three Affiliated Tribes in North Dakota, voiced a common complaint: “The time it takes to go from lease to production is three times longer on trust lands than on private land.”

Congressional auditors have repeatedly documented the extent of the frustration. Last year, the Government Accountability Office found that the Bureau of Indian Affairs‘s “management shortcomings and other factors” hobble tribes’ energy development. Specifically, the agency

does not have the data it needs to verify ownership of some Indian oil and gas resources, easily identify resources available for lease, or identify where leases are in effect, as called for in Secretarial Order 3215 and internal guidance. BIA also faces staff limitations and does not have a documented process or the data needed to track its review and response times, as called for in implementation guidance for Executive Order 13604, and therefore it cannot ensure transparency in its review of energy-related documents. These shortcomings can increase costs and project development times, resulting in missed development opportunities, lost revenue, and jeopardized viability of projects.

At a Santa Fe hearing on Indian energy development held in October, U.S. Rep. Rob Bishop (R-UT) noted that the “issue at its core deals with human dignity, self-determination and opportunity. Unfortunately, nearly every aspect of energy development on tribal lands is influenced or controlled by the federal government, a policy stemming from old notions that Indian tribes are incapable of or unwilling to manage their resources.”

With prices of both oil and natural gas on the rise, there’s no better time to empower native communities to expand energy development.

According to the latest article about New Mexico’s dire budget situation, Dan Secrist, vice president of the Communication Workers of America union said, “cutting any more will mean the curtailment of services.” Certainly, spending less money will get “less government,” but perhaps less government isn’t such a bad thing, especially when your state is spending at far higher levels than its neighbors:

The Rio Grande Foundation published a detailed list of budget cuts. A few of those (like “across the board” cuts to higher education) were at least addressed in the October special session, but there is plenty of wasteful and unnecessary spending still available:

Cut funding on Eliminate Local Economic Development Act: $55.4 million;

Eliminate Film Production Tax Credit: $50 million;

Eliminate Tourism Department: $16.9 million;

Get rid of Job Training Incentive Program: $6 million;

Reduce unproven preschool program: $52 million

Close higher education branch campuses: $10s of millions depending on closings;

Finally, from a separate brief dealing with the issue, Reform long-term-care insurance issues within Medicaid $100 million.

Here we go again.

New Mexico’s “economic development” brain trust has formed “GrowBio,” to “identify and advance actionable strategies to grow biotechnology businesses in New Mexico to benefit the state’s economy by creating new and high-paying jobs to improve the lives of New Mexicans.”

Dr. Richard Larson, executive vice chancellor at the University of New Mexico Health Sciences Center, told the Albuquerque Journal that the state has “already created the foundations for a strong bioscience industry,” and is now “at the stage where the state and private sector must work together on policies and incentives to move a lot more discoveries from lab to market to help biotechnology startups grow and thrive.”

If the state has a “burgeoning biotechnology industry,” as the Journal claimed, that would come as news to the Biotechnology Innovation Organization, “the world’s largest trade association representing biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and in more than 30 other nations.” In a report issued earlier this year, BIO found that between 2012 and 2014, the number of bioscience firms in New Mexico rose by only 0.5 percent. The number of jobs in the industry fell by 6.9 percent — a sharp contrast to the Land of Enchantment’s neighbors:

Source: “The Value of Bioscience Innovation in Growing Jobs and Improving Quality of Life 2016,” Biotechnology Innovation Organization

Biotech would indeed be a good industry to expand in New Mexico. Compensation is generous and the potential for growth is vast. But “more tax credits for out-of-state investors and funds set aside in the state budget” won’t get the job done. Neither will a “bioscience authority that would establish connections between the innovation community and sources of capital to fund bioscience startups” and a “head of bioscience” for the New Mexico Economic Development Department.

Only sweeping, and high-impact, economic-development policy shifts will attract the kinds of businesses and industries that are needed to rescue New Mexico from its dire economic/fiscal condition. The central-planning approach has been tried. It doesn’t work.

While the national election largely went in favor of Republicans, New Mexico reverted back towards Democratic control of the Legislature. With the exception of a few years of slight Republican majorities in the Senate during the 1980s, Democrats have had an iron-lock on the Legislature since 1954.

So, now that Democrats have re-taken the House, will we see another 52 years of Democrats controlling the Roundhouse? Good question.  The following chart from Rob Nikolewski, formerly the New Mexico Watchdog, would seem to indicate that Democrats are continuing to lose registration while Republicans are holding steady and DTS are growing.

If voting patterns hold along those lines, Republicans in New Mexico should not fret. They will remain competitive and possibly become more competitive in the future. However, there has long been anecdotal evidence for the registered Democrat who sometimes or always votes for Republicans. Perhaps that dynamic is changing? It is hard to say.

There is no doubt that Republicans in New Mexico face uphill battles to get into and remain in office. It has certainly not reached the point of irrelevance as has California’s GOP.

What we do know is that Republican Mayor RJ Berry will likely be replaced by a Democrat in 2017 (Republicans have a big challenge due to changes in the runoff process alone, let alone Berry’s policies). And, in 2018, the Republicans will have to pick up three seats in order to create a tie in the House in an off-year election. And then there is the race for Governor. If Tom Udall runs as is widely speculated, he will be very difficult for the GOP to defeat.

In summary, while the party registration data seem to be moving in their direction, the political situation on the ground is quickly moving in the other direction.

The Foundation is tracking announcements of expansions, relocations, and greenfield investments published on Area Development’s website. Founded in 1965, the publication “is considered the leading executive magazine covering corporate site selection and relocation. … Area Development is published quarterly and has 60,000 mailed copies.” In an explanation to the Foundation, its editor wrote that items for Area Development’s announcements listing are “culled from RSS feeds and press releases that are emailed to us from various sources, including economic development organizations, PR agencies, businesses, etc. We usually highlight ones that represent large numbers of new jobs and/or investment in industrial projects.”

In November, of 16,780 projected jobs, 13,556 — 80.8 percent — were slated for right-to-work (RTW) states:

As for the sub-metrics the Foundation scrutinizes:

* Ten domestic companies based in non-RTW states announced investments in RTW states. Just two announcements went the other way.

* RTW prevailed in foreign direct investment, too. Fourteen projects are headed to RTW states, with five to occur in a non-RTW state.

Marquee RTW investments included:

* Lucid Motors, “a luxury mobility company applying innovative engineering, design and technology to define a new class of premium electric vehicle,” picked Arizona for its manufacturing facility (2,000 jobs)

* Citing “the advantages Arizona offers to businesses in terms of operating costs, light regulation and low taxes,” ADP announced a new operations center in Tempe (1,500 jobs)

* CSRA, an IT firm, dedicated its Integrated Technology Center (800 jobs) and announced it was building a Customer Engagement Center (300 jobs), both in Louisiana

* Credit One Bank chose to build a new, expanded headquarters in Nevada (500 jobs)

Once again, no investments were announced for the Land of Enchantment.

Methodological specifics:

* All job estimates — “up to,” “as many as,” “about” — were taken at face value, for RTW and non-RTW states alike.

* If an announcement did not make an employment projection, efforts were made to obtain an estimate from newspaper articles and/or press releases from additional sources.

* If no job figure could be found anywhere, the project was not counted, whether it was a RTW or non-RTW state.

* Non-border-crossing relocations were not counted, border-crossing relocations were.

At the Rio Grande Foundation we TRY to be positive. Sure, we point out problems, but we also put forth positive reforms that could make a difference for New Mexico’s struggling economy. But challenges are growing and I don’t see policymakers stepping up.

For example, construction is a major economic factor. The Associated Builders and Contractors have ranked New Mexico’s construction climate 50th in the nation. As bad as that is, it is made all the more painful by the fact that in Colorado they are complaining about TOO LOW rates of unemployment in construction while New Mexico’s rate is the 2nd-highest in the nation, FOUR TIMES the rate of Colorado.

But if there are any guarantees about the liberal takeover of the New Mexico Legislature, opposition to “right to work” and repeal of New Mexico’s “prevailing wage” laws may be the most ironclad “non-starters” in Santa Fe these days.

High unemployment means few jobs and few people paying taxes. The positively shocking outcome of that is, as the Legislative Finance Committee noted in its November newsletter: there was a 30 percent drop in general fund balances between October 2015 and October 2016.

Check out the chart below which shows how New Mexico’s revenue situation has worsened dramatically since January of 2016. That is of course when oil prices began their steep decline, but we at the Rio Grande Foundation have been talking for years about our State’s over-reliance on the federal government and oil and gas industries.

The Democrats who recently took over in Santa Fe are eager to raise taxes, but you can’t squeeze blood from a turnip. The productive folks that have remained in New Mexico will just accelerate their migration out of state.

Earlier today, U.S. Sen. James Lankford (R-OK) appeared at a Cato Institute event in Washington. “Cutting Wasteful Spending in the Trump Administration” also featured Citizens Against Government Waste‘s Thomas A. Schatz, the Heritage Foundation‘s Justin Bogie, and Cato’s Chris Edwards.

Unlike last year’s “Wastebook: The Farce Awakens,” a survey of waste, fraud, and abuse compiled by U.S. Sen. Jeff Flake (R-AZ), the latest volume of Lankford’s “Federal Fumbles: 100 Ways the Government Dropped the Ball” doesn’t include a specific fiscal atrocity based in New Mexico. But there are plenty of examples that touch upon public policy in the Land of Enchantment:

● Medicaid, the welfare program that could soon “cover” half of New Mexico’s population, provides “an unlimited supply of federal money” but “no consequences to … state budgets.” As such, it suffers from a severe improper-payment crisis. The Government Accountability Office recently found “enrollees with fake Social Security numbers and payments to people who should not be enrolled because they are either enrolled in another state, are in jail, did not provide accurate information to prove they qualify, or were deceased.”

● The Obama administration has halted “all new coal-mining leases on federal lands.” It’s one of the president’s “seemingly endless list of climate regulations, including the costly Clean Power Plan.”

● The EPA has issued new controls to regulate methane in the oil-and-gas sector. But the industry “is not even the primary producer of … emissions and the main increase around the globe does not even come from the U.S.”

But Lankford’s depressing document offers some hope, such as:

● Along with U.S. Rep. Steve Russell (R-OK), the senator is sponsoring legislation to zero out the Essential Air Service, which receives “federal funding despite studies illustrating that the subsidized flights are often sparsely utilized at a cost of more than $500 per passenger.”

● The U.S. Department of Energy’s National Nuclear Security Administration (NNSA) “has been on the GAO’s [high-risk] list for 25 years, primarily due to inefficient program operations that have cost American taxpayers billions more than they should.” To address the problem, “this year’s Energy and Water appropriations bill … includes language asking NNSA to conduct a review of all projects greater than $750 million.”

Read Lankford’s deep dive into federal dysfunction here.

The Rio Grande Foundation takes a backseat to no one in having a skeptical approach to government regulations. Broadly speaking, it is our view that unnecessary and ill-conceived government regulations are killing New Mexico’s economy and have constrained the US economy as well.

So, it is definitely in the category of “man bites dog” that there is an issue in Carlsbad for which the Rio Grande Foundation believes that necessary regulations may be skirted. The issue involves a proposed potash mine 13 miles Southeast of Carlsbad. The mine would developed by the Mosaic Company. Issues at a Mosaic mine in Florida prompted Governor Rick Scott of Florida to enact sweeping policy changes after the company’s activities created a massive sinkhole leading to 215 million gallons of radioactive water being dumped into the state’s aquifer.

Folks in Carlsbad know better than most how problems can develop from poor siting of mines and discharge points. A potential sinkhole is located at the City’s “South Y” along Highway US 285. The Carlsbad I&W Brine Well operated at the current location almost continuously from 1979 to July 2008, but the mine was forced to close after its process of injecting fresh water into the ground to dissolve the salt and extract brine caused a liquid-filled underground cavern to form.

New Mexico taxpayers face costs ranging from $15 and $25 million to permanently fix the problem.

Now, Mosaic, under a potential agreement with New Mexico’s Environment Dept., is planning on discharging 7.5 million gallons of brine-water a day which comes with the potential of contaminating neighboring drinking, recreational, and agricultural water. The discharge location had been approved by State regulators, but the company has asked to move the site without further study or analysis of the new location.

It’s worth noting that in the wake of recent Mosaic mining activity in Florida and Louisiana the company felt obligated to commit $630 million to pay for closures and remediation projects at certain facilities after the EPA found them in violation of state and federal laws.

Eddy County officials and state regulators must act more responsibly on behalf of the citizens of southern New Mexico to ensure Florida’s misfortunes don’t become New Mexico’s problem.

No one wants economic development to happen in New Mexico more than we do at the Rio Grande Foundation, but we also don’t want to act in haste or desperation in ways that have negative repercussions for New Mexico taxpayers or the environment.

The Associated Builders and Contractors‘ new “Merit Shop Scorecard” just came out and the news is not particularly good for New Mexico. The 2015 placed us dead last (51 out of 51, behind the District of Columbia). We’ve moved up this year, but only to 50th (we beat out Illinois).

