The New Mexico Legislature has adjourned for 2016. There were several major disappointments including lack of action on “right to work,” “Prevailing wage reform,” and school choice, (to name just a few).

But it is too easy to focus on the negatives because a few economically-helpful bills got through this session. These include (finally) legislation to reduce worker’s compensation benefits for workers who show up drunk or stoned on the job. This year’s bill was sponsored by Sen. Jacob Candelaria, but past efforts were sponsored by Rep. Dennis Roch. No matter what, this is a long-overdue reform and we are glad it finally passed.

Another positive from this session is that New Mexico’s Legislature has brought ride-sharing companies like Lyft and Uber under a reasonable system of rules and regulations. They will now be able to operate legally in New Mexico without threats from the Public Regulation Commission that they are operating illegally. Ride-sharing can improve transportation and mobility throughout our state while also reducing our State’s serious DUI problem. Kudos to Rep. Monica Youngblood who sponsored the ride-sharing bill.

Finally, being that this was a 30-day “budget” session, the Legislature passed a budget. The fast-changing (declining) revenue picture calls the viability of this budget into question, especially considering media reports indicating a 12% decline in general fund revenues. In other words, unless the price of oil rebounds dramatically later this year, we expect the Legislature to be called back for a special session to make further cuts later on in the year.

This will especially painful given that 2016 is an election year, so legislators of both parties are keeping their fingers crossed for higher oil and gas prices. We expect them to be disappointed.

If you haven’t heard the news, the Federal Bureau of Land Management (BLM) recently held a well-attended public hearing in Farmington on the issue of “venting and flaring” of methane from natural gas wells. Droves of Four Corners residents came out in opposition to the costly new regulations being considered by the Obama Administration.

This is a huge issue for Farmington, NM, in particular, as the city saw the biggest jump in unemployment last year among 387 US cities. The San Juan basin is a major producer of natural gas and, while “venting and flaring” are not optimal for the industry, the amount of “venting and flaring” in recent years has declined.

The BLM is currently accepting comments and will do so until April 8, 2016. The Rio Grande Foundation has submitted the following comments and encourages you to submit comments (click here to do so) (or at the email or mailing address below) in opposition to the proposed “venting and flaring” rule.

February 17, 2016

U.S. Department of the Interior, Director (630)
Bureau of Land Management
Mail Stop 2134 LM
1849 C St. NW.,
Washington, DC 20240

OIRA_Submission@omb.eop.gov.
Attention: OMB Control Number 1004-AE14

To Whom it May Concern:

I am the president of a free market policy research organization called the Rio Grande Foundation. We are based in Albuquerque. Our research focuses on New Mexico’s economy which is uniquely-challenged among US states. Our unemployment rate has been the highest in the nation for two months running. Our poverty levels are among the highest in the nation. As a state, New Mexico is the third-most dependent on the oil and natural gas industries as a percentage of our budget.

Given that the Bureau of Land Management controls 13.5 million of New Mexico’s surface acreage, approximately 2 million fewer acres than are occupied by the State of West Virginia, federal regulations have a tremendous impact on New Mexico’s economy.

On a statewide basis:

 There are 54,457 operating oil and gas wells in New Mexico
 The oil and gas industry employs 69,000 people in New Mexico;
 The average salary is $71,500 compared to the overall state average salary of $39,660
 56% of the oil and 63% of the natural gas is produced from Federal (BLM leases)
 In fiscal year 2014 the industry provided $2.1 billion of the state of New Mexico’s $6 billion general fund revenues (35%)

I should also note that while my organization is based in Albuquerque, we study the entire New Mexico economy. A recent report from the US Department of Labor labeled the Farmington area as suffering “extreme economic duress,” noting that it had the largest increase in its unemployment rate among 387 metropolitan areas nationwide in 2015 .

The northwestern New Mexico city saw its unemployment rate rise 2.1 percentage points last year, to 7.3 percent. The last thing New Mexico’s Four Corners area needs is a new set of costly federal regulations that negatively impact the region’s economy.

Methane Emissions are the object of the proposed regulations

 Venting and flaring of large amounts of methane represents lost profits to industry. While it is sometimes unavoidable, there are efforts already under way within industry to curtail the amount of emissions.

 Methane is both a product and by-product of oil and natural gas production. Onshore oil and natural gas operators are becoming more efficient at capturing methane emissions, and at reducing methane emissions from production activities. The national trend of methane reduction is supported by GHG reporting data, and it holds true despite a historic increase in oil and gas production over the past several years.

 Without regulations overall greenhouse gas emission in the San Juan Basin have decreased from 10.7 million metric tons in 2007 to 7.3 million metric tons in 2014.

 Vented methane emission in the San Juan are down due to cost effective and efficient practices including:

o Better operating practices that are decreasing the number and duration of venting events.
o Reduced pneumatic device emissions by reclassifying, removing, replacing and retrofitting high-bleed pneumatic devices.

Good Regulations vs. Bad Regulations

 Good regulation practices:

o Single and appropriate entity responsible for regulation;
o Effective in meeting public policy goals: environmental, health and safety;
o Based on science;
o Cost effective: the overall benefit of regulation is greater than the cost.

