Our new study is the latest report outlining the relative tax burdens of New Mexico's top 10 cities in population. The cities are ranked in terms of most to least friendly below. Useful charts and data abound in the report itself:
7. Santa Fe
8. Las Cruces
9. Rio Rancho
There's no doubt that New Mexico needs to become more economically competitive. Tax policy is one area in need of improvement. I discuss the opportunities in this 15 minute interview. The show airs live on KNAT Channel 23 on Thursday, Nov. 29, 2012 @ 10:00 am
(Albuquerque) The Competitive Enterprise Institute and Rio Grande Foundation today released a joint working paper criticizing the Regional Haze settlement agreement recently proposed by the New Mexico Environment Department. The study is the first independent analysis of the settlement, which would resolve an ongoing dispute between the state and the Environmental Protection Agency over the haze-causing emissions from the San Juan Generating Station.
“EPA’s Regional Haze plan would impose almost $375 million in compliance costs on PNM ratepayers, in order to achieve an “improvement” in visibility that is imperceptible,” said CEI policy analyst William Yeatman, who authored the report. “Unfortunately, the state’s alternative proposal is even worse—it would cost almost $20 million more, yet it would significantly diminish PNM’s firm generating capacity. To put it another way, the state’s alternative would cost more, for less.”
At issue is an EPA regulation, known as Regional Haze, which requires that states improve visibility at federal National Parks. In June 2011, New Mexico proposed a Regional Haze plan that required a $36-million retrofit at the San Juan Generating Station. Three months later, in August 2011, the EPA rejected the state’s plan, and imposed a federal plan that required a $375-million retrofit at the power plant—more than ten times the cost of the state’s original plan. During the summer and fall of 2012, the New Mexico Environment Department led negotiations, in an attempt to reach an alternative agreement that would bridge the gap between the state and the EPA on Regional Haze.
In early October, after months of negotiation, the New Mexico Environment Department proposed a settlement agreement, which was then sent to EPA for review. Unfortunately, the Environment Department refused repeated requests for details on the settlement agreement. Despite the lack of specifics, it is nonetheless possible to perform a line-item cost analysis of the proposal, using regulatory filings submitted by PNM and conservative assumptions.
“New Mexico is much better off continuing to fight for its original, affordable Regional Haze proposal in court,” noted Yeatman, referencing litigation launched by the state against the EPA over the Regional Haze regulation in late 2011. The case is pending before the Tenth Circuit Court of Appeals. He continued, “Due to the unique prerogatives accorded to states under the Regional Haze program, New Mexico’s lawsuit has good prospects for success. Even were New Mexico to lose its case, suffering the EPA’s regulation would be better than the settlement negotiated by the New Mexico Environment Department.”
Added Rio Grande Foundation President Paul Gessing, “New Mexico rate payers deserve the best rates possible. While environmental concerns are important as well, the original proposed retrofit is far more sensible and cost-effective than the other two options.”
To read the report, click here."
The damage that was brought upon the coastlines of New York and New Jersey by Hurricane Sandy, estimated to cost up $50 billion, has some economic analysts stating that the tragic event could be an economic blessing (as discussed in a November 5 article). These individuals believe that the disaster could provide a desperately needed boost for the sluggish economy due to reconstruction. The idea that massive destruction is good for the economy should be seen as absurd on its face, but many economists – including Nobel-winner Paul Krugman – subscribe to this fallacious argument.
The great political economist Fredric Bastiat challenged this erroneous view back in 1850. Bastiat used the example of a broken window to illustrate how although we may see the new work which has been provided to the glazier to fix the window, but we do not see where that money could have been spent or invested absent of the damage. By simply replacing the broken window with a new one, no new wealth has been created; rather society is one window poorer than before.
The scarce resources that will be employed to rebuild the infrastructure destroyed by Sandy will be denied of their other potential uses. Of course, the rebuilding of damaged property is necessary, but it robs us – especially those directly impacted – of wealth. Disasters should not be confused with economic stimuli.
Rio Grande Foundation
Check out this new one-page report from the Rio Grande Foundation detailing potential job-loss scenarios if the minimum wage hike ballot measure passes in Albuquerque.
The fact that New Mexico's education system is in dire need of reform is not lost on citizens of our state. Recent polling found that 75 percent support the simple act of holding back third graders who can't read.
This is good news! People clearly want to see reform — and our children deserve the best education possible for them.
While eliminating the social promotion of third-graders who cannot read would be a good start for the Legislature next session, we need to use all the tools at our disposal to ensure that kids can read and their schools are successfully teaching them to do so.
Hopefully, voters focus on this issue in the upcoming election and weigh support for such modest education reforms in deciding who they wish to represent their interests in Santa Fe.
The reality is that banning third-grade social promotion is not enough to improve our schools. In fact, no single education reform is going to solve the problems that have been with us for generations.
One reform that is sweeping the nation — but is being hindered here in New Mexico — is the fast-growing virtual/digital learning model.
Why is New Mexico, once again, falling behind in education?
We do have the state's first full-time virtual charter school up and running in Farmington because an innovative school district saw the possibility of virtual education. But, New Mexico Connections Academy, a proposed full-time, statewide public virtual school that applied for another charter for the 2013-2014 school years, was denied on a 6-3 vote by the Public Education Commission.
Despite strong interest from parents, a thorough application, committed volunteer board, and no opposition voiced at a public meeting, the PEC turned down the New Mexico Connections Aca-demy charter application.
The application is now on appeal to Education Secretary-designate Skandera.
There are countless examples of how technology has positively impacted virtually every aspect of our lives. It is only now getting started in truly changing education.
The PEC's decision was based in part on a Richardson-era legal opinion that questioned the legality of "virtual" charters. With such a mind-set, it is a wonder that New Mexico students are not forced to use only an abacus to learn math, or a wax tablet to learn how to write.
Michael O'Leary is an adjunct scholar with New Mexico's Rio Grande Foundation, a limited government proponent.
(Albuquerque) The Laffer Center for Supply-Side Economics at the Texas Public Policy Foundation has joined Rio Grande Foundation to publish a recent analysis of income taxes at the state level. The study, “Taxes Really Do Matter: Look at the States” authored by Dr. Arthur B. Laffer, a former advisor to President Ronald Reagan, and Stephen Moore, senior economics writer for the Wall Street Journal, debunks recent research by the Institute for Taxation and Economic Policy (ITEP), a group that advocates for state level income taxes.
In the report, Laffer and Moore found that in any ten-year period, the no-income tax states – Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming – consistently outperform the equivalent number of the highest income tax states – Oregon, Hawaii, New Jersey, California, New York, Vermont, Maryland, Maine and Ohio. No-income-tax states experienced a 14 percent population growth versus only 5.5 percent of the highest income tax states. Similarly, job growth in the no-income tax states was 5.5 percent while -1.6 percent in the highest tax states.
“The California/Texas comparison is especially interesting as California has one of the highest income tax rates at 10.3 percent and Texas has no income tax,” said Laffer. “Over the ten-year period studied, Texas gained nearly 870,000 transplants from other states while California lost over 1.5 million residents.”
“New Mexico provides further evidence for the Laffer/Moore thesis on the reduction or elimination of personal income taxes, said Rio Grande Foundation president Paul Gessing. “The top rate was reduced from 8.2 percent to 4.9 percent during the Richardson Administration which spurred economic growth, at least relative to other states.”
The data clearly shows that Americans are moving out of low tax states and moving away from high tax states and taking their incomes along with them. “You can’t tax an economy into prosperity,” said Laffer.
Laffer Center website: http://www.laffercenter.com/
Facebook page: www.Facebook.com/TheLafferCenter
Twitter feed: www.Twitter.com/LafferCenter
What is Austrian economics? Who is responsible for the economic crisis? Should America adopt the Gold Standard? Tom Woods discusses these issues and more: