© 2020 NEW MEXICO NEWS SERVICES 12/14/20
ACI changes name, offers economic plan with old and new
By Harold Morgan
New Mexico Progress
Among the 13 construction projects recently getting awards from the Associated General Contractors New Mexico are ten from government and three from the private sector. The division—23 percent private sector, 77 percent public—are measures of our situation. Even the private ones involve government.
One private project, the Ten 3 Restaurant on Sandia Crest outside Albuquerque, likely occupies forest service land, giving it a substantial government presence. The public sector came with the money for the 107-unit Sterling Downtown affordable multi-family workforce housing project in downtown Albuquerque with county bonds, tax credits and trust funds.
The private sector has a big role in a government project, the Artesia Aquatic Center, with $3 million in seed money from four Artesia firms and more from individuals, an approach fitting that part of our world.
The New Mexico Chamber of Commerce has stepped into these contrasts and the turbulence of 2020 with a new name and an approach it calls, “Driving New Mexico’s Future: Empowering a Competitive Economy in a Post-Pandemic World.”
The long name for the approach neglects to say it is a plan for the New Mexico economy, but that’s what it’s supposed to be. On page one the document is called “strategic action plan.” One the back cover, it’s called a “strategic action agenda.” Plans and agendas are different. That much I remember from management jargon.
The chamber’s former name, “Association of Commerce and Industry,” came with the appendage, “Oh, by the way, we are the state chamber of commerce.” Awkward. The change is long overdue.
We face two “current competitive challenges,” the plan says, starting with improving the business climate, workforce skills and infrastructure to better compete for new jobs and investments.
Challenge number two is growing the working age population to provide the bodies for those new and retained businesses. Discussion of the working age population ignores, as is the habit, our place among the states with the lowest percentage of the population working. Overcoming the education and cultural problems with these non-working people of working age will be a huge challenge, if ever attacked.
The plan offers six general topics with 17 fairly specific items for attention in bettering the state. Nine concern workers, and four want to lure new residents. Most of the specifics cite programs in other states. One specific—reviewing the gross receipts tax—should provoke a few smiles. Like been there and done that, many times, and to no avail.
The plan’s Dec. 9 debut presents a timing problem. The 2021 legislative session starts Jan. 19, a mere 41 days after the debut. The plan offers complex ideas. Complexity takes time. The standard legislator’s response to these ideas will be, “OK, tell me more.” That takes time.
The Legislature will have two hugely complex agenda items—COVID and money. All this in a body with a political conviction that shifted left in November.
A further complication is that the New Mexico Chamber is not neutral, however much it might protest otherwise. Some legislators will say, “Chamber of commerce… business… bad guys…”
The document emailed to me failed to say where to find another copy. Such information is usually at the front on page one or two or at the back. The document was emailed by a chamber staffer with the email of “@nmchamber.org.” The new website is nmchamber.org. The office address is 2201 Buena Vista Dr. SE, Ste. 410, Albuquerque, 87106; phone 505-842-0644.
Getting a copy, reading it, and thinking beyond the Legislature would be useful. This is a long term project.
© 2020 NEW MEXICO NEWS SERVICES 11/30/20
Economy is diversified, diversifying, and we should welcome oil and gas
By Harold Morgan
New Mexico Progress
From the cavern of our health and economic difficulties comes an old wail; diversify the economy. Actually the argument, well distributed to newspapers around the state, is for diversifying away from oil and gas, as if oil and gas hadn’t spent the last couple of years diversifying away from New Mexico after the brief happy boom.
The pitch is left-handed, from James Jimenez of Voices for Children and Oriana Sandoval of the Center for Civic Policy. They discuss the commodity nature of hydrocarbons, the associated massive gyrations in state revenue and the “fact” that for climate reasons hydrocarbons are evil.
Jimenez and Sandoval likely wouldn’t quite agree with that assessment.
Economic diversification is an old cry in New Mexico; snap your fingers and wonderful things will happen. The claim used to be that we needed less government in the state. That has disappeared. Now the villain is oil and gas.
Start with our economy already being diverse. Tourism includes the quite different activities of skiing, visiting galleries, making the stuff that goes into the galleries, national parks. We grow chile and cattle.
Things are happening. The state Economic Development Department has an Outdoor Recreation Division that issues many news releases and has helped create a few private sector jobs. The department commissioned a study that showed the Gila and San Francisco watershed in the southwest part of the state supports 3,900 jobs. Another release said the outdoor economy contributed $2.4 billion to the state’s gross domestic product. Of course the release overlooked our outdoor GDP being the smallest of the Rocky Mountain states.
The state’s pueblos—“Pueblo Nations” seems the proper term—have made National Geographic’s group of the world’s 25 coolest places to visit in 2021.
Stretodynamics Inc., of Delaware, has joined the list (surprisingly long, to me) of companies doing testing at the Spaceport America facility north of Las Cruces.
Sandia National Laboratories just announced getting six regional technology awards.
One technology went to BayoTech of Albuquerque which envisions local hydrogen production as a way to reduce the costs and help move to environmentally better hydrogen fuels. Another transfer was small solar cell research to mPower Technology Inc. of Albuquerque to advance the technology for homes, everyday objects, and space.
On Kirtland Air Force Base, the Air Force Research Laboratory Space Vehicles Directorate, has opened a $4 million Deployable Structures Laboratory for testing novel deployable space structures.
The private sector is responding. The big Netflix expansion is the latest.
Orion Center will be 122 acres at the southeast corner of Gibson and Girard SE, between the Albuquerque airport and Kirtland Air Force Base. The developer is Group Orion of Washington, D. C. The hope is for two million square feet for manufacturing, a multistory office and laboratory, and a hotel. Initial employment would be 1,000, growing eventually to 2,500.
Group Orion is a subsidiary of Theia Group Inc., also based in Washington, D. C. Theia is developing a satellite network, its website says, “to enable digitizing the entire earth in real time.” The manufacturing building would be used for making Theia’s products.
Thunderbird Kirtland Development Corporation’s MaxQ, set for 70 acres east of Orion Center, will include offices, hotels, retail and restaurant space. One advantage, the developers say, will be the ability to walk through a security gate for access to Kirtland.
A comment decades ago was that if Starship Enterprise was real, New Mexico components would be aboard. We’ve been in the space business a long time. Today we are building on that base.
Oil and gas will take care of itself, one way or another, through the machinations of the private sector, politics and the constitutionally required balanced budget.
© 2020 NEW MEXICO NEWS SERVICES 11/16/20
Bernalillo County GOP calls 16 point congressional loss a huge accomplishment
By Harold Morgan
New Mexico Progress
Unlike some past years, Republican candidates showed up for the 2020 general election. Like most past years, not much happened.
Still, showing up is the first step.
Just nine of the 46 Democratic seats in the House of Representatives lacked a Republican candidate. In seven of the seats, the Democrat got a free ride. Libertarians contested two seats. Only one Democrat in the Senate escaped. That was Sen. Bobby Gonzales of Taos, whose district includes Taos and Rio Arriba counties.
The race for the U. S. Senate was won by Rep. Ben Ray Lujan. Former TV weatherman Mark Ronchetti lost. Lujan is still not my guy. Aside: I wonder if voters considered Ronchetti’s weatherman status credible, even with him having the appropriate college degree. What do TV weather people really do beyond dance around in front of a screen? That’s unfair, but that’s a possible perception. Lujan’s blackjack dealer history is long forgotten.
Ronchetti emerged as a candidate in January, about a year late for a first time candidate, even with all the name recognition from being on TV. The name bought Ronchetti a 16-point defeat (57 to 41) in Bernalillo County, his home. Ronchetti’s overall losing margin was six points, 52 to 46.
A Nov. 8 email from the Republican Party of Bernalillo County offers this astonishing commendation for Ronchetti’s effort. “As difficult as a U. S. Senate run in New Mexico can be, Mark Ronchetti accomplished an amazing feat with his excellent results.” Without the Libertarian candidate, Ronchetti might have a lost by a bit less.
The email designated as “a huge accomplishment” the 16-point loss by Michelle Garcia Holmes in her race for Congress. Alexis Johnson had even less success in her race to replace Lujan in Congress; she lost by 18.
We shouldn’t overlook the Public Regulation Commission. Republican Janice Arnold-Jones lost by 20 points to Democratic incumbent Cynthia Hall. In the other PRC race, Libertarian Christopher Luchini got 28 percent of the vote against Democrat Joseph Maestas, suggesting voters might have preferred a more substantive alternative to Maestas.
Sen. Peter Wirth of Santa Fe is the Senate Majority Floor Leader. This month he was the majority leader with 82 percent of the vote in his reelection effort, the highest percentage among Democrats. Yes, there was a Republican on the ballot. Another Santa Fe senator, Nancy Rodriguez followed with 80 percent of the vote in race. Two Democratic senators with slightly smaller margins serve the area near the University of New Mexico. They are Antoinette Sedillo Lopez with 78 percent and, with 77 percent, Gerald Ortiz y Pino who is the oldest senator at 78.
Ortiz y Pino’s opponent, Lisa Meyer-Hagen, did campaign. She went door-to-door talking to voters. She sent promotional literature through the mail. But there wasn’t near enough campaign to get voters’ attention. That takes time, a year or more, and a lot of money against a well regarded incumbent such as Ortiz y Pino.
Sometime candidates are placeholders. The name appears on the ballot in case an opportunity appears later for a serious candidate. The other guy may die, a national political figure crassly observed some years ago, or do something stupid. It happens.
A serious candidate must be presentable (some of the Republicans weren’t), be willing to do the huge amount of work required of a candidate, and be able to find sufficient money.
An email from the state Republican Party the day before the election said, “Tomorrow we vote Republican, tomorrow we Save New Mexico.” That didn’t happen. Voters need a reason to support a candidate. Having such a reason and communicating it requires more than showing up
© 2020 NEW MEXICO NEWS SERVICES 11/2/20
‘Greatness of beauty’ in NM but oversized services, state and local governments
By Harold Morgan
New Mexico Progress
Two new (new to me, anyway) approaches to framing our thinking about New Mexico came from the Federal Reserve Bank of Kansas City’s recent New Mexico Economic Forum. Both approaches are economic; one is policy.
The fed’s Nicholas Sly said New Mexico’s concentrations of state and local government employment and of service industry activity are both higher than other states. These pose special challenges to the state. A number of New Mexico’s risks are unique as compared to the rest of the nation, he said.
Considering the state’s situation surfaces a long conversation with a present state representative, who is a solid liberal. The difference between us, she said, is for solutions to policy matters, she chooses the public sector, and I choose the private sector. Well, yes. And that won’t change with the 2020 election.
But public sector spending will drop, which will have a greater effect here than in places where these government sectors are smaller. The Democrats solidly dominate state government and will continue to do so, despite a valiant Republican effort that is blocked by lack of money and the bizarre genius of President Trump. Whether there will be unique thinking applied to the special challenges, we’ll have to see.
Service industries are most easily defined as not manufacturing, mining or construction. Services are trade, transportation, professional services such as accounting and consulting, tourism, and finance. Call centers land somewhere in services.
New Mexico’s declines are most pronounced in the service sectors, though general merchandise has been hurt less; Spending for accommodations (hotels) and food are down just over 40 percent through mid-September from January. Arts and entertainment are down around 65 percent, with clothing and general merchandise stores holding fairly well, all things considered, down less than ten percent. Allen Theaters of Las Cruces is the latest casualty with all 11 theaters closing recently.
People losing jobs are giving up, not seeking new jobs. Our labor force participation has dropped 5 percentage points in 2020—from 59% to just over 54%. People unemployed for a long time tend to lose employment skills, occupational licenses and knowing how to show up every day and interact with other employees.
Economic forecasters lack a feel for the coming new normal, which obviously depends on the pandemic. Short term forecasts have a 25% variance between the average of the ten most optimistic and the average of the ten pessimists.
These economic events will happen in the unusual environment that is New Mexico. Analysts, your columnist included, struggle to adequately describe this environment. “Land of Enchantment” has never quite gotten there. English writer D.H. Lawrence, lured to Taos by Mabel Dodge Luhan, gets closer. Lawrence’s three years in New Mexico were the most consequential of the ten places he lived, writes George Scialabba in the October Commonweal magazine. Scialabba was reviewing a new Lawrence collection, “The Bad Side of Books.” The review was titled, “D.H. Lawrence, Arch-Heretic.”
Lawrence said, “New Mexico was the greatest experience from the outside world that I have ever had… The moment I saw the brilliant, proud morning shine high up over the deserts of Santa Fé, something stood still in my soul.... In the magnificent, fierce morning of New Mexico one sprang awake, a new part of the soul woke up suddenly, and the old world gave way to a new. There are all kinds of beauty in the world, thank God.... But for a greatness of beauty, I have never experienced anything like New Mexico.”
Think about that. “Greatness of beauty.” The trouble is, it’s tough to eat beauty.
© 2020 NEW MEXICO NEWS SERVICES 10/19/20
Viante taking new approach to search for common ground solutions
By Harold Morgan
New Mexico Progress
When you are onto something, but not quite there, go to Plan B. Rethink the approach.
Viante has shown there exists in New Mexico a continuing desire for approaching the broader public policy issues facing the state.
This desire is not new. In the mid-1980s a number of groups were talking about dealing with New Mexico’s future. Sens. Jeff Bingman and Pete Domenici forced the discussions together into what became New Mexico First. Later Fred Nathan founded Think New Mexico. The two groups’ successes, to be polite, are modest, in my opinion, though Think New Mexico can cite the most accomplishments. Think New Mexico’s long donor list ratifies the desire to do something. People will back that desire with money.
Still, as if often repeated, New Mexico remains at the bottom of the lists. Enter Viante. Start with the name; it comes from Latin. Drawing upon the classics always warms my heart.
When considering organizations or companies, the board of directors offers insight. Viante’s board has an important omission—people from the usual cast of characters in civic affairs around the state. Five of the ten directors are under forty, reminding me of one of the groups Bingaman and Domenici squashed into New Mexico First. These ten should bring fresh thinking. Only one of the directors looks old enough to be called “old.” The others seem to be runners with MBA degrees and small children.
In 2017 Dale Armstrong was new to the legislative process. He went to Santa Fe during the legislative session to support business-related legislation and to learn about the process and support his wife, Gail Armstrong, a legislator. He was amazed and not in a good way. After some thoughts about moving to Texas, Viante was the result.
Rhiannon Samuel became the staff. To start, Viante did a scorecard, rating legislators on 15 bills under the broad categories of education, crime and quality of life and also on whether legislators show up to vote, which, after all, is the ultimate responsibility of an elected official. The idea was that specific legislation would percolate from the ratings. It didn’t happen, repeating the experience of New Mexico First and the Domenici Institute. (Think New Mexico does push specifics.)
The COVID-19 pandemic provided an opportunity to rethink. Thus Plan B—survey the policy horizon and develop legislative proposals to strengthen the “common ground” solutions that will improve life for all New Mexicans. The approach is simple, though difficult; talk to people, see what’s on their mind. It’s a kind of ultimate networking approach, starting with Rhiannon Samuel’s network and the networks of the Viante board. Identify involved groups and seek referrals from the groups.
Viante has some advantages in this gargantuan task. To start, none of the usual civic suspects are on the Viante board – no chambers of commerce, no trade associations, only one lawyer (and he’s retired), and no lobbyists. The board members are business people—restaurant operators, architects, contractors, communications professionals. They can make decisions without the insular thinking and fear of political retribution that strangles action by the people attending Albuquerque’s biweekly powers-that-be meetings.
Even though the board members com e from the private sector, there is no “business” agenda that sets up in opposition to, say, unions. Just those “common ground” solutions.
As to proposals for the 2021 session, “it’s a bit fluid,” Samuel says. Uncertainty comes from COVID, the election and the state’s massive financial troubles. “Most of the conversations come down to money; what are we going to do?” Samuel says.
For the very immediate future—the Nov. 3 election—Viante has created a voting resources manual (https://viantenm.org/voting-resources) with everything you need to know about voting.
© 2020 NEW MEXICO NEWS SERVICES 10/5/20
Large uncertainties mean job growth might resume in 2025
By Harold Morgan
New Mexico Progress
When considering the state government financial situation, I’m a glass half empty type. Maybe even three-quarters empty. The good news about state revenues is that the black hole of projections from the spring isn’t quite as deep as originally thought by the state’s number crunching wizards. The bad news is that the hole remains quite deep.
A federal bailout is one reason the hole has gotten less deep. But that enables the state to continue kicking the can of any even half serious rethinking of state activity. Maintain those necessary services, for sure.
State number crunchers unveiled new revenue projections Sept. 30 for the Legislative Finance Committee. The presentations were a joint show from the Department of Finance and Administration and Taxation and Revenue Department secretaries and solitary from the LFC staff.
The LFC’s first statement that “significant uncertainty in the current outlook” meant projections were provided in a range, as in saying that recurring revenue might be between $6.4 billion and $7.3 billion for the current budget year (fiscal 2021) ending June 30, 2021. That’s down from 7% to 18% from fiscal 2020.
This is extraordinary. Projections are always in a range; that’s the nature of statistics. But a number within the range typically is firm enough to be THE number. For this year, our wizards can’t say.
The uncertainties are large, the LFC said. Start with a possible virus resurgence this fall and during the winter. Indeed, we are ten days into fall as of this writing, Oct. 1, and the state’s rolling average of reported COVID-19 infections has more than doubled (to 207) since Labor Day.
The state economy was just barely above where it was ten years earlier, having endured a lost decade. Then, in April, the state lost 100,000 jobs. About a third of those jobs reappeared by August. The more important number is the 62,000 person, or 6%, drop in the state’s labor force from 957,000 in August 2019 to 895,000 in August 2020.
This would matter less if we had a robust participation in the labor force, but we don’t, usually landing in the bottom five. We had a big drop from low base. The drop may be larger than thought because the feds tend to under estimate job losses.
Businesses that are operating—all those restaurants trying to function with takeout and reduced capacity—may not make it. The leisure and hospitality sector was down 29%, or 29,000 jobs, for the August to August year. Business plans don’t usually account for being profitable on half of expected sales. Mining and logging sector employment dropped 30 percent, losing “only” 8,000 jobs that are much better paid than restaurants. This sector, mostly oil and gas, is the big hit to state revenue.
The status of the various federal employment support programs is more than uncertain—the federal paycheck protection program, additional federal unemployment support.
As all these issues interact with one another, the uncertainty builds, observed the state agency presenters.
A third of our 33 counties show unemployment rates less than 10%. Five are above 9%. Lea County, at 15.3 %, had the second highest unemployment, and showed the largest year-over-year decline in grow receipts tax collections, 29.4%, or $525.4 million, during the April to June quarter.
The number of wage jobs statewide is expected to drop around 4% this budget year and add about 2% next year, not quite recovering the current year decline. It will be 2025 before the state gets back to December 2019 job levels.
That means that come 2025, we will be starting the decade over.
© 2020 NEW MEXICO NEWS SERVICES 9/21/20
Indian Country housing wrapped in BIA red tape
By Harold Morgan
New Mexico Progress
Outgoing Sen. Tom Udall likes to issue news releases calling for things to happen in Indian Country, sometimes spotlighting institutional matters. The exhortations typically come without introduced legislation and budgets, so I’m not sure what the releases really mean except for the not insignificant moral suasion of a United States senator saying something. Most recently Udall gathered 13 other Democrats to sign a letter to the chairman of the Federal Communications Commission to, as the news release said, “expeditiously address the digital divide in Indian Country.”
Water infrastructure, cultural patrimony, housing grants, health care and wildlife corridors are among the topics of Udall’s news releases the past few months. Buying a house and enjoying the well known benefits of ownership is another matter of interest in Indian Country.
Wherever there is a house being purchased, paperwork is part of the process. The Center for Indian Country Development at the Federal Reserve Bank of Minneapolis has reviewed the mortgage paperwork process at the Bureau of Indian Affairs for home buyers on tribal trust lands. Production of the required Title Status Report (TSR) is slow, so much so that mortgages sometimes become unavailable and deals collapse. The Center’s report, dated September 9, is “Shortening the TSR timeline: A proposal to end delays that hinder Native homeownership.”
The problem, the center writes, is that “Certified TSRs from the BIA are required for underwriting trust land home mortgages and for selling those mortgages into the secondary market.” Selling the mortgage is vital because it frees up money at the typically local financial institution, allowing it to make more mortgage loans. Certified TSR’s cover all those items needed to show the title is good—the legal description, liens, past transactions—that a piece of land accumulates over time.
Note here that I’m writing from the center’s report, which says that sometimes procedures vary from tribe to tribe but does not mention New Mexico. Overall, the situation is that, “Housing shortages, trust land development, and equitable capital access are critical issues.”
The recommendations start with building on what the BIA does well. There is even a BIA handbook. Then have all BIA offices play by the rules, that is, comply with existing timelines and consider new statutory deadlines for title recording and certified TSRs.
Think about that. Passing a law is the recommendation for getting paperwork processed. That recommended law would have to go through the United States Congress, a serious time-consuming hassle. This tells me—the external person—that the problem is large. The BIA says things are fine.
There should be a secure online portal for the handling of all documents related to the transaction.
Various federal agencies including the BIA and Housing and Urban Development have housing programs in Indian Country. They should be required to talk to one another, perhaps via an interagency report card that would track delivery of the various programs, in particular the factors in delayed or abandoned deals.
Producing mortgage paper work is one of those matters given little thought by most of us; it’s in the background and supposed to work. The research and policy proposals are a big part of the Center’s job. “Our mission is to support the prosperity of Native Nations through actionable research and community collaboration,” the Center says. Being part of the Federal Reserve puts the Centers focus on the financial. My experience with Fed organizations is that Fed products are of the highest quality.
Mortgage title paperwork is stifled in the BIA bureaucracy, as, one might figure from Udall’s news releases, are a host of other matters. Udall’s released are to be commended. Getting something done would be a good next step.
© 2020 NEW MEXICO NEWS SERVICES 9/7/20
ACI finds opportunity for Statewide Economic Strategic Action Plan
By Harold Morgan
New Mexico Progress
Crisis offers opportunity. That appears to be the logic behind the “Statewide Economic Strategic Action Plan” being developed by the Association of Commerce and Industry. The effort is worthy.
Nearly all of the talk about the economy in New Mexico is inane. Too much government! More recently, too much oil and gas! The Spaceport will be a great thing! (Maybe eventually.) The pablum of New Mexico First reports is close to humorous. As noted in my last column, economic development in New Mexico means, among other things, repairing the fronts of buildings in down Truth of Consequences. Wow.
ACI is the natural organization for such a project. It is statewide. It is the New Mexico chamber of commerce. “Business,” however defined, is the constituency.
Allison Smith, a lobbyist from Las Cruces, is the current ACI chair. Smith has a separate business, Roadrunner Capitol Reports, for tracking legislation. The first vice chair is Tom Briones, an Albuquerque lawyer who represents small and medium businesses. Last year’s chair was Sayuri Yamada, the government affairs director (i.e. chief lobbyist) for the Public Service Company of New Mexico.
The project will cost some money. PNM is the “lead partner” with Chevron the “premier partner.” Among the top 15 supporters, I saw only two financial institutions, both Albuquerque based, Nusenda Credit Union and Bank of Albuquerque. Not so long ago (well, 25 years ago, actually), with PNM, banks would have led support of an effort such as the ACI study. We would have seen Wells Fargo, Sunwest Bank (now Bank of America), First National in Albuquerque (now Bank of the West), Los Alamos National Bank. Let’s do credit US Bank as a major ACI supporter.
The project is worthwhile, even if nothing much comes from it. The worth will be from many people thinking about the state as an entire entity. I don’t remember a similar effort that was substantive happening for a long time. Under the Martinez administration in 2014, the Cultural Affairs Department did an excellent and thorough analysis of the “Creative Economy.” The report hit the shelf about 20 minutes after completion. But nothing has viewed the entire state. I hope ACI’s consultant, Economic Leadership of Raleigh, North Carolina, digs the art study off the shelf.
An online survey with four main sections, done last week, is part of the project. The survey asked “satisfaction” with 15 matters, including legal climate, business taxes, public safety, broadband, and quality of life. It says to pick the top five from 19 ultra broadly stated approaches that will help businesses—reduced business taxes, more access to capital, promotion of better health (rah, rah!). Pick three from a ten-item list of workforce issues, such as basic academic skills, childcare, and drugs and five top things state government might do from a 16-item list.
The project document is full of today’s business jargon, “deliverables… slide deck… supply chain disruptions… leadership planning session… leadership retreat… outreach strategies…”
To me, the most encouraging deliverable (that means a product) will be a “cluster analysis and a supply chain analysis of major industries statewide to identify opportunities for growth.” That almost sounds like figuring out major industries really work, just about my favorite topic. Over time, chile has been the working example. My work in this area has produced little interest and no actions. (Of course, it may have been the sales pitch.)
Finally, there will be “potential legislative and regulatory reforms” and “outreach strategies,” whatever those might be. For reforms, start with the state’s Constitution, the key to higher education change.
All by November.
© 2020 NEW MEXICO NEWS SERVICES 8/24/20
Harris wants “environmental justice for all,” safer cosmetics products
By Harold Morgan
New Mexico Progress
Democratic presidential nominee Joe Biden chose as his running mate California Sen. Kamala Harris, a failed presidential candidate. The mainstream media swooned, as one would expect. Washington Post columnist E. J. Dionne said, Harris “was always the safest, most experienced, and most tested choice… Harris will create excitement…” She also checks all the demographic, identity politics boxes.
Wall Street Journal columnist Kimberley Strassel would be expected to be crabby about such rapture and she is, pointing out that the Harris presidential campaign was considered “one of the most bungled and disorganized presidential campaigns of this cycle.” The Harris campaign was “rightly skewered” by Democrats and the media after folding in December 2019, weeks before the Iowa caucus.
Outgoing New Mexico Sen. Tom Udall has provided a way to sort the he said-she said. The headline on Udall’s August 12 release said, “Udall, Harris Introduce Environmental Justice for All Act.” Udall’s timing was startlingly appropriate. Biden anointed Harris August 11, the day before. Udall’s headline is true, in a narrow sense. The headline implies that Udall led the effort, though it doesn’t quite say that. Gotta love those clever headline writers.
Udall’s release says he “joined” Harris and Sens. Corey Booker and Tammy Duckworth “to introduce” the bill. Sure does leave the impression Udall led the charge.
After listing eight aspects of the bill, the release refers to a one-page backgrounder that proved to be on the Harris Senate website (harris.senate.gov). Harris references two members of the House of Representatives by name, “dozens of congressional colleagues” and others, but no mention of Udall, Booker or Duckworth. With all the egos floating around, you would think the naming of names would be coordinated. So were the Harris omissions merely sloppy or on purpose? Neither would be good in a potential president.
The text of the bill clarifies matters. It is Harris’s bill. Udall is along for the ride.
The website backgrounder begins, “As our nation reckons with systemic racism, our fight for clean air, clean water, and a healthy environment cannot be disentangled from the fight for justice. Environmental racism fuels disparities in environmental and public health and its impacts can be seen across society. Systemic barriers, including redlining, intentional disinvestment, and unregulated pollution, have systematically had devastating impacts on communities of color.
“That is why we need comprehensive environmental justice legislation. All people have the right to clean air, clean water, and a healthy environment. But for too many, these rights are still unrealized. That injustice, and the cumulative injustices of housing, economic, education, and health care injustice, and others, mean that millions in America have been ignored by our government for generations.
“If we are to achieve justice for all, we must achieve environmental justice for all.”
Within the eloquence, Harris commits a rhetorical sin so common and unnoticed it’s almost a cliché. She says, “For too many, these rights are still unrealized.” Too many? For me, if there are “too many,” then a proper number exists.
The object of the 130-page bill, it says at the top, is “To restore, reaffirm, and reconcile environmental justice and civil rights, provide for the establishment of the Interagency Working Group on Environmental Justice Compliance and Enforcement, and for other purposes.” There are more than 20 specific policy aspects, some quite specific, including four pages of detailed regulations of safer cosmetic products with a section on disproportionately impacted communities. Another section covers menstrual product labeling.
I didn’t find a definition of “disproportionate.” Defining “environmental justice” takes 85 words in paragraph 11 of section 3. Defining “environmental justice community” takes another 41 words.
Take a look. Amazing. Much more government. It’s on the way.
© 2020 NEW MEXICO NEWS SERVICES 8/10/20
Government distributes many small sums of money, to what end?
By Harold Morgan
New Mexico Progress
The body of citizens comprising New Mexico have a challenge, that being deciding what to do about the activities of state government and how to pay for those activities. Well, yeah, you might think. So what? We know that. More huge challenges remain.
The Legislature did what needed to be done in the four-day mid-June special session, robbing Paul to pay Peter and Peter to pay Paul. Some specific items were cut. Gov. Michelle Lujan Grisham vetoed some of those cuts. Our much bruised state spending can was effectively kicked again with no serious rethinking.
More must be done. More cuts, that is, not more vetoes of the cuts.
Like what? In general, new initiatives that came from the 2020 legislative session should be carefully reviewed with an eye to cancelling the program.
One example is the Outdoor Recreation Division of the Economic Development Department. Just after the current budget year began, it announced a grant program to, the news release said, “help residents improve access to outdoor recreation in their communities. This grant program focuses on conservation-minded shovel-ready projects…”
My memory is that the Obama administration found there was no such thing as a truly “shovel-ready” project for the Great Recession infrastructure projects. The outdoor grants will be from $5,000 to $25,000 with an equal match required. One suggested project is an outdoor climbing wall.
The Department of Cultural Affairs gives money to arts organizations. For the current budget year (FY 2021) the average grant to the 193 organizations is $5,531.89. That’s not much. Does the money really matter?
The Rio Grande Valley Celtic Festival Association of Albuquerque gets $3,909 to produce two festivals about Celtic stuff. As a Celtic person (my last name is Welsh), I assure you I don’t care about the festivals.
The Miniatures & Curious Collections Museum in Roswell gets $4,630 for workshops and “exhibitions of miniatures and curious collections.”
Clovis Community College gets $6,172 for performances and educational outreach activities “characterized by culture and gender diversity, accessibility, arts education, and high artistic quality.” Gender diversity in Clovis?
Not surprisingly, nearly all the arts grants go to Bernalillo County and points north. A few other small clusters show on the grants map: Las Cruces, Silver City, Farmington, Shiprock, Las Vegas.
The Economic Development Department’s LEADS (Local Economic Assistance & Development Support) grants will send $10,637 to downtown Truth or Consequences to somehow fill the many vacant buildings in the commercial district.
The Roswell Chaves County EDC will spread its $25,000 around to business attraction, retention, and expansion, and real estate and workforce development. All that dilution, plus a few more tasks not listed here, would seem take a toll on effectiveness.
Mountainair will spend its $2,730 on equipment to turn the village multi-purpose building into a functional training center. Three organizations will split $75,000 to support entrepreneurs working from home.
One opportunity might be to dump the bio income tax credit and the biomass corporate income tax credit. It extended this year via HB 146, sponsored by Rep. Javier Martinez, Albuquerque Democrat.
More opportunity should come from thoroughly reviewing the capital outlay projects reauthorized in HB 355. The winners include locomotive repair in Clovis and the proposed Route 66 visitor center in Albuquerque.
Deleting programs is difficult: Everything has a constituency. And power, jobs, and clientelism.
The Republicans need to inventory these opportunities and develop a program for the election. The program would have a long list in order to spread the anger. It might work. Gov. Susana Martinez dumped the Commission on the Status of Women. The identity politics left went nuts. It stayed dumped.
© 2020 NEW MEXICO NEWS SERVICES 7/27/20
We will not return to a pre-COVID economy
By Harold Morgan
New Mexico Progress
Committees of the Legislature like to travel during the summer. Moving meetings around during the interim (between sessions) officially allows legislators to become acquainted with the state’s quite different regions.
For the locals, it means talking to legislators without the expense of a trip to Santa Fe, a nice side effect when times are tight. The time required further reduces the nonsensical myth of a “part-time” legislature.
Community attractions are nice, too. Artesia may have the coolest downtown of the state’s small cities. And an outdoor dinner on a balcony in Taos Ski Valley is a time to be cherished.
Summer is the time for new concepts, visiting informally with legislators and putting potential statutory flesh on ideas.
These attractions help offset the environment when the news is uniformly bad, as it was
At the start of the Legislative Finance Committee’s semi-virtual Cloudcroft meeting last week.
The news: The economic disasters from the COVID-19 virus and the oil collapse mean that the state faces a lost five years.
Concepts and numbers came from retired New Mexico State University economics professor Jim Peach. The forecast and more numbers were from Jeffrey Mitchell, director of UNM’s Bureau of Business and Economic Research, which operates an economic model that is a key part of state government’s revenue forecasting.
The questions and comments from legislators, some in the room, some not, had a theme—more information, quickly, about daily developments. Simply watching the governor’s weekly news conference isn’t adequate. Sen. George Muñoz, Gallup Democrat, said legislators need faster information “so we can be prepared when our constituents call us.” Constituents stop them in the grocery to ask what’s happening. Muñoz also cited another theme of some legislators—cutting government.
“A common question I get,” Peach said, speaking from Las Cruces, is when are we going to return to the pre-COVID economy. “We’re not going to recover” during 2020 and 2021 was his starting response, “The simple answer is that we cannot and will not return to a pre-COVID economy. The world will be different. Our lives will be different.” The effects will be as profound as past huge crises—World War II or 9/11.
The oil and gas industry will not get to the previous employment levels, if only because productivity improvements mean producing hydro-carbons with far fewer people. As compared to 2014, Peach said, in 2019, “the state produced 2.7 times as much oil with a few more rigs and slightly fewer jobs.”
Oil production will remain well under 2019 levels through the end of 2025.
Of the big general job sectors, leisure and hospitality has taken the biggest hit with 24,981 unemployment claims registered, 20 percent of the total. This sector contains the restaurants we’ve heard so much about, plus hotels and other businesses central to tourism. Health and private educational services is next with 15 percent of the claims, followed by retail with 12 percent. Mitchell listed a number of reasons behind the uncertainty of the unemployment numbers including not counting the self-employed.
Overall, retail has been weak for ten years, Peach said.
Albuquerque should achieve 2019 job levels by the end of 2024. The state will hit that level in 2023. It’s bleak for Farmington, which is expected to flatline at 94.5% of the 2019 employment. Income gaps will widen, Mitchell said, requiring in turn more healthcare and social assistance.
Peach mentioned that education is a huge part of the economy.
A legislator asked Peach, “Why aren’t we figuring out how to cut spending?” Peach’s response, “State expenditures will have increased.” Education is one example. The next session will have to see new income streams or spending “drastically cut.”
© 2020 NEW MEXICO NEWS SERVICES 7/13/20
A leader emerges, maybe, for race, inequality considerations
By Harold Morgan
New Mexico Progress
Attention has turned to statues. This makes some sense.
Rick Steves, in Sophia, the capitol of Bulgaria, a few years ago, observed that monuments, including a Lenin statue, have been moved to the Museum of Socialist Art. Steves, who has a PBS travel show, said, “Today, these statues seem only to preach their outdated ideology to each other. I love to visit places like this and think of the treasures we have in our freedom.” Reminder: That outdated ideology was the communist dictatorship.
