News from the Session: Fall 2010 Legislative Update

With a new political landscape in New Mexico, the 2011 legislative session will be particularly challenging.  Here are some thoughts about the past election and upcoming issues facing legislators in January.
Very Best Wishes,

Bullet Point Negative campaign ads -- the bane of modern politics

I have never seen a campaign cycle as negative as 2010.  The Supreme Court's unfortunate decision in Citizens United unleashed a flood of misleading commercials which certainly played a large role.  But it also seems that candidates from both parties traded thoughtful debate for slash and burn attacks.

While there is nothing wrong with highlighting disagreements on issues, the politics of personal destruction have gone too far.  One thing is certain, with the amount of mud good people on both sides of the aisle threw at each other, its going to take a lot of hot showers to wash away the rhetoric and move Republicans and Democrats to the governing we so desperately need.

The voters chose to make changes and I respect their decisions.  Our democratic process works when citizens participate and I commend all those who took the time to study the issues and make their voices heard at the polls.

Congratulations to Governor-elect Susana Martinez and the other successful candidates.  I can share from my own experience in 2004 when I first won a seat in the New Mexico state House, that the challenges of serving are very different from the campaign that gets you elected.  The issues that seem so black and white in the thirty-second radio spot or political mailer, have a quick way of morphing into a palate of gray choices, none of which are easy.  Compromise is hard, but in the end it's the central tenet of the system designed by our Founding Fathers.

Bullet Point  New Mexico's budget

The ongoing budget crisis is unlike anything New Mexico has ever seen. After 800 million dollars in recurring cuts the last two years, our current 2011 budget is 5.2 billion and it is still short millions of dollars. And, the revenue shortfall for 2012 is projected to be another 260 million dollars.

For those who argue that a 5.2 billion dollar budget is still too high, I would note that, adjusted for inflation and population growth, this budget is actually lower than the budget in Governor Gary Johnson's last year in office. And, attempts to blame one political party for the fiscal predicament are unfair. During my first four years in office (2004-2008) when state revenues were off the chart, Republicans and Democrats voted together for balanced budgets that increased funding for teachers and health care coverage for our most needy citizens. We also voted together to cut taxes.

Can the government be further streamlined and be made more efficient? Yes. The Government Restructuring Task Force has been meeting for the last five months and I look forward to its recommendations on consolidating agencies and eliminating duplicative and unnecessary boards and commissions.

Can more cuts be made? Yes, but I would contend we have reached the point where any additional cuts have to be carefully targeted and cannot be "across the board." And, there are areas in the budget where further cuts will jeopardize the future of our state and, in some cases, violate constitutional obligations.

The final tool which has to be on the table is new revenues. While the "no new taxes" mantra may be the politically expedient position, history tells us that we need the revenue side of the equation to help get out of this hole.

1987 was the last time New Mexico faced a significant budget shortfall, although the shortfall paled compared to what we face today. Republican and Democratic members of the legislature who served during that time have told me that it was Republican Governor Garrey Carruthers who spearheaded the tax increases that were needed to balance the budget. He worked hand-in-hand with both parties in the legislature to make this a bi-partisan effort. This is the type of leadership we need as we move forward.

Bullet Point Our schools must be sufficiently funded

Public education is our number one economic development tool. Providing a well balanced education that not only offers the basics, but provides art, music and physical education, is an investment that will pay off many times over. Yet, some of my legislative colleagues continue to advocate for more cuts to our schools. This position, in my view, is extremely short sighted and may be unlawful.

The New Mexico Constitution mandates a "uniform system of free public schools sufficient for the education of and open to all children . . ." In 2008, a million dollar "sufficiency study" found that New Mexico is under-funding K-12 education by fifteen percent. Since that time, rather than increase the funding, we continue to cut the education budget.

If a constitutional challenge to education funding were to work its way through the courts, I am sure the overall budget woes would be considered. Even in this environment, however, it's hard to see how the larger classrooms and program cuts that result from under-funding lead to a sufficient education system. Certainly our 49th in the nation education ranking supports the argument that we are not meeting our constitutional obligations.

Kudos to the Governor-elect for her commitment not to cut education funding. It will be interesting to see how she keeps that promise and her pledge not to raise taxes.

Bullet Point Let's recalibrate our tax code and close the corporate tax loophole

One of the easier ways to raise revenues is to sunset tax exemptions and deductions that no longer make sense. Here is a link to a PDF file with the list of exemptions and deductions and a link to a PDF file showing their fiscal impact. These lists outline the range of policy choices available to legislators.

Our tax code is also full of loopholes, none bigger than the corporate tax loophole which lets multi-state corporations avoid taxes paid by their New Mexico competitors. For six years I have carried a bill to end this unfair tax policy. Yet, the bill has never made it out of committee to the floor of either the House or Senate. Perhaps the groundswell of public support this year will overwhelm the corporate lobby that fights this effort at every step.

Finally, at some point in the future we need to reinstate progressivity into our income tax rates. After Governor Bill Richardson's income tax cuts, New Mexico's top income tax rate of 4.9% kicks in for all individuals earning more than $16,000.00 and all couples earning more than $24,000.00. We essentially have a flat tax which means the person making seventeen million dollars a year pays the same rate as the person making seventeen thousand. This is wrong from a tax policy perspective and hurts our kids by taking needed revenues out of schools.

Bullet Point Now is the time to get involved

The democratic process works when people are engaged. Are there ideas I have outlined which you agree with? Ideas you oppose? Your input is critical, so do not hesitate to e-mail, write or call with thoughts and suggestions.

Thank you as always for the opportunity to serve.

Peter Wirth
State Senator
District 25

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