Errors of Enchantment Blog Postings

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Why is New Mexico not realizing its potential?
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Time to Toss the Wish Lists?

Fri, 2015-09-25 11:40

The 2016 legislative session is four months away, but it’s not too early for New Mexico’s solons to think seriously about fiscal restraint.

Field production of crude in New Mexico more than doubled between 2007 and 2014. But the boom, at least for now, is over. ConocoPhillips is laying off workers, and in August alone, the state lost 1,000 jobs in the mining sector, which includes oil and gas. Goldman Sachs thinks oil may drop to as low as $20 per barrel. And as the U.S. Energy Information Administration noted this week, “upstream investment is highly sensitive to changes in oil prices”:

But wait, it gets worse. The state’s Medicaid bill keeps rising. Yesterday the Albuquerque Journal reported that “226,783 of … newly eligible adults have enrolled in the program” since Governor Martinez expanded it in 2013.

Legislators from both parties never tire of floating big-spending initiatives, from “infrastructure” projects to economic-development schemes to “universal preschool.” But it’s looking more and more like revenue declines and runaway Medicaid expenditures will enforce budget discipline during next year’s session.

Santa Ana Star’s issues not unique

Thu, 2015-09-24 13:55

Recently, an article appeared in the Rio West section of the ABQ Journal stating that the troubled Santa Ana Star Center’s finances were “looking up.” Having followed the Center and its financial issues over the years, I felt it imperative to set the record straight, so I submitted a letter to the editor to clarify that while the Center’s finances are not quite as bad as they once were, the Center was and remains an extraordinarily bad “investment” of taxpayer dollars. My letter appeared in the Rio West section of the paper on the 19th of September.

Letters to the Editor

Rio West – ABQ Journal

Your story about the finances of the Santa Ana Star Center “looking up” couldn’t have been further off the mark. It may be true that the annual operating subsidy for the Center has dropped from $874,000 to $769,000, but with Rio Rancho taxpayers on the hook for an additional $2.2 million annually through 2032, the Center’s finances will continue to be a major burden on City taxpayers.

It is true that a vast majority of arenas and events centers are money losers. That’s hardly a justification. Rather, it is an indicator that cities like Rio Rancho are overinvesting in such facilities relative to the market’s willingness to pay for them. In basic economic terms, supply is outpacing demand.

For Rio Rancho, it is too late. City taxpayers are paying what currently amounts to 80 percent of their annual gross receipts tax collections for an arena. Yes, bond money is separate from the general fund budget, but when you put the City’s financial obligations in that light, you see why the Center was a major mistake.

The good news is that Rio Rancho’s experience can be a lesson to Albuquerque and other cities that might be considering such major and potentially burdensome spending projects.

Paul J. Gessing
Rio Grande Foundation

New Mexico’s Broken-Record Poverty Rate

Wed, 2015-09-23 10:14

It received very little media attention, but the U.S. Census Bureau’s latest American Community Survey figures on state-level poverty yielded ho-hum news for New Mexico.

From 2013 to 2014, the poverty rate in the Land of Enchantment fell slightly, from 21.9 percent to 21.3 percent. (Only Mississippi fared worse.)

A look at poverty in the era of the Great Recession/Weak Recovery shows how little progress has been made:

Centrally planned economic development, a too-generous welfare state, no right-to-work law, little innovation in government education, and a cumbersome and pervasive tax on gross receipts. Is it any wonder New Mexico can’t escape its poverty trap?

Subsidizing Hollywood: That’s a Wrap?

Mon, 2015-09-21 12:21

Bernardo Saracino should stick to acting.

Last week the New Mexico native, who has a role in the critically acclaimed film Sicario, told KRQE: “Albuquerque is definitely on the map. No matter whom I talk to, when they ask where I’m from, I’m like ‘Albuquerque’; they’re like ‘wow there’s a lot of work there.'”

Not exactly. Bureau of Labor Statistics data indicate that film-and-video employment in the state is declining:

Writing in the weekend edition of The Wall Street Journal, Chris Hudson and Donald Bryson noted that “Michigan and New Jersey ended their handouts earlier this summer, while Louisiana capped its subsidies — albeit after doling out more than $1 billion in the past five years. Arizona, Idaho, Indiana and Missouri have also either rolled back or shut down their programs in recent years.”

Isn’t it time for New Mexico’s elected officials to admit that subsidizing film and television productions has been an expensive failure? Isn’t it time to follow the wisdom of the states that have ended welfare for Hollywood?

Right to Work Boosts Job Creation — Missouri trying to beat NM to be the 26th RTW state

Mon, 2015-09-21 09:59

The following op-ed was written in anticipation of an attempt by Missouri’s Legislature to override a gubernatorial veto of “right to work” in the Show-Me State. Rio Grande Foundation was one of 80+ organizations nationally that signed a letter in support of Missouri becoming the 26th “right to work” state. Unfortunately for Missourians,  the Legislature did not succeed, but Missouri is now competing with New Mexico to become the state that tips the balance to a majority of US states being “right to work.”


One notable policy shift that is picking up steam is the adoption of “right to work” laws. In the past few years, the idea that workers should be able to choose to associate with and/or pay dues to labor unions has spread to the traditionally heavily-unionized “Rust Belt” states of the Midwest. Indiana, Michigan, and Wisconsin have all adopted such laws while serious “right to work” efforts have been put forth in Missouri, West Virginia, and my home state of New Mexico.

With 25 states currently in the “right to work” column and 25 states still practicing forced unionism, we at the Rio Grande Foundation decided to track in real time where jobs were actually moving across America. “Right to work” laws have traditionally been associated with greater job growth, but how did this process work in real time?

So, we looked to the experts at Area Development for information. 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.

While not “all-inclusive,” the jobs tracked on the site will tend toward being high-paying “economic base jobs,” not fast food and retail.


Every month this year, we at the Rio Grande Foundation have tracked job announcements from Area Development at our blog [3]. When it comes to job creation in 2015, “right to work” states are America’s job creation powerhouses. Despite somewhat smaller populations overall, Area Development notes 105,229 jobs created or added in the 25 “right to work” states. During the exact same time period, forced-unionism states created or added a mere 25,311 jobs.

In other words, during 2015, using real-world jobs data from Area Development, “right to work” states have created or added more than 80 percent of jobs.

This is not a new trend. Over virtually any time period, “right to work” states have dominated American job growth. Between 1993 and 2009, for example, “right to work” states saw 37.9 percent job growth while forced unionism states grew by just 19.6 percent.

Americans have been moving in search of greater economic freedom since before the country was founded. The original settlers left Europe in search of economic opportunity and then spread from coast to coast for the same reason. Blacks fled the South before and for more than a century after the Civil War and are now returning in part due to the economic freedom to be found there.

Given this history and “right to work’s” success in terms of job creation, it is no surprise that Americans overwhelmingly support such laws. When Gallup polled Americans on a variety of labor issues in August, 2014, 77 percent of independents, 74 percent of Republicans, and even 65 percent of Democrats said they supported “right to work” laws. Americans said they support “right to work” even as they say they expressed strong support for unions 53-38 percent.

The freedom to choose is one of the unique features of America. For decades, Americans have “voted with their feet” by moving themselves and their jobs from forced unionism to worker freedom. Other states can and will soon benefit from this form of worker freedom.

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Not the time to raise taxes for Biopark

Fri, 2015-09-18 13:12

D. Dowd Muska, New Mexico Rio Grande Foundation

Albuquerque has fewer jobs today than it did in 2007. In July, Bloomberg put it on a list of large cities that “lost the greatest share of local people to other parts of the country between July 2013 and July 2014.” And when scholar Joel Kotkin examined the best metropolitan statistical areas for jobs in 2015, Albuquerque ranked 86th among 93 mid-sized cities.

Is now the time for Albuquerque to hike its gross receipts tax?

