Op-Ed by Raúl Montaño Ayala
Researcher and Scholar
Rio Grande Foundation

Amid New Mexico's boom in oil tax revenues, legislators have contemplated ways to put these surplus funds to work for the Land of Enchantment. During the last session the Legislature grew spending by 11%. They raised taxes, doubled the State’s film subsidy program, and created an outdoor division, among many big-spending ideas. When taken together the 2019 session resulted in a massive expansion of government.

What our State really needs is not more government spending. Instead it needs policies that foster entrepreneurship. What legislators need to do is promote laissez faire, free market policies that allow business to thrive and make our State more attractive to companies and residents and therefore more prosperous.

Jeff Mitchell, of the Bureau of Business and Economic Research at the University of New Mexico, points out that “since the end of the [Great] recession, New Mexico has ranked 48th nationally in the growth of business and professional jobs and 45th in the growth of financial services jobs.” A large financial and entrepreneurial sector is crucial for sustained economic development and growth. Since New Mexico lags severely in both, this profoundly affects our state’s vitality. Yet, nothing in the 2019 session directly addressed these important areas.

Many independent sources rank New Mexico as one of the lowest in the nation for economic freedom and entrepreneurship. The Canadian Fraser Institute, in their annual Economic Freedom of North America report, assessed the economic freedom of metropolitan areas around the U.S. and found a positive correlation between economic freedom and metropolitan prosperity. They assert that “metropolitan areas [and states] with higher economic freedom tend to have higher per capita incomes and faster population growth.” Not to mention lower crime rates, lower unemployment, higher educational attainment, better roads and hospitals and other public goods.

Economic freedom is measured by analyzing government spending, government tax revenue, and employment in government jobs as a percentage of total state employment, all of which translate to the tax burden placed on citizens and businesses, and all of which are debilitatingly high in New Mexico. Fraser's report ranks New Mexico in the fourth quartile (least free) among States with respect to economic freedom, unlike our prosperous neighbors of Arizona, Colorado, and Texas, all in the first quartile as the most free. Again, what was done by the Legislature in 2019 to promote economic freedom? Nothing at all.

A 2017 policy brief from the local Rio Grande Foundation similarly reports that government spending, Gross Receipts Tax rates, and the ratio of government sector to private sector employment is excessive in New Mexico. Even USA Today ranks New Mexico third in the country with the highest percentage of its workforce employed in the government sector at 22.5%. Furthermore, all of these government entities are our state's largest employers and provide our highest-paying jobs. The Legislature in 2019 piled even more spending and government bureaucracy on top of what existed.

Since New Mexico is also the most reliant state on federal dollars, our economy is at the mercy of Washington DC, the decisions of whom would make OUR state's economy among the first to suffer should DC decide to “shut down” or cut us off. This translates to the dire need for us to slash business and property taxes (which actually CAN boost tax revenue) to let our business sector grow and make New Mexico more self-reliant and less dependent on Uncle Sam. Since our economy consists primarily of government entities (Public Schools, State Colleges and Universities, National Labs, and Military bases), we have plenty of work to do.

There are ways in which New Mexico is great for young people like me. We have a booming craft beer industry, unique culture and cuisine, music festivals, and relatively affordable housing. However, amenities and government jobs fueled by oil production are not enough. The ease of business enterprise is key to the prosperity that New Mexico has historically lacked.

Raúl Montaño Ayala is a recent graduate of the University of New Mexico and a policy scholar with New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility.

Live from Silver City

Join GCB Three Times Weekly Updates

Welcome to Three Times Weekly Updates! You will be subscribed to email notifications with links to recently posted articles.
You can unsubscribe anytime. We never share or rent your email to anyone.

Fire Alerts

Editor's Note

Check out Pets to Adopt. The High Desert Humane Society has some new cats and dogs up for adoption.

Those new to providing news releases to the Beat are asked to please check out submission guidelines at https://www.grantcountybeat.com/about/submissions. They are for your information to make life easier on the readers, as well as the editor.

Classifieds: We have changed Classifieds. Check periodically to see if any news ones have popped up. The former software failed us, so it's just a category now, with prices posted. Send your information to editor@grantcountybeat.com and we will post it as soon as we can. Instructions and prices are on the page.

Images: We have received complaints about large images blocking parts of other articles. If you encounter this problem, click on the title of the article you want to read and it will take you to that article's page, which shows only that article without any intruders. It's a software problem, not easily fixable, other than showing fewer articles per summary page. If you are a frequent visitor, you might not mind fewer articles per page, but if you only come once in a while, you likely want to see more articles to browse. Write me at editor@grantcountybeat.com to let me know your feelings on this issue. 

Compliance: Because you are an esteemed member of The Grant County Beat readership, be assured that we at the Beat continue to do everything we can to be in full compliance with GDPR and pertinent US law, so that the information you have chosen to give to us cannot be compromised. 

New Columnists: The Beat continues to bring you new columnists. And check out the old faithfuls who continue to provide content.

The Beat has a column for you gardeners out there. The Grant County Extension Service will bring you monthly columns on gardening issues. The first one posted is on Winterizing your houseplants and patio plants.

The Beat totally appreciates its readers and subscribers!  


All articles and photos indicated by a byline are copyrighted to the author or photographer. You may not use any information found within the articles without asking permission AND giving attribution to the source. Photos can be requested and may incur a nominal fee for use personally or commercially.

NOTE: If an article does not have a byline, it was sent to the Beat and written by someone not affiliated with the Beat

Don't forget to tell advertisers that you saw their ad on the Beat.

Newsletter: If you subscribe to the Join GCB Three Times Weekly Updates option on the left side of this page, you will be subscribed to email notifications with links to recently posted articles.

Here for YOU: Consider the Beat your DAILY newspaper for up-to-date information about Grant County. It's at your fingertips! One Click to Local News.

Feel free to notify editor@grantcountybeat.com, if you notice any technical problems on the site. Your convenience is my desire for the Beat. 

Disclaimer: If you find errors in articles not written by the Beat team but sent to us from other content providers, please contact the writer, not the Beat. For example, obituaries are always provided by the funeral home or a family member.

We can fix errors, but please give details on where the error is so we can find it. News releases from government and non-profit entities are posted generally without change, except for legal notices, which incur a small charge.

Thanks for your support for and your readership of Grant County's online news source—www.grantcountybeat.com