 The proposed venting and flaring rule is bad regulation for the following reasons:

o Redundant and contradictory with other federal regulations and state regulations;
o Requires extensive capital and operating expenses with little or no additional benefits;
o Not based on science and in fact, locks in operating and technology solutions that have been shown to be inferior;
o Cost prohibitive especially in era of low community prices will force existing wells to be plugged with the loss of future production, jobs, taxes and other revenues.

 What are weaknesses in the BLM’s approach?

o The BLM has attempted to understand economic impacts of these rules in isolation and has overestimated the benefits and underestimated the costs;
o We believe the cumulative economic impacts of the proposed changes should be considered in total across all their proposed rules;
o As proposed, these changes are significant and will have major impacts on investments in new and existing projects on federal and Indian lands, with the potential for job losses, premature well closures and significantly lower federal and tribal revenues;
o The BLM should conduct a more thorough economic impact analysis rules in isolation and has overestimated the benefits and underestimated the costs should be considered in total across all their proposed rules.

I am very concerned with the proposed BLM rule because as currently drafted it will lead to wells being prematurely plugged and devastating loss of jobs and needed economic activity in the Four Corners region and New Mexico as a whole.

New Mexico’s budget is in free-fall (along with oil prices). Yet politicians of all stripes in Santa Fe have expressed a desire to pay (especially young and new) teachers more.

The case for higher teacher pay is questionable. According to the somewhat dated information over at the website “Teacher Salary Info,” New Mexico teachers are paid 16th-most in the nation.

Nonetheless, IF your desire is to pay teachers more, pensions must be reformed. In a recent article by Marcus Winters of the Manhattan Institute, he discusses a recent paper for the Center for Analysis of Longitudinal Data in Education Research which found that 10 percent of the earnings for an average public school teacher goes toward paying for pension liabilities accrued on the behalf of prior cohorts of teachers. That’s money they could be taking home in salary.

As Winters continues, “most teachers earn very little retirement compensation for each of their first two decades of teaching and then suddenly accrue large amounts of pension wealth during their late career years. The vast majority of teachers leave the system before they receive the large payouts. The money those who exit leave on the table goes to fund the comfortable retirements of the few who stuck around for their entire career.”

Obviously, reforming teacher (and other government pension systems) will be challenging and potentially-expensive in the short-term, but in the long-term, a defined-contribution (401K-style) system will attract more young, highly-qualified teachers who may want to do the job for a few years before moving on to other career opportunities.

For further research on teacher pensions in New Mexico, check out this report from the National Council on Teacher Quality. The report gives New Mexico a “D” grade for its teacher pensions and overall has a great many concerns bout their funding and fairness.

The 2016 legislative session is winding down, and we’ll soon know how lawmakers score on the Rio Grande Foundation’s Freedom Index.

For those placing wagers, though, Rep. David Adkins would be a safe pick as a repeat champ. So far, members of his chamber could score as many as +21 points. Adkins is atop the field, with all 21 points earned.

Here’s a sampling of the legislator’s votes:

* For HB 63, which limits worker-compensation benefits for intoxicated employees.

* Against HB 166, a bill to require the licensing of home inspectors.

* For HB 168, a bill to legalize transportation-network companies such as Uber and Lyft.

* For HB 200, which provides some relief from the state’s expensive and unnecessary “prevailing wage” mandate.

* For HB 206, a pro-taxpayer measure to permit the design-and-build method for government projects.

Adkins is a husband, father, small businessman, and pastor. He’s also a consistent vote for limited government and the free market in New Mexico. More like him, please!

The budget numbers are changing (for the worse) on an almost daily basis. The latest information calls for a 12% decline in General Fund revenues which means a reduction of $700-$800 million (not factoring in rainy-day funds etc).

The point remains, as I note below, that no matter how the budget gap is filled, there are some programs that should be eliminated in their entirety prior to cuts being enacted elsewhere.

Like spring follows winter, proposals to increase taxes on hard-working New Mexicans are flourishing in Santa Fe. Dozens of such proposals have been put forth, including several by Democrat Senate Finance Committee Chairman John Arthur-Smith. Gov. Martinez has repeatedly pledged NOT to raise taxes, so it is unlikely these proposals will be enacted, but what about the merits of the issue? Should taxes be raised in New Mexico?

One of Sen. Smith’s proposals that has attracted media attention is SB 281 which would re-impose the gross receipts tax on groceries. Groceries used to be taxed just like everything else bought in the store, but when he was governor, Bill Richardson decided to eliminate the tax on groceries. The broader gross receipts tax was hiked by half a cent. This all sounds simple, but was really a complex tax-shift that the Legislature has tinkered with since it was enacted.

And now, Sen. Smith wants to again tax groceries as a means of raising revenues in tight budgetary times. Taxing food is not an inherently bad idea, but it shouldn’t be done without reducing the gross receipts tax on other purchases.

That is only the start. Smith and his Democrat colleagues want to add taxes to everything from cigarettes to gasoline, to personal income, while also freezing New Mexico’s corporate income tax rate in place rather than continuing a scheduled phase-down to 5.9%.

The immediate concern for policymakers is New Mexico’s deteriorating budget picture. Due to declining oil prices, there is “only” $35 million in “new” money. Once $85 million in new costs for half-a-year of Medicaid expansion are added to the mix, everything else in New Mexico’s budget is being squeezed. Thus the calls for higher taxes.

Of course, New Mexicans are hard-pressed right now and it is shameful that politicians in Santa Fe want to increase taxes in a state with the highest unemployment rate in the nation and residents suffer from some of the highest poverty rates in the nation.

According to the Federation of Tax Administrators, New Mexicans face the 9th-highest state tax burden as a percentage of resident incomes of any state in the nation. The last thing we need is higher taxes.

New Mexico has some relatively easy solutions to its budget woes. The State spends approximately $50 million annually to subsidize film companies and the Rail Runner costs taxpayers another $25 million to operate. When times are good, these programs seem like nice things to have around, but are supporters really going to say that education, law enforcement, and behavioral health programs for the poor should be cut instead?

That’s ultimately their argument.

Of course many will come back with the “tax the rich” mantra, but New Mexico is poor. We have some rich people and some profitable businesses, but capital is mobile. They can leave our state anytime. And, as is plain to see, plenty of businesses avoid New Mexico.

We have one publicly-traded company (on a stock market) headquartered in the state (Public Service Company of New Mexico). We have seen our best-and-brightest moving to places like Texas for several years. Raising taxes isn’t going to help the cause.

It is time for tough decisions in Santa Fe. Alaska and Michigan recently eliminated their film subsidy programs. The Rail Runner is an epic money-loser even by mass transit standards. They are the fattest targets for policymakers, but there are plenty of others.

Gov. Martinez is right to avoid tax hikes. New Mexico’s economy faces enough challenges already.

Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization

This article was originally published at NMPolitics.net. Legislation along these lines was introduced in the 2016 session, but was not placed on Governor Martinez’ “call.”

New Mexico’s Legislature faces a plethora of duties during this year’s 30-day regular session. But a measure that should be a no-brainer, deserving of bipartisan support, permits dental therapists to practice in some rural and underserved areas of the state.

Dental therapists are trained to provide routine care, including drilling and filling cavities. Last year, a bill that would have allowed dental therapists to practice in New Mexico passed the Republican-held House, with Democratic support, only to fail in the Senate without so much as a floor vote.

However, a task force of legislators, along with supporters and opponents of dental therapists, came to a compromise late last year. The bill they’ve crafted, HB 191, isn’t perfect – the establishment of a state dental director isn’t necessary, and neither is a mandate that all children receive a dental exam as a prerequisite to school enrollment. Nonetheless, allowing dental therapists to work in our state would be a promising reform.

It is not a government mandate. It doesn’t involve taxpayer subsidies. It’s working in other states, including Minnesota and Alaska. And it’s a solid step away from the ugliness of professional protectionism through government licensing.

Support for reducing or eliminating government’s role in occupational licensing has drawn support from such ideologically disparate people as Nobel-Prize-winning, libertarian economist Milton Friedman and President Obama.

Friedman railed against the evils of professional licensing in speeches and debates that can be found online. The president’s 2016 budget proposal “seeks to reduce occupational licensing barriers that keep people from doing the jobs they have the skills to do by putting in place unnecessary training and high fees.” Last year, the White House’s Council of Economic Advisers issued a detailed report questioning the benefits of occupational licensing.

The left-right agreement on dental therapists in the Land of Enchantment includes the free-market Rio Grande Foundation as well as the left-leaning Health Action New Mexico and New Mexico Voices for Children. Both of the latter support the “Affordable Care Act,” while the Rio Grande Foundation works overtime to expose Obamacare’s many disappointments and failings.

In many rural areas of our state, dental coverage is not the issue – care is. According to a 2013 report by the Legislative Finance Committee, over 63 percent of New Mexicans live in areas where there are shortages of dental-health personnel. Allowing these professionals to carry out some activities that have previously been only available under the direct care of dentists would improve accessibility in rural and underserved communities. It can also create new business opportunities for entrepreneurial dentists.

HB 191 allows dentists to supervise therapists from off-site. But remote management doesn’t apply to filling cavities, despite mounds of evidence that shows that dental therapists can do the job effectively and safely under off-site supervision. Fixing this flaw would give a dental practices more flexibility in setting up a satellite office in a small town, and/or extending their office hours to serve more patients.

Healthy teeth are in many ways the key to overall health. People with periodontal disease are two times more likely to develop heart disease and arterial narrowing as a result of bacteria and plaque entering the bloodstream through the gums. That’s not all. Poor dental hygiene is correlated with everything from dementia to diabetes and even cancer. Increasing the availability of dental care in New Mexico can have cascading positive benefits throughout our healthcare system.

New Mexico’s lawmakers and governor have a chance to bring the free-market solution of dental therapy to our state by stripping the extraneous mandates and costs out of HB 191, and expanding scope-of-practice capabilities throughout rural New Mexico. The clock is ticking on the 2016 session.

Dental therapy is good for patients, taxpayers, and the economy. Why let partisan rancor get in the way of smart policy?