See a map illustrating the results below:

Among the ways New Mexico laws fall short are lack of “right to work” and having a “prevailing wage” mandate. Unfortunately, recent changes to New Mexico’s Legislature make it unlikely that anything will be done to address those two issues.

Not surprisingly, New Mexico’s construction industry suffers from the second-highest unemployment rate in the nation. The “good” news is that nearby Colorado has the lowest construction unemployment rate in the nation.

If there’s an image that should be ingrained in the minds of New Mexico’s governor and legislators, it’s the one above. It depicts the number of individuals on the state’s Supplemental Nutrition Assistance Program, more commonly known as “food stamps.”

Since April 2014, the number of SNAP beneficiaries has risen, every single month.

Every. Single. Month.

Nationally, “American businesses have added 15.5 million jobs since February 2010 … the longest streak of overall job growth on record.” The unemployment rate is down to 4.9 percent, and the Dow Jones Industrial Average has soared past 19,000.

But in the Land of Enchantment, the unemployment rate is the highest in the contiguous states, and 26 percent of the population is on food stamps.

In two weeks, legislation for the 2017 legislative session will begin to be prefiled. With no serious alterations in public policies, implemented awfully quickly, New Mexico’s economic, fiscal, and welfare woes are sure to continue.

We are still waiting for the food stamp-induced economic stimulus.

During the special legislative session which was held in October, a push was made to “do something” to apply New Mexico’s gross receipts tax to sales of goods shipped into New Mexico via online vendors. Although the analysis provided by the Legislature is unclear as to exactly HOW GRT would be collected on Internet sales, the intent is clearly there. The provision was rejected by the Republican House, but will undoubtedly return now that Democrats have control of both houses.

I was quoted along with several legislators and others with knowledge of the issue in this article by Andrew Oxford at the Santa Fe New Mexican.

Unfortunately for legislators looking to boost New Mexico’s bottom line, collecting taxes by online vendors is not as easy as it sounds. As I wrote back in 2000 for the National Taxpayers Union, there is nothing exempting Internet sales from taxation. Rather, it is the 1992 Supreme Court decision in Quill which exempts out of state vendors (lacking a physical presence in a state) from that state’s demands to collect and remit taxes to them.

Congress could act to force small businesses to collect these taxes, but a Republican-controlled Congress is not likely to do something that hasn’t been done in nearly two decades including eight years of Democrat control. Looks like legislators will have to look elsewhere for revenue…or, maybe even make some tough decisions to streamline government.

Did you have empty chairs at your Thanksgiving dinner table? We all know people, especially young ones, who have left New Mexico for greener economic pastures. Our States poor business climate is forcing our people out.

Unfortunately, policymakers failed to push through needed policy reforms like “right to work” and school choice in the last few years. Now, with Santa Fe “progressives” now in control of the Legislature, things aren’t going to get any easier. Instead, tax hikes and more spending will be aggressively pushed in Santa Fe.

But, there is hope. Hopefully President-elect Trump’s pro-energy/anti-ObamaCare policies will bring greater economic growth to the United States as a whole, thus helping New Mexico’s economy. A Trump Supreme Court nominee could have great, positive impacts.

No matter what the future holds, you know that the Rio Grande Foundation will be there fighting the ideological battles and making the case for free markets, limited government, and individual freedom.

On this “Giving Tuesday,” I hope you’ll support the charities that you value, but know that it is the free market that can solve most of our woes, especially here in New Mexico.

Click here now to support the Rio Grande Foundation! There is no better way to support freedom in New Mexico.

The Rio Grande Foundation is a 501c3 charitable organization which means that donations to us can be deducted from your 2016 taxes. I hope you’ll support the organization that works to solve the most important problems facing our State. Thank you!

Some day soon, I want young people to be able to find economic opportunities right here in New Mexico so they don’t have to move to economically-freer places like Texas, Utah, or Colorado.

Sincerely,

Paul Gessing
President of the Rio Grande Foundation

According to the Bureau of Labor Statistics, when we “watch television, listen to the radio, read a book or a magazine, surf the Internet, make a phone call or send a text, or see a movie at the theater,” we’re being served by the information industry. The sector has 2.8 million employees, and pays a full-time salary of $77,626.

Unfortunately, jobs in information were badly battered by the Great Recession. Since the end of the downturn, employment has grown in just 14 states.

There’s bad, and then there’s abysmal. New Mexico ranked 43rd in “growth,” dropping by 19.2 percent. The Land of Enchantment roughly matched Oklahoma’s loss of 20.2 percent. Texas and Colorado posted slight declines, but two neighbors — Utah and Arizona — enjoyed significant growth. (See chart above.)

New Mexico’s performance is pretty surprising, given the political-media establishment’s relentless claims that the film-and-television industry here is “booming” and that the tech sector is about to take off.

Billions of dollars in federal “investment” and a hugely expensive incentive program for Hollywood? Not getting the job done, evidently. Maybe school choice, a right-to-work law, tax reform/relief, and deregulation are worth trying?

Source: Holtec International

Election Day brought good news to fans of the Yucca Mountain project. The long-planned but never-built facility was slated to house spent nuclear fuel from the nation’s atomic plants. But for decades, fierce opposition in Nevada — led by Sen. Harry Reid — blocked Yucca’s opening, and in 2010, the Obama administration torpedoed the repository for good.

Or did it? Reid has retired, the reliably pro-Yucca GOP retained control of both chambers of Congress, and restarting the project is “actively being discussed by advisers” to the president-elect’s transition team.

If Yucca is revived, that’s not good news for an intriguing proposal in southeast New Mexico. As regular readers of Errors of Enchantment know, Holtec International is pursuing a “state-of-the-art interim storage facility” not far from the Waste Isolation Pilot Plant. Commercial repositories, spread throughout the country, represent a much better approach than the federal government’s billion-dollar, one-size-fails-all approach. The nationalized, technocratic, Cold War-era strategy has been a disaster for ratepayers, taxpayers, and the nuclear industry. Permanent storage of nuclear “waste” by for-profit entities is the way to go. (Here’s a deeper look at how that might be done.)

Holtec’s proposed facility, depicted above, could make an important contribution to settling the spent-fuel quandary once and for all — and give New Mexico’s dismal economy a boost along the way. For the sake of free-market energy policy as well as opportunity and prosperity in the Land of Enchantment, let’s hope that Yucca stays dead.

The article in the Albuquerque Journal’s “Rio West” section outlines UNM West’s $20 million expansion plans.

The State is mired in a serious budget crunch. Higher education just took a 5 percent hit in the special session held in October. And, New Mexico’s higher education student population is declining rapidly. So, it makes “perfect” sense that UNM Health Sciences Center would be building a $20 million expansion at its West Side campus.

It’s not that the programs and training aren’t necessary or helpful, but New Mexico already spends 6th-most in the nation per student according to 24/7 Wall Street. We simply can’t afford all of these “investments” using taxpayer dollars.

Leslie Morrison’s (listed as a vice-chancellor for academic affairs at UNM Health Sciences Center) comments are particularly enlightening. The facility opened its doors in 2010, yet Morrison stated in defense of the project that “we really wanted to re-energize UNM West, but…it needs more of a focus and it needs to have more students there.”

We couldn’t agree more, but rather than pouring more resources into an ever-expanding array of campuses and branch campuses, it is time for some tough decisions by Legislators and other policymakers. We don’t have enough money to fund what we have. The budget is being reduced and could be reduced even more. Why would we spend even more?

We at the Rio Grande Foundation have taken a keen interest in economic developments in West Virginia. The Mountaineer State has historically had a lot in common with New Mexico (although that is rapidly-changing).

But, in February of 2016, West Virginia did something New Mexico hasn’t and likely won’t do for some time: it went “Right to Work.” Almost on cue, the unemployment rate began to fall in West Virginia (as seen in the chart below).

But, in August, a judge issued an injunction halting law from being implemented and enforced. And again, almost on cue (again as seen in the chart above) West Virginia’s unemployment rate began to move, this time in the opposite direction (higher).

Now, “right to work” laws have been deemed legal all over the nation and three new states, Missouri, Kentucky, and New Hampshire are all in line to adopt similar laws, so it is VERY likely that West Virginia will soon see its law blessed. But, businesses HATE uncertainty and they also don’t like to wait for the legal system to work things out.

Could it all be a huge coincidence? Sure. New Mexico stood pat and has seen some ups and downs (mostly ups) to its unemployment rate, but I’m going to predict that WHEN West Virginia’s law is approved by the courts, the Mountaineer State will leave New Mexico in the dust economically….not just in unemployment, but overall job growth, and other economic measures as well. After all, some have expressed doubts about “right to work” by calling for data from a single state to show whether such laws have an impact (or not).

It would seem we have even more data in the affirmative.

KRQE’s Larry Barker should be commended for his probe of the City of Santa Fe’s Environmental Services Division. The reporter’s four-month investigation revealed that “administrators failed to address hundreds of safety-related defects in many of its older garbage trucks.”

Allowed to peruse “1,400 maintenance and inspection reports for Santa Fe trash trucks,” the New Mexico Trucking Association’s Johnny Johnson concluded that the city’s “fleet is poorly maintained and there is a total disregard for public safety.”

As Barker noted, one of the reasons the city was allowed to be so slipshod is that “government-owned trucks” are exempt from federal regulations. (When the chief of New Mexico’s Motor Transportation Division was asked “if regulated, would Santa Fe’s truck fleet be subject to some kind of compliance action,” the official replied, “Absolutely.”)

But it’s worth stepping back a bit, and pondering a rather basic question: Why does Santa Fe operate refuse trucks at all?

More than half of the nation’s municipalities contract out all or a portion of garbage/recycling collection. The Reason Foundation’s Leonard Gilroy describes the benefits as “cost savings (competitive delivery of solid waste services typically generates cost savings on the order of 20 to 40 percent), enhanced risk management, efficiency or technology improvements, and debt reduction.”

Some recent developments:

* Portland, Maine is exploring the privatization of “of its trash and recyclables as part of a review that is expected to bring major changes to a waste management program that has become increasingly unpopular with residents and municipal officials”

* Hunterdon County, New Jersey, which “has been looking for some time to get out of the waste business,” is looking to “contract with another county, or contract with another private entity” to operate its transfer station

* Fall River, Massachusetts has successfully contracted out trash collection, with the goal of saving “just under $1.5 million in fiscal 2017 and $8.7 million over the life of the [ten-year] contract”

Closer to home, in January, the Santa Fe Chamber of Commerce compiled a list of recommendations to tackle The City Different’s many budget woes. The organization wrote what while “marginally profitable on an operating basis,” the Environmental Services Division could be replaced by firms competent “in the management of both recyclable and disposable waste. Ongoing evaluation of privatization options is warranted.” After Barker’s investigation, such an evaluation is downright urgent.

Love him or hate him, Donald Trump has made it clear that he’s no fan of free trade. And that’s why all those working to boost New Mexico’s woefully underperforming economy need to be concerned.

Trade is arguably the only sector of the Land of Enchantment’s economy on the upswing. Despite the brutality of the Great Recession and a subpar recovery, between 2009 and 2015, jobs connected to the exports of goods — not services, it’s worth noting — more than doubled, according to the International Trade Administration, a division of the U.S. Department of Commerce.

Intel’s products dominate the state’s exports, but a pretty wide range of goods leaves New Mexico for customers aboard — including heavy equipment, medical supplies, compressors, aircraft parts, chemicals, plastics, circuits, and fertilizers. Agriculture plays a big role as well. Among the states, New Mexico is third in the export of tree nuts and ninth in dairy products. We export beef, cotton, and vegetables, too.

The top destination for New Mexico’s exports? You guessed it: Mexico. Israel ranks second, followed by Canada. China lands at #4, with Belgium rounding out the top five.

In September, the Albuquerque Journal reported that exports to Mexico “grew 17.4 percent in the first half of 2016, from $758 million from January-June of last year to $890 million this year,” while sales to Asia “increased by 173 percent from January-June of this year.”

“Renegotiate” NAFTA? Slap a 45 percent tariff on imports from China? New Mexico can’t afford that kind of dunderheaded protectionism.

The Commonwealth Foundation, the Rio Grande Foundation’s sister think tank in Pennsylvania, has released a useful — if depressing — examination of laws and regulations covering states’ government unions.

“Transforming Labor: A Comprehensive, Nationwide Comparison and Grading of Public Sector Labor Laws” explores “11 key measures that directly affect taxpayers and public employees.”

It won’t surprise many, but New Mexico ranks among the 20 states with “collective bargaining that is either legal or required,” as well as “card check” certification, and “some form of binding arbitration during contract negotiation impasses.” New Mexico also permits “release time,” which the American Legislative Exchange Council defines as “the practice of paying a public employee a public salary for time spent in union recruiting and representation activities.”

As the map above indicates, New Mexico’s overall grade of “D” was the worst in our region. Texas received an “A+” and Arizona scored a “B.” Three of our neighbors were “C” states: Utah, Oklahoma, and Colorado.

With state finances a mess and government employment claiming so large a section of the budget — either directly, or through subsidies to counties, municipalities, and school districts — the report arrives at an important time. Serious reforms of “labor” law pertaining to government “service” in New Mexico are a must. Waiting only makes the problem grow larger.