Who’s to Blame for New Mexico’s Great Depression?

Herbert Hoover.

The name is synonymous with indifferent right-wingery in the face of desperate need for “progressive” change.

Last week Alan Weber, who in 2014 failed to secure the Democratic nomination to run against New Mexico’s incumbent governor, wailed about “the Herbert Hoover policies of the Martinez administration.” That kind of rhetoric will only intensify, as the 2017 session gets underway, and disputes over fiscal and economic-development policies mount.

Weber and his ilk are crafting a narrative they think will help them achieve legislative victories. Their tale is simple: New Mexico’s many woes are due to the policies pursued by Susana Martinez. The answer to the state’s dismal condition is to go back to the future — and a repeal of Martinez’s misguided cut in the corporate tax, part of “an old ideology that gained prominence 40 years ago,” is a good place to start.

But how much change has the governor brought to public policy in New Mexico? Looking at the record, it’s quite clear that it’s been mostly business as usual in Santa Fe since January 2011, when Martinez took office. Here’s a brief list of the major reforms that conservatives, libertarians, and free-market voices advocate at the state level, and how they’ve fared in the last six years:

Tax Cuts: Martinez did sign a modest reduction in the corporate tax. But the levy has never been much of a revenue-producer for the state. Most workers in the Land of Enchantment’s private sector are employed by firms that do not pay the corporate tax, but pass their income through to owners/investors. Many states survive, and even thrive, without corporate taxes at all.

Tax/Expenditure Limits: Alone in our region, New Mexico has no limit on the revenue that its taxes can raise, and no cap on how much state government can spend. And it’s probably not a coincidence that expenditures in the Land of Enchantment are out of control. As the graph below, total spending dwarfs that of our five neighbors.

Source: U.S. Census Bureau data

Right to Work: Need this even be mentioned? We know that ending compulsory unionism can be a major factor in boosting economic development. But RTW is dead, dead, dead in Santa Fe — at least until a new crop of lawmakers is elected.

School Choice: The value of a skilled workforce is another driver of investment and job creation. Recognizing the failures of a monopolized, unionized education “system,” many states have moved toward K-12 competition. New Mexico has not joined in. Its charter-school law is weak, vouchers are nonexistent, and no tax credits are available for donations to scholarship-granting charities. Even the left-leaning Brookings Institution gives the state’s largest school district a “D” on its “Education Choice and Competition Index.”

Electricity Deregulation: Choice works with your power bill, too. But over a decade ago, an attempt to allow competition in electricity was repealed, and there does not appear to be any interest in reviving the law. In addition, a “renewable portfolio standard,” which mandates the use of expensive and intermittent sources of electricity, is the law in New Mexico. It’s at 15 percent now, and is slated to increase to 20 percent (!) in 2020.

Marijuana Legalization: Social conservatives might remain opposed to decriminalizing cannabis for personal use, but libertarians and many in the right’s fiscal community recognize the budget and economic benefits of ending a “war” that can’’t be won. Governor Martinez is opposed to legalization — a position she shares with many Republicans and Democrats, it’s worth noting.

Healthcare: In perhaps the worst public-policy decision made in the Land of Enchantment in the last few decades, Martinez fell for the claim that a radical broadening of Medicaid eligibility would be both affordable and serve as a “stimulus.” Her decision surely pleased the state’s liberals, but we now know what a disaster expansion has been.

So you make the call: Has the red-state model really been implemented under Susana Martinez? Errors of Enchantment certainly doesn’t think so. Maybe the answer to New Mexico’s crisis is to finally implement a policy programme geared toward limiting government, spreading opportunity, and fostering individual responsibility.

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5 Replies to “Who’s to Blame for New Mexico’s Great Depression?”

  1. Wonderful summary but too complicated for the low information voter. Simply remind voters that NM has had single party Dem rule for most of the last 86 years and the prodigious problems that beset the state have grown over many decades when the Dems controlled all three branches of state government. To wit:The last time Republicans held a majority on the state Supreme Court was in the 1920’s; the last time Republicans held a majority in the state house an senate at the same time was 1930 and in the last 86 years since 1931, Republicans have held the governorship only 29 years.

  2. I agree with most of your points here. I have been very disappointed with Susanna Martinez’s tenure as governor. The GOP controlled State House, also squandered its stewardship as well. Looking back, I’m sure the only reason Susanna was elected was as a reaction to the horrible tenure of Bill Richardson and his never ending corruption and scandals. The GOP will lose the governorship in 2 years, and the Dems will keep the legislature — this ensuring a continued Dem stranglehold on the state. Unless we as a state are willing to things very differently, and make major changes, things will remain the same. it’s been more than frustrating in the run up to the start of the legislative session to read from Dem lawmakers condemning Martinez, and offering the same old stale progressive “solutions” for our problems. Their solutions are not going to make things improve either.

  3. I think the core issue is that statehood has not worked out for New Mexico. For more than 100 years we have elected leaders who fail at the basic functions of state government. Perhaps self-government just isn’t our thing. If we can rescind statehood and annex ourselves to one or more of the surrounding states, we will see an immediate boost to our economy — and the stumblebums we elect to the legislature will be a harmless minority in a larger state.

  4. Having lived in S.E. N.M. for 70 years and seen how our state has been run, I no longer see NM as the state I’ve loved. The liberal “Kool-Aid” keeps this state down and until things change, it will always be so. This state has so much to offer yet with “business as usual” it will always be a “third world country”.

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