Dowd Muska (dmuska@riograndefoundation.org) is research director for New Mexico’s 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 Albuquerque Public Schools (APS) bond measures recently passed overwhelmingly, despite a slew of scandals and payouts leading to concerns from district leaders that voters might use the bond election to punish the district. With a total of $575 million at stake, this was not a trivial concern.

An outpouring of opinion pieces and editorials from community leaders urged voters to put their concerns about the district and its management aside and support the bonds “for the children.” This was seemingly effective, as turnout was nearly double what it normally is for similar elections (still low at 7 percent, but much bigger than normal).

There is no doubt that a rejection would have gotten APS’s attention. It was a blunt instrument indeed, but it would have generated a swift reaction from district leaders.

Since the blunt instrument was rejected by voters, what means do voters have of keeping APS accountable? Locally, it pretty much boils down to electing the “right” people to the school board. Since the main job of the school board is to hire a district superintendent who ultimately oversees the schools, this is another weak and indirect method of accountability.

The situation at the state level is not much better. We elect a governor and legislators based on dozens of issues (and personality traits), with their stances on education among them. The governor then hires a secretary of education who is in charge of implementing that governor’s education policies. This process is yet another indirect and slow means of holding our education system accountable. What if I like Gov. Martinez’s policies on taxes and the economy, but don’t like what Department of Public Education Secretary Hanna Skandera is doing? Or, I might strongly dislike the governor, but appreciate what Skandera is doing. How do average people communicate their concerns to these people?

This is not limited to the current administration. Accountability, specifically its absence, is endemic to government educational systems.

If businesses think accountability in education is a trivial matter, they need look no further than New Mexico’s worst-in-the-nation graduation rate, constant discussion of our “workforce preparedness/quality,” and the tremendous growth in education spending in recent decades.

An intermediate step toward improved accountability is school choice. Ironically, the week immediately prior to the APS bond election was celebrated as “National School Choice Week.” New Mexico has some choice, most notably charter schools. I’m on the board of a charter school and support them, but the approval or rejection of a school’s charter (a legal document granting from a charter-granting authority) is yet another blunt tool for reformers.

Other forms of school choice offer greater potential for success. These include: vouchers and tax credits, as well as education savings accounts, which were recently enacted in Nevada. These options – particularly tax credits in recent years – have been discussed in New Mexico’s legislature. In terms of accountability, they would be a huge improvement. If these schools don’t perform at a level that makes them significantly better than traditional public schools, those schools will go out of business. On the other hand, if more parents demand a particular choice than are available, someone will attempt to expand the supply of similar options.

That’s real, direct accountability – the kind that comes from the free market. Competition quickly allowed consumers to embrace, and then reject, Blackberry devices, while iPhones and Androids made (and continue to make) rapid advances and continually innovate in order to win greater market share.

Unfortunately, that is a level of accountability that is beyond the wildest dreams of even ambitious education reformers today. School choice is the best available option and New Mexico policymakers need to get on board with it now if our state is ever going to get out of last place both educationally and economically.

Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, 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 Senate Public Affairs Committee’s tabling of the right-to-work bill sponsored by Sen. Mark Moores (R-Albuquerque) comes at a particularly disastrous time for New Mexico. Unemployment is rising, layoffs are mounting, and the fiscal picture is darkening.

RTW is a key piece of a broader package of pro-growth reforms that must be implemented to finally build a vibrant and sustainable private sector in the state. The Foundation recently completed 12 months of analyzing job-producing investments announced by Area Development magazine.

Overall, jobs in RTW states claimed 77.8 percent of all positions to be created:

RTW states prevailed in each of the 12 months:

We also examined “border crossing,” in which investments were made by companies based in one type of state shifting to another. (For example, in December, CVS announced the hiring of 500 “pharmacists, pharmacy technicians and administrative staff” for a new facility in RTW Florida. The corporation is headquartered in non-RTW Rhode Island.) RTW bested non-RTW, 172 to 43.

Foreign direct investment also prevailed in RTW states, by a wide margin. Companies based abroad announced 186 investments in worker-freedom states, as opposed to 65 in compulsory-unionism states.

The Foundation now has a full year of data, and will be refining our findings to further probe why RTW is so attractive to companies and industries in manufacturing, logistics, finance, IT, biotech, and business services. For any New Mexico lawmaker who doubts the value of RTW, we’re happy to explain what we’ve found so far.

As was predicted and is now being reported, legislation that would have made New Mexico a “right to work” state died on partisan lines last night in the Senate Public Affairs Committee. It was, but predictable result. There are a few things that need to be discussed about this issue and the 2016 legislative session in general:

1. I was pleased to sit beside Sen. Mark Moores (the bill’s sponsor) and provide my testimony. Moores did a great job as well;
2. Sen. Ortiz y Pino (and Sen. Candelaria for a time) ran the Committee smoothly and in a way that respected everyone’s time. Having each side pick five people is far superior to having unlimited public comment (as happened last year in the House);
3. I listened to testimony from Allen Sanchez, the lobbyist for the Catholic Church, relating to the late-term abortion ban — which was killed in the same committee earlier in the afternoon — he was far more passionate in his opposition to the “right to work” bill than he was earlier on the abortion issue for which he seemed to apologize and equivocate at times;
4. As usual, there was a great deal of misinformation presented by opponents of “right to work” that I’ll address below:
   1. It increases inequality/kills the middle class: please look at state-by-state Gini coefficient data and tell me where it “kills” the middle class. 7 of the least unequal/most equal states have “right to work” and the three most unequal states are not “right to work.” There’s not even correlation, much less causation.
   2. “Right to work” kills jobs (just look at Wisconsin!): Thankfully there are 24 “right to work” states besides Wisconsin — which has been “right to work” for less than a year. Overall, these “right to work” states consistently outperform non-“right to work” states on job creation.
   3. “Right to work” reduces wages, but when you factor in cost-of-living, “right to work” states have higher actual living standards.
   4. “Right to work” forces unions to represent those who choose not to pay dues or “fair share” payments. This is simply not true. Unions can and do form “members only” units which allow them to negotiate solely on behalf of those who pay dues. A detailed explanation of this — discussed from a hard-left “progressive” perspective — was published by the left-wing In These Times magazine.  This is no academic exercise. The article notes that United Auto Workers (UAW) Local 42 at the Volkswagen plant in Chattanooga, Tennessee, was organized as a members-only union.
5. While Democrats are criticizing Gov. Martinez for focusing on criminal justice as opposed to economic issues, the fact is that the Democrats’ agenda is more of the same unaffordable big-government that has gotten us into 49th and 50th on most economic lists. We can do economic development in this state without “right to work,” but the Senate refuses to act on almost ANYTHING put forth to reform New Mexico’s economy.

Yesterday was “New Mexico Film & TV Day” at the Roundhouse, but rather than a clear-eyed discussion and analysis of the taxpayer-provided goodies state politicians shower on Hollywood, the event served as a networking get-together for rent-seekers and a rally against worker freedom.

The New Mexico Film Office was on hand — distributing stickers and temporary tattoos — as was New Mexico Women in Film, the film program of Santa Fe Community College, the Digital Arts and Technology Academy, Nob Hill Studios, the New Mexico Italian Film and Culture Festival, UNM’s Interdisciplinary Film and Digital Media Program, Mitchell & Presley Talent Group, the Institute of American Indian Arts, and the New Mexico Post Alliance.

The day’s lowlight was an obnoxious, 20-minute harangue by Patrick Fabian (pictured above). The actor, who plays “Howard Hamlin” in “Better Call Saul,” told a fawning crowd of union members and activists that he wouldn’t have clothes on his back or a car to drive if it weren’t for the Screen Actors Guild‐American Federation of Television and Radio Artists. After all, corporations are “unaccountable” and only care about “the bottom line.”

Fabian cited dodgy stats about the impact of right-to-work laws in Oklahoma and Wisconsin, and warned that New Mexico would engage in a “race to the bottom” if it passed a RTW law. He also claimed that there was “vibrant production” in New Mexico, a state that is becoming a “top-tier destination for entertainment.” That’s nonsense, of course, as the Foundation has documented again and again and again.

One of Fabian’s statements was beyond dispute, though. He called himself a “knucklehead actor.” No argument there.

The Rio Grande 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 January, of 8,722 projected jobs, 6,823 — 78 percent — were slated for right-to-work (RTW) states:

Fifteen 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 (FDI), too. Eleven projects are headed to RTW states, with two to occur in non-RTW states.

Marquee RTW wins included New York-based VOXX International’s opening of a “flagship” manufacturing facility in Florida (300 jobs), Ohio-based Toledo Molding & Die’s pick of Tennessee for a factory for “interior and air and fluid management systems” (250 jobs) and California-based Shift Technologies’s choice to build “its first East Coast operation” in Virginia (100 jobs).

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.

* Intrastate relocations were not counted, interstate relocations were.

By itself, New Mexico’s tax on corporate income doesn’t render the state economically uncompetitive. A heavy and complicated overall tax structure, lack of a right-to-work law, extensive welfare architecture, reams of burdensome regulations, alarming dropout rate, and many other factors make the Land of Enchantment an undesirable place to do business.

But it’s important to note that, as the Tax Foundation recently documented, New Mexico’s top marginal corporate tax is higher than each of its five neighbors. The levy is statutorily slated to drop to 6.6 percent for the current year, down from 6.9 percent in 2015. Oklahoma, Utah, Colorado, and Arizona have lower rates — and Texas, of course, has no corporate tax at all.

Enter Sen. Mimi Stewart (D-Albuquerque). The hard-left legislator and “retired educator” has sponsored a bill to delay the “rate reduction to [2017] and all subsequent rate reductions by one year.”

Is hiking taxes during what’s looking more and more like an economic apocalypse for New Mexico a good idea? You make the call.

The Rio Grande Foundation is tracking the goings-on in Santa Fe. Despite New Mexico’s worst-in-the-nation unemployment rate, most of the action — with the session more than half-over — has been on drivers licenses and “tough on crime” policies. That is not to say that large numbers of bills –including several economic reforms — haven’t passed the New Mexico House only to lay stacked on Majority Leader Michael Sanchez’s desk. It is true that there has been a shift in priorities (as you can see from the list of House-passed bills).

Click on Sanchez’s picture to go to that site: 

One group that claims to understand the need to focus on economic issues is the House Democrats. They rolled out their “Economic Opportunity Plan”  which House Democratic Leader, Representative Brian Egolf (D-Santa Fe) claims — with no research whatsoever — would reduce the State’s unemployment to 3.9%. That would take us from dead-last to tied with Idaho for 11th. 

These are the very same  people who, when they finally got booted from office after 52 years of House dominance, had helped New Mexico to the worst poverty rate in the nation. Needless to say, the most significant parts of their agenda comes from the far-left playbook although many of the bills on the lengthy list like (HB 11: Shaken Baby Syndrome Educational Materials) seem almost trivial and unrelated to the New Mexico economy.

• HJR 10: Tap the Permanent Fund for Early Childhood Education;
• HB 125: Increase Minimum Wage;
• HB 255: New Higher Income Tax Bracket
• HB 89: Public Employee Salary Increases

Interestingly, though the group decries the emphasis by Gov. Martinez on criminal justice issues, their list of public safety bills is almost along as the rest of their bills combined. Mostly, the “Economic Opportunity Plan” seems to be a laundry list of bills proposed by House Democrats during the 2016 session. There is no philosophical approach (besides more and bigger government). There is no analysis provided as to their impact. Just the old “Trust Us!”

Many on the right support the storage of spent nuclear fuel beneath Yucca Mountain, simply because “greens” and loathsome legislative careerist Harry Reid hysterically oppose the proposal.

But anyone who’s looked at the U.S. Department of Energy’s management of the project — not to mention Yucca’s status as a perpetual political football in Washington — recognizes that a one-size-fits all, bureaucrat-administered “answer” to the nuclear industry’s problem of radioactive leftovers is profoundly unwise.

More than $15 billion in ratepayer revenue has been spent on Yucca, but not one fuel rod has made its way to Nevada. (The Department of Energy was supposed to start filling the repository in 1998.)

The good news is that there’s a growing awareness that other options should be pursued. (Some of us figured that out long ago.) There’s plenty of money left in the Nuclear Waste Fund, and every penny should be spent on alternatives to Yucca.

One possibility is Holtec International’s proposal to built a interim facility between Carlsbad and Hobbs. Rep. Cathrynn Brown (R-Carlsbad) has drafted a memorial in support of the plan.

As one element of a broader effort to privatize high-level nuclear waste, Holtec’s safe, secure storage could help drive a stake through the heart of the Yucca boondoggle. Best of all, it would be real, sustainable economic development for New Mexico — based not on another infusion of federal cash, but a market-oriented response to epic-level D.C. incompetence.

One of the greatest disappointments about public policy today is the Democrat-Republican consensus on “early childhood education.” The groupthink is on display in today’s edition of The Santa Fe New Mexican. Reporter Milan Simonich wrote that “Sen. Sander Rue, R-Albuquerque, said he was satisfied that scientific evidence shows that early childhood education is effective,” but expressed “concerns about taking money from the [Land Grant Permanent Fund] and then making sure it would be spent properly.”

Transparency, oversight, and accountability are always desirable, of course, but the senator is wildly off the mark in believing that preschool is backed by strong data.

Despite working for the left-leaning Brookings Institution, developmental psychologist Grover J. “Russ” Whitehurst, who once served as the director of the Institute of Education Sciences within the U.S. Department of Education, finds no “evidence of program success when we look to state pre-K programs.”

In Georgia, for example, studies have yielded sobering results. One concluded that the “estimated effects of Universal Pre-K availability on test scores and grade retention are positive, but are not statistically significant, suggesting there were no discernible effects on statewide academic achievement.” Another found that “positive effects for children from low-income families … were offset by negative effects for children from higher-income families.”

We’ve known for a long time that Head Start is a failure, and state-level programs are producing similar outcomes. “Universal preschool” has an enormous price tag, and there is no “scientific evidence” demonstrating that it is a worthwhile “public investment.”

Rio Grande Foundation Speaker Series Event:
Luncheon with Robert Zubrin
Author of Merchants of Despair: Radical Environmentalists, Criminal Pseudoscientists and the Fatal Cult of Antihumanism

Click here for registration form.

Mr. Zubrin’s latest book, Merchants of Despair: Radical Environmentalists, Criminal Pseudo-Scientists and the Fatal Cult of Antihumanism; is the newest addition to the New Atlantis Books series.

Merchants of Despair traces the pedigree of the ideology that human beings are a cancer upon the Earth — a species whose aspirations and appetites are endangering the natural order — and exposes its deadly consequences in startling and horrifying detail.

It exposes the worst crimes perpetrated by this antihumanist movement, including eugenics campaigns in the United States and genocidal anti-development and population-control programs around the world. And it provides scientific refutations to antihumanism’s major pseudo-scientific claims, including its modern tirades against nuclear power, pesticides, population growth, biotech foods, resource depletion, industrial development, and, most recently, fear-mongering about global warming. The book’s official homepage is: www.MerchantsOfDespair.com.