The New Mexico BioPark Society thinks so. It’s leading the charge for a GRT increase of one-eighth of 1 percent. The projected revenue from the “temporary” tax, estimated to be $17 million annually for a decade and a half, would be used to fund “capital needs, including design, construction, acquisition, improvement, renovation, rehabilitation and equipping or furnishing of the ABQ BioPark.” On Oct. 6, voters will decide the GRT hike’s fate.

There’s no question that the BioPark, which includes the zoo, botanical garden, aquarium, and Tingley Beach, is valued by both locals and tourists. In June, it offered a day of free admission, to celebrate record-setting attendance. The following month, a ranking issued by the Travel Channel found the botanical garden to be one of the best in the country.

But there are compelling reasons for Albuquerque voters to leave the GRT rate where it is. First, while the hike sounds small, a look backward reveals just how heavy the city’s tax burden has become. At the start of the 2000s, Albuquerque’s GRT rate stood at 5.8125 percent. Currently, it’s 7.1875 percent — an increase of 23.7 percent. Any benefits of better BioPark infrastructure would likely be offset by the deterrent value of a higher tax. Second, there are alternate means for the BioPark to boost its coffers. Raising the admission fee for adults is an option, given that it “is $3 less than El Paso charges, $8 less than Denver and $11 less than Phoenix,” according to news reports.

Raising revenue directly would dodge the threat of city diversions. Earlier this year, political activist Joe Monahan recalled that in 1999, the city’s GRT was hiked for transportation spending. But in 2005, an “audit found not all the money was being spent as originally billed,” and today, “the city’s financial condition … is much more precarious.” It’s far from certain that the BioPark will receive all the revenue the proposed GRT hike will generate.

Finally, a strong case can be made for freeing the BioPark from government management — and possibly even ownership. The day-to-day operations of many American zoos are overseen by contractors, not municipal employees. The New Mexico BioPark Society is “dedicated to the development of, procurement for and capital improvement of the ABQ BioPark … and to providing a quality facility through the support of related conservation, education and recreation programs.” As researchers at the Reason Foundation noted, the society is a prime candidate for outsourcing, since it is “already fulfilling … duties such as fundraising, coordinating volunteer efforts, organizing special events and providing educational programming.”

Rather than seeking to tie the BioPark even more tightly to the political process, the facility’s supporters should recognize that the best path forward is a transition away from city ownership/operation. Presently, the New Mexico BioPark Society needs the permission of city councilors and the mayor to do something as simple as raise the fee for riding the zoo’s train.

Albuquerque is struggling. Job growth remains sluggish. Business expansion is disappointing. And airport traffic has fallen for seven years in a row. The ugly reality of the city’s economic condition offers more than enough justification for voters to be skeptical of a BioPark tax hike with a price tag of a quarter of a billion dollars. Besides, there are better options to preserve and enhance one of the city’s most popular attractions.

D. Dowd Muska is research director of New Mexico’s Rio Grande Foundation, an independent, nonpartisan, tax-exempt research and educational organization.

From the Albuquerque Business First:


Randal O’Toole Deconstructs Bus Rapid Transit and Outlines Future of Transportation

Thu, 2015-09-17 10:15

Randal O’Toole spoke earlier this week on the issue of Albuquerque’s transportation future. In particular he focused on the City’s proposed bus rapid transit system, the Rail Runner, and the future of transportation. The entire presentation is below (slides here). Below that are some of the most important slides from O’Toole’s presentation. If you want to get active against bus rapid transit, there is a grassroots activism organization called “Save Route 66.”

The proposed bus rapid transit system will increase congestion in the Central corridor, just ask the consultants tasked by the City with looking at the proposal:

Portland, OR, is often touted as a “model” for mass transit, but after spending billions of dollars, transit carries fewer passengers than it did in 1980:

Transit is a trivial portion of the transportation mix in Albuquerque:

Transit appeals to those who make almost nothing and those who have very high incomes and can choose to locate next to it. For working/middle class Americans, transit is far less useful:

Albuquerque’s bus system is not especially “green” when it comes to energy use. It’s hard to believe a new bus system will be a dramatic improvement:

Discussing Amtrak’s Southwest Chief w/ NPR’s Morning Edition

Thu, 2015-09-17 08:12

There has been a decent amount of discussion in New Mexico over the future of Amtrak’s Southwest Chief. The train runs on the tracks that were purchased by the State for the Rail Runner and run from Raton in the north through Albuquerque. The train then runs West through Gallup and Grants, but New Mexico doesn’t own those tracks.

Amtrak is demanding improvements to the tracks or they won’t run the trains anymore. As noted in the story, Gov. Martinez put up $1 million of our tax dollars as a “down payment” on the $4 million annually that Amtrak is asking for states through which the Southwest Chief runs.

The interview is below. My interview starts around the halfway mark. One interesting note is that the reporter who did the story is based out of Los Angeles. Even though the Southwest Chief travels between New Mexico and Los Angeles, as he notes, he flew home.

Your guide to the City of Albuquerque election ballot

Wed, 2015-09-16 15:20

Early voting for the City’s October 6 elections is under way. Early voting locations can be found here. Control of City Council hangs in the balance with liberals eager to pick up a 6th seat on the Council to create a veto-proof majority. From the more conservative side, there is hope of adding a more moderate voice to the Council in the form of Hessito Yntema.

Interestingly enough, Albuquerque’s elections require a photo ID when you go to the polls, a tool that generates little in the way of concern come election time, but that the Obama Administration and many liberals claim is “racist.”

Of course, along with the Council races, there are a number of questions on the ballot for voters to decide on. I have listed them below in order of importance:

1) Tax Hike for ABQ BioPark would seem hard to justify: As the Rio Grande Foundation has noted elsewhere, Albuquerque’s gross receipts tax rate has risen by more than 20% since 2000. The gross receipts tax is incredibly harmful and regressive. We also believe there are other ways including privatization which is in use at 75% of zoos that could save money and improve the quality of our zoo without raising taxes in a time of great economic difficulty.

2) Question 1 would change the signature requirement for initiatives to 20% of the last mayoral election and would require that such elections be held only alongside other municipal elections. The latter in particular would save the expense of holding special elections. These changes make sense.

3) Bonds: There are several bonds on the ballot. As we have pointed out in the past, bonds are paid for with your tax dollars. While we all enjoy the government services paid for by these bonds, not all community center and park projects are essential, particularly in economically-challenging times.

My unpublished response to the NY Times: article missed real scandal harming our state

Wed, 2015-09-16 09:24

The New York Times recently saw fit to publish an article noting that New Mexico Democrats are looking to capitalize on recent scandals (both the Dianna Duran and APS scandals) in an effort to reduce Gov. Martinez’s popularity. The idea that a popular governor’s political opponents would attempt to bring them down no matter how tangentially they are tied to a given scandal is nothing new and it hardly seems worthy of a paper that touts itself as publishing “all the news that’s fit to print.”

But the Times has long been a mouthpiece for the liberal establishment. So, despite a terrible (non-existent) track record of having letters published in the Times, I penned the following and submitted it. Since I talk about economic freedom and question the very premise of the article in question, I had no illusions of publication, but I figured it was worth putting words to paper:

Political scandals are nothing new in New Mexico. The fact that some in the State’s Democratic Party are attempting to tie some recent scandals to Gov. Susana Martinez is no surprise given her popularity and her success in shifting political control of State government toward Republicans.

Unfortunately, the real “scandal” in New Mexico is its high poverty and poor economic performance. Both have been driven by the State’s relative lack of economic freedom and a strong private sector economy. Instead, the state has historically relied on a massive federal presence and extractive industries, most notably oil and natural gas.

This year several serious economic and education reforms passed the Republican House only to be killed, often without a vote, in the Democrat-controlled Senate.

Examples include “right to work,” school choice, a reduction in worker’s compensation for workers who injure themselves while drunk or stoned on the job, simplified paths for alternative teacher certification, and a regulatory structure to make the state attractive to ride-sharing companies like Uber and Lyft.

