Ever More Open Society - Except in Government

We live in the information age.  A quick web search, and you can find information about almost anything.  Overall, I think this is a good thing.  In my mind knowledge is power.  The ability to learn and find answers quickly makes overcoming some previously insurmountable challenges surmountable.

Yet, there is one place in our society where open sharing of information is seemingly going in the wrong direction. Ironically, this place is called the "public sector."

New Mexico’s Open Meetings Act is meant to help ensure public involvement and to prevent backroom deals in state and local government, but violations of the law are widespread, an investigation by The Independent has found. School boards, universities, town councils, county and state commissions, and boards across the state have broken the law, casting a shroud of secrecy over government officials’ deliberations and bargaining.

Violating the Open Meetings law can contribute to a culture of political secrecy and corruption, Foundation for Open Government Executive Director Sarah Welsh told The Independent. It also raises questions about the legality of decisions reached based on issues discussed during illegally convened closed sessions.

And, it's not just the violation of open meetings that is troublesome:

The New Mexico Foundation for Open Government says a state agency violated the Inspection of Public Records Act when it redacted information from public documents before giving them to Republican gubernatorial candidate Allen Weh.

Now it appears the Department of Finance and Administration (DFA) is in the process of correcting that violation.

Sarah Welsh, the sunshine group’s executive director, recently made her own request for some of the public records DFA had provided to Weh with redactions. The agency provided the records to Welsh without redactions, which allowed her to see that DFA had inappropriately blacked out routine information – such as handwritten notations of account numbers or notes such as “OK to pay” – before providing the documents to Weh.

“They provided different information to me and to the Weh campaign, which is not the way it’s supposed to work,” Welsh said.

Story after story have shown that increasingly all levels of public government feel free to act with impunity in keeping the public in the dark:

Attorney General Gary King is accusing Gov. Bill Richardson of violating the state open-records act by withholding the names of those in the 59 political jobs Richardson said he eliminated.

"It seems implausible that your office would make a formal announcement (about the layoffs) when it had no set of records to support its numerical assertion," Chief Deputy Attorney General Albert Lama wrote in an opinion this week. "It creates the impression that some staff member in the Governor's Office possesses, contrary to your response letter's assertions, records pertaining to the 59 exempt employees ...

At some point, the voters are going to say enough is enough.  And, it's increasingly looking like that point may occur this November.

Why Some Businesses Supports Indirect Taxes

The day after we filed to pay our income tax (direct taxes) and in reflection of the "across the board" tax increases (indirect taxes) that were pushed and past this last legislative session, it is good to reflect on why some business groups might have pushed for these widespread tax increases.

After I wrote yesterday's post, I read a selection from From Out of Step: The Autobiography of an Individualist, by Frank Chodorov; The Devin-Adair Company, New York, 1962, pp. 216-239 entitled Taxation is Robbery.  It is definitely worth reading, and I thought I would draw your attention to this piece in particular:

Tacit support for indirect taxation arises from another byproduct. Where a considerable outlay in taxes is a prerequisite for engaging in a business, large accumulations of capital have a distinct competitive advantage, and these capitalists could hardly be expected to advocate a lowering of the taxes. Any farmer can make whiskey, and many of them do; but the necessary investment in revenue stamps and various license fees makes the opening of a distillery and the organizing of distributive agencies a business only for large capital. Taxation has forced the individually-owned and congenial grog-shop to give way to the palatial bar under mortgage to the brewery or distillery. Likewise, the manufacture of cigarettes is concentrated in the hands of a few giant corporations by the help of our tax system; nearly three-quarters of the retail price of a package of cigarettes represents an outlay in taxes. It would be strange indeed if these interests were to voice opposition to such indirect taxes (which they never do) and the uninformed, inarticulate and unorganized consumer is forced to pay the higher price resulting from limited competition.

I know I'm on a big versus small kick that might seem to be getting old to some, but I think this theme deserves a lot more attention than the traditional partisan rhetoric. It is the shifting economic paradigm of our times.

The Big Against the Small Continued

I've noted time and time again that a change has occurred in America that is quite unsettling.  The dynamic shift that concerns me is the alignment of big business and big government interests against those of small businesses and individuals. Now, maybe this has always existed, but I don't think so - at least not to the level that is currently evident.

It used to be that government interests (tax collection and regulation) were contrary to the majority of business and individual interests, but this has now changed.  What has emerged is a return to days of old (i.e. landed aristocracy and ruling monarchs indenturing the masses and suppressing entrepreneurship).  Consider that "too big to fail" businesses are now encouraging increased taxation and regulation that will:

1. stifle competition from upstarts with regulatory barriers to entry
2. burden potential challengers with profit draining regulation
3. create new revenue streams by artificially increasing costs of individuals (think cap and trade)

The latest evidence of this trend is the new compliance focus of the IRS:

A new study by the Transactional Records Access Clearinghouse (TRAC) shows that despite a growing federal deficit, IRS audit efforts aimed at the nation's largest corporations have precipitously declined in the last few years and now are at an all time low.

According to Dean Zerbe, alliantgroup National Managing Director and former Tax Counsel on the Senate Finance Committee, "As if April 15th isn't frightening enough for small business owners, now comes news that the IRS has increased audit hours for small and medium businesses by 30% over the last five years, while at the same time decreasing the number of hours spent auditing large corporations by 33%."

Keep in mind, that taxpayer bailouts went to the largest of corporations.  Those same corporations are now reaping the rewards of free money:

For 2009, the Fortune 500 lifted earnings 335%, to $391 billion, a $301 billion jump that's the second largest in the list's 56-year history, approaching the increase in the robust recovery of 2003. 

Yet, this taxpayer investment into corporate profits has nothing to do with creating jobs for Mr. and Mrs. Taxpaying America.  In fact, the opposite has held true:

The number of Americans filing for unemployment insurance for the first time jumped for the second week in a row, according to government data released Thursday.

There were 484,000 initial jobless claims filed in the week ended April 10, up 24,000 from an unrevised 460,000 the previous week, according to the Labor Department's weekly report. 

 And, it's not just jobs that continue to disappear. Those losing their homes also continues to increase:

In the first three months of 2010 foreclosure filings rose 7%, to more than 930,000, compared with the previous quarter, according to the online foreclosure marketing firm RealtyTrac. That is a 16% jump over the first three months of 2009.

Foreclosures started off the first quarter with modest gains but spiked in March to a record 367,000 filings. Plus, nearly 258,000 of those filings were for bank repossessions, the highest quarterly total RealtyTrac has ever reported.

This is not good for America.

Another Thought on the Size of Government

More often than not, the discussion of bigger versus smaller government comes down to arguments around:

1. paying more or less in taxes
2. individual rights versus the greater good

I'm just as guilty as everyone else for minimizing the discussion to these points.  However, something I read this weekend reminded me that what often gets lost in the discussion is that the argument for smaller government is really about individual responsibility.  I have touched on it before - especially as it relates to parenting and education. But, it's worth revisiting again.

I believe that the vast majority of people in this world are good.  I believe that given the opportunity to do what's right and just,  most people will do the right thing. If they see somebody in need, they will lend a helping hand, not because they are required to by law, but because it's the right thing to do.

Of course, this isn't just something I believe, it is something I see re-affirmed everyday. I see it every week when adult volunteers step up to coach community children in various sports or help out in classrooms. I see it when I look at the good works done by various religious and social organizations. I see it when people write checks to support the needs of the homeless, the hungry or special needs children along with many other very worthwhile causes.

Unfortunately, one of the problems with continually growing the size of government is that it erodes this sense of individual responsibility to provide solutions to the challenges facing our communities.  If we continually increase taxes to take care of everything, it is not long before we as individuals no longer feel personal responsibility to be part of the solution.  Instead, we begin to feel that we've paid our taxes to support [fill-in the blank], so our part is done.

However, the reality of the situation is that in a great many cases, the government solution to solving the same problem is inefficient and overly bureaucratic.  Primarily, this occurs because whenever government is involved in providing a solution the one thing that is guaranteed to follow is regulation upon regulation mandating "how to do it right." Those mandates lead to investment in compliance as opposed to solving the problem at hand. Interestingly enough, when it comes to compliance, most people will seek to do the minimum required.  Yet, ask those same people to volunteer to solve a problem, and they will work on it until it is done.

So, back to what triggered this post. Former Congresswoman Heather Wilson posted a recent speech on her Facebook wall that she gave at the Air Force Academy, which included the following statement:

In my experience in the Congress, it seemed to me there were two kinds of people in public life: those who want to be somebody and those who want to do something. 

I'd argue that this doesn't just apply to those in Congress. It extends to everyone. Being somebody is easy, and in the grand scheme of things, meaningless.  Andy Warhol noted, "In the future everybody will be world-famous for 15 minutes." Now, there is some fame (i.e. being somebody) that lasts more than fifteen minutes, but despite the duration, if it is not coupled with doing something, it is equally meaningless.

Getting elected to public office, transforms you overnight from "nobody" to "somebody." The same is true for a professional athlete or movie star.  But, "being somebody" is fleeting. Once you're gone, your fame is irrelevant. Sure, there are those whose legacy continues beyond their life, but it is not because they were somebody as much as they did something - made a contribution to society that impacted people's lives.

Larger and larger government removes the motivation to truly do something and make a contribution. It shifts the drive to do something from the people to the government.  It attempts to rob us all of the pleasure and satisfaction of individually making a lasting contribution. In history, every "great" society that has gone down this path has ultimately collapsed to a shell of it's former self. It's time for the pendulum in this country to shift back to acknowledging the value of the individual before it's too late.

Compliance Trumps Jobs as Governmental Priority

There is well reasoned analysis out there that the high unemployment numbers we are currently experiencing might be with us for some time:

The unemployment rate hit 10 percent in October, and there are good reasons to believe that by 2011, 2012, even 2014, it will have declined only a little. Late last year, the average duration of unemployment surpassed six months, the first time that has happened since 1948, when the Bureau of Labor Statistics began tracking that number. As of this writing, for every open job in the U.S., six people are actively looking for work.

All of these figures understate the magnitude of the jobs crisis. The broadest measure of unemployment and underemployment (which includes people who want to work but have stopped actively searching for a job, along with those who want full-time jobs but can find only part-time work) reached 17.4 percent in October, which appears to be the highest figure since the 1930s. And for large swaths of society—young adults, men, minorities—that figure was much higher (among teenagers, for instance, even the narrowest measure of unemployment stood at roughly 27 percent). One recent survey showed that 44 percent of families had experienced a job loss, a reduction in hours, or a pay cut in the past year.

So, it is kind of interesting that federal and some state governments are more interested in "catching" businesses in a worker misclassification game to fill government coffers than making sure that people can work and feed their families.

President Barack Obama's proposed 2011 budget suggests tough times ahead for employers who rely heavily on independent contractors in order to keep down labor costs.

If the budget is approved, the Internal Revenue Service will add 100 new enforcement personnel as part of a $25 million plan to crack down the misclassification of workers as independent contractors.

When you consider that 50 percent of jobs created during the economic recovery are contingent labor, you quickly see that a Catch-22 situation is unfolding.

Of course, many of the businesses that are able to survive the recession are also smart enough to quickly assess the forthcoming penalties and make employment decisions based on those pending government regulations.  Those decisions will be in the best interest of the business and its current employees, but will do nothing to put out of work Americans back to work:

And our associates voted to schedule 50-hour workweeks rather than hire new associates — even if it means working five 10-hour days or maybe even working on Saturdays when needed. We’re just not going to hire right now because we don’t know what’s coming next. We hope something will be made clearer in the next 90 days as our country focuses on what is necessary to create jobs in America. Then we can re-evaluate our decision.

Put yourselves in the shoes of the tens of millions of Americans struggling to keep their families fed and housed.  Now, think what this crackdown will mean to them.  Instead of earning a living, they will be forced to remain on the public dole or worse, so that tax collectors can go after those that are trying their hardest to survive.

Elect Officials Fail New Mexico

When the Legislature meets during the 30 day session, the constitutional mandate is clear:

B. Every regular session of the legislature convening during an even-numbered year shall consider only the following:

  (1) budgets, appropriations and revenue bills;

  (2) bills drawn pursuant to special messages of the governor; and

  (3) bills of the last previous regular session vetoed by the governor.

(As amended November 5, 1940, November 5, 1946, and November 3, 1964.)

Yet, despite this clarity of purpose, they adjourned the session without passing a budget:

The 30-day legislative session sputtered to a stop with no agreement on a budget or tax hikes, ensuring a special session that Gov. Bill Richardson said will begin Wednesday. 

Addressing the budget deficit was the singular most important item this session, but instead of focusing on the topic at hand, hundreds of other bills were introduced.  Which means during a time of budgetary crisis, the Governor will be calling the legislature into a special session at an extra cost to working families of $50,000 per day. Almost as offensive as the failure to get the job done because of a lack of focus, is the promise to once again introduce of legislation of no pressing consequence:

The special session would be devoted almost exclusively to budget matters, with perhaps "another item or two" on the agenda, according to the governor.  

You waste our money during the legislative session by refusing to focus on the singular topic of importance, and now you promise to do the same in a special session. Anyone who is elected, or seeking elected office, and does not take issue with this, does not deserve to hold elected office.

Denish-Come-Lately

Denish-Come-Lately

Noun

Singular Denish-come-lately

Plural Denish-come-latelies

Denish-come-lately (plural Denish-come-latelies)

1. (idiomatic) A newcomer; a novice; an upstart. 

 Example in Common Usage:

Considering her complicit silence for seven plus years as Lt. Governor and many more years before that as the Chairman of the Democratic Party, many might consider Diane Denish's election year decision to become an open government advocate something of a Denish-come-lately phenomenon.

It's been more than half a decade, all of which Lt. Governor Diane Denish has occupied the number two seat in one of the most corrupt and backroom dealing administrations this state has ever seen, since I've lamented the fact that how the administration spends taxpayer dollars is done in secrecy.