• Location:  Marriott Pyramid 5151 San Francisco Rd NE, Albuquerque, NM  87109
• When:  Wednesday, March 16, 2016, 12:00 noon to 1:00pm.
• Cost:  Seating is limited and can be purchased at the discounted price of $30 through Wednesday, March 9, 2016; $40 thereafter.

In addition to his writing on the environment and public policy, Zubrin is the author of the critically acclaimed nonfiction books The Case for Mars, Entering Space, and Mars on Earth; the science fiction novels The Holy Land and First Landing; and articles in Scientific American, The New Atlantis,American Enterprise, the New York Times, and the Washington Post. He has appeared on major media including CNN, C-SPAN, the BBC, the Discovery Channel, the Science Channel, NBC, ABC, and NPR.

Robert Zubrin is a New Atlantis contributing editor and a fellow at the Center for Security Policy. For many years, he worked as a senior engineer for Lockheed Martin.

Click here for registration form.

A UNM sociology professor and her Oregon-based sidekick are on the warpath against the Rio Grande Foundation and our research on “right to work.” As usual, their “research” is lacking and elicited a swift response from us.

Interestingly, given the brevity of New Mexico’s 30-day session and the attention shift to criminal justice issues, it is looking less likely that “right to work” (or many other economic reforms) will get a serious look in the 2016 Legislature. That is not the case in West Virginia where “right to work” will likely pass in a matter of weeks (making the state the 26th to do so).

This article from West Virginia sums up the arguments on “right to work” fairly well. The author cites a study by the Legislature’s Bureau of Business and Economic Research which found “RTW policy leads to long-run rates of GDP growth that are around .5 percentage point higher than non-RTW states…The study also found a 1.4 percent job rate growth in RTW states over the last two decades, compared with one percent in non-RTW states.”

The writer also noted that,

While (right to work) would be a blow to union power, it’s not a death knell. Instead, it may give rise here to “members-only agreements” where unions represent only the workers who choose to belong. The unions are under no obligation to provide any representation or services for non-union workers.

Kevin Robinson-Avila, in today’s Albuquerque Journal, had a good overview of the state’s two permanent funds. As usual, they’re under siege by liberals who seek to siphon more revenue for “public investments.”

The two funds are mighty tempting targets. Together, they are worth nearly $20 billion — more than state government spends in an entire year.

But as the left dreams of using New Mexico’s “sovereign wealth” on another round of doomed-to-fail programs, attention may turn to another fund. The state’s budget reserve, according to the governor’s spending plan for the 2017 fiscal year, is $505 million, or 8.1 percent of “recurring appropriations.” As Medicaid costs balloon and the oil-and-gas industry continues to suffer, look for that share to dwindle, even though the Legislative Finance Committee prefers that the rainy-day kitty be kept at 10 percent.

With “new money” predicted to be just $30 million in the 2017 fiscal year, look for pols to start eyeing the budget reserve. A half-billion dollars can make a big contribution toward successful denial of fiscal realities.

The Journal’s Winthrop Quigley had an interesting column over the weekend in which he detailed how New Mexico’s history of colonization and violence make it “anti-business.” While we’ve had our disagreements with Quigley, he hits on a number of truths in his article. Nonetheless, I want to weigh in with my own thoughts here:

1) It is interesting to me that Quigley almost constantly uses “right to work” to as an entree to discussing what he believes doesn’t work in terms of economic reforms. He’d never launch into a fatalistic discussion of New Mexico’s long and challenging history by denigrating the potential of early childhood programs or Medicaid expansion. He also fails to address more than a dozen other reforms that the Republican-controlled House has passed in recent years only to be killed without so much as a vote in the Senate. He just dismisses “right to work” as “not a solution” and moves on.

2) Quigley notes the lack of trust for outsiders in New Mexico. Interestingly, free market capitalism, despite its “dog-eat-dog” reputation, requires a great deal of trust. That trust usually results in benefits for all parties involved in a free exchange, but trust is nonetheless required. Trust is indeed lacking in New Mexico due in part to its history of colonialism and political corruption.

3) Cultures change. A recent report noted that New Mexico’s corruption has been enabled by the federal government. The loss of federal spending and now, significant oil and gas revenues, mean that change is imperative. The old ways never worked particularly well. Now, they are being exposed as a total failure. It is time for New Mexicans to embrace free markets and build the trust necessary to create a robust private sector.

The story is split in two with Gessing’s story starting at approximately the 2:40 mark:

Missed yesterday’s celebration of National School Choice Week in Santa Fe? Don’t go looking for media coverage — there wasn’t much.

The Santa Fe New Mexican‘s Robert Nott wrote an article — and dutifully mentioned the recent, and specious, Legislative Finance Committee that concluded that “charter schools cost more for similar results.”

The Foundation was proud to participate in two National School Choice Week events. In addition to speaking at the capitol rally, research director D. Dowd Muska presented an overview of the past, present, and future of school choice to the New Mexico State University chapter of Young Americans for Liberty.

For more on the subject, visit the Friedman Foundation for Educational Choice.

Just in time for School Choice Week, the American Federation for Children working with Beck Research, LLC, has released polling on Americans’ support for school choice.

Key findings from poll:
· 70 percent fully support the concept of school choice, including 42 percent who strongly support it, while 24 percent oppose it.
· Last year, 69 percent supported and 27 percent opposed.
· 65 percent support private school choice (32 percent oppose), when those surveyed were asked if they support, “opportunity scholarships, also known as school vouchers.”
· Support among Democrats has increased from 60% in 2015 to 65% in 2016 while Independents’ (66%) and Republicans’ (80%) preference for choice remains steady.
· 53 percent of voters support “school vouchers” (without using the term “opportunity scholarship”).
· 65 percent support Education Savings Accounts with only 29 percent opposed.
· 75 percent support public charter schools with only 21 percent opposing it.

School choice tax credits legislation (HB 207) has been introduced in the New Mexico House. Similar legislation passed the House during the 2015 session but never received a vote in the Senate.

The poll, conducted January 19-24, 2016 surveyed 1,100 likely voters, including an 800 person national sample, on questions related to educational choice, vouchers and charter schools.

Earlier this week, the latest unemployment numbers were released and New Mexico remained stuck with the highest rate in the nation (6.7%). That’s obviously not good news.

But, as we’ve pointed out in the past, unemployment numbers only tell part of the story. If people have dropped out of the workforce, they are not included in the unemployment rate. So, it is important to consider the workforce participation rate as well.

And, as the chart below which tracks US and New Mexico workforce participation rates dating back to 1976, New Mexico (finally) saw a rebound in 2015 after years of decline.

Before you get too excited, it is worth noting that New Mexico still trails every other neighboring state:

Is this just a “dead cat bounce” or is it a sign that more New Mexicans are getting back to work? It’s hard to say. What we know is that New Mexico’s economy needs some dramatic free market reforms that push our unemployment rate down and increase the numbers of New Mexicans who are “makers” as opposed to “takers.”

COMMENTARY: “States may, if its citizens choose, serve as a laboratory.” Justice Louis Brandeis in New State Ice Co. v. Liebmann

When it comes to economic policy issues, the states are supposed to be the dominant actors. This is the view laid out by Justice Brandeis. It flows seamlessly from the United States Constitution’s design which emphasizes “federalism.”

But this isn’t another article about how Washington is overstepping its bounds. Rather, it is about how New Mexico’s Legislature might want to keep closer tabs on policymaking activities of local governments.

Local governments derive their powers from the states within which they are located. In some states they are given broad latitude. In others, like Virginia, their power is strictly limited. Virginia’s minimum wage and other employment-related policies are set by the Legislature.

For simplicity’s sake, this is a good thing, regardless of your views on the minimum wage.

While my organization does not support raising the minimum wage on economic grounds, that has not stopped New Mexico and more than half of all U.S. states from raising their minimum wages above the federally-mandated level of $7.25. New Mexico’s rate is currently at $7.50.

The $7.50-an-hour rate is straightforward, but as things currently stand, the cities of Albuquerque, Las Cruces, and Santa Fe have their own wage rates. Separate rates are mandated by the counties of Bernalillo, Doña Ana, and Santa Fe. It’s not just the complexity of varying wage rates and jurisdictions; there are additional, complex rules over how tipped wage rates are calculated depending on the provision of certain benefits like employer-sponsored health insurance.

Complying with myriad tax rates and formulas can be a nightmare for any business, especially small ones. Seemingly well-intended efforts to raise wage rates are creating tremendous complexity and compliance burdens for the very small businesses that we need to create jobs and dig New Mexico’s out of the current economic malaise.

Statewide preemption

That growing complexity is a big reason that groups like ACI and the New Mexico Restaurant Association have gotten behind a “statewide preemption bill.” The bill has been followed in the 2016 session by Rep. Harper in the House and Sen. Moores.

The idea that state legislatures, not a mixture of cities and counties, nor far-off bureaucracies in Washington, D.C., should regulate New Mexico’s economy is self-evident. In fact, Brandeis, quoting further from his “laboratories of the states” argument said that the idea was to, “try novel social and economic experiments without risk to the rest of the country.”

So, if California wants to adopt a $10.50 or even $15.00 per hour minimum wage, let them. If Texas would like to not impose legal wage floors at all, ideally that should be their prerogative. Of course, as things currently stand, the federal rate of $7.25 is the baseline for every state.

I believe that under such a system people and jobs will continue to move from heavily-regulated, high-minimum-wage states like California to less-regulated states like Texas, but I might be wrong. I’d love to give states the leeway to duke it out. Localities, not so much. It’s messy and convoluted with multiple jurisdictions at play. Local borders are unclear to all but the best-informed.

Lest supporters of high minimum wages think this is just an effort to kill minimum wages entirely, local minimum wage hikes give legislators a “pass.” After all, an Albuquerque legislator nowadays can say, “Why should the state raise the state minimum wage when Albuquerque has done it?”

The leading opponents of “preemption” might be rural legislators. They see “big cities” even here in New Mexico as a world apart from themselves and their more conservative constituents. Nevertheless, preemption makes sense. New Mexico’s cities and the businesses located there are engines for New Mexico’s entire economy. We are ultimately in this together.

Gessing is the president of New Mexico’s Rio Grande Foundation, an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility.