Shortly before the Biden Administration imposed a moratorium on oil and gas leasing on federal lands, the Foundation’s president Paul Gessing joined the Institute for Energy Research podcast to discuss New Mexico’s energy portfolio and what possible consequences the state could face from a ban on hydraulic fracturing instituted by the Biden administration.
Given the uniqueness of 2020 it is VERY interesting to see where people are moving to and from. But, while 2020 was a very unique year, 2020 mostly saw the continuation of a trend that saw high tax “blue” states like New Jersey, New York, California, and Illinois continue to lose people while more economically-free (both long-term and in terms of the Virus), lower-cost states like Idaho, South Carolina, South Dakota, and Arizona were among the biggest gainers in terms of population.
Fast-growing “blue” Oregon is an enigma but we suspect Californians may be moving in numbers due to its relatively lower costs.
The following data for New Mexico from the report show that New Mexico tends to attract older retirees and those moving for “lifestyle” reasons. Younger people and those moving for jobs or family are less likely to choose New Mexico.
In case you missed it, Albuquerque’s City Council recently punted on TWO big issues. RGF discussed both issues with KOB TV channel 4. You can watch the discussion relating to fines and even jail time for disobeying the public health order below.
And, RGF and the local business community has engaged in a the issue of mandatory paid sick leave. The Council (again) pushed the final vote to at least February 1, 2021.
The following opinion piece by RGF president Paul Gessing appeared in the Las Cruces Sun News on November 22, 2020
Recently, both the Santa Fe and Rio Rancho school districts joined Albuquerque and Las Cruces schools in abandoning any in-person learning. Instead, for the foreseeable future all learning in New Mexico’s largest school districts will be done online. The odds seem very good that this situation will continue into 2021 and possibly through the end of the school year.
Oddly, while Gov. Michelle Lujan Grisham constantly tells us that her anti-COVID efforts are based “on the science,” leading health bodies like the CDC have recommended in-person learning. And, as a Nov. 16 email distributed nationally from the New York Times put it:
“The one indoor activity that appears to present less risk is school, especially elementary school. Why? Young children seem to spread the virus less often than adults do. “Research has shown that if you put social-distancing protocols in place, school is actually quite a safe environment,” Andreas Schleicher, who studies schools for the Organisation for Economic Co-operation and Development in Paris, told NPR.
Closing schools and switching entirely to remote learning, on the other hand, has big social costs. Children are learning less, and many parents, mostly mothers, have dropped out of the labor force. The U.S. is suffering from both of these problems and from a raging pandemic.
The upshot is that increasing numbers of parents have few choices when it comes to educating their children. That is, unless they can pay for and get their child enrolled in one of the religious or private schools around New Mexico that have been providing in-person learning throughout the school year (despite arbitrary occupancy restrictions imposed by the governor).
The governor and the union-dominated political power structure of the state has been implacably opposed to helping parents and families as they face dire challenges in educating their children thanks to the pandemic and the shutdown of in-person teaching. Earlier this year New Mexico sued the Trump Administration to stop any CARES Act funding from being directed to non-public schools, other states (including two of New Mexico’s neighbors) have found creative ways to directly help families impacted by the shutdown of in-person learning in many school districts.
Oklahoma is providing $30 million from the CARES Act to support families impacted by the virus-induced shutdowns. “These programs will allow for students and families of diverse backgrounds to access the quality resources they need in order to continue their education journey amid the COVID-19 pandemic,” said Gov. Stitt.
Idaho has created a $50 million program using CARES Act dollars to spent on eligible educational materials, devices and services. Parents can apply for benefits totaling $1,500 per eligible student and a maximum award of $3,500 per family.
Texas used $30 million to help special needs students whose families have been forced to deal with a difficult situation in the pandemic. Families of some students with disabilities may be eligible for $1,500 per child in aid to use toward services including tutoring, therapy and digital resources.
But, here in New Mexico the options most children are really limited.
Students, often young ones without typing and computer skills engaged in virtual learning, sometimes without great Internet access;
Spending scarce resources in these difficult times on private schools while continuing to pay taxes for government schools;
Or, withdrawing students completely from government schools and having one or more parent or family member dedicated to educating children at home.
These are not great options for many New Mexico families. Returning to in-person learning is undoubtedly the best available option. It would also be great if New Mexico came up with something similar to what is happened in neighboring states at least as a start to helping families deal with the consequences of the ever-shifting educational playing field. Alas, New Mexico didn’t get to 50th in education by making good decisions.
Paul J. Gessing is president of New Mexico’s Rio Grande Foundation.
The following appeared in the Farmington Daily-Times on October 7 and several other newspapers.
Recently, California Gov. Gavin Newsom made headlines with his announcement that by 2035 his State will ban the sale of gas-powered vehicles. That is an ambitious goal, but given the time line, it is hard to say what compliance will look like.
But for another, arguably even more ambitious car mileage proposal, one need look no further than New Mexico. Las September New Mexico Gov. Lujan Grisham announced that by just model year 2022 New Mexico would be increasing its fuel economy requirement for new cars to 52 MPG. The current average fuel economy rate is 25.1 MPG according to the EPA.
As we noted at the time, Gov. Lujan Grisham (at the time) had “out California-ed California” by adopting even more stringent fuel economy standards than those on the books in California.
Will California’s decision spur Lujan Grisham to action? Perhaps more importantly, is New Mexico REALLY going through with the Gov.’s 52 MPG standard? This was put forth at a time of a record (oil-driven) economic boom in New Mexico. That boom has evaporated thanks to COVID 19 and the Gov.’s lockdown of the State’s economy. She MAY not be as enthusiastic about such radical plans at a time of serious economic challenges.
If you’re expecting to find legislation on this topic from the 2020 legislative session, don’t worry, nothing was even introduced. We have never even seen a formal executive order from the Gov. formalizing this requirement. In fact, after the initial round of media discussion (led off by the New York Times) the issue has been completely forgotten about.
And just to be clear, if the Gov. completely backed away from her plan, we would be more than happy to support such a move. The number of automobiles on the market right now that achieve such a standard is limited to about a dozen or so hybrid models. Considering that “light trucks” now account for 69 percent of the new car market, getting to that 52 MPG average is going to require one or more of the following:
Unforeseen, drastic changes in automobile purchasing patterns among New Mexicans result in few trucks and more fuel-efficient vehicles being purchased;
Massive taxpayer subsidies will have to be handed out to support the purchase of small/hybrid vehicles and massive taxes will be levied on larger vehicles and trucks.
Large numbers of New Mexicans purchasing their vehicles in neighboring states and bringing them home (thus devastating New Mexico car dealerships and the State economy).
As much as our Governor desperately wants to virtue signal to radical environmental groups who so strongly support her, attaining 52 MPG is simply not realistic by 2022. California’s Gov. at least had the good sense to impose his regulations long after he will be out of office, but unless Biden wins the White House and picks her for a position in his Administration, she will have to make some hard decisions about whether to comply with this mandate (or not).
Perhaps it is already a forgotten promise that she never intended to honor in the first place? If so, that is certainly fine with us, but it would seem that New Mexicans should be given an honest explanation so they know what to plan for or expect the next time they walk into a car dealership.
Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility
We at the Rio Grande Foundation have found the New York Times’ website tracking COVID 19 to be very useful in better understanding the important data surrounding the Virus and the State of New Mexico’s response to it.
Watch this short, 3 minute video and you too will better understand the situation.
In an effort to protect taxpayers in the aftermath of the global Coronavirus pandemic, the Rio Grande Foundation sent a letter to candidates for legislative offices requesting they sign the Taxpayer Protection Pledge. The letter was sent as follows:
Dear New Mexicans,
As a member of the New Mexico Legislature or a candidate to hold that office, one of your primary goals is to help New Mexicans get back to work. This downturn has been driven partially by the economic shutdown associated with the Corona Virus, but also in part by steep decline in oil prices.
Whatever the cause of the downturn, New Mexico government plainly spent beyond its means in recent years and has plenty of spending to cut before tax hikes are even considered. While the economy remains largely shut down and the start of our economic recovery remains unknown, we do know that New Mexico’s economy faces a steep challenge that will not be assisted by tax hikes on businesses and other hard-working New Mexicans.
I want you to pledge to the people of New Mexico not to raise your NET taxes as a result of the current economic downturn. In practical terms, this means no tax hikes through the end of the 2021 New Mexico legislative session.
The candidates were asked to respond to the request and pledge to not increase taxes as a result of the economic downturn. For legislators and candidates interested in signing the pledge, kindly write to email@example.com and mention the Taxpayer Protection Pledge.
State Representative Candidates who have signed the pledge:
Dinah Glenda Vargas (R)
for State Representative District 10
Adrian Anthony Trujillo, Sr (R)
for State Representative District 11
Kayla Renee Marshall (R)
for State Representative District 13
Ranota Q Banks (L)
for State Representative District 15
Ali Ennenga (R)
for State Representative District 15
Antoinette Bernice Taft (R)
for State Representative District 16
Scott Goodman (L)
for State Representative District 17
Kimberly Ann Kaehr-Macmillan (R)
for State Representative District 17
Michael Eugene Hendricks (R)
for State Representative District 20
Paul Ryan Mckenney (L)
for State Representative District 21
Stefani Lord (R)
for State Representative District 22
Ellis C Mcmath (R)
for State Representative District 23
Robert S Godshall (R)
for State Representative District 27
Robert Jason Vaillancourt (L)
for State Representative District 28
Thomas Ray Stull (R)
for State Representative District 28
Adelious De Stith (R)
for State Representative District 29
Randall K Sobien (L)
for State Representative District 30
John L Jones (R)
for State Representative District 30
Steven Ray Penhall (L)
for State Representative District 31
J Scott Chandler (R)
for State Representative District 32
Isabella Solis (R)
for State Representative District 37
William Parrish Kinney (L)
for State Representative District 38
Rebecca L Dow (R)
for State Representative District 38
Luis M Terrazas (R)
for State Representative District 39
David E Hampton (R)
for State Representative District 43
Jeremy B Myers (L)
for State Representative District 44
Helen M Milenski (L)
for State Representative District 45
Jay C Groseclose (R)
for State Representative District 46
Gail “Missy” Armstrong (R)
for State Representative District 49
John Foreman (R)
for State Representative District 52
Ricky L Little (R)
for State Representative District 53
Cathrynn N Brown (R)
for State Representative District 55
Candy Spence Ezzell (R)
for State Representative District 58
Greg Nibert (R)
for State Representative District 59
Giovanni Coppola (R)
for State Representative District 68
Nathan M Dial (R)
for State Representative District 70
State Senate Candidates who have signed the pledge:
In economic policy terms New Mexico’s 2019 Session was a disaster. Massive expansion of film subsidies, new mandates on electricity generation, a higher minimum wage mandate, tax hikes, and 12 percent spending growth were the lowlights.
Of course, with fast-growing oil production and a strong national economy, New Mexico’s economy remains strong and surplus revenue will again be available when the Legislature convenes in January.
At the Rio Grande Foundation, we see numerous opportunities for bipartisan reform, but 2020 could also result in another spending binge that does nothing to address the systemic policy problems facing our State.
The most obvious opportunity is gross receipts tax reform. This must involve lowering rates and elimination of taxes of services provided by contractors and other business inputs. These taxes can be avoided by purchasing services (like bookkeeping and web hosting) from out-of-state providers in order to avoid the GRT which is applied at rates above 7.5% in most New Mexico communities.
Sadly, in 2019 the Legislature eagerly imposed GRT on several businesses, consumers, and industries. These included non-profit managers of Los Alamos National Lab, non-profit hospitals, and purchases made over the Internet.
But, the GRT remained unchanged in any systemic way. Rates remain high and the problem of taxing business inputs and “pyramiding” remains unchanged. With a billion dollar surplus available and both Gov. Lujan Grisham and Speaker Egolf making noise about tax reform, now is the time to act. And, while details may vary, the general model outlined in bipartisan legislation introduced by Rep. Jason Harper (R) and Sen. John Arthur-Smith (D) remains the logical framework for reform.
Another bipartisan reform opportunity should include public employee pensions (specifically PERA and ERB). Gov. Lujan Grisham should be applauded for naming a task force to take a serious look at PERA which covers public workers NOT employed in the education system (and thus covered by ERB). Given its weaker financial position and importance to public education budgets, ERB deserves a similar look.
Both systems are seriously underfunded, a situation which must be addressed. Also, both need to be updated to better serve the 21st Century work force. Colorado and other states have successfully done this. New public employees in New Mexico should be offered more portable benefit options outside of the traditional pension system, which rewards longevity as opposed to those who may want to “give back” for a few years and then move on to other career goals as younger workers wish to do these days. Both types of employees should have retirement options that work for them.
Finally, there is the issue of occupational licensure reform. Bipartisan legislation (SB 385) made its way to the Governor’s desk in 2019 only to be vetoed. We hope to make another push to address the unnecessary obstacles licensing often puts in the way of willing workers and willing customers/employers.
While there is potential common ground for economic reform in 2020, there are numerous serious issues, particularly with the Gov’s proposal for “free” college. Here are two:
While the oil boom as perked up the State economy in recent years, job opportunities are still more diverse, plentiful, and generally better-paying in neighboring states. Absent economic reforms (see GRT discussion above) how can we be sure that “free” college will actually benefit New Mexico’s economy?
New Mexico’s biggest education challenge is the performance of its K-12 system. Absent much more ambitious reforms than those currently being discussed to raise student outcomes “free” college won’t do much good.
While this oil boom is driven by production as opposed to prices, all good things eventually come to an end. What happens when oil prices or production decline due to environmental concerns, the global economy, technological advances, or some other unforeseen change?
This 30 day session will go a long way to determining New Mexico’s economic future.
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
We have been doing a lot of work comparing New Mexico’s relatively moribund economy and population growth figures relative to other states. Specifically, we have talked a lot about Colorado’s strict limits on spending and taxes known as the Taxpayers Bill of Rights.
Interestingly enough, when it comes to income inequality, New Mexico is actually at the high end and is higher than its lower-tax, higher income, blue state neighbor, Colorado. Though, to be fair, New Mexico incomes are more unequal than most states with the exception of blue-state paragons California, New York, and Connecticut (and purple Louisiana).
Even based on the left’s own supposed metrics which favor equality, liberal-dominated New Mexico is not getting the job done.