(Albuquerque, NM) —The Rio Grande Foundation today joined with elected officials and organizations from 50 states representing a wide range of industries to voice strong concerns with the U.S. Environmental Protection Agency (EPA) flawed “Clean Power Plan.”
For more than 70 years, New Mexico has exercised exclusive jurisdiction over its retail electricity markets. With the passage of the Federal Power Act in 1935, the Congress codified New Mexico’s—and all States’—prerogative to oversee their retail electricity markets, unencumbered by federal intrusion. EPA’s Clean Power Plan, by its very terms, would erase this “bright line” in jurisdiction between federal and state governments.
In addition to usurping the state’s authority, the rule adds insult to injury by imposing unreasonable costs on New Mexico ratepayers. Residential rates are projected to increase by 13 percent to 14 percent, while industrial rates are projected to increase by 23 percent. Making matters worse, the rule also poses a threat to electric reliability.
In response to previous EPA rules, utilities already have announced the closure of 633 megawatts of coal-fired electricity in New Mexico. EPA modeling for the Carbon Pollution Rule projects that the regulation would cause an additional 1,001 megawatts of electricity generating capacity in New Mexico to retire.
The Rio Grande Foundation’s comments are available online.
Said Paul Gessing, president of the Rio Grande Foundation which organized and submitted the comments, “Reliable and inexpensive electricity is critical to creating a prosperous economy. Working class New Mexicans, small businesses, and those on fixed incomes, cannot afford to see electricity prices skyrocket due to unnecessary and ineffectual federal regulations.”
Gessing further noted that it is not just his opinion that the regulations will be ineffective, in September 2013 testimony before a House committee, EPA administrator Gina McCarthy conceded the agency’s climate-change regulatory regime would not affect the climate, because the preponderance of current and future greenhouse-gas emissions originate in Asia.
In conclusion, the EPA is imposing significant costs on New Mexico businesses and rate-payers for no net reduction in current and future greenhouse-gas emissions.
Rio Grande Foundation president Paul Gessing sat down recently with Mike Cosgrove of KNAT TV on the topic of "right to work" and what it could mean for New Mexico's economy.
The recent crash of Virgin Galactic’s SpaceShip2 in the Mojave Desert was a tragedy for the pilot that lost his life in the accident. It was also a setback for Richard Branson, Virgin Galactic, and the entire private space industry. However, for New Mexico taxpayers, it was only the latest and most vivid sign that building a Spaceport was not a wise use of tax dollars.
The transition from publicly-funded space travel (NASA) to a competitive, private-sector model was destined to be choppy and unpredictable. It is very much an open question how humans will travel safely and regularly into space in private spacecraft.
Even NASA with its multi-billion dollar budgets never quite figured out how to get humans back and forth form space routinely and regularly. The Space Shuttle was originally intended to launch as frequently as once a week. That didn’t come close to happening even in the best of times.
This all leads us to New Mexico where, at the behest of then Gov. Bill Richardson, our Legislature embarked our state upon a spaceport construction project at a cost to taxpayers of $220 million and counting.
A decade after this project was undertaken we have no idea what technologies will be used to fly people to space, whether companies can make space tourism profitable, and whether New Mexicans will benefit economically even if the space tourism industry succeeds.
Unfortunately, while Branson, Rutan, and other space pioneers are putting their own money and reputations on the line to make their space enterprises successful, the folks who unwisely got New Mexico into this mess cannot be held accountable and will suffer no personal losses from their actions.
Bill Richardson is not lying awake at night wondering if New Mexico’s Spaceport succeeds and I know of no legislator or other elected official who lost their race due to their unwise “investment” in the Spaceport.
This is where the Spaceport goes from isolated mistake to cautionary tale. The Spaceport has proven to be a spectacular failure in large part because the people behind it didn’t have any “skin” in the game. This lack of consequences leaves politicians to make decisions based on all manner of personal and political desires.
That is not to say that private sector entrepreneurs don’t fail. Indeed, if you know anything about Steve Jobs, he failed time and again as do most entrepreneurs. But they have their own money at stake and thus have the incentive to make better bets and only make bets they expect to succeed.
Just as governments should not kill businesses through high taxes and onerous regulations, government should not attempt to place bets using tax dollars on favored industries or technologies.
The Spaceport is only the most vivid failure of such government overreach in New Mexico, but we see the Rail Runner piling up ongoing losses and massive “balloon payments” due in the not-too-distant future.
The film industry which the economically-ignorant cite as a great success has actually lost $147 million for taxpayers since 2010 according to the New Mexico Legislature’s own study.
In recent years, taxpayers have also lost $16 million in subsidies for Schott Solar and $19 million Eclipse Aviation.
These wasted tax dollars could have been returned to real New Mexico entrepreneurs in the form of tax cuts to produce jobs and a real economic stimulus to our state. Instead, those scarce dollars have been – and in the cases of the Rail Runner and film subsidies – continue to reduce our prosperity by taking money out of entrepreneurs’ pockets and allocating it to less productive uses.
The good news is that Gov. Martinez doesn’t seem inclined to grandiose spending on spaceports and trains. Hopefully, New Mexicans have learned an important lesson about the promises of politicians and, rather than government micromanagement of our economy – a tendency that has led us to our impoverished state – will support government as referee, not coach.
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
The following article by Dr. Deane Waldman appeared in the Albuquerque Journal on November 16, 2014. RGF president Paul Gessing offered his own thoughts on the Think New Mexico proposal in this blog posting.
Recently in the Journal, my friend and colleague Dr. Barry Ramo spoke glowingly of Think New Mexico’s plan to improve health care in the Land of Enchantment. Unfortunately, the plan, hatched by our own homegrown policy think tank, is off base.
In fact, it brings to mind the famous aphorism, “The road to hell is paved with good intentions.” Think New Mexico is smoothing our way to a blisteringly hot place where we do not want to go.
Their plan advocates enactment of new rules and regulations to:
1. “Require transparency of hospital prices and risk-adjusted quality indicators…”
2. “Outlaw price discrimination…”
3. “Prohibit gag clauses…”
4. “Seek a federal waiver so that Medicaid will pay the same prices as private payers.”
The people at Think New Mexico say they want to restore free market forces with its manifold advantages to the “market” of New Mexico health care.
Freeing the market in health care is a very good idea. What they propose is the opposite.
A highly regulated, tightly controlled free market is a contradiction in terms. You either control a market or let it do its thing. Note the action verbs in Think New Mexico’s first three proposals: require, outlaw and prohibit. They are about as controlling as any words I know.
In the free market, there are no external controls on the two players: Consumers choose to spend or not, and sellers compete. No third party makes decisions for them.
There should be some regulation of the market as a whole, but no mandates as to what specific consumers and sellers can do or cannot do. A free market does not have some who are required to follow the rules while others are exempt.
There are no free market forces when buyers are required by law to buy a specific, government-approved product and only that; where sellers are told what to sell and at what price; and where a third party pays the bill.
The people at Think New Mexico no doubt mean well. Nonetheless, the group is paving the road to hell.
They say they want to “free” the market, yet propose to do so by increasing the number of rules, regulations and restrictions!
You cannot reduce regulatory constraints on a market by adding more regulations. You cannot cure cancer using cancer.
Getting useful comparative shopping information into the hands of consumers would be necessary in a truly free market. But first, consumers need control of and responsibility for their own money. They need to be making the spend/not spend decision rather than the government.
It gets worse. “Price” in health care is a meaningless term.
Everywhere else, price is what the consumer pays to the seller. In health care, the consumer doesn’t pay, and no one pays what the price tag reads. Payment is decided by the federal government, rather than through the balancing mechanism of negotiation between buyer and seller.
So the consumer gets useless information and cannot economize because the spend/not spend decision is made by someone else. That is not a free market.
On the supply side of a free market, various sellers compete for consumers’ dollars based on the true price (cost to customer), features, and quality. Not so in health care, where the market is tightly controlled.
The government, not the seller, sets prices and quality standards. There is no competition between the various sellers of goods and services.
There is competition in one place in health care: between insurance carriers. They compete strictly on price and then make their profit by delaying, deferring and denying the care we need.
Health care is the antithesis of a free market. Think New Mexico’s plan will not make it one. Though the group’s ostensible intentions are laudable, their implementation plan is deeply flawed. It will only smooth our descent to an overly warm clime.
Dr. Deane Waldman, author of “The Cancer In Healthcare,” is an adjunct scholar for the Rio Grande Foundation.
(Albuquerque, NM) —The Rio Grande Foundation today joined with 375 trade associations and chambers from 50 states representing a wide range of industries to voice strong concerns with the U.S. Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers’ flawed proposed rule to dramatically expand the scope of federal authority over water and land uses across the U.S. and called for the proposal to be withdrawn. The effort was led by the U.S. Chamber of Commerce. The comments are available here.
The rule is simply an attempt by Washington, D.C., bureaucrats to take over the economies and the livelihoods of everyone in the western U.S. It has little to do with environmental protection, and everything to do with a political takeover of our most precious resource – making everyone in the west dependent and beholden to Washington bureaucrats.
As the groups’ comments state, “The proposed rule is really about the Agencies’ overreaching attempt to replace longstanding state and local control of land uses near water with centralized federal control. In light of the overwhelming evidence that the proposed rule would have a devastating impact on businesses, states, and local governments without any real benefit to water quality, the Agencies should immediately withdraw the waters of the U.S. proposal and begin again. The current proposed rule is simply too procedurally and legally flawed to repair.”
The comments detail several examples of the impacts of the proposed rule, including:
Before our debate in Las Cruces (and thus before the election or the Virgin Galactic crash), I sat down to discuss the issues of the day with former Democratic gubernatorial candidate Alan Webber for a discussion with Fred Martino on KRWG's Newsmakers.
I was asked by KRQE Channel 13 to discuss efforts by the federal government to take funds from Toby Martinez' (who stole from taxpayers in the Municipal Courthouse scandal alongside Manny Aragon) pension in order to fulfill Martinez' restitution requirements. Unfortunately, according to my reading of New Mexico law, the Feds can't tap Martinez' pension under New Mexico law despite his criminal conviction. Astonishingly, according to the report, Martinez' pension is worth upwards of $473,000 which is illustrative of the incredible generosity of New Mexico's underfunded pension systems. Watch the full interview below:
Our friends at the Heartland Institute have some excellent research and information on right to work and its potential impact on New Mexico (including research from RGF).
Lastly, I had a letter to the editor in the Albuquerque Journal's Business section on Monday which may have been missed amid all the election activity:
Letters to the Editor
Albuquerque Business Journal
In his column on right to work laws, Marshall Martin concludes that “there is little question having right to work may signify that a state is business friendly, one cannot be certain that having right to work is the deciding factor…”
That is a true enough statement. In the real world, “scientific” studies of economic systems don’t work. “Proof” that right to work is indeed good for the economy is as elusive as is “proof” that any law or system works.
What we do know is that eight out of 10 of the fastest growing states in 2013 were right to work. We also know that between 1977 and 2008, right to work states produced 44.5% more jobs and saw per-capita personal incomes grow 10% faster than states that do not have such laws in place.
Of course, right to work is not only an economic issue. It is a freedom issue. Workers shouldn’t have to join unions or pay union dues if they don’t want to.
It is true that no single economic policy change made by New Mexico’s Legislature is our ticket to prosperity, but a right to work law – which unlike most other “economic development” schemes won’t cost taxpayers a dime – is a good place to start.
So, the Legislature, whatever its partisan makeup, must embrace a variety of pro-market reforms if New Mexico’s economy is to be turned around, but right to work, a policy which according to Gallup is supported by 65% of Democrats nationally, is a great starting point.