Now that election season is in full swing, Governor Richardson's number two is trying to reposition herself as a "Champion of Sunshine."  Well, she may be able to fool some folks, but come November the voters are not likely to forget that when it came to letting the sun shine in this scandal plagued administration, Lt. Governor Diane Denish her time hiding in the clouds.

Even as recently as a few months ago, when this administration refused to identify those the 59 administration faithful who were supposedly being cut (probably to hide the fact that some were being moved to other positions), the sound of Lt. Governor Denish's silence was deafening.

Sorry, but being a Denish-Come-Lately to the sunshine brigade is just not going to cut it in November.

It Only Took Three Days

So, who wants to raise our taxes? If you're a legislator in Santa Fe eager to raise taxes on small businesses in New Mexico, raise your hand.  No, better yet, just scribble your name on top of the proposed new tax bill.

Oh, sure I understand how some readers might think that this is a tax on the rich, but that's because they don't understand how most small businesses are set up.  They are usually limited liability companies or sub chapter S corporations.  That means that the profit from their company ends up on their personal income tax filings.

Now with banks being tight on lending (despite bailouts from taxpayers), most profitable small businesses are keeping those retained earnings in their company to keep their doors open and hold onto their key employees. But, that last lifeline is about to be raided by legislators and the administration in Santa Fe because it's easier to force more layoffs in the private sector than to cut unnecessary spending in public sector.

After all, who is going to notice if one more small business is forced to close their doors? Well, the answer is I will, and I sure hope you feel the same.  If you find your legislator's signature on this additional tax on small business, I hope you'll give them a call and ask them to get their priorities straight. If you don't know what your legislator's signature looks like, no problem, you can download this PDF of the entire bill along with the document they signed to kick off the session.

What's Important to Voters

On the national level, elected Democrats just received a wake-up call that their agenda is not our agenda. And, by our, I mean the majority of voting Americans whose number one concern is housing and feeding their families:

Shorn by Massachusetts voters of their pivotal 60th Senate vote and much of their political momentum, the White House and congressional leaders are considering a more modest version of Obama's top legislative priority. It could focus on curbing insurance company practices like denying coverage to sick people and on helping low-earning people and small businesses afford coverage, officials said.

Also fueling the Democratic search for a fresh health care strategy is a conviction by many in the party that it's time for an election-year focus on jobs and the economy, which polls show are easily the public's top concerns.

Of course, they're kind of missing the mark. Jobs and the economy are NOT an election-year focus.  They are an EVERY year focus.  Think about it. If we have a strong economy and jobs, the vast majority of Americans can take care of meeting their own healthcare needs.  I know.  What a concept!

I'll also let you in on a little secret. The more government taxes and regulates, the less likely we're going to see jobs and a strong economy. The bigger government gets, the smaller the private sector gets. 

Don't believe me? Well, look for a state with a really big government footprint. A state like, hmm, well, a state like New Mexico. We've got lots of big government and very little industry.  The result? We've got a very poor populations per capita.  Are we seeing how this works?

Our state legislators would be wise to consider this as they wrangle with how to save all of those "very important" government programs. If we want to see jobs and growth, we need to shrink the size of government.  Of course, the easiest way to do that is stop feeding the beast.  In other words, make do with the revenue we have as opposed to taking away more jobs by increasing taxes even more.

Never Quite Short Enough

Despite the fact that this year's State of the State address by Governor Richardson was billed to be his shortest to date. It still seemed a bit long to me. Then again, I always have a hard time continuing with the speech after the Governor begins spewing nonsense:

New Mexico has always been fiscally responsible.

Unlike Washington, New Mexico cannot run a deficit, nor overspend.

We must have a balanced budget.

And we have balanced the budget every single year.

If New Mexico can't overspend, you have to wonder how we got ourselves into this pickle.  Oh wait, no wondering needed.  I know exactly how we ended up here.  We took one time funds and created recurring expense obligations - one after another after another.  There are the obvious examples like the Rail Runner and the Spaceport, and there are many more not so obvious examples, like continually throw money at education without expecting a single result.

There's been a lot of talk about increasing taxes this session, but the shot heard round the world should serve as a warning to those that prefer tax raising over spending cuts.

Imagine That

I've noted before that there are places that government spending can be cut to provide taxpayers better return on their investment.  Now, the Committee on Government Efficiency has come to the same conclusion:

The Committee on Government Efficiency delivered its report to Gov. Bill Richardson and legislators with recommendations to merge some departments, eliminate certain boards and commissions, saving $129 million overall.

Now, let's see if the Governor and legislators are more committed to finally reigning in spending or continuing to throw our hard earned money away.

Blood in the Water

There must be blood in the water because the sharks are most definitely starting to circle closer and closer:

A records clerk at New Mexico State University is suing past and present state officials and a couple of controversial financial firms in a class-action suit to recapture money lost in questionable investments by the state Educational Retirement Board.

The suit, filed by Donna Hill of Las Cruces, seeks to win back money for 95,000 beneficiaries of the state educators' pension fund.

Hill, in an e-mail Tuesday, referred all questions to one of her lawyers, Jonathan Cuneo of Washington, D.C.

This suit appears to be identical to another suit that has been filed based on the questionable management of funds by the State Investment Council (SIC). Actually, calling the investment practices questionable is probably a bit too kind. Heck, calling them "investments" is in itself a bit of a misnomer:

The tab for bad investments the state made with Chicago-based Vanderbilt Capital just got worse — to the tune of at least another $65 million.
    
The Legislative Finance Committee is now estimating the state lost $155 million in a series of highly leveraged mortgage investments with Vanderbilt, up from earlier estimates of $90 million.
    
On Tuesday, the Senate Finance Committee was told by a private attorney whose client is suing to reclaim the losses that the red ink on the investments could go as high as $200 million.
    
Legislators were not happy .
    
"We've got a budget crisis, an ethics crisis and an investment crisis," said Sen. Cisco McSorley, an Albuquerque Democrat and chairman of the Senate Judiciary Committee. "I don't know if we can deal with all three in a 30-day session."
    
The concern was bipartisan. 

While this news was breaking, our fearless Governor Richardson, Chairman of the SIC, was addressing the Greater Albuquerque Chamber of Commerce (GACC) on his plans to raise taxes by $200 million - just a little more than the amount of taxpayer money the SIC "lost" under the administration's watch. 

Now, for those who might be tempted to argue that the Governor was simply derelict in his duties when it came to oversight of the SIC investment practice, consider this latest finding from an independent third party:

An outside review of the State Investment Council, commissioned after a string of scandals, recommends significantly curtailing the governor's power over the SIC. 

Scandal after scandal is bound to hurt those seeking office in 2010 with deep ties to the administration. After all, how much more can they expect the public to tolerate in the current economy?

On the negative side, said Larry Waldman, senior research scientist at UNM's Business and Economic Research, “The local situation is terrible. Job growth is the lowest it has been since at least World War II. It's worse than most people thought it would be.” He said New Mexico's economy probably won't show signs of recovery until at least the second quarter of this year. 

 Hmm, not exactly the time most rationale people would think to promote regressive taxes, but then again, it's not like this administration has ever really been concerned about the needs of everyday New Mexicans.

Money? What Money? Jobs? What Jobs?

Are you wondering why you can't find new jobs based on New Mexico's investment in roads from federal stimulus money:

A very small percentage of New Mexico's $3.2 billion in stimulus money has been funneled to highway and bridge construction.
    
The state's total allotment includes $302 million for transportation projects, which covers projects ranging from work on airport runways to bus shelters and mass transit systems. Just more than half of the transportation money, more than $169 million, is going to 15 highway and bridge projects, according to the New Mexico Office of Recovery and Reinvestment Web site. 

I can't help but wonder if it has something to do with the fact that Governor Richardson essentially bankrupt the NM DOT with his reckless spending. But, in all fairness to Governor Richardson, even if this had not been the case, you still would find it difficult to find significant employment gains from stimulus money:

An Associated Press analysis of stimulus spending found that it didn't matter if a lot of money was spent on highways or none at all: Local unemployment rates rose and fell regardless. And the stimulus spending only barely helped the beleaguered construction industry, the analysis showed.
    
With the nation's unemployment rate at 10 percent and expected to rise, Obama wants a second stimulus bill from Congress including billions of additional dollars for roads and bridges — projects the president says are "at the heart of our effort to accelerate job growth."

Well, it didn't work the first time, so I guess try, try again.  What the heck, it's only your future earnings they keep spending.

Adding Insult to Injury

Wow, talk about adding insult to injury.  Taxpayers are bilked out of tens of millions while the Richardson Administration was at the helm of the State Investment Council. Now, they are making matters worse by requesting CYA budget increase funds:

The State Investment Council has asked for nearly $6 million in additional money to cover legal expenses associated with the ongoing investment scandal, and a leader in the state Senate is none too happy about it.
        
"It just doesn't make any sense to me," President Pro Tem Tim Jennings, a Roswell Democrat, said Friday. "I'm concerned that everyone is concerned with protecting themselves instead of protecting the public."
        
The State Investment Council wants a $1.7 million budget adjustment and a $4 million supplemental appropriation to cover the legal expenses. Much of the money would go to a San Francisco law firm that is charging up to $950 an hour and can earn up to $5.8 million under a contract that started at $30,000. 

Just to make sure that everyone is on the same page.  We have legislative committees recommending tax increases and 2 percent pay cuts for government workers and teachers while $950 an hour is being spent on San Francisco lawyers. 

Yeah, that makes sense.

When Will We Ever Learn?

Regulation costs money. Regulation upon regulation upon regulation costs lots of money without adding any significant benefit to our society.  In fact, more often than not these additional regulatory burdens lower our quality of life by misdirecting limited resources.

Yet, it seems not a week goes by that some new regulation designed to protect us is passed. We're told our schools are in a budget crisis situation, yet the federal government has put in more regulations that costs schools money in areas that have nothing to do with inproving academics:

Imagine a playground with bark chips instead of sand, curved plastic edges and smooth bolts so no one gets hurt, specialized swing chains and three different play zones for different ages.
    
This is not just someone's imagination. It's a set of federal guidelines that will cost Albuquerque Public Schools about $10 million to meet.
    
The federal guidelines are not mandates per se, but failure to follow them leaves the district vulnerable to lawsuits, said John Dufay, APS maintenance and operations director.
    
He said the most important reason for doing so is student safety, although liability is an issue. Any student injured on a playground that doesn't comply with the guidelines would have an easier case, he said. 

Now, I have two school age children, and don't want to seem them get hurt playing on playgrounds.  But, let's get real here.  Children sometimes get hurt when they play, and there don't exist safety measures that can be put into place to 100% protect children from getting hurt. I can almost guarantee you that even with these proposed playground changes, we will still have kids getting hurt during recess. And, we will still have schools getting sued when children get hurt because we live in a litigious society.

 It's not just regulation supposedly designed to protect children that is misguided. There are other regulatory burdens that basically boil down to more money out of our pocket. 

New pollution controls could be in store for New Mexico as the Obama administration moves to crack down on smog.

Parts of at least four counties — San Juan, Rio Arriba, Doña Ana and Bernalillo — could be out of compliance with the new ground-level ozone standard proposed by the U.S. Environmental Protection Agency.
    
Nationally, the new limits could more than double the number of counties in violation.  

What's going to follow these regulations? Well, let's see:

• increased vehicle emission testing = money out of your pocket
• prohibition on gas lawn mowers = money out of your pocket
• no pump times for filling your vehicle = citizen inconvenience 

Of course, that's just a partial list.  States and municipalities will have 20 years to come up with prohibitions and mandated services to meet these new federal regulations.  Plus, we know that as soon as these regulations are in place, someone will come up with a new stricter regulations will come into play. After all, that's what the government does - come up with new regulation and legislation.

The kicker is that we don't live in a national bubble, so the regulations and associated costs along with reduction in quality of life won't really make a big difference in the end:

"In places like southern Doña Ana County, there's not a lot the state can do," said Mary Uhl, state Air Quality Bureau chief. "There are not a lot of emissions to be reduced. The state will need to work with Texas and Mexico to address that."
    
The tighter standards, though costly to implement, will ultimately save billions in avoided emergency room visits, premature deaths, and missed work and school days, the EPA said. 

That last sentence says it all.  What we're really doing is cost shifting from one expense area to another. We're removing one inconvenience n replacing it with another. We're not improving our lives in any substantial manner.  We're just regulating for the sake of regulating.

Executive Budget Recommendation for Fiscal Year 2011

Governor Bill Richardson's 181-page Executive Budget Recommendation for Fiscal Year 2011 was released yesterday, and I'm having a really hard time making it past page ten:

Governor Richardson believes government must be managed in a fiscally responsible manner, and that every government program must be held accountable to the taxpayers. Throughout his administration Governor Richardson has worked to make sure every tax dollar is spent wisely. He has required state agencies to find efficiencies, streamline existing processes, realign resources as policy priorities change, and collaborate to reduce duplication and bureaucracy.

During his first year in office, the Governor implemented a number of efficiency measures, including eliminating unnecessary contracts, maximizing federal and other revenue, shifting dollars to the classroom, executing strategic purchasing and implementing a statewide performance review that by FY07 resulted in more than $80 million in savings to the citizens of New Mexico. He also stepped up enforcement against tax fraud to collect more back-taxes owed.

The only explanation for the above excerpt actually showing up in print is that the Governor has found money to hire joke writers. After all, there is a lot that can be said about how the Richardson Administration has managed the state, but the words "fiscally responsible" don't belong anywhere in that description.

Let's look at some of the key points being made here.

1. "Every government program must be held accountable to the taxpayers" - When was the last time you heard about a government program being held accountable under the Richardson Administration? The correct response would be never.  The only government programs that have been shutdown for a lack of accountability have come about as a result of external indictments. Heck, even the proposed across the board "3-percent reduction in spending" is a way of avoiding holding individual programs accountable.
    
2. "Throughout his administration Governor Richardson has worked to make sure every tax dollar is spent wisely." - Talk about re-writing history. I'm trying to understand how losing $90 million in an effort to fill the pockets of campaign contributors is considered spending tax dollars wisely.
   
   
3. "He has required state agencies to find efficiencies, streamline existing processes, realign resources as policy priorities change, and collaborate to reduce duplication and bureaucracy." Let's see, hardly a year went by where the Governor did not create new layers of government or dole out high paying government jobs to supporters. How this can be seen as reducing duplication and bureaucracy is anyone's guess.

The rest of his claims are just as ridiculous.  Scanning through the actual line item proposals actually leaves one scratching his head as well. Sure, there are a lot of proposed cuts, but its the proposed increases that just don't make a lot of sense.  For example when considering must haves during a time of economic crisis, consider whether these make the top of your list?

1. 26.2% budget increase for the Athletic Trainers Practice Board
2. 11% budget increase for the Interior Design Board
3. 489% budget increase for the Office of the Natural Resources Trustee
4. 28% budget increase for the Legislature

All I can say is that's an interesting choice of priorities when you're going to be coming after the taxpaying public for even more tax dollars.

Can't Say I Didn't Warn You

While some celebrated the passing of the Christmas Eve health insurance legislation in Congress, sensible folks lamented its passing for a variety of reasons.  First, as I've noted on more than one occasion providing health insurance to most Americans, does nothing to improve access to quality of healthcare for all Americans. Case in point:

The Mayo Clinic, praised by President Barack Obama as a national model for efficient health care, will stop accepting Medicare patients as of tomorrow at one of its primary-care clinics in Arizona, saying the U.S. government pays too little.


More than 3,000 patients eligible for Medicare, the government’s largest health-insurance program, will be forced to pay cash if they want to continue seeing their doctors at a Mayo family clinic in Glendale, northwest of Phoenix, said Michael Yardley, a Mayo spokesman. The decision, which Yardley called a two-year pilot project, won’t affect other Mayo facilities in Arizona, Florida and Minnesota.

Look for more top quality healthcare facilities to follow suit in the coming months and years. And, where will this leave us? Well, like most big expensive government entitlement programs, it will leave us even deeper in debt, and an insolvent program that fails to deliver as promised.  Oh sure, the program won't be a total loss. In fact, for those states whose Senators were into selling their votes, this legislation will prove to be a big win:

New Mexico Sens. Tom Udall and Jeff Bingaman on Wednesday criticized special deals that Democratic leaders struck with some senators to win support for a sweeping Senate health care bill headed for passage today.
    
But the two Democrats said the deals weren't enough to justify voting against a measure they said would benefit New Mexicans.

Senate leaders offered Sen. Ben Nelson, a Nebraska Democrat, 100 percent federal subsidies for new Medicaid beneficiaries added to his state's rolls under the Senate legislation. Other senators wrangled separate financial concessions for their states in exchange for their support for the Senate bill.

Sorry, criticizing the deals after the fact, but voting in a manner that tacitly endorses the deals doesn't really hold water. Pretending this was a win for New Mexicans is a little less than honest:

According to Udall, the Senate health care overhaul would eventually insure 91 percent of New Mexicans, improve rural health care and grant permanent reauthorization of the Indian Health Care Improvement Act, among other things. 

Think about that for a moment. Despite promises that this "landmark legislation" would insure all Americans, in New Mexico, the best outcome will be to insure 91% of New Mexicans... EVENTUALLY.  When this does EVENTUALLY happen, you can't help but wonder how many of the newly insured still won't have access to quality healthcare because they won't be able to find an institution willing to take their insurance.


What a mess.

2010 The Year of the Tax Increase

Every year Governor Richardson gives a name to the upcoming legislative session. Well, if even a small part of the proposals made by Governor Richardson's Budget Balancing Task Force come to pass, the 2010 legislative session will be known as The Year of the Tax Increase. Actually, we should probably make that plural. This 400+ page document has tax upon tax upon tax proposed as the solution to our supposed budget woes.

Some of these tax increases, if passed, would take effect TOMORROW. I kid you not. Proposed income tax increases would begin tomorrow and are designed to take $327,971,000 out of our pockets over the next five years and give it to elected officials to make up for their spending spree over the last seven years. Now, while the economy, at least temporarily, does not seem to be getting worse, it also doesn't seem to be getting any better.  Unemployment numbers are holding steady at levels not seen since the 1940's:

New Mexico's jobless rate remained steady at 7.8 percent in November, the same as the previous month but much higher than the 4.6 percent rate in November 2008.
    
The national unemployment rate in November decreased to 10 percent.
    
The state's labor department, the Department of Workforce Solutions, says the state lost 25,400 jobs over the past year.
    
The department says the decline in the number of jobs is the worst New Mexico has seen in modern times and it will be a number of years until employment reaches pre-recession levels. 

That's right, it will be many more years until we get back to healthy rates of employment and a growing economy.  Yet, for those of you lucky enough to be holding a job, you're going to find yourself, not only working harder because you're doing the work that used to be done by two or more people, but also working for less, because state government is going to be taking hundreds of millions of dollars out of your pocket.


Remember all tax increases are permanent. It's just the nature of the beast. Consider this from the report:

The gross receipts tax was first levied in 1934 (as the emergency school tax) as a temporary measure to keep the schools open; it was made permanent in 1935. The tax applied to almost all business sectors, including services. This contrasted markedly with other early-adopter states, like Mississippi, which taxed only sales of tangible goods. In 1966, the tax was reorganized and renamed as the gross receipts tax.

Government  always uses some sort of "emergency" to rationalize its takings, be they individual freedoms or financial. However, long after the "emergency" has subsided, what was supposed to be a temporary measure becomes permanent.  There are those who think it is time to raise these GRT taxes even higher. Yet, consider that:

The table following the map shows that New Mexico’s average tax rate is the 28th highest out of the 46 states with a sales tax. However, New Mexico ranks fifth highest in terms of sales tax revenue as a percent of personal income, a result of both the relatively low level of personal income in New Mexico and the broad base of New Mexico’s gross receipts tax.

What, fifth highest in terms of sales tax revenue is not high enough? We want to be number one? I really don't see how being at the top of this list would be a good thing. Let me put this in another perspective, total GRT collected from us, the taxpaying public, in 2004 was $2.3 BILLION.  Five years later, the economic crisis has resulted in only $3.2 BILLION taken from our bank accounts.

Wait a second! That's not a decline in GRT.  That's an increase in GRT revenue ! In fact, that's a 38% increase in taxes in collected.  Now, ask yourself, am I making 38% more today than I was five years ago?  If the answer is yes, well, you're lucky. But, the truth is that as a whole we're only making about 22% more today than we were in 2004.  If the government thinks they are in a crisis, then the taxpaying public must be beyond crisis. Yet, they want to raise our taxes even more.

I could go on, but I think you get the point.  State government IS NOT in a revenue crisis situation.  The problem is that spending has been out of step with reality for many years now.  At the very least, we should be cutting expenses back to 2004 levels. If you doubt me, then ask yourself, are my neighbors, family and friends better off today that they were in 2004? I'd be very surprised if you could answer that with a "yes".

If you're the type to make New Year's Resolutions, I've got easy one for you to make.  Resolve to call your legislators and the Governor, assuming you can locate him, and let them know if they like elected office, they will cut spending to bring it in line with our income growth before considering a single additional tax.

Return to Feudal Times

People who work for the government work for us - the taxpayers. Ultimately, we're their bosses. I know, based on some interactions you have with your employees it seems that they conveniently forget this fact.

Be that as it may, it truly works much the same as any business. We, the tax-paying bosses, produce revenue so that they have a job. This goes for everyone who is collecting a government paycheck, from President all the way down to administrative support staff in the smallest municipality in the nation.

Of course, the one biggest difference is that you, the taxpayer, can't immediately fire these employees for poor performance. Imagine how different your last unsatisfactory interaction with a taxpayer paid employee would have been if you could fire those who don't meet your level of expectation. Sure, you're probably thinking, "I can fire the elected ones." But, the thing is that particularly type of firing is a delayed action. The underlying reason the individual is losing their job is not apparent in that type of firing.

It's kind of like housebreaking a dog. If you scold the dog after the fact for eliminating in the home, it will not equate the reprimand with the actual act of relieving itself in the home. For that to happen, you actually have to catch the dog in the act and show your displeasure. Same thing with elected folks on the taxpayer payroll. When they get reprimanded (read: the boot out of the door), they think it has something to do with changes in the political wind. They rarely think it is because of their repeated poor job performance.

Ok, so our system isn't perfect. No news on that front. But, the system we've had in place is still better than any other around the world. Or, at least it had been. There wasn't immediate accountabilty, but until recently there had been some semblance of accountability. For example, until recently, our employees felt obligated to provide us information when we requested. An obligation that is legally mandated.

I said until recently. Now, it appears even that level of accountability is going by the wayside:

Days after a spokesman for Gov. Bill Richardson told a TV reporter that it was “not appropriate or dignified” to identify the 59 political appointees who are losing their jobs, Richardson’s office has formally denied a newspaper reporter’s request for that information.

The Santa Fe New Mexican’s Kate Nash didn’t get much – including anything that identifies the people who are being laid off – in response to her request.

Reporters, who happen to be taxpayers as well, have historically taken the role of internal audit committee for our, the taxpayers, business. In other words, they've looked out for our interests. However, if we allow them to be shut out and denied information about who is or isn't working for us at a given time, then we stop having any sort of control over our government employees and officials. When this happens, those folks no longer work for us as public servants. Instead, we work for them in a manner very reminiscent of feudal fiefdoms in days of old.

I don't know about you, but the idea of becoming a serf is not particularly appealing to me.

Tax Increases Only Inevitable in Governor's Mind

Governor Bill Richardson is all about raising taxes in the upcoming 2010 legislative session. In his mind, a tax increase is inevitable. But, thankfully sounder minds may prevail:

Sen. John Arthur Smith, D-Deming, the Finance Committee chairman, said many lawmakers from rural parts of the state — both Democratic and Republican — remain wary of raising taxes during tough economic times, despite the state's budget deficit.

"There's no guarantee there's going to be revenue enhancements," Smith said Thursday. "I just don't see an overwhelming vote."

Lawmakers already have reduced general fund spending by about $700 million, from $6 billion to about $5.3 billion, because of steady declines in state tax revenues. Some legislators say there's room for more cuts in the state budget, which grew by 50 percent during Richardson's first six years in office.

First, a word of advice to those that oppose tax increases. Let's call them what they are - tax increases. The presumably poll tested and less offensive positioning of tax increases as "revenue enhancements" isn't fooling anyone. The voting public in New Mexico is not as naive as some elected officials would like you to think. If you raise our taxes, we'll know it. And, we'll hold it against you. We get enough "enhancement" junk mail in our inboxes to know political spam when we hear it.

With that said, let's talk about the resistance to cutting the bloated budget - a budget that increased 50% since the current administration took control. Exactly what has this recurring explosion in spending bought us?

• Is your life better today than it was in 2002?
• Are schools performing better than they were in 2002?
• Do you feel safer in your homes today than in 2002?
• Do you feel more optimistic about your future today than you did in 2002?

My guess is that the vast majority of New Mexicans would answer all of these questions with a resounding, "No!" So, let's stop talking about tax increases and let's get back to a time when life was enhanced and government was smaller. It would be a small step back to make a huge step forward.

New Legal Industry Niche Grows

In Monday's post, I noted that a new industry would result while the State tried to hold onto their unconstitutionally imposed property produced lightning tax revenue, and sure enough the lawsuits have started:

The owners of about 30 homes sued the Bernalillo County assessor on Tuesday to recover more than $42,000 in overpaid property taxes — the latest twist in the debate over "tax lightning."

The plaintiffs, 50 in all, argue they paid too much in taxes because of the state's unconstitutional property tax law, which two state district judges have already ruled against.

More litigation could be on the way. Clinton Marrs, the plaintiffs' attorney, said he is working on another suit that would involve about 100 homes.

"This is just the first wave," Marrs said of Tuesday's suit.

So, let's consider this for a moment. Bernalillo County Assessor Karen Montoya indicated that tens of thousands of taxpayers have been unjustly impacted by tax lightning. With just 30 homes suing, the remuneration potentially owed is $42,000. Imagine what it will be when everyone starts suing.

Did I mention that the biggest jump in keyword activity on this site in the last two days came as a result of words associated with tax lightning? Hmm, I've never sold ads on this website, but considering the size of this market, maybe I should make an exception this once and sell a top and side banner ad to a legal firm for the month of December and January at $2500 a pop? After all, tis the season to need a little extra spending money.

Any takers?

Visual Depiction of Unemployment Reality

A reader sent me a link to this visual depiction of our nation's unemployment numbers since January 2007, and it eerily looks like a disease infecting the entire nation.

State Prepared to Fight County Tax Lightning Correction

A law from 2001 put a 3% cap on the amount our property taxes could increase year over year. However, the law allowed the property tax to be reassessed upon sale of the property. The result has been an unconstitutional tax lightening effect. In other words, two neighbors in the same size house could find themselves paying hugely different annual tax bills.

After two judges have found this unequal taxation to be unconstitutional, Bernalillo County Assessor Karen Montoya has opted to do the right thing and put everything back in balance by 2010. But, it appears she is going to get a fight from State Secretary of Taxation Rick Homans:

Rick Homans, secretary of the state Taxation and Revenue Department, said Montoya's decision could have serious consequences.

"A massive rollback in property taxes, as suggested by the county assessor, raises several complex legal questions and has potentially serious fiscal implications that need to be studied more closely in the weeks ahead," he said.

Leave it to a state bureaucrat from the Richardson administration to twist the facts into a new reality. The truth of the matter is that it was the law that was passed in 2001 that raised the complex legal issues. Complex legal issues that impact tens of thousands of voters in Bernalillo County alone. Complex legal issues that have been determined by the courts to be unconstitutional, not once but twice.

Now, it is refreshing to see an elected official like Bernalillo County Assessor Karen Montoya decide to take a corrective course of action on behalf of taxpayers. Compare that action to the current administration's fallback position to delay justice for those unfairly penalized. The Richardson administration would rather push off taking any action, and instead create a new industry and over burden the court system by forcing tens of thousands of taxpayers unjustly impacted by tax lightning to sue for equitable treatment under the law.

Considering that many of those homeowners are probably struggling to keep a roof over their families heads in these times of increasing unemployment and home foreclosures, it is clear that this administration puts protecting their revenue streams ahead of the needs of working New Mexican families.

An Interesting Choice

Listen, I'm the first one to advocate for cutting the explosion of appointed positions from state government. But, with the culture of corruption and fraud that has plagued New Mexico under Governor Bill Richardson's, especially in the arena of investments, this cut leaves you scratching your head:

One employee who got a pink slip said his job probably isn't the kind the Legislature intended to eliminate.

Bruce Kohl, head of the Securities Division at the Regulation and Licensing Department, said he's a recognized expert in his field who has put in 15 years at the division under several governors.

"I think they intended to get rid of political deadwood, not the technical professionals needed to run state government," he said.

"I think the public has the perception that exempts are a bunch of political hacks who can't be touched, but there are some very good people who serve as exempt employees," he said.

Kohl, an attorney, worried more about what's next for the division than his own future. Among other things, the division brings securities fraud cases.

This is right up there with those that were looking to gut the State Auditor's office. There is only one way I think this makes sense. That is if the Governor's office is going to release a statement that says Mr. Kohl was guilty of looking the other way while the Richardson Administration allowed political connections to be used to guide investment contracts that resulted in millions upon millions of dollars in losses for New Mexico taxpayers.

Of course, if the opposite were true, and Mr. Kohl played a role in bringing these practices to light, well, then it sure would appear that the Richardson Administration is going after the good guys. I don't know which it is, but someone's got some explaining to do.

The Bankrupting of America

You know you have a problem when the folks that print the money are spending so much that they are exceeding their own debt ceiling:

The Senate began a debate Monday over the future of health care in America that's likely to go on for weeks, but behind the scenes, lawmakers are struggling to resolve an even more explosive issue: how to pay for all their ideas.

Federal budget deficits remain at record highs. The national debt is $12.1 trillion; Congress must vote soon to let it go higher, or else the Treasury won't be able to issue new debt. President Barack Obama is expected to announce today a plan to send an additional 30,000 to 35,000 American troops to Afghanistan, which will require more spending.

If you think healthcare insurance for all is the most important issue facing this country, think again. This forced insurance boondoggle will result in a deterioration of service options and a bankrupting of America. The only good news is that bankruptcy is a time of re-organization. At least that's good news if you think the political leadership of our country needs to be re-organized out. And, by re-organized, I mean shown the door.

Escape From New Mexico Costs $100 Extra

One of the things I've always liked about living in New Mexico is how convenient it is for business travel. I can hop on a plane and get to many of our nation's largest metros within three hours. Well, shortly after the New Year, it looks like it is going to cost me an extra $100 if I want to avoid being quarantined to New Mexico:

"The way it is right now, come Jan. 1st, residents of New Mexico and residents of about 25 other states wouldn't be allowed to board airplanes unless they had a valid passport."

And, why is this?

The biggest issue is that New Mexico gives driver's licenses to foreign nationals and illegal immigrants, which under the new law, would be illegal.

So, because our state government thinks it is important to make New Mexico a sanctuary state for illegal immigrants, I have to pay $100 extra if I want to travel freely in my own country. Yeah, that makes sense. Oh, I know some of you want to blame it on the Bush Administration for pushing the Real ID Law. For the record, I was not a fan of the expansion of a police state then any more than I am now. But, they've been gone for almost a year, so the new administration is just as much to blame for pushing this expansion of government and the resulting new tax on citizens.



And, that is exactly what it is - a new tax. Any time a government decision requires you to fork over more money to comply, it is a new tax. What really irks me is that no one at the state or federal level seems to care that this is going to cost me both a significant amount of time and money:

"Right now it's a game of chicken, between the federal government and the state governments," [New Mexico Taxation and Revenue Secretary Rick] Homans said.

A game of chicken? That's the game where two people in moving vehicles come right at one another and see which one swerves out of the way first, right? Well, it's really easy for state and federal government to play chicken with one another when the taxpayer/traveler is the one driving both cars. Nothing like taxpayer pain for bureaucratic amusement.

So, the states and the feds can't get on the same page to allow law-abiding citizens to travel freely within our national borders. Now, what do you think is going to happen when we have nationalized healthcare?

Duplication is Really Unneccessary

When times are tough, it is important to start taking a hard look at the various government commissions funded by taxpayers and ask, "Do we really need this?" For example, the Albuquerque Journal has an article today announcing that the New Mexico Commission on the Status of Women is helping Clovis area homemakers head back into the work force. How are they doing this?

The commission's Displaced Homemakers office is offering a free workshop called Effective Work Search Skills.

Lorraine Bantista, coordinator of the Displaced Homemakers Office, said the four-part workshop aimed at women will cover self-assessment, types of job search techniques, tapping into the hidden job market and preparing for the interview.

Let's deal with the obvious first. Every single one of these topic areas can be found online with a quick Google search. This is just another example of one of those government agencies that would be politically unpopular to defund, but is absolutely unnecessary. If you don't believe me, take a look around the NM Commission on the Status of Women website, and then tell me with a straight face this is a needed agency. Do you really think a single woman's life in New Mexico is improved by the work of this commission?

Politicians like to play games and talk about putting prisoners on the street, hurting education or letting people starve, but the truth is that until they start cutting these unnecessary commissions and agencies, they have no case to increase taxes.

Taxes Before Responsibility

There's a war brewing for the 2010 Legislative Session. The battle lines have been drawn, and on one side are those that believe government excess should be pared down, and on the other side are those that want to see the tax and spend party to continue by raising even more taxes. The spend, spend, spend people have formed the organization, Better Choices New Mexico, to make their case, which basically boils down to:

This alliance of small businesses, faith-based groups, working families, and nonprofit organizations believes cutting critical services and programs would be a terrible mistake. Instead, the Legislature needs to open the books on tax expenditures, close the loopholes for out-of-state corporations, and rollback the tax breaks for the wealthy.

What's amazing to me is that essentially what they are defending is the spending gone wild policies that have left us in an economic crisis that should not have occurred. Any organization that wants to be taken seriously about seeing better choices in New Mexico had better address the severe mismanagement of taxpayer funds by the state before asking for more money. Their one-pager makes the case over and over again for increasing revenue, but not once does it talk about cutting expenses. The closest it comes is to suggest shifting dollars from one area of waste to another.

And, mind you there is a lot of waste in government spending in this state. There are the obvious signs of waste that are uncovered everyday:

Nemazee and others connected to Carret Asset Management gave campaign contributions to Gov. Bill Richardson before and after receiving the contract, according to the magazine. “The contract with the State Investment Council, which oversees $12 billion in trust funds from oil and gas leasing fees, has so far yielded $1.7 million in fees for Carret,” the author of the article, Nathan Vardi, reports.

Of course, no one wants to take responsibility for this kind of waste:

Richardson’s spokesman says the governor, who is chairman of the New Mexico State Investment Council, played no role whatsoever in the hiring of Carret.

Only in New Mexico could the Chairman get away with full denial of accountability. Then again, this is the same Governor who can hand out multi-million dollar favors like candy on Halloween
without the least bit of economic restraint, no matter how bad out budget situation may be:

I'm positively shocked that Governor Richardson has been a long time friend of the Hool brothers who are behind the Santa Fe Studios. The project, which I wrote about a few months ago, is being subsidized to the tune of $10 million by state taxpayers with taxpayers in Santa Fe County chipping in another $6 million. The whole thing stinks.

Of course, at the same time as he is pushing for additional subsidies for an already-subsidized industry, Richardson is pushing for tax hikes on the rest of us.

Then, there is the wasteful spending that is not so obvious unless you're a government insider:

I am a state employee who is faced with trying to determine where to cut groceries, utilities, Christmas spending...I can accept the furlough...However, I looked at the salaries at executive agencies and must ask how did the agency on aging become a full Department? Military affairs? Where did some of these commissions come from? Do we need them or should we place higher expectations on persons employed in these areas? For example, why isn't the Department of Homeland Security part of the Department of Public Safety?

Why not consolidate programs and eliminate some high salaried executives? Why are we paying outlandish rents for private buildings when there are vacant government buildings? I am not placing the blame on any branch of government, just venting.

Well, someone better start blaming a branch of government. It's called accountability. But, then again, its easier to push for tax increases than to actually try to make a better choices in New Mexico. After all, it's all about our children, right?

Three sport utility vehicles purchased for school administrators from an out-of-state dealer. A $91,000 tow truck. Thousands of dollars for iPods for students. Paying athletes and cheerleaders to pull weeds. Lunches, including a $110 tab at the Rio Chama Steakhouse paid for by federal funds intended for low-income students.

These are just some of the questionable expenditures uncovered by audits of five medium-sized school districts that were discussed Thursday at a meeting of the Legislative Finance Committee. One LFC staffer said these audits "barely scratch the surface" of waste and abuse in some school districts.

Yeah, it's all about the children. Now, you tell me something. Do better choices start with putting more money in state coffers, or does it start by saying enough is enough? Until the people taking and spending our money are held accountable for their fiscal mismanagement, corruption and fraud, I say they don't get to increase taxes by even one tenth of one percent.

New Mexico Experiences Exponential Growth

Usually congressional districts are added to a state after a census. The next census is not until 2010; however, it seems that as a result of some explosive, yet undocumented growth, the number of congressional districts in New Mexico has grown from three to forty [hat tip: New Mexico Watchdog].

Of course, as is evident by the chart below taken from government run recovery.gov, many of these new congressional districts are still waiting for their stimulus money.





But, it is expected that all eyes will be on New Mexico's 22nd Congressional District (once it can be located), which was able to turn less than $62,000 in Recovery Act funds into an amazing 25 new jobs. The cost of living in this particular district must be incredibly low as that amounts to a $2,480 salary per new job created.

Comparing the number of jobs created in New Mexico's 22nd Congressional District with the 15.8 jobs created in the state's 35th Congressional District for a whopping $8.9 million is the cause of more than one raised eyebrow. Rumors of political favoritism abound, but as of the writing of this post the congressional representatives from these districts could not be found for comment.

Now, for those of you who think this is no more than a programming glitch, please keep in mind this is a state of the art website built with no expense spared:

A Maryland-based IT firm that specializes in defense contracts was awarded the federal contract to build Recovery.gov, the government site meant to make stimulus spending transparent. The bill to taxpayers for this Web site will be $9.5 million in the next six months.

To put that in perspective, consider USASpending.gov, the Web site created by the Coburn-Obama Act of 2006 that tracks all federal contracts and grants. The government purchased the software for that site for $600,000 from nonprofit watchdog OMB Watch, which had developed the software for itself outside the federal procurement system.

Or, consider the many spending transparency Web sites that state governments have recently created. The most expensive of these is that of Texas, which cost $300,000 to develop. Most states spend less than $100,000 on transparency sites.

Maybe I'm not being fair. Maybe it was just a clerical error. Well, if they can't keep track of the money flowing into New Mexico, just how well do you think they tracked the trillion plus flowing into the rest of the nation.

Everybody starting to understand why unemployment numbers keep rising despite government "stimulus" spending.

Veteran's Day Thoughts

There is an interesting interview with Veterans Service Secretary John Garcia over at nmpolitics.net. Secretary Garcia expresses grave concern about the budget cuts that are being incurred by his office and the impact those cuts will have on veterans. A very appropriately timed message for Veterans Day. But, this is what got me thinking:

Garcia said when he took over the department, which was elevated to a cabinet level post in 2004 and has 17 field offices, its budget was less than $2 million. After administrative expenses, including salaries for 20 accredited and certified veteran service officers, there was$200,000 left for veterans, or $1 per vet. That budget has since quadrupled, but he said it still only provides $4 per veteran.

Think about that for a minute. A state agency budget that went from $1.6 million to $6.4 million in five years. Based on what is noted above, administrative expenses and salaries accounted for approximately $1.4 million five years ago. Now, administrative expenses and salaries account for $5.6 million; whereas the direct benefit to veterans has only gone from $200,000 t0 $800,000.

That's what the numbers tell us. That's not the story Secretary Garcia is focusing on. No, he is appealing to our sense of patriotism and playing on our emotions to help protect the administrative expenses and salaries of his department. Now, mind you, I think he believes in what he is preaching. The problem is from the belly of the tax-spending beast his perception of reality is distorted.

Secretary Garcia talks about the challenges of reaching a new generation of veterans:

“With the recent war in Iraq and Afghanistan I’ve got an influx of new veterans — a new generation of veterans — and it’s tough to find them,” Garcia said. “Veterans just don’t walk into our office and say, ‘I want my benefits.’ We’ve got to find them. I don’t want them to wait 30 years, like I did and many Vietnam vets did. We have to be very proactive and do our outreach of services.”

Okay, so if the new generation of veterans don't just walk into their offices, why are they paying expenses for 17 field offices? Does anyone really think that conferences and seminars are the best and most economical means of getting information to a new generation of veterans? If you want to find someone, doesn't it make sense to go where they are to look for them?

But a recent survey from Pace University and the Participatory Media Network shows that only 22 percent of 18- to 24-year-olds use Twitter, while 99 percent have profiles on social networks.

We know where 99 percent of a new generation is located, and guess what, it won't cost millions of dollars in administrative expenses to reach them. Heck, it won't even cost hundreds of thousands of dollars. In fact, give me full control of 25% of the current budget (in other words a 75% budget reduction), and I will guarantee that I can document a doubling of the number of veterans receiving information in less than 12 months time.

Today it is important to recognize and thank all of those who serve and have served our country to fight for our freedom. Spending money on inefficient and bloated bureaucracies in their name is not the way to do it.