More statues are coming down in the South in reaction to a movement called the “Lost Cause of the Confederacy” becoming an outdated ideology. This movement was behind monument building across the South in the decades around 1900. The rationale was that the confederates were the good guys, just outgunned.
The statue argument, in the op-ed analysis of retired New Mexico State University political science professor Jose Garcia, has “suddenly morphed into a mob led by fanatics determined to destroy public icons of 17th century colonial New Mexico.”
Garcia isn’t some gun-toting right winger. His mother was from Hagerman, his dad from Holman, near Mora. Garcia spent 13 boyhood years in South America. He likens our situation to a book burning in 1497 led by a fanatic Dominican priest, Girolamo Savanarola.
“We need those monuments, those stories. They offer us a glimpse of who we are, warts and all,” he says.
A potential leader has appeared. Consider a definition of leadership for an idea of just how amazing would be the prospect of a real leader: “Management is the capacity to handle multiple problems, neutralize various constituencies, motivate personnel... Leadership, on the other hand, is an essentially moral act, not—as in the case of most management—an essentially protective act. It is the assertion of a vision, not simply the exercise of a style.” This comment from Bart Giamatti came during April 1989. Former president of Yale University, he was Commissioner of Baseball at the time.
Chad Cooper, an Albuquerque financial analyst, has moved into the debate. He had to, I think. As an African American and the new president of the University of New Mexico Alumni Association, he had to become involved if he was to be credible. In the June issue of The Howler, the association’s newsletter, Cooper provided a profound and passionate meditation on racism and inequality. He met the difficult challenge of combining the personal with an analytical consideration of the long term.
With two UNM degrees, I have had little use for the alumni association, which has seemed only to celebrate UNM football, a bizarre concept. That might be changing.
Cooper said: “Now is the time for all of us to be better listeners to each other, be advocates for each other, and understand that the fight for equality is a marathon. We must continue to be vigilant and outspoken against racism and inequality long after this new cycle ends.
“I see fellow New Mexicans greeting us and each other with kindness and respect. People have asked what they can do to help. Hopefully, this is the beginning of a major change and national dialogue around racism and inequality… if we are all willing to listen….
“I am hopeful for better days to come, but those days will not come unless we all say that we have had enough.”
Cooper’s eloquence and position make him a leader of the state, part of the tiny group of people willing and able to consider the difficult broader issues facing the state. The association is a perfect vehicle; it’s neutral and statewide, really nationwide.
I hope Cooper asserts a vision. New Mexico needs one. I also hope he includes the Aggies.
© 2020 NEW MEXICO NEWS SERVICES 6/29/20
Tulsa reconciliation didn’t need Trump
By Harold Morgan
New Mexico Progress
New Mexico has plenty of Oklahoma connections, most recently the closing for the summer of the Philmont Scout Ranch just outside Cimarron. In 1922 Tulsa oilman Waite Phillips made the initial purchase at the site and gave it to the Boy Scouts of America in 1938.
In the 1950s and 60s Phillips’ namesake oil company, Phillips Petroleum Company, headquartered in Bartlesville, west of Tulsa, was one of the large operators in the Ambrosia Lake uranium boom along with Kerr McGee of Oklahoma City.
The University of Tulsa has joined the crowds pounding University of New Mexico in football.
Pat Hurley, Herbert Hoover’s Secretary of War, was born near Tulsa and, as a New Mexico resident, had a thing about running for the Senate against Sen. Dennis Chavez. Another political connection comes through Rep. Brian Egolf, Santa Fe Democrat and Speaker of the House, who was born in Oklahoma City as I was. His grandfather, William Egolf, probably knew my parents at Classen High School in Oklahoma City.
This long-winded introduction is provided to say it’s worth stepping from our usual topic boundary of the New Mexico border to consider the Tulsa Race Massacre of May 31-June 21, 1921. White mobs destroyed the Greenwood district, an African American enclave north of downtown, killed as many as 300 people, and left 10,000 homeless. A long and moving Wikipedia article gives the details.
Somehow the massacre was scrubbed from the civic consciousness for around 70 years. My Tulsa source, a member of today’s civic elite born in Tulsa in 1942, remembers he didn’t begin to hear about the massacre until after college, around 1970. It wasn’t mentioned in the schools. The event got attention starting in the mid-1990s. “Riot” was the 1990s term.
My maternal grandparents were in the area at the time, if not in Tulsa. So was the maternal grandfather of my ex-wife. This makes it a bit personal. I better appreciate what some Navajo people told me at Bosque Redondo (near Fort Sumner) at the event commemorating the 150th anniversary of the June 1, 1868, signing of the treaty releasing Navajos from the concentration camp. They could feel their ancestors’ spirits, the Navajos said.
Tulsa has created what appears from the website to be an admirable truth and reconciliation commission.
Questions remain as to how and why the event was lifted from the civic consciousness. The why seems obvious: embarrassment, regret. But how? The Wikipedia article tried to blame planners, a group known for pursuing ideologies. The planner plan, which did happen, was to build a rail hub on the Greenwood site. But planners work for people such as mayors. Mayors in turn work for and are part of the core group that runs any community, especially smaller ones.
I speculate that the core group convened a meeting, maybe in a conference room at the biggest bank. Or the country club. Or the biggest oil company. The two or three leaders of the core said, “Boys, this is the way it’s gonna be.” The school superintendent, if not in the room, would be instructed that all mention of the massacre would be eliminated from the curriculum.
The legacy will change from silence. School curriculum will include the massacre by next year, Tulsa 2021 hopes.
Tulsans heavily favor President Trump, my local expert said. Even so, Tulsa’s reconciliation work didn’t need Trump’s recent visit that drew 6,200 in the humidity and heat to non-socially distanced quarters in the 19,000-capacity BOK Center.
Nor did even-hotter Phoenix need the President to pack a crowd into a mega church a few days later. Of course, it’s a dry heat in Arizona.
© 2020 NEW MEXICO NEWS SERVICES 6/15/20
Assume responsibility for spending binge and don’t wait for feds
By Harold Morgan
New Mexico Progress
There’s a lot of moral injury going around. The concept applies immediately to healthcare workers and cops—people “who are strung out, stretched to the breaking point,” writes Peggy Noonan, Wall Street Journal columnist from New York City. Some of us have it relatively easy with an income to cover the bills and things to do. Others, not so much, especially in McKinley and San Juan counties.
Our Legislature faces a huge challenge in the special session starting June 18. To be sure, the challenge is modest compared to medical and law enforcement personnel, but still huge.
The good news is general and extends to the future; Permian Basin oil production growth will return “by next year and continue through 2030, consulting firms Rystad Energy and Wood MacKenzie estimate.” The Permian, the Wall Street Journal continued, will be “the central spot for new U.S. oil investments.”
Rep. Nathan Small, Las Cruces Democrat, thinks the special session won’t require radical actions. “Some budget cuts are needed,” he allowed in an op-ed.
The $1.25 billion in federal stimulus money will save us, Rep. Small thinks. That hope, if fulfilled, would allow us to cop out of responsibility for the spending blowout of the past two years. Add the wondrous leadership of Gov. Michelle Lujan Grisham.
Small also sees all sorts of “innovative ideas” appearing. Not a chance. Innovation, no. Solvency, yes.
The people—that’s you and me—will be kept from the capitol—during the special session. That’s not good, but necessary, I think. Still, that leaves us depending on our much disparaged (by the left) citizen legislature. We will have to talk to our representatives and senators during the election, especially those beleaguered few who have opposition.
The Legislative Finance Committee, reporting June 10, estimated general fund balances “without any changes” will be 8.8 percent negative as of June 30, 2021, the end of the coming 2021 budget year. That’s $1.98 billion under December’s estimate. The recurring revenue for the 2022 budget year is forecast at $1.4 billion less than recurring appropriations. “However, in hindsight, 7.5 percent general fund appropriations growth for FY21 was excessive,” the LFC remarks. Something—several somethings—will be done.
These comments come from the handouts at the LFC’s June 10 meeting. The Staff Solvency Framework is a 63-page challenge with mind-bending detail. The approach “focuses on simple, straight forward, moderately austere options” for the current year and FY 21. The limited time for the session and the depth of the financial hole means fancy stuff won’t appear. Rep. Small’s “innovative ideas,” whatever they might be, come to mind. The administration and the Legislature, through interim committees, will devote the next seven months until the 2021 legislative session to our new future.
Part of the framework is a 78-item list of capital projects for which there is no money set aside, no money spent, too little money allocated and which are non-compliant. Projects include work on the Chief Theater in Mora, schools, an Albuquerque RV park, and a road from Santa Teresa and Sunland Park.
“Sanding” is the budgeteer’s word for a little off the top. The framework offers numbers for 2, 4, and 6% sanding. There will be less hiring. Some new programs will be dumped due to future revenue limits.
As is customary, the state’s forecasting group does a baseline consensus forecast with optimistic and pessimistic alternatives. The consensus sees it taking four years to return to the job levels of the early 2020 bounty. Overall, “rapidly evolving economic conditions place significant uncertainty on the depth and duration of the decline.”
© 2020 NEW MEXICO NEWS SERVICES 6/1/20
Use of “disproportionate” leaves out respect
By Harold Morgan
New Mexico Progress
“Ideas have consequences. Words really matter,” reads a note on my office wall. The attribution is to David Brooks, New York Times columnist and Public Broadcasting pundit.
New words creep in to alter the dialogue. I don’t know the source (or sources) of the new words, but somehow, suddenly, it seems, a given new word is everywhere, something like Chicken Man. I suspect there is a gnome in the basement of the New York Times or Public Broadcasting who invents these things and distributes them to the talking head glitterati.
Consider “shutter.” Organizations are closing these days. “Shutter” has become the word of choice. “The firm is shuttered,” the story says. A little internet searching showed me hopelessly lost from the vocabulary view. Shutter, as in “to close,” is fraught with entries and definitions.
I once asked author Tony Hillerman about his word use, which was spare, as compared to his friend Norman Zollinger, who used many words. Hillerman said he always sought the correct single word. When one word worked, he didn’t want two.
In debates, if you use the other candidate’s words, you have already lost because you are trying to debate on the other candidate’s turf. Twenty years ago, the policy debate was about “smart growth.” The good guys called their organization, “Smart Growth New Mexico.” End of debate.
In considering this column, it registered that people today don’t talk in public about religion. They talk about faith. That seems a way to avoid “religion.” Yet religion was the base of this country’s founding.
Words become phrases. An individual is not “divorcing,” the individual is “going through a divorce.” Or a person is not “homeless;” the person is “experiencing homelessness.”
“Disproportionate” is one of today’s words. As it is a long word, the meaning is obscure. Properly used, in my opinion, “disproportionate” is a statistical term, meaning, I think, that something like COVID-19 is having greater impact in some places than in other places. As an awkward bonus, “extra disproportionate” appears sometimes.
A feeling nags that this description is a concentrated cultural phenomenon. This sense stems from the identity of those mostly throwing around the word “disproportionate,” that is, liberal national media, even the Washington Post, and those more to the left. The further nagging notion is one of moral outrage from the self-appointed activists.
For what it’s worth, nearly 80 percent of the people in McKinley County are Native American, the Census Bureau reports. In Cibola County it is 43.8 percent and 41.1 percent in San Juan County. These are the three counties hardest hit by a huge margin by COVID-19.
Another element—lack of respect—seeps through the outside reporting that I have seen about the Navajo Nation and other tribes.
Respect is what counts with native people. I got that lesson on a hot day in Grants in July 2008. The meeting was about designating much of Mt. Taylor as a Traditional Cultural Property. The speakers from Acoma, Laguna and Zuni Pueblos, from the Navajo Nation and the Hopi Tribe, started with a few words in their language, then shifted to English and said the meeting and the TCP designation were all about respect.
OK, I thought, you have my attention.
At the 2018 treaty signing commemoration held at Bosque Redondo, Joseph Nez, now Navajo Nation president, spoke of resilience, reconciliation and telling young people the story. He said, “We have to teach this dark time in our history. It’s for all people to know that we can change. This is not just a Navajo story. We’re all survivors. This is a Southwest story. We need each other.”
Yes, we do.
© 2020 NEW MEXICO NEWS SERVICES 5/18/20
A conservative sensibility would help special session
By Harold Morgan
New Mexico Progress
A legislative special session is necessary to deal with the humongous blows to the state’s previously forecast revenue for the 2021 budget year that begins July 1.
The revenue situation is so uncertain and perilous that the state’s consensus revenue estimating group has done a preliminary review of the economic and financial situation. It’s ugly.
The budget for the coming fiscal year (FY 21) was built on a forecast of $7.9 billion in recurring revenue. The review reckons revenue will be between 22 percent and 30 percent less and will wipe out the reserve funds that brought joy in February. Legislators will be required to do what elected officials hate to do: Say no.
My first guess as to what the session will not do is emphasize boring mundane stuff at the expense of cool stuff.
The state’s faded license plates are a boring mundane infrastructure item that may exist as a tiny flicker in the back of the legislative mind. Way back when more boatloads of oil money were anticipated (two months ago), I was set to argue that the state should pay for new and visible plates for everyone. I saw a city bus recently with a totally faded plate. But, whatever, that plate has been faded for a long time. Infrastructure, physical and institutional, holds the society together, providing the base.
By contrast, movies are cool. My guess is that the state’s money-losing production subsidy will be handled delicately.
What I’m sure is way out there is the claim of James Jimenez, executive director of Voices for Children. In a May 6 news release, Jimenez, a career public finance professional, said, “With federal relief and the state’s record-high reserves, New Mexico is well-positioned to make a few minor budget adjustments in the June special session.”
A few minor budget adjustments? Uh, no.
What would be nice but simply doesn’t exist in the conservative realm in New Mexico is a conservative sensibility like that of political commentator and baseball philosopher George Will. A couple of years ago Will observed, “In baseball, as in the remainder of life, the most valuable rules are unwritten.”
Will’s new book is “On The Conservative Sensibility.” Reviewer James Piereson, a senior fellow at a conservative outfit, the Manhattan Institute, likes Will and his book. Piereson’s review was in The New Criterion.
“This book’s primary purpose is not to tell readers what to think about this or that particular problem or policy . . . but rather to suggest how to think about the enduring questions concerning the proper scope and actual competence of government,” said the introduction.
The special session likely will draw on the lessons of the Great Recession of 2008 and following years. The approach was cutting a little bit of everything. “Sanding” was one technique. Think about lumber and sandpaper. Sanding smooths the rough edges and reduces the size of the lumber a bit. So it was with the budget. Sanding, plucking money from every conceivable budget hole, some actual reductions, and a lot of money from the feds got us through.
Solvency was the word of the day for several years. The Legislature, led between sessions by the Legislative Finance Committee, did an admirable job. It’s curtain call time now.
The special session scramble most likely will overwhelm any broader thinking. Still, thinks the naïve columnist, some lurking presence of the conservative sensibility approach to considering politics would be good. As the state “reopens,” remember that faith in technocrats’ ability to organize economic systems is a delusion.
© 2020 NEW MEXICO NEWS SERVICES 5/4/20
Santa Fe Institute offers classes seeking order in COVID-19 complexity
By Harold Morgan
New Mexico Progress
In a recent column I presented computer modeling as a straightforward process of defining relations with equations, assuming values for elements in the equations, and then letting the computer decide what happens under the assumed values.
The Santa Fe Institute has taken the approach much, much farther, a great public service. SFI has created a four-session course under the heading “Transmission: SFI Insights in COVID-19.” The course itself is “Complexity of COVID-19.” Complexity is what SFI does for a living.
The introduction, setting the scene, says, “COVID-19 has very quickly proven to be a terrifying demonstration of complex systems. We are all suddenly witnessing the consequences of deeply entangled systems.”
We see these consequences every day, even if just in the photographs of empty streets.
Transmission networks, usually obscured, are the paths along which one thing gets to another. For say, cancer or Alzheimer’s, the networks are complex. Unraveling the paths gets into genetics. For COVID-19, the networks are “rather simple” and part of everyday life. The virus goes from animals to people to more people through contact and then moves through transportation systems (such as a new passenger on mass transit) to business and social settings.
These systems are supposed to work; I remember being appalled at finding a fire hydrant that didn’t work. When these systems don’t work or work too well, as in the virus case, we can change the system. Social distancing and quarantine are system changes but within the system.
How to change the system? That’s where SFI comes in. Its mantra, its job, is, “Searching for Order in the Complexity of Evolving Worlds.”
A big problem lying under the scientific analysis and modeling is the mix of science and policy. The technical people— every epidemiologist, virologist, economist and anyone else providing scientific advice—want to be right and to be as specific as possible. Typically, the scientists’ best is a range of possibilities. The trouble is that the wider the range, the greater the chance of being correct, but the smaller the chance of being useful to the policy maker. And vice versa. A narrower range focuses a policy decision but is more likely to be wrong.
It’s a nice but wishful idea that the science be cleanly separated from the policy. The rope between useful policy guiding advice and being wrong is tightly strung. No completely right or wrong answer exists, as with most complex problems. Among the several states and among different communities, different approaches exist. The state of Georgia has one idea. Grants, New Mexico, has another. Sweden has yet another.
The necessary shift to online education raises an intriguing question: “Beyond facilitating science labs, arts, and sports, what exactly is the unique value of in-person education?” With limited in-person work, SFI shows one approach to higher education. Another approach, also located in Santa Fe, is the intensively in-person St. John’s College which now is doing distance learning.
Ultimately, control falls to the individual. Reading about the present conditions brings better information about our individual preferred approach.
More information is better. But there is an appropriate reflex against too much information, whatever might be the definition of “too much.” Massively pervasive tracking of the disease spread endangers our democracy.
We do have a lot of possibly available and handy big computer iron. New Mexico has about 10 of the world’s top 500 fastest supercomputers, including the Trinity supercomputer at Los Alamos, currently seventh fastest in the world. My guess is that these machines and the smart, talented people who run them are being put to work.
© 2020 NEW MEXICO NEWS SERVICES 4/20/20
Equations, variables and guesses produce model results
By Harold Morgan
New Mexico Progress
Mathematical modeling gets headlines these surreal days. Actually, the results of running models get headlines. The models themselves get little attention.
The appeal to headline writers and their editors comes, I think, from models offering something definite—a number—as together we face the COVID-19 virus. A number in an awful situation is a headline writer’s grist.
A model projects a high death toll. OMG, we think, something horrible to worry about. Then the same model projects a lower death toll. Whew! Not so bad. In the headlines recently is the Institute for Health Metrics and Evaluation at the University of Washington (www.healthdata.org), which created an early model (maybe the first) of the virus situation in the United States.
For some perspective, let’s drop back to Modeling 101. The following discussion shares my understanding, gathered from bits and pieces over a long time. The thoughts apply to situations beyond COVID-19, such as, say, climate change. The difference is that while virus models land in the headlines and generate questions, asking questions about climate models is forbidden or a sin or something because all climate details are settled, thank you.
A model presents something. Could be the plastic airplanes or ships I assembled as a kid in the ‘50s. Or maybe an auto manufacturer’s half-size prototype. Or a three-dimensional drawing, using a computer, of an auto part or a house. Or a set of equations, which is where it gets murky for many of us. In terms of actually doing the math, I hit the wall in calculus as a high school senior. My daughter brings hope; she majored in math and physics.
Equations are a way of saying something, expressing relationships. Instead of words, the statement is done using numbers and letters standing in for ideas. A simple equation states the relationship of oil revenue to the state’s general fund: (oil price) plus or minus $1 equals (general fund revenue) plus or minus $22 million. The oil price/revenue equation is easy because it is based on data. The relationship has a history.
Saying something more complicated requires more and more complicated equations. These more complex equations must start somewhere, namely with people. People might say, I think this result depends on three things (called variables) happening. The result might be producing a certain number of newspapers during an eight-hour work shift. One variable might be the number of pages in the issue relative to the maximum number of pages the press can produce all at once. Probably a press will have a maximum of pages it can produce while running full speed; more pages will mean a slower speed. Color will be another variable; more color use will mean fewer pages because part of the press must print the color. People will be a further variable; does everyone on the press crew come to work? If, say, just two of the three press crew people appear, can the two run the press and at what speed? Management makes some assumptions, guesses, that this is about what might happen.
Each variable will be expressed as an equation; each equation will affect the others. The more variables, the more complex it gets. Together the equations model the process. Necessarily the model will be on a computer. Change a variable such as population density and the result changes.
When things get really, really complex, as in the case of the coronavirus pandemic, making new assumptions can produce very large changes in the results.
One thing we all must remember is that the results from running a model are a range of numbers, much more than just one number.
© 2020 NEW MEXICO NEWS SERVICES 4/6/20
Jobs: Good year in 2019 shows that we can grow again
By Harold Morgan
New Mexico Progress
“The way we were,” Barbra Streisand sang. “Can it be that it was all so simple then.”
Then was seven weeks ago. The legislative session ended Feb. 20 after doing what I called “Democrat stuff,” namely spending the gushers of money on all those “needs” ignored by Susana Martinez administration and filling those jobs left vacant but, clumsily, left on the books as authorized.
Then things changed. Yes, we know that, you say. The COVID-19 virus and oil. In price terms, oil, which especially affects New Mexico state revenues, is set for the worst year since 2003, reported the Wall Street Journal in the March 28-29 edition. The Journal’s prediction comes from a poll of 11 banks.
It is useful to review the 2019 revised average job figures, both to prod the memory and to think about where the state might be when things might be “all so simple.” The thing also to remember is that the state got lucky with the boom. For growth the past few years in travel and tourism, we benefitted from the now-ended national economic expansion and the “New Mexico True” marketing campaign that lured visitors and their spare money. Good news continued in January with a 13,400 job, or 1.6 percent, increase from January 2019.
Each year economists in the Department of Workforce Solutions review the previous year’s wage job estimates, add reports from sources releasing data after the original unveiling and produce new, presumably better, estimates that provide a benchmark for the coming year. The numbers, all annual averages, are in the January issue of DWS’ Labor Market Review newsletter
Overall, the wage job growth was 1.6 percent in 2019 over 2018. The original estimate was 1.7 percent, so the total percentage change isn’t much. The state added 11,600 jobs, 900 fewer than during 2018. Estimated government gains increased as the private sector estimates shrank.
Of the statewide sectors in 2019, manufacturing was revised upward by 4 percent or 1,100 jobs. Leisure and hospitality was cut by 3,300 jobs or 3.2 percent.
Metro Albuquerque and Santa Fe were the statistical winners from benchmarking. The Duke City was given another 3,200 jobs monthly, bringing the estimated 2019 increase to a decent 1.3 percent instead of a so-so 0.7 percent. Santa Fe’s monthly average job total grew 1,000 jobs to make the increase 1.7 percent instead 0.3 percent.
The wage job estimates were revised downward for the Farmington and Las Cruces metro areas. Las Cruces was cut 200 jobs per month or 0.3 percent. The Farmington estimate dropped 500 jobs or 1 percent.
The February jobs report showed continued good growth with 12,000 new jobs year over year. March was different. The new claims for unemployment compensation show that the job situation hit the wall during the week of March 21 with 18,105 New Mexicans filing for unemployment. That was more than 20 times the 869 filing during the week of March 14. Claims jumped to 28,182 the week of March 28.
The past couple of years show the state can grow, can produce more good jobs, even if concentrated in a couple of counties. The oil and virus blows show us yet again that depending on luck is a bad plan. Instead, we need hard work on the basics. Here’s one small example. The Labor Market Review reported that in Mora and Catron counties all of the out-of-school 16 to 29-year-olds were neither employed nor in the labor force. With 73.3 percent, Mora led in the percentage of young adults ages 20 to 24 who were unemployed.
Yes, these are small population rural counties. But we can’t write them off.
© 2020 NEW MEXICO NEWS SERVICES 3/23/20
Oil disruption will spark special session, and abandoned mines pose dangers
By Harold Morgan
New Mexico Progress
“A surreal juncture” was the phrase an email writer used the other day. Further comment on the COVID-19 virus is best left to others because of the rapid movement of events. But things continue to happen. Two will get a mention—oil and abandoned mines.
The big picture of oil, gas and especially the shale business has gotten attention in this column, mostly through passing along national headlines about volatility and the fact that a whole lot of the companies, the small and mid-size ones especially, aren’t making any money.
While the Delaware Basin subset of the Permian may be the best basin ever, things have changed. The point is that our massive actual and proposed increases in state spending the past two years (the current budget year that ends June 30 and the next one) are built on forecasts, not cash. The forecasts no longer work.
On March 16 oil prices on the New York Mercantile Exchange dropped to $28.70 per barrel, a four-year low, reported the Wall Street Journal. “Oil is caught in a severe demand and supply shock, both of which have an uncertain future,” the Journal quoted JPMorgan Chase analysts. A new element, the Journal reported the day before, is a Russian “strategic campaign to cripple U.S. shale-oil production.”
A special session of the Legislature looms.
Mining comes from outgoing Sen. Tom Udall, who is closing his Senate career with reports, news releases, conferences and such about mining matters and Native American issues. The latter I applaud. Udall approaches mining from the view that miners are bad guys.
Udall’s March 11 release covered a new report, “Abandoned Hard Rock Mines” (www.gao.gov/products/GAO-20-238), from the General Accounting Office. Hard rock mining involves 11 minerals including copper, molybdenum, potash, silver, gold and uranium. Coal is a “soft” rock.
The GAO calls itself “the audit, evaluation, and investigative arm of Congress, (which) exists to support Congress in meeting its constitutional responsibilities…” That means the GAO works for Congress. Udall attached the GAO report to a March 11 release. The report was addressed to the Ranking Member of the Subcommittee on Interior, Environment, and Related Agencies of the Senate Committee on Appropriations. That means Udall.
The abandoned mine situation seems a little like what my cousin the dentist observed decades ago about my wisdom teeth; Don’t bother them unless they bother you. Think Gold King.
The GAO took 21 months to do the report. It covered 13 western states including New Mexico.
Mine sites come with “features.” Apparently, though, there is no agreed definition of a “site” or a “feature.” This throws uncertainty into the numbers. Features can be mine openings, pits, buildings, and/or leftover materials called tailings. In addition to the physical and environmental hazards at a site, young men, alcohol and nearness to more populated areas can bring in the “stupidity factor.”
Four federal agencies found “at least” 140,000 features at abandoned mines on the agency’s land. The four were the Forest Service, the Bureau of Land Management, the National Park Service and the Environmental Protection Agency. Of those, 67,000 might be safety hazards and 22,500 might be environmental hazards. Actual confirmed hazards are 6,439 for physical safety and 1,363 for environmental. While these numbers are large, the federal four think there might be another 390,000 problems not yet in federal databases. Then there are state and private lands.
From the 2008 budget year to 2017, New Mexico spent $4.3 million “to address” environmental hazards at abandoned mines and nothing on safety hazards, the report said. The feds spent $64.5 million.
Udall’s solution: a royalty to be paid by future mines and a reclamation fee for existing and future mines.
© 2020 NEW MEXICO NEWS SERVICES 3/9/20
Lobbyists, trade groups essential for government functioning
By Harold Morgan
New Mexico Progress
Bill Fulginiti was a lobbyist. He was also executive director of the New Mexico Municipal League and had been director for more than 40 years when he died February 26. The League, as one might deduce from the name, is the trade organization of city governments. These are generally referred to as “incorporated municipalities.”
Part of his job was to maintain contact with the Legislature, attending relevant interim committee meetings and organization gatherings and working on policy development. At last December’s legislative forecast conference of the New Mexico Tax Research Institute, Fulginiti discussed “diversification of our revenue sources.”
“That’s been our policy for some time,” he said. He pointed out that the state has 106 municipalities with 106 economies and no access to income tax revenue. Only 21 cities have more than 10,000 people. He was happy with the capital spending approved in the 2019 legislative session, “but it comes with some issues. You have to go through many permit systems.”
The League’s office is at 1229 Paseo de Peralta in Santa Fe. That puts it in the ring of trade associations, businesses, lawyers (some of whom are lobbyists) and lobbying firms surrounding the Capitol. As the Municipal League does for cities, trade associations talk to state government and then talk to members on behalf of the government.
Sometimes they spend money. On Feb. 13, well into the 2020 session, the League bought dinner for the Senate Finance Committee. The price was $2,904.57, according to the Report of Expenditures Form B Expenditures. Fulginiti filed this report as an individual lobbyist with the spending done on behalf the League.
Fulginiti was part of the group that is critical to the functioning of our state government. Call them the “expert systems” group. These are people who know how things work; they have the knowledge of the system in their head.
Lobbyists are an essential piece of the interface between government and citizens and organizations both public and private. They convey information both ways. This is both necessary and efficient. Like any other specialized function, government and the Legislature come with their own approaches.
Dealing with this world can mystify the uninitiated, especially during the semi-organized chaos of a session. I remember a senior banker, a marine veteran, and a very precise individual, who left his first exposure to a session mumbling to himself. There is some irony with one government lobbying another government, but that’s the way it is.
A New Mexican story in January talked about “the enormous influence that lobbyists have over lawmakers” and “reforms” that New Mexico Ethics Watch (nmethicswatch.org), a bunch of lawyers, claims would do something about the influence. The organization has a 55-page report about their proposals.
The New Mexican reported Feb. 27 that lobbyists spent about $195,000 “on legislators” during the session. That’s the kind of headline number sure to gain attention. But is the influence really “enormous?”
The spending comes to $1,741 for each of our 112 legislators. If you’re selling your soul, that’s a pretty low price. And what exactly does it mean to spend money “on legislators.”
Our citizen legislators tend to be partial to subjects where they have some background. Thus, legislators from Lea and Eddy counties tend to be fond of oil and gas. A legislator from the University of New Mexico’s law school turns out to be “progressive,” not that “progressive” means progress.
Here’s an example of lobbyist spending. The National Dance Institute in Albuquerque has five registered lobbyists including the executive director, Russell Baker. Three of the people are listed at the same post office box in Santa Fe. The group’s Dec. 31 report showed spending of $17.31. Lunch for a legislator, maybe?
© 2020 NEW MEXICO NEWS SERVICES 2/24/20
Private sector Good Samaritans needed to help clean up mines
By Harold Morgan
New Mexico Progress
The full glory of the 2015 Gold King Mine spill of three million gallons of toxin-laden water into the Animas River fills a full page opposite the title of a new report about cleaning up abandoned mines: “Prospecting for Pollution: The Need for Better Incentives to Clean Up Abandoned Mines.” The author is Jonathan Wood, a Property and Environment Research Center (PERC) research fellow and an attorney at Pacific Legal Foundation.
Immediately after the spill Rep. Ben Ray Lujan, now a Senate candidate, declined to stand up for his constituents as the yellow squash-colored Animas flowed across his congressional district. But enough of that.
PERC, of Bozeman, Montana, calls itself the “home of free market environmentalism.” The notion of free markets and environmentalism might be considered an oxymoron by religious enviro types. Read on.
The state’s Mining and Minerals Division says on its website that “there are over 15,000 abandoned mine features in the State of New Mexico. They range from shallow prospect pits to 500 feet deep mine shafts to piles of coal gob (mine waste).” Tunnels and air vents are features.
New Mexico is one of five states with more than 6,500 abandoned mines. The Navajo Nation, much of which is in Arizona, has more than 500 abandoned uranium mines. A $600 million cleanup program for 94 mines was approved in 2017. The deal is between the EPA, the Navajo Nation and Freeport-McMoRan, a Phoenix-based mining firm. More to come.
Abandoned mines remaining untended or sloppily and carelessly tended (think Gold King) can generate all sorts of nasty problems. The EPA is generally responsible for cleaning up the messes, a situation that does not produce happiness. Remember, the EPA caused the Gold King spill. Worse, the PERC report says, the EPA gets only a small part of the money needed to have any effect. Yet estimated cleanup costs are in the tens of billions.
Enter markets and the private sector, maybe.
In general conversations, markets are black boxes of sorts. Stuff is mysteriously produced. The left (Bernie Sanders) claims markets are a conspiracy and all rigged. Economist Deidre McCloskey offers a better explanation. Markets comprise free people with ideas, which are thought useful and are embraced by other free people who agree the ideas are useful. Value (money) is exchanged and life for both is improved. There is a “betterment,” as McCloskey puts it.
Possible betterments from abandoned mines can exist. Minerals that are economically viable today remain in mines. Such minerals could not be profitably mined using the technologies of a century ago. Mine waste may also contain previously unknown minerals that are profitable today. Utilities might find it cheaper to do a one-off cleanup than paying for water treatment until the end of time. Conservation groups such as Trout Unlimited have helped financially with mine cleanup. The report calls such groups “Good Samaritans.” Those who would benefit from cleanups represent “a large, untapped source for additional funds,” Wood says.
But then enter the regulators. Catch 22 appears to be the uniting principle for constructing rules. “Federal regulations erect substantial obstacles... (and) make voluntary participation in any cleanup a risky proposition,” Wood says. He examines two huge sets of regulations: the Superfund and the Clean Water Act.
They are a mess. Examples include an EPA rule that could snare someone buying a polluted property. The buyer can become responsible for all past pollution even if having nothing to do with past sins.
Legislative solutions require eliminating disincentives, limiting red tape, reducing litigation risk for both Good Samaritans and the feds, creating water quality trading schemes.
Want to know more? Wood provides five pages of endnotes.
© 2020 NEW MEXICO NEWS SERVICES 2/10/20
HSD Data Book offers sprinkling of basics plus budget pitch
By Harold Morgan
New Mexico Progress
The introduction to the Human Services Department’s new State of New Mexico Data Book says it is “a summary of social, economic and health statistics of our state.” There is “a diversity of information.”
Strip away everything else and find a sales pitch for the department’s budget requests for fiscal year 2021, the budget year starting July 1. Of the 186 pages, 26 are devoted to the money. Another 37 pages go to HSD’s programs.
The book opens with 31 pages of economic statistics. It presents data in map format plus a bar graph showing the rank of each state or county for the particular factor. To start the stats, a page claims to explain things. One illuminating item is new to me; maps can have numerators and denominators. Remember elementary school, remember fractions? The numerator in the fraction goes on top. The denominator goes on the bottom. (Yes, I had to look it up.)
“Food insecurity” gets four pages of the 31 pages of economic numbers. For those not having the term on the tip of their tongue, a definition is provided.
“The U.S. Department of Agriculture defines food insecurity as a lack of consistent access to enough food for an active healthy life.” Looking around the Department of Agriculture site (ers.usda.gov), food insecurity emerges as a complex idea wrapped around “state of the art statistical methods.”
“Living wage” as a term, it appears to me, spends more time in the public dialogue than food security. You’ve heard, “Raise the minimum wage so people can earn a living wage.” Again, there is the question of meaning.
“Living wage is an alternative measure of basic needs, drawing upon geographically specific expenditure data related to an individual's/family’s likely minimum food, childcare, health insurance, housing, transportation, and other basic necessities (clothing, personal care items) costs,” the book says. “Living wage draws on these cost elements and the rough effects of income and payroll taxes to determine the minimum employment earnings necessary to meet basic needs while also maintaining self-sufficiency.”
As a term, “living wage” contains a lot of ideology.
The remaining economic statistics cover a sprinkling of the basics: population, income, unemployment and poverty rates. Four stand out starting with Native American population by county. Hispanics, African Americans and Asians don’t get maps. So much for “a diversity of information.”
The other data points are single parent households with children by state and county, drug overdose deaths and suicides.
What the book does not do is provide any insight about our economy, about how people earn a living and provide for their children. It’s like saying, as does the Albuquerque Community Foundation, that poverty is the problem without considering the causes of poverty.
Colorado is comprehensive, considering causes for all 50 states. Start at page 22 of the 2017 edition of Toward a More Competitive Colorado, a publication of the Metro Denver Chamber of Commerce. Page 22 has the state competitiveness index where New Mexico is 49th and Colorado is 14th. Every third year the report is a comprehensive edition with hundreds of data points. In between 30 key indicators are summarized to see if anything has changed significantly. These scatter among economic vitality, innovation, taxes, livability, preschool through 12th grade education, higher education, health, infrastructure. Colorado is compared with seven “competitor” states, a group including Arizona and Utah, but not New Mexico.
The best number is single parent households with children. Of New Mexico’s households with children, 42.9 percent have only one parent, third largest in the nation. Look to the counties and find a high correlation with poverty. Maybe HSD should have a program to encourage marriage.
© 2020 NEW MEXICO NEWS SERVICES 1/13/20
The Legislature: Spending real money on needs
By Harold Morgan
New Mexico Progress
Illinois Sen. Everett Dirksen didn’t say what I thought would be a good introduction to state spending and legislative direction set for consideration during the session starting Jan. 21. Dirksen did not say, “A billion here, a billion there and pretty soon you’re talking real money,” according to wikiquote.org. Maybe the misattribution is appropriate. With all those billions, fog develops.
Certainly the session will discuss and allocate real money‚ billions of dollars.
Gov. Michelle Lujan Grisham’s Jan. 6 news release sketched an overall general fund budget of $7.68 billion for the 2021 budget year starting July 1. That’s roughly $4,800 for each of the 1.6 million New Mexicans over 17.
We just crossed the $7 billion spending threshold this year. Give politicians money and they will spend it. On “needs.” Of course, all spending is needed; there is no unneeded public spending. Democrats are better at finding needs, but Republicans cannot claim purity.
At last month’s New Mexico Tax Research Institute Tax Policy Conference, the Legislative Finance Committee provided its usual stellar summary of state finances and issues. The bi-partisan LFC prepares a budget for legislative consideration as does the executive branch under the governor. The budgets normally differ a little at the margins, but mostly go in similar directions.
Hydrocarbons, aka oil and gas, set the scene for state finances. Production from the light oil in shale deposits declines quickly, said LFC Director David Abbey. “In 12 months we lose 75 % of the productivity from a new well.” Thus, drilling must grow just to keep present production levels. There is “great volatility and great downside risk,” Abbey said. A treadmill it seems.
The built-in volatility, said Rep. Patty Lundstrom, Gallup Democrat and LFC chair, means “we’ve got to make sure we have strong savings.” The governor’s answer is a 25 % general fund reserve target.
The budget builder’s task was matching the average agency’s 17% increase in spending for the 2021 budget year against the forecast 10% income increase.
The Legislature’s focus starts with public education, with a $3.2 billion recurring budget for the current year, which includes a $448 million, or 16%, hike from the year before. The governor wants another $200.3 million. The spending goes to needs and to responding to a lawsuit judgment saying the state is doing a rotten job for at-risk kids. Approaches include a longer school day and a longer year.
Work will continue on the public employee pension funds, which “face large and growing unfunded liabilities,” the LFC presentation said. A proposal for the Public Employees Retirement Association seeks “to balance the responsibility for pension liabilities across the state, retirees, and current and future workers through COLA reductions and contribution increases.”
Transportation is a topic “near and dear” to Lundstrom’s heart. Her McKinley County home, where she is the economic developer, has both an interstate highway (I-40) and much that is very rural.
Getting it done is another story. The state has appropriated but not spent $1.8 billion supposedly to pay for 3,135 projects. Just buying road right of way is a challenge. Money is appropriated for only part of a project, requiring another appropriation the next year. Inflation raises project cost. Planning is inadequate. Lundstrom will propose a highway stabilization fund.
Healthcare work starts with New Mexico having the nation’s highest percentage of the population covered by Medicaid, the health insurance program for low-income families and individuals. Proposals include a replacement management information system, behavioral health reforms and improving services for people with developmental disabilities.
Other topics include early childhood education and state government financial stability.
All to be done in 30 days. Somehow it will get done. Pretty much.
© 2020 NEW MEXICO NEWS SERVICES 12/30/20
Oil boom to ease, and what about rest of state?
By Harold Morgan
New Mexico Progress
Some concise economic numbers were the Dec. 23 present from the New Mexico Economic Databook, published by the Federal Reserve Bank of Kansas City. All the numbers here are as compared to the same period in 2018 (third quarter to third quarter).
The unemployment rate was 4.8 percent in November, and total payroll employment was up 1.9 percent. Employment growth was broad-based across industries but strongest in construction, mining and logging. Nominal personal income grew 5 percent in the third quarter. Workplace earnings rose 5.4 percent. Home prices increased 6.4 percent in the third quarter, but single-family and multifamily were down 6.7 and 27.5 percent, respectively, year-to-date through October. In September 2019, crude oil production was up 30.2 percent, and rig counts down. Exports were 18.3 percent higher in the third quarter.
A broader view came Dec. 20 at the New Mexico Tax Research Institute Tax Policy Conference. Jeffrey Mitchell, director of the University of New Mexico’s Bureau of Business and Economic Research, expanded on fed numbers. BBER provides economic data and forecasting for the economics group that produces state revenue estimates. Of the three possible outcomes for BBER’s forecast, a recession in 2021 carries the highest probability, at 35 percent.
Two Wall Street Journal stories provide national context. The Dec. 16 story was datelined Midland, Texas, 98 miles southeast of Hobbs. The headline: “Companies Suffer as Shale (Oil) Cools.” A week later, a story discussed banks tightening credit criteria on small and mid-size producers.
Bankruptcies loom, the stories said. More than 30 oil firms went down during 2019. The good news is that much of our production comes from the Delaware Basin, the fabulously productive subset of the Permian Basin. The Delaware “is not a national phenomenon,” Mitchell said. It has to do with geology and drilling technology. The high productivity offers a cushion to the national recession expected by the end of 2020.
“Our current situation,” Mitchell said, is that “we are doing—and will be doing—very well, almost entirely due to the oil and gas sector. (But) the boom as we have gotten to know it… is starting to slow.”
Oil production has grown 140 percent the past three years. For 2020, Mitchell sees 11 percent and four percent average annual growth from 2021 to 2024.
“Doing well” meant 1.3 percent job growth, or 10,600 jobs, for the second quarter of 2019. That growth rate was down from 1.5 percent, or 12,500 jobs, during the first quarter, which was the best performance since 2007. Eddy and Lea counties produced a third of the second quarter job growth.
“We are in a situation where we are at a pivot point,” Mitchell said. In the current budget year, FY 20, and in FY 21, infrastructure construction, paid for by oil income to state government, will drive job growth. The construction stimulus will end with 2021, dropping job growth to around 6,000 each quarter, about half the rate of 2019. Growth in the metro areas will continue; the Farmington metro will continue “struggling mightily… a pattern we’ve seen for some time,” Mitchell said.
The “significant outflow” from 2012 to 2018 from the state has been of people in their twenties and thirties with children and bachelor’s degrees. With the oil boom, the migration flow has reversed, but different people are coming. They are young, much earlier in their professions, and with much broader education. This migration seems directly tied to oil and may be temporary.
Mitchell’s suspicion poses a huge challenge to the administration, the private sector, the Legislature and anyone interested in economic development.
© 2019 NEW MEXICO NEWS SERVICES 12/23/19
Efforts start to save Gila River from self-appointed saviors
By Harold Morgan
New Mexico Progress
Some topics in our public discussions generate no controversy; it’s God, mother and apple pie. National parks and wild and scenic rivers are that way. Only grumpy people like me wonder, for example, if it wouldn’t be a good thing to clear the maintenance agenda at Bandelier National Monument before making it a national park.
Haydn Forward doesn’t seem grumpy. During our brief conversation he was pretty much on an even keel, though he did pause now and again to pick his words carefully when talking about his passion—the imperfections of the Wild and Scenic Rivers Act and designating the Gila and San Francisco Rivers in southwest New Mexico as wild and scenic.
Forward comes to this passion in a manner that may seem unusual these days; he took an oath as part of becoming vice chairman of the San Francisco Soil and Water Conservation District, which is based in Glenwood.
New Mexico has 47 districts. As independent divisions of state government with elected boards of supervisors, the districts are central to local government, especially in rural areas. According to the Department of Agriculture website, the districts “conserve and develop the natural resources of the state, provide for flood control, preserve wildlife, and protect the tax base.“ The objective is “to develop locally driven solutions to natural resource concerns.“
When something threatens districts, the people involved object. Here the “something” is the move to designate the Gila and San Francisco Rivers as officially wild and scenic. Forman objects. His mission is “balancing the scale about the truth.”
The truth may be out there, but for now it isn’t much involved in the Gila-San Francisco discussion, which Forward says the New Mexico Wilderness Alliance (aka NM Wild) is driving. NM Wild is even writing the legislation for the wild and scenic designation, local offices of Sens. Heinrich and Udall “have confirmed to me,” Forward says. He sees the task as properly the purview of the senators.
I was unable to reach the New Mexico Wilderness Alliance at the numbers listed on its website, and the email would not transmit.
He came to Albuquerque recently for two presentations at the Joint Stockmen Convention. After he made the case to board of the Coalition of Arizona-New Mexico Counties it passed a motion to “oppose any Wild, Scenic and Recreation River designations in Arizona and New Mexico.“ The coalition consists of ten New Mexico counties and six from Arizona.
With Wild and Scenic designation, control of the land and water goes to the federal government, Forward says. The feds would appoint a custodian, possibly located in the U. S. Forest Service, possibly in the U. S. Park Service -- Forward doesn’t know, which worries him. This control would apply within municipalities. It isn’t just the river, designation includes a quarter mile on both sides up to the high water mark and likely would affect proposed uses above and below the Wild and Scenic section. The custodian would specify zoning standards.
Forward reviewed the language in the act. He concluded that “any tributary and associated property that the custodian deems will impact the scenic or recreational meaning of the act will not be allowed to use their water or make land improvements.” The scary caveat is the statement about affecting the meaning of the act. It is totally a judgment call. A good guess of the regulatory tilt comes from the growth of the number of Wild and Scenic rivers -- now 209, including four in New Mexico, after starting with ten rivers in 1968.
For more information, Forward suggests calling the Catron County Commissioners’ office at 575-533-6423.
© 2019 NEW MEXICO NEWS SERVICES 12/2/19
2000 to 2018: A lost eight years
By Harold Morgan
New Mexico Progress
As the end of 2019 approaches, a look at New Mexico’s population and earnings performances will provide a base for digesting the effects of the oil boom of the past couple of years. That nothing much happened is the story from the most recent data. “Most recent” means 2017 and 2018.
The population data show a lost decade. Not exactly news, but something worth remembering. Harkin back to the thrilling days of late 2016 (with apologies to the Lone Ranger).
At the December 2016 conference of the New Mexico Tax Research Institute, David Abbey, director of the Legislative Finance Committee, talked of zero job growth and state government maybe not having enough cash to pay its bills. How soon we forget as we slosh around in oil revenue.
Something did happen in 2017, a singular accomplishment that must have Mississippi saying, “Thank God for New Mexico.”
In that year New Mexico slipped ahead, actually below, Mississippi to claim the nation’s lowest real (meaning statistically adjusted for inflation) income per person: $40,255, just $98 below Mississippi’s $40,353. We managed this by having income growth of 0.6 percent for the year, less than half of Mississippi’s 1.3 percent.
In regular dollars we escaped the bottom with a personal income of $39,709, putting us $1,245 ahead of West Virginia and $3,132 over Mississippi.
The income figures reflect what New Mexicans have been doing all decade: Leaving, taking their money, and moving to other states. Between 2013 and 2018 the state population grew to 2.095 million. The six-year increase was 2,636 people, a miniscule rate of just over one tenth of one percent. The growth rate has picked up the past two years. We added 606 people in 2017 and 1,853 in 2018.
Note that these population figures are net numbers. People come and go; our concern is the difference. Our neighbors are more populous and getting more so. Arizona’s 2018 population was 7,171,646 in 2018 with 5,695,564 in Colorado.
New Mexico added 36,249, or 1.7 percent, between the April 2010 census and 2018.
New Mexico is losing ground. In 2018, we were the 36th largest state, placing between Kansas and Nebraska. States with fewer people than New Mexico include Wyoming (with 577,737 people, the smallest population state), Vermont, both Dakotas and Montana.
Between 2017 and 2018, we were 39th in population growth with 2,033 more residents and 40th in the percentage of growth. Our increase was just shy of one percent. Arizona was fourth and Colorado seventh in growth percentage.
The components of population change are natural increase (births and deaths) and migration (people coming and going). “Negative natural increase” is the awkward jargon for more people dying in an area than being born. “Negative net migration” is the slightly less awkward term for more leaving than coming.
Domestic migration, meaning to elsewhere in the United States, is our key number. Between the 2000 census and 2018, a net of 62,051 people picked up and left New Mexico. Other countries supplied us 27,423. Small population states losing people to domestic migration during the period include Wyoming, Wisconsin, Rhode Island, Vermont, Nebraska, Kansas (96,461 left), Iowa, and Alaska. No states lost people to international migration.
There were 142,845 deaths for the eight-year period, partly offsetting 213,795 births for a natural increase of 70,950.
New census numbers will appear next year. If job growth is any proxy, Eddy and Lea counties will be very happy due to oil. Albuquerque will be somewhat pleased. The other metro areas—Santa Fe, Las Cruces and Farmington—it’s hard to say. Rural counties are an even bigger question.
© 2019 NEW MEXICO NEWS SERVICES 11/18/19
To know the essential New Mexico, all you need is love
By Harold Morgan
New Mexico Progress
In thinking about New Mexico, the question of the state’s essence—the spirit—is constant. Here is one view.
“Like O’Keeffe, (Rebecca Salsbury) felt deeply inspired by the culture and landscape of New Mexico.”
Salsbury was the wife of Paul Strand, a great photographer of the early 1900s. The observation is from Carolyn Burke’s review in the New York Review of Books of “Foursome: Alfred Stieglitz, Georgia O’Keeffe, Paul Strand, Rebecca Salsbury.” (O’Keeffe was married to Stieglitz.)
O’Keeffe first visited New Mexico in 1929. Twenty years later she moved here permanently.
Consider the source here. Granting culture and landscape as a critical insight is required by O’Keeffe’s place as a premier artist of the 20th century. But what is beyond culture and landscape? After all, the culture(s) were already here. So was the landscape. The native cultures were and are rich and complex. The O’Keeffe-Salsbury inspirations certainly brought far more depth than did the approach of Mabel Dodge Luhan, who responded to a letter from her husband saying, “Save the Indians.”
The sky raised O’Keeffe’s inspiration level. She started painting clouds around 1960. A new show, “Seeing Beyond” at the Georgia O’Keeffe Museum in Santa Fe, explores this work. You’ve got to be good to get your own museum.
The question reappears. What is beyond? What’s next? Light, for one thing. Organized religion for another.
These days the state is home to a number of organized religious groups. That means the state counts holiness as what economic developers call an “export product,” one drawing money from elsewhere and sending its output of nourished souls to other places. These groups are not the mainstream mass market churches. Rather these are specifically organized, even if affiliated with a broader group.
Start with monasteries. The Catholic Church calls them “religious life communities.” New Mexico has 11, according to a directory (deoestgloria.com/us). They’re scattered around the state with nine in the north, where such groups tend to locate. The Benedictines’ Our Lady of Guadalupe Monastery is in Silver City. The Franciscans’ Poor Clare Nuns is in Roswell. All have websites.
Dar al Islam, founded in 1979 across the valley from Abiquiu, just calls itself “a non-profit organization.” The mission is “to present Islam to all peoples of North America.” The website, daralislam.org, may offer an answer to what is beyond cultures and landscape. It says the location is “among the most pristine and tranquil spaces in all of North America.”
The Lama Foundation near San Cristobal, which is up the road north from Questa, isn’t exactly a religious community, but it is “a landmark for spiritual renewal and discovery,” says lamafoundation.org. It “embraces all spiritual traditions.”
Lama is famous for the book “Be Here Now,” which tells the story of Richard Alpert who became Ram Dass.
Hanuman Temple (nkbashram.org), west of the Taos plaza, is called the Neem Karoli Baba Ashram. It celebrates Neem Karoli Baba, “a great Indian saint of the Humalayan lineage.”
Two outlets (if that’s the word) of Sufi Ruhaniat International are in Silver City. Sufism is called Islamic mysticism.
The Presbyterians have operated Ghost Ranch near Abiquiu as an education and retreat center since 1955. O’Keeffe first visited Ghost Ranch in 1934 and bought a house there in 1940.
What was for decades the Glorieta Baptist Assembly near Santa Fe is now a Christian camp operated by Glorieta 2.0.
Still the question remains. What else? A suggestion comes from the Proceedings of the Santa Fe Institute’s First Interplanetary Festival. Also from the Beatles. All you need is love.
© 2019 NEW MEXICO NEWS SERVICES 11/4/19
Businesses already tend to “stakeholders” because it’s the right thing to do
By Harold Morgan
New Mexico Progress
Profit is almost the first responsibility of a business. First is economic performance, which profit measures, management guru Peter Drucker said 45 years ago. “Only business has economic performance as its specific mission,” he said early in his classic, “Management.” That means everyone from home-based individuals to mega-corporations in New York, Chicago, Los Angeles, Silicon Valley, and elsewhere.
In August the Business Roundtable, a club of very large companies, threw what was called new stuff into the responsibility equation when it issued a “New Statement on the Purpose of a Corporation” that was signed by 181 CEOs. From my view the statement—heavily criticized by the right as a copout and lauded by the left—simply wrote down what businesses already do.
These huge companies and their statement do affect New Mexico. A good many (I have no idea how many) operate in the state. McDonald’s is everywhere, often operated by franchises owned by local residents. There are the big banks—Wells Fargo and Bank of America. Exxon Mobil in the Permian Basin. Facebook in Los Lunas. Also, Best Buy, AT&T, ConocoPhillips, Caterpillar, Union Pacific, Target. Plus, we are all customers of the companies, so we can’t ignore what they say.
Extend the concept just a little to include nonprofits and government entities. The concept extension recasts profit to mean having some money left over at the end of the accounting period. We all are bound by accounting systems starting with individual checkbooks and becoming large and complex for the big guys. If the organization doesn’t have any money left over and continues not having any money left over, eventually the organization will run out of money.
Nonprofits, which supposedly have superior moral character, will seek more donors, which amounts to selling stock, except the donors, small ones, anyway, will have no control over the organization. Government organizations will appeal to legislative bodies. If these organizations fail to solve the money availability problem, they will disappear.
The words in the statement are weaselly, gathering all the buzzwords of public dialogue and corporate mission statements: “sustainability” (of course!), “stakeholders,” “diversity,” “inclusion,” “transparency.” Drucker is direct. One of management’s three tasks, he said, is “managing social impacts and social responsibilities.”
The word “profit” does not appear in the statement. This is strange; the corporate big guys of the Business Roundtable are afraid of talking about profit. Yet profit makes possible the taxes paying for government and the philanthropy financing nonprofits.
Businesses cannot not do the things the statement discusses. Here’s an example from a long time ago. A junior employee of an Albuquerque company was found to have walked away from a Los Angeles prison farm. He had to return to jail for a few months. The company kept his job open.
Look around at the activities of New Mexico companies. They maintain street and highway medians. They get a little advertising by posting a sign in the median. Seems a fair exchange to me. Companies support youth athletics. Maybe the company name appears on the back of the jersey. People give time to all sorts of activities.
Smith’s is hardly a New Mexico company; it is part of Kroger, the nation’s largest grocer. But it does local things. My neighborhood Smith’s sometimes collects spare change at the register for charities. Smith’s and others, such as Wal-Mart, provide a spot by the door for Girl Scouts to sell cookies in the early spring.
While a good many of the people in our citizen legislature are retired, others have jobs. The employer figures out how to accommodate the public service. They just do it without any push from Elizabeth Warren, Bernie Sanders or the Business Roundtable.
© 2019 NEW MEXICO NEWS SERVICES 10/21/19
Considering Senate candidates: Toulouse Oliver doesn’t believe female senator, Lujan “beat Trump”
By Harold Morgan
New Mexico Progress
Democrats and Republicans have problems in the 2020 race for the U. S. Senate seat being vacated by Tom Udall. Their respective problems are quite different.
Let’s assume that political races are about the candidate’s ideas and persona, with money as a key variable. A candidate must also have some ego, enough self-regard to do the work.
The idea is to sell the candidate’s ideas and persona to the voters. To have something to sell, a candidate needs an unknown “it,” a quality of magnetism that draws people and lights up a room. The selling requires money.
The further assumption is that voters, being rational, will go with what is known and acceptable, barring an alternative being offered. The source here, as before when considering candidate ideas, is the emails sent asking for money.
Ben Ray Lujan, incumbent congressman from the north, has most of the money, no ideas, and what ought to be one huge liability—copping out of representing his constituents in the Gold King Mine spill.
I have kept 65 Lujan emails since June. Lujan is running against Senate Majority Leader Mitch McConnell and President Trump. Lujan seldom varies. There is no discussion of ideas about the future of America. A few messages condemn Trump’s September rally in Rio Rancho.
Best of all, Lujan says, “I beat Trump in 2018.” At what, I wonder? Did you not know that?
An alternative exists. The other Democratic candidate is Secretary of State Maggie Toulouse Oliver. From what I’ve seen in the media, she seems to offer a reasonable persona. Ideas are another matter. She is a radical.
On Oct. 7, Toulouse proclaimed, “Brand New Congress, the organization that endorsed and backed 30 change-making candidates in 2018, including Representative Alexandria Ocasio-Cortez—has endorsed Maggie’s campaign!... Maggie is the most progressive candidate in this race by far, and she doesn't buckle when it comes to her values.”
A Sept. 30 email said, “We won't back down on demanding action in Washington to solve our most pressing issues.” Not Santa Fe?
The Oct. 6 message was, “Votes like (confirming Brett Kavanaugh to the Supreme Court) have real consequences when not enough women are in a position of power to be heard and to influence our democracy… And that's exactly what happened: Instead of believing women, the United States Senate confirmed Brett Kavanaugh…”
Toulouse Oliver conveniently and hypocritically ignored the 45-minute Senate floor speech by Republican Sen. Susan Collins, of Maine, detailing her vote for Kavanaugh. It came down to “lack of corroborating evidence” for the accusations, Collins said. “But certain fundamentally legal principles about due process, the presumption of innocence, and fairness do bear on my thinking, and I cannot abandon them,” she said.
The two Republicans in the race, Mick Rich and Gavin Clarkson, are unknown. Before considering candidate ideas, voters must have some sense of the candidate. Voters get that sense from the candidate communicating with them, which requires money – a lot of it, maybe a million dollars, maybe much more. The spending must happen well before the election—that means this year—in order to allow to move to talking about candidate ideas.
The two Republicans are not spending the communications money. They lack the money to spend, both having raised just a few hundred thousand dollars as of Sept. 30, according to the Federal Election Commission.
I assume these two men are sincere and want to be taken seriously. Another candidate motivator exists. Candidates, however frivolous, are indeed taken seriously. After all, one of those guys might be our United States Senator. That seriousness feels good. It brings a glow of importance.