As New Mexico slowly stirs from its self- induced Covid coma, it finds itself with the highest unemployment rate in the country.  Surrounding states are bustling with economic activity while New Mexico yawns and stretches after its long and deep sleep. As is always the case, our politicos bemoan our lack of economic diversification and promise to bring jobs and economic development to the state. Their chances of success are most likely doomed.

In the race to attract private business to the state, New Mexico is primarily competing against the five surrounding states of Arizona, Utah, Colorado, Oklahoma and Texas. In category after important category, New Mexico is not even in the same league. Here are just a few examples:

1. all of the surrounding states have better K-12 public education systems. The NM public education system has been ranked worst in the country and shows no sign of improvement;

2. all the surrounding states have better state university systems. Of the seven state universities in NM that grant four- year degrees, only one is ranked in the top five-hundred academically in the U.S. (NMSU, #484);

3. all of the bordering states have lower crime rates. NM is #1 in the country for per capita property crime and #2 for violent crime. Albuquerque is on its way to having one of the highest homicide rates in the country;

4. NM is ranked as the fifth worst run state in the country. None of our neighbors has such a low ranking;

5. NM is not a right to work state (potential workers can’t be required to pay union fees and dues as a condition of employment). All of the surrounding states other than Colorado are right to work states. This is one of the most important criteria that companies wanting to relocate look at. Many private companies won’t consider coming to a non- right to work state, and

6. NM has a diabolical gross receipts tax that taxes the sale of goods and services. We are one of just four states in the country that taxes services by default. Why would a large private services company want to come to NM and pay an additional 7% to 8% in taxes when no such tax is due in neighboring states? Among the six states, NM is the only one that has a sales tax on professional services.

Despite an unattractive and sometimes hostile business environment in NM, a few large private companies do business here without major taxpayer incentives. The oil and natural gas extractive industries come to mind. But a far larger number of large private companies will only come here if bribed with taxpayer dollars to do so. Invariably when there is a newspaper article touting a new company coming to New Mexico, it will be revealed in one of the concluding paragraphs that taxpayer funds are being given to the company. The two prime examples of bribing private businesses with taxpayer money to come here are the film industry and Spaceport. When one takes a close look at the numbers, one sees that the enormous taxpayer expenditures paid have vastly exceeded the economic benefits received.

There will be no fundamental change in New Mexico’s private business climate until there is fundamental political change - and the voters have shown no interest in fundamental political change. The last time that Republicans held a majority in both houses of the state legislature at the same time was 1930 and the last time Republicans held a majority on the state supreme court was in the 1920s.

—Charles Sullivan
Albuquerque, NM