Is New Mexico in a "death spiral" or not?

Recently, we at RGF made a pretty big deal out of a Forbes report that called New Mexico the number one "death spiral" state in the nation. Albuquerque Journal economy reporter Winthrop Quigley took issue with the report and argued that New Mexico, while it has some problems, is not in a "death spiral."

Rio Grande Foundation policy analyst Marcos Portillo wrote the following response to Quigley which appeared in Monday's Albuquerque Journal.

Mr. Quigley may believe that Forbes’ “death spiral” claim is unwarranted, but the fact is that New Mexico’s economy is among the worst in the nation.

Quigley’s assumption is that New Mexico will continue getting infused with federal dollars into the foreseeable future. Federal funds currently make up nearly $6 billion of the $15 billion in total state expenditures. New Mexico also has one of the highest concentrations of federal employees (of about 33,000) in its various military bases and laboratories.

When the federal government tightens its belt, our economic problems could worsen.

Currently, New Mexico is: Ranked dead last in economic freedom by the recent Fraser Institute report;

Has a poverty rate that is highest in the nation;

Has an education system ranked 46th of 47 by the US Department of Education;

Has a Human Services Department website proclaiming that it is “serving one in three” even prior to the massive government expansion under ObamaCare.

Has a judicial climate ranked 44th of 50 by the US Chamber of Commerce;

And, while most states experienced some economic growth over the past year, New Mexico lost more jobs than any state but coal-dependent West Virginia.

There’s great potential in NM and many good things about the state and its people. Unfortunately, its current economic structure is dependent on the whims of bureaucrats 3,000 miles away and public policies are holding us and our citizens back.

Marcos Portillo
Additional contact information
Policy Analyst
Rio Grande Foundation

KUNM editorial: expand school choice in New Mexico

This is the second of my occasional audio editorials for KUNM 89.9FM. It tackles the need for expanded school choice in New Mexico. Check out the first one on economic reform here.

'Fiscal cliff' already impacting New Mexico economy


Much has been said about the “fiscal cliff” in Washington. Not nearly as much has been said about the impact slowing federal spending will have on New Mexico. Less still has been put forth in terms of economic policies that can make our state less dependant on Washington.

For starters, it is worth a bit of history. The Rio Grande Foundation has recently produced a chart showing New Mexico’s per-capita personal income as compared to the national average dating back to 1940. Since about 1960, New Mexicans’ personal incomes’ have been between 75 and 85 percent of the national average, thus making us, by most any measure, among the poorest states in the nation. That’s the bad news.

The really scary news is that back in 1940, prior to WWII and the rise of the military-industrial complex, New Mexico was truly “dirt poor” with personal income levels barely above 60 percent of the national average.

The question is, if we see spending cuts of the scope needed to close trillion dollar plus deficits, will New Mexico wind up dirt poor again? It will unless our elected leaders make needed reforms.

New Mexico and the "fiscal cliff" discussion

RGF president Paul Gessing, Gerry Bradley of Voices for Children, and Chris Hellman of the National Priorities Project appeared recently on the KUNM call in show to discuss the "fiscal cliff," the national budget situation, and its potential impact on New Mexico.

The full podcast is available online by clicking here. Details on the show at the KUNM website.

National Reports Make for a Tough Week for New Mexico: Point to need for Dramatic Shifts in Economic, Education Policy

Regardless of the makeup of the Legislature and no matter who inhabits the Governors’ mansion, New Mexico is in dire need of reform. That is the clear and unambiguous conclusion that can be derived from just a few recent news stories this week.

First, Forbes put the Land of Enchantment at the top of its list of “Death Spiral States. ” Said Forbes:
Don’t buy a house in a state where private sector workers are outnumbered by folks dependent on government.
Thinking about buying a house? Or a municipal bond? Be careful where you put your capital.
Don’t put it in a state at high risk of a fiscal tailspin.
Telling its readers not to buy a house in New Mexico is not exactly reassuring for current homeowners in our state.

Second, according to a new report from the US Department of Education, New Mexico’s educational system is 46th out of the 47 systems studied. Just 63 percent of New Mexico students in the 2010-2011 school year finished secondary school.

Lastly, according to a new report from the Fraser Institute, a free market think tank based in Canada, New Mexico is the least economically-free state in the United States and is freer than only the Canadian province of Prince Edward Island.

With NM being ranked the least economically free state in the entire union (and most of Canada) it is no wonder we will continue to see a further hemorrhaging of jobs as businesses and employers will invariably seek to set up shop in any other state with a more business friendly environment.

Said Paul Gessing, president of the Rio Grande Foundation, “New Mexicans are used to their state being ranked poorly in these national rankings, but they cannot feel good about these results and the fact that our state has been hemorrhaging jobs while other states grow. Our state needs a healthy dose of free market policies and educational choice during the upcoming 60-day legislative session.”

No organization has been as active in studying these problems and putting forth solutions. Contact the Rio Grande Foundation at 505-264-6090 for interviews.

KUNM Commentary: Key To Recovery: Attract New Businesses, Not More Federal Spending

You can read or listen to the commentary that ran on KUNM by clicking here.

Discussing License Plate Expenses with KRQE Channel 13

New Mexico allows some non-profits to fund raise by creating special license plates. While good in concept, the State has a warehouse full of unused plates sitting around for a number of these organizations. Channel 13 asked me to weigh in:

Rio Grande Foundation releases latest tax-friendliness study

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:

1. Carlsbad
2. Hobbs
3. Clovis
4. Roswell
5. Alamogordo
6. Farmington
7. Santa Fe
8. Las Cruces
9. Rio Rancho
10 Albuquerque

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