Will He Run?
Will our governor run for president in 2008? Robert Novak has learned he probably will:
Democratic insiders have raised from “possible” to “probable” the prospect of presidential candidacies in 2008 by New Mexico Gov. Bill Richardson and Sen. Joseph Biden of Delaware.
Richardson has said he will await his 2006 re-election campaign in New Mexico before making a presidential decision. But party insiders say now he is preparing the groundwork for a national campaign, assuming that his second term as governor is likely. Richardson is a former member of Congress, U.S. ambassador to the United Nations and secretary of energy.
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Bird Flu Pandemic?
Here is an interesting perspective on the prospect of a bird flu pandemic. I did not know that the bird flu has been around since at least 1959 and has yet to mutate. Did you?
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State Treasurer Scandal
Would you like to know how to easily reduce the likelihood of future scandals? See our research director’s recommended reforms here.
The problem is not merely some sticky fingered officials, but rather the way the operation ignores some obvious lessons of economics. Incentives really do matter.
Check it out.
Economics of the “Windfall Profits Tax”
Good economic evaluation by Professor Henderson of so-called “windfall” tax here, including why it is unjust. Check it out.
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Economic Illiteracy in the Capitol
According to the Albuquerque Journal today (subscription) New Mexico’s two senators are not in favor of implementing a “windfall” profits tax on oil companies. This is good news. Our senators are not joining the illiteracy stampede.
I nonetheless sent them both a letter today. Here it is:
Dear Senator
I encourage you not to make matters worse for oil and gasoline consumers by imposing a “windfall” profits tax on oil production. I am a consumer of gasoline; and I am as unhappy as anyone else about higher prices. But a windfall profits tax would make me unhappier, since it would insure that oil and gasoline prices would be higher than without such a tax. The reason: it would undermine the roll of profits in that sector of our market economy.
Seeking profits (and avoiding losses) is what drives all sectors of our prosperous economy; and it is why we are prosperous. When we see rising profits we can be sure that more resources will be devoted to the profit generating activity. It may come about a bit slower in the case of oil and gasoline (compared, say, to Microsoft) because of the difficulties of bringing new wells into production or of building and expanding refineries. The high prices associated with high profits should be viewed as our friend. This friend encourages economizing on the part of buyers and more production on the part of sellers. That is just what we want to reduce the scarcity of oil and gasoline and what we cannot accomplish with windfall profits taxes and price gouging laws. Unfortunately we seem to forget how bad the results were when government last felt it had to do something about prices. The roll of price in making good things happen in a market economy seems to be universally misunderstood by the public; and I am always amazed by the vilification of profits.
Profits have recently been analyzed and compared by my good friends at the Tax Foundation. They have found that oil companies’ profits may be a little higher than their long-term average; but those profits are not unreasonable compared to other industries. They have a good point that helps put recent energy trends in perspective; but that point tends to deflect attention from the crucial roll of profits (and prices) in guiding the behavior of buyers and sellers in energy (or any other) markets.
There is a change in energy policy that would be helpful. It seems to me that you could strike a better balance between benefits and costs when it comes to regulation. Why not allow the building of new refineries? Why not allow transportation of gasoline between geographic areas of the country? Why not relax restrictions on drilling and exploration for oil? All of these actions would reduce the costs and risks for producers, benefiting us all.
Sincerely,
Harry Messenheimer, Ph.D.
President and Co-Founder, Rio Grande Foundation
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Education Bureaucrats Left Behind
Good for Utah!
We’re Back!
Our site has been down for most of the last two weeks so that we could install some updates. Also, we have a new webmaster.
Thanks to Wayne Klick for the improvements he has made over the last 3 years. He has been responsible for the RGF website; and he helped launch our blog some 18 months ago. We wish Wayne well in his new endeavors in Lawrence, Kansas.
More on Government Gouging in Action
I have posted here, here and here about the counterproductive effects of price gouging laws.
Have you heard about the awful gas lines in Florida following Hurricane Wilma? Were you able to figure out what the problem was? Think about it before you read Russell Robert’s explanation here. Were you able to do better than the news media?
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It’s for the Kids in Colorado! Or is it the Teachers’ Union?
Colorado may be losing its effective limits on government growth. Since 1992 the envy of the rest of the country, it now looks like they are falling for the seductive promises of big government. Check out this fine CATO piece that explains what is really going on.
Alas, it looks like November 1st will be a sad day for the prospects of liberty, opportunity and prosperity in Colorado.
How Many Feet before Wishful Thinking Ends?
Answer is here. Hat tip to Robert Lawson for the link.
This BC cartoon would work especially well for NM too. How about bubbles that say “I’m a tax cutting governor,” “education reform will work” and/or “more economic development incentives?” Email me if you have any more suggestions (hmessen@nmia.com).
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