Santa Fe Business Owners Hurting Over Minimum Wage

Most economists worth their salt oppose government wage mandates for the simple fact that politicians have much less knowledge about what a "fair" wage is than do employers and workers making decisions in a free economy. Santa Fe's "chickens" of government-mandated wage inflation are now coming home to roost. In fact, business owners in the City Different are organizing to make a last stand against the 30-cent increase in the wage which is set to take effect at the end of January.

Business owners say that raising the wage in a strong economy is one thing, but with economic growth slowing dramatically generating increased unemployment and mainstream economists concerned about deflation, a free market would see wages shrink, thus naturally sucking marginal workers into the employment market albeit at marginally lower wages. Unfortunately, mandated wage rates disproportionately harms teens and low-skilled workers.

Santa Fe made a mistake in mandating wage rates that are far above market levels. Unfortunately, business owners and marginal workers will be the ones feeling the pain.

Bailout the Schools???

Everyone wants a bailout these days. Once Congress and the Bush Administration made the misguided decision of bailout out AIG and the banking industry, every other industry -- not to mention governments and individuals -- decided that they deserved some money from the federal government.

In yesterday's Albuquerque Journal, Christine Trujillo
President, American Federation of Teachers-N.M, made the case for a government "bailout" of education. While I couldn't disagree more with her overall point, the truth is that she makes no factual argument for the "bailout." Rather, she makes some pointless statements about societal changes that she argues make educating children next to impossible.

The biggest red-herring is that education suffers from inadequate spending. This is the argument some are making for a major gross receipts tax hike for additional education spending, even in these tough economic times. As Dr. Harry Messenheimer has pointed out, education spending per-capita has increased dramatically in recent years. Check page 6 of this study.

There is no need to bail out education with a tax hike of any kind. Instead, like the Big 3 automakers, education will be forced to improve and become more efficient with competition and by giving consumers greater freedom of choice.

We're Against Everything...

At least that is what the folks over at the blog Urban ABQ believe. Apparently, we're also intellectually lazy. But is it true?

Yes, we at the Rio Grande Foundation oppose the taxpayer-financed Albuquerque streetcar, the taxpayer-financed Rail Runner, and the taxpayer-financed Albuquerque arena. But does that mean we oppose "everything?" I believe the evidence points elsewhere.

For example, we support the Heritage Marketplace development which has been killed by the City of Albuquerque. Also, we'd support the parishioners at St. Francis Xavier Catholic Church who were outlined on the front page of today's Albuquerque Journal. It turns out that the churchgoers would like to cook home-made food (tamales, menudo and homemade goodies like bread pudding and bizcochitosfor), but the City health regulators are forcing them to buy food instead.

The fact is that we at the Rio Grande Foundation support private sector efforts and realize that those who use and abuse government power by forcibly taking other people's hard-earned money via taxation are pushing ideas that would otherwise not garner financial (as opposed to political) support from enough people to be viable.

Rocky Long and the Albuquerque Arena

Lobo football fans awoke this morning to find that their head football coach of the past 11 seasons, Rocky Long, had resigned. While the losing 2008 season was definitely tough on the coach, he made a point of stating that New Mexico football will never flourish until the fans decide to turn out in greater numbers to support the program. What does this have to do with public policy in New Mexico?

Well, Albuquerque's political establishment is considering the construction of a brand new taxpayer-financed arena in downtown Albuquerque. Possible anchor tenants include an arena football team and a WNBA franchise. While studies are done with an eye towards justifying the expenditure, despite difficult economic times, the real question is "If you build it, will they come?" After all, Lobo Football is a Division I, "major league" product. If fans won't support them, will they support women's professional basketball?

The record is mixed. Fans turn out for the Isotopes and Lobo basketball, but not for the Thunderbirds minor league basketball, not for Lobo Football (at least not enough to make the team as successful as its /">Mountain West peers, and not for the Scorpions hockey team.

It is hard to say what makes the teams that succeed do so and why other teams lack fan support, but I don't trust our City Council and Mayor to spend a bunch of our money to figure it out, do you?

RGF President (and others) Discuss Global Warming Science, Policy

Recently, I appeared on a special on Channel 4 called "The Climate Case" to discuss global warming and what, if anything, should be done about it. The show lasts 30 minutes and can be found below:

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Also, if the current fiscal crisis has any silver lining it is that Congress, according to New Mexico Sen. Jeff Bingaman, Chairman of the Energy Committee, says that Congress will not act until 2010 on global warming legislation. At least Congress recognizes that the American people view purported climate change as far less of a problem than the economy. Of course, whether government at any level has the right solutions is an even better question.

Eliminating Taxpayer-Financed Tax Grabs

Regardless of how you feel about the results of the recent election, it would seem that taxpayers of all stripes should be concerned that government officials are able to tilt the balance of ballot elections by using tax money to advertise on behalf of those ballot measures. Opponents of higher taxes, like the Rio Grande Foundation, must rely on donated funds and are given no free resources or media platform to argue against these tax hikes and bond measures.

I wrote about this problem in this week's edition of The Taos News.

$4.5 million for Moriarty Racino Infrastructure?

According to KOAT TV:

The Albuquerque Downs are moving to Moriarty, and the city's major hopes extra funding will come with it.

Mayor Adan Encinias is asking the state for $4.5 million to help cover infrastructure costs for the new racino. Plans for the track are complete, and this is the only issue standing in the way of breaking ground. The Downs president hopes to begin racing by the summer of 2010.

While I am completely agnostic as to whether or not the Downs should move, I find it hard to believe that Moriarty deserves $4.5 million of our tax dollars for the privilege of hosting the Downs. After all, isn't state-sanctioned legalized gambling and horse racing supposed to be an economic boon for the area?

Rather than asking taxpayers in the rest of New Mexico to foot the bill for Moriarty's infrastructure, perhaps they could leverage some of those future tax revenues in the form of bonds in order to pay for the needed roads etc. In the best of economic times, Moriarty's case for $4.5 million of our tax dollars would be on shaky footing at best. In current, tough times when cutbacks are being made across the state, Moriarty should be asked to come up with something a bit more creative than fleecing the rest of us for their Racino.

Privatize the Sunport?

It is no secret that cities all over the country including our own Albuquerque are facing mounting budgetary problems. Chicago just received $2.5 billion in exchange for leasing the airport to a private company. Once debt is paid off, Chicago is expected to receive $1 billion from the privatization.

Albuquerque's Sunport is owned by the City of Albuquerque and receives taxpayer funding. There is no doubt, however, that a private, profit-making company could do a better job while also providing resources in the form of lease payments to the City. With impending belt-tightening including recent cuts of $15 million, Albuquerque's elected leadership should consider painless ways to access needed funding.

The win-win for taxpayers is that they get a better-run airport and save money at the same time.