Wednesday, October 26, 2011

Rainy Day

Two former New Mexico republican legislators are bemoaning the overuse of our state's severance tax permanent fund during these tough economic times.  That fund takes oil and gas severance taxes and puts them into a trust fund of sorts whose earnings go to pay off severance tax bonds that are used for public capital projects.  Many people have said this fund was really set up as a "rainy day fund" to be used in hard times.  In some respects that is true.  But, I have to agree with the legislators that the fund is being unduly hit.  Most of the money that is intended to strengthen the fund is being used to pay off more and more bonds approved by a pork barrel approach to projects.

We are not at a point just yet where this fund needs to be invaded in this manner.  Our state's permanent funds, including the Land Office permanent funds, are an envy of most other states.  These funds were visionary at a time when non partizan solutions were sought in the era between statehood and the 1990's.  My old boss democrat Governor Bruce King supported the severance tax measure as did a majority of the legislature.  Where have those times gone?  Dead with the likes of Susana Martinez and the neo cons.

Dead with the shifting of wealth over the last two decades very few control most of the money.  You can see where the wealthy would like things they way they are happening in the Severance tax funds.  If the state spends its savings account then the rich pay less taxes.

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