Political scandals will come and go, but Gov. Martinez’s efforts to undo decades of bad government policies in the Land of Enchantment should be applauded.

ObamaCare destroys another health care choice in New Mexico

Tue, 2015-09-15 15:51

In a free market, choice is the order of the day. Quality and low prices also predominate when personal choice and the freedom to compete dominate. In fact, Socialist presidential candidate Bernie Sanders who obviously is not a fan of free markets famously said, “You don’t necessarily need a choice of 23 underarm spray deodorants or of 18 different pairs of sneakers when children are hungry in this country.”

Unfortunately, the health care marketplace was heavily regulated before Obama became President and his “ObamaCare” health law has further restricted choices. As today’s Albuquerque Journal explains, New Mexico Health Connections will now offer only health maintenance organization plans, or HMOs, which restrict participants to a contracted provider network.

According to the article, Health Connection’s decision, coupled with an earlier decision by Blue Cross Blue Shield to largely pull out of the individual market, means about 23,900 people with PPO plans on and off the exchange will have to find new coverage for 2016.

Again, the promise of ObamaCare is far from reality, an issue that led the liberal-leading Politifact to call Obama’s promise “lie of the year.”

Rio Grande Foundation Signs Amicus Brief in US Supreme Court Friedrichs Case on Worker Freedom

Mon, 2015-09-14 14:28

The next big case coming to the US Supreme Court is Friedrichs v. California Teachers Association. At issue is whether the current practice in non-“right to work,” forced-union states of requiring workers to pay union agency fees for the privilege of being a public employee violates the First Amendment rights of workers. This case has the potential to guarantee the right to work for public employees in all 50 states. In other words, it would free government workers who don’t want to be associated with a union from having to pay dues in support of that union.

The full text of the amicus brief can be found here.

Interestingly enough, some New Mexico “first responders” took the opportunity presented by the marking of the 14th anniversary of 9/11 to inveigh against the concept of “right to work.”

As the article noted, “Albuquerque firefighter and former state representative Emily Kane spoke about how the 1993 attack on the World Trade Center provided opportunities to better serve those in such an attack. She said after the first attack, union officials provided an ‘ability to communicate’ with building officials and first responders and subsequently implement more fire drills and better radio communication.”

So, “right to work” is bad because…9/11. Aside from the fact that New Mexico is not New York City and is far less likely to be attacked by terrorists, I simply can’t fathom how forcing all public employees to pay union dues really makes them or us safer. We’ll see what the US Supreme Court has to say when it hears the case.

Left and Right Should Agree to Reform Occupational Licensing

Mon, 2015-09-14 08:41

The Rio Grande Foundation is an unabashedly free market organization, often labeled “conservative.” That doesn’t mean that we don’t agree with the political left on various policy issues, but it does mean that opportunities for such agreement require an honest assessment of reform opportunities and principles.

An ever-growing area on which left and right might agree is occupational licensing and the ever-increasing thicket of regulations facing workers as they attempt to make an honest living. This has been an issue of interest to free market advocates going back to the 1970s and economist Milton Friedman.

In a sign that at least some liberals are starting to see Friedman’s point of view, President Obama’s Council of Economic Advisors recently released a report called “Occupational Licensing: A Framework for Policymakers.”

The report detailed some of the very real problems with occupational licensing. As the paper concluded:

There is evidence that licensing requirements raise the price of goods and services, restrict employment opportunities, and make it more difficult for workers to take their skills across State lines. Too often, policymakers do not carefully weigh these costs and benefits when making decisions about whether or how to regulate a profession through licensing.

Furthermore, as the report noted, there has been an explosion in the area of professional licensing. More than one-quarter of U.S. workers now require a license to do their jobs, with most of these workers licensed by the states. The share of workers licensed at the State level has risen five-fold since the 1950s. About two-thirds of this increase stems from an increase in the number of professions that require a license.

Given New Mexico’s historical lack of economic freedom, it is no surprise that the Land of Enchantment has onerous regulations on workers. A 2012 report by the libertarian Institute for Justice, New Mexico is the ninth most broadly and onerously licensed state with the 12th most burdensome licensing laws.

According to the report, New Mexico has higher barriers for more occupations than most states. Fifty two of the 102 low- to moderate-income occupations studied are licensed in New Mexico.

The state also has above-average education or experience requirements for other occupations. For example, aspiring pest control applicators and vegetation pesticide handlers lose two years to experience before receiving a license. Thirty two states have no experience requirement for pest control applicators, and 39 states have none for vegetation pesticide handlers. Fire and security alarm installers lose two years to experience, compared to averages of less than a year-and-a half among the 34 states that require licenses.

New Mexico’s mania for licensing doesn’t just harm consumers; it harms those trying to turn their lives around after a brush with the law. Under the New Mexico Criminal Offender Employment Act, even convictions not directly related to the occupation are grounds for ineligibility for obtaining an employment license.

One solution is to allow ex-offenders to obtain provisional licenses that are valid for a shorter period of time and subject to immediate revocation if they commit a new offense, violate a term of probation or parole, or violate a rule of the occupation. Such provisional licenses provide a positive incentive for success while still holding the ex-offender accountable. A few years ago Texas lawmakers specified in law that a provisional license becomes a permanent license after six months if the license holder is in full compliance.

Given the negative impact professional licensing has on middle and lower-income workers and those convicted of crimes, we would love to see a left-right coalition both among policy organizations and legislators coalesce on this issue in New Mexico.

An added benefit of a cross-partisan regulatory reform effort is that it could boost New Mexico’s lagging economy.

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

An interesting listen: labor unions and the downfall of the American auto industry

Fri, 2015-09-11 14:32

This American Life is a radio show that appears on NPR. In other words, it is hardly right-wing, but in July of this year there was an interesting show on the American auto industry (click to listen) which included some very candid statements about unions (including many from former union members).

If you’d rather read than listen, the transcript can be found here. I have included some of the most stunning statements below:

• Compared to Japan, where auto workers and management worked together, labor relations in America were more like war.

• A former running back from the University of Arkansas named Bruce Lee ran the western region for the United Auto Workers, and was in charge of the Fremont Union Local 1364. Now, normally, somebody like Bruce Lee is supposed to defend his union members no matter what, but even he says they were awful.

Bruce Lee (speaking)
“It was considered the worst workforce in the automobile industry in the United States. And it was a reputation that was well-earned. Everything was a fight.

They spent more time on grievances and on things like that than they did on producing cars. They had strikes all the time. It was just chaos constantly.”

One of the expressions was, you can buy anything you want in the GM plant in Fremont. If you want sex, if you want drugs, if you want alcohol, it’s there. During breaks, during lunchtime, if you want to gamble illegally– any illegal activity was available for the asking within that plant.

Frank Langfitt (speaking)
Sounds like prison.

Jeffrey Liker (speaking)
Actually, the analogy to prison is a good analogy, because the workers were stuck there because they could not find anything close to that level of job and pay and benefits at their level of education and skill. So they were trapped there.

And they also felt like we have a job for life, and the union will always protect us. So we’re stuck here, and it’s long term. And then all these illegal things crop up, so we can entertain ourselves while we’re stuck here.

Rick Madrid (speaking)
A lot of booze on the line. I mean, it was just amazing. And as long as you did your job, they really didn’t care.

• If you’re wondering how people kept their jobs, well, back then, the UAW was still quite powerful. Under the union contract, it was almost impossible to fire anybody. And if management ticked off the union, workers could just shut the plant down in minutes.
With that sort of leverage, absenteeism became absurd. On a normal day, one out of five workers just didn’t show up. It was even worse on Mondays. Billy Haggerty worked in hood and fender assembly. He says so few workers showed up some mornings, management couldn’t start the line.

Makes “right to work” sound a lot more pro-labor and pro-business and the unions a lot less sympathetic.

Talking the Tea Party, and Transportation

Fri, 2015-09-11 12:48

The Foundation’s biweekly radio program, the New Mexico Freedom Hour, airs tomorrow at noon on KKOB.

Guests in the first half hour will be Will Summers and Rick Harbaugh of the Albuquerque Tea Party. The group is holding its annual fundraiser later this month, with Mark Meckler, co-founder of the the Convention of States Project, as speaker.

The Cato Institute’s Randal O’Toole, soon to appear in Albuquerque, will call in for the second half hour. The transportation and land-use scholar will discuss the city’s proposed bus rapid transit project, as well as the Rail Runner, and other issues related to how New Mexico moves both people and cargo.

The New Mexico Freedom Hour can be streamed online here.

How Planning and Zoning Kills Jobs

Wed, 2015-09-09 16:46

Earlier today, Corrales MainStreet conducted a work-study session with councilors regarding a draft plan for “economic development” in the village. As expected, there was much discussion of, as the Corrales Comment put it, “eligibility for programs and incentives through the N.M. Local Economic Development Act.”

But Mayor Scott Kominiak made some points that would surely put smiles on the faces of advocates for the free market. Kominiak noted that in his deep-blue municipality, NIMBYism is rampant. The mayor added that the village has “a very unfriendly planning and zoning process.”

That reminded us of an Albuquerque Journal article published earlier this year. The piece examined “the stack of land-use policies and plans intended to govern growth” in the city. Planning Director Suzanne Lubar, in an interview with reporter Dan McKay, offered a grisly assessment: “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.'”

Despite the groupthink of New Mexico’s economic-development establishment, taxpayer largesse is not the only tool for boosting jobs and entrepreneurship the state. (It’s not even an effective tool, but let’s leave that for another day.) A deep dive into and significant revision of unnecessary and unworkable regulations promises a sizable payback.

New Mexico’s Cartel Federalism

Wed, 2015-09-09 11:49

The folks at the Mercatus Center, a free market think tank at George Mason University, have come out with a new report comparing US states and how their versions of “federalism,” the interaction between state and federal governments, enhances or reduces liberty.

According to the report which can be found here, “it is surely reasonable to wonder how two sources of political power within the same territory can be more favorable to liberty than one. It turns out that the pro-liberty quality of federalism is a possible but not a necessary feature. This essay explores this two-edged quality of federalism to discern more clearly the relationship between federalism and liberty. It also examines how the erosion of federal liberty that has been underway for around a century might be amended in a pro-liberty direction.”

As patterns go, the “cartel” states tend to be “blue” states (like New Mexico) but there is far less of a pattern with regard to other states. One thing New Mexico policymakers should consider doing to reduce the “cartel” aspects of its economic system is to eliminate (or at least reduce) occupational licensing as Obama’s Council of Economic Advisers recently urged.

Hope, Change, and ‘Early Childhood Education’

Tue, 2015-09-08 15:04

New Mexico’s junior senator had a particularly cloying — and fact-free — Labor Day message for his constituents.

In his first sentence, Martin Heinrich got the origin of the holiday wrong. Labor Day, in the senator’s shopworn morality play, was created to recognize “workers and the labor movement’s fight for fair wages and better working conditions.” But as historian Thaddeus Russell observed, “In 1884, when President Grover Cleveland signed the bill making Labor Day a national holiday … he and its sponsors intended it … as a promotion of the great American work ethic. Work, they believed, was the highest calling in life, and Labor Day was a reminder to get back to it. It was placed at the end of summer to declare an end to the season of indolence, and also to distance it from May Day, the spring event that had become a symbol of the radical labor movement.”

In addition to flunking history, Heinrich’s endorsement of “early childhood education” was an indication of how clueless the fedpol is on the realities of preschool.

Grover Whitehurst, a scholar with the liberal Brookings Institution, has found “weak evidence behind the groundswell of advocacy for public investments in statewide universal pre-k.” Research has repeatedly shown that whatever small gains preschool produces vanish within a few years. (It’s known as the “fadeout effect.”)

Last week, one of the nation’s top teacher-union bosses was in Albuquerque, to pitch a $175 million preschool plan. Calling it a tool to “build a middle class in America,” she touted the scheme as a “really exciting ground-up innovation.”

Nonsense. Real innovations aimed at boosted the well-being of students would assault family fragmentation and violent crime in New Mexico.

In Utah, where test scores are high, state taxpayers don’t fund a dime of preschool. But the Beehive State is a very different place than the Land of Enchantment. Both have underclasses, of course, but Utah’s illegitimacy rate in less than half of New Mexico’s. The violent-crime rate in our state is nearly three times what it is in our neighbor to the northwest.

Democrats and Republicans from coast to coast have been suckered into supporting massive “investments” in preschool. The results have been abysmal — and served to distract from the true causes of underachievement in education.

Options for reforming Albuquerque Public Schools

Tue, 2015-09-08 09:59

There are several issues facing the Albuquerque Public Schools (APS) including the recent departure of Superintendent Valentino. Unfortunately, there are few ideas for reforming the school district. This blog posting will consider some ideas for reforming New Mexico’s largest school district.

1) Split APS into two or more districts. APS is a large (31st-largest in the nation), sprawling district with urban, rural, and suburban schools. Some argue that the district is too bureaucratic and top-heavy to succeed. Our take is that it may help to shake things up, but there is little data on how an additional school, smaller school district would improve outcomes.

2) Winthrop Quigley of the Albuquerque Journal recently noted that New Mexico has a state-wide funding formula with most decisions made in Santa Fe (and most money flowing from there). We at the Rio Grande Foundation support decentralization and would prefer to see both school funding and decisions made at the local level. One doesn’t work without the other though.

Quigley makes some important points about the problems at APS and with the centralized funding mechanism that New Mexico uses. Unfortunately, the centralized model has been spreading to other states due to funding equity issues and the lawsuits that have been rather successful in recent years in forcing more centralized educational systems in other states. Our take is that more decentralized funding and decision-making systems are a good thing, but it’s not likely to be done in New Mexico due to rampant inequality in potential funding.

3) Follow New Orleans and go to a system of all charter schools in APS. In the wake of Hurricane Katrina, all of New Orleans’ schools were “charterized.” In other words, New Orleans achieved decentralization by simply changing the way the schools were managed.

As seen in the chart below, the charters spurred dramatically-improved education performance in New Orleans schools. Perhaps APS could see similar performance gains by moving to all-charters? Our take is that this is the solution that must be considered to reform APS. As bad as the Valentino has been, it was not as impactful as Hurricane Katrina. Making the dramatic move to an all-charter district would definitely upset the status-quo.

Bus Rapid Transit and Millennial Myth-Making

Fri, 2015-09-04 11:20

Several Millennials were in the audience at last night’s forum on the profoundly unwise proposal for “Albuquerque Rapid Transit.” The group seemed to support, in lockstep fashion, bus rapid transit along Central Avenue — particularly the project’s alleged value as way to retain and attract young professionals to the city’s core.

Clearly, they weren’t aware of it, but the attendees were not at all representative of their generation. Earlier this year, the National Association of Home Builders released a survey of where those born since 1977 want to live. Urban environments were not popular:

Furthermore, transit-as-catnip-for-Millennials was dealt a serious blow by a 2014 analysis by City Observatory. Between 2000 and 2012, the six metro regions that transportation scholar Wendell Cox calls “transit legacy cities” expanded their young, college-educated populations by an average of 20.8 percent. That growth was dwarfed by the performance of “sprawling” metro regions such as Houston (49.8 percent), Orlando (43.3 percent), Nashville (47.6 percent), San Antonio (50.5 percent), Oklahoma City (56.8 percent), Jacksonville (44.8 percent), and Las Vegas (72.8 percent).

Finally, a few months ago, Bloomberg reported that “Millennials … accounted for 27 percent of new car sales in the U.S. last year, up from 18 percent in 2010, according to J.D. Power & Associates. They’ve zoomed past Gen X to become the second-largest group of new car buyers after their boomer parents. Millennials are starting to find jobs and relocating to the suburbs and smaller cities, where public transport is spotty.”