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Wednesday, October 14, 2009
FROM THE PRESIDENT: CHRISTINE TRUJILLO
Lawmakers Must Require Private Sector to Share Pain of Recession

By Christine Trujillo, President, American Federation of Teachers – New Mexico

Over the next week, lawmakers must address the following facts during the special session: The student funding unit value cuts ($60 per unit), which they passed last January, have not worked. We’re right back where we started, another budget deficit. This time at least $500 million, maybe more.

Tax revenues continue to decline in New Mexico because Gov. Richardson and lawmakers did something they shouldn’t have done. Last January, they cut public spending and didn"t touch private spending.

As President Obama stated in April, during his Georgetown University speech on the economic collapse, “The last thing government should do in a recession is to cut spending.”

Respected, well-known New Mexico economists recently mailed a letter to Gov. Richardson and legislators which says the same thing -- cutting public spending during a recession only makes our situation worse: higher unemployment, reduced tax revenues and increased demand for disappearing public services.

But, with the private sector’s support, New Mexico lawmakers cut public spending last January by almost $1 billion. They did nothing about the wealthiest New Mexicans who earn $295,000 or more, and out-of-state corporations who aren't sharing the pain of this recession. Both entities continue to get our revenues from tax cuts and tax loopholes.

Our wonderful, underfunded education system, as well as other public sector services, have collaborated with private sector representatives. But, we're at an impasse today over the root causes of New Mexico's budget deficits. Lawmakers and the private sector will not cooperate with us.

Nevertheless, AFT New Mexico, which represents 9,000 teachers and educational employees, is out-front with solutions to New Mexico’s economic crisis and budget deficits. Our proposals are much, much better than cutting education and the student values again. Our proposals are supported by thousands of New Mexicans. Our October 9 rally in Santa Fe at the Roundhouse clearly demonstrated overwhelming public support for these proposed solutions. Lawmakers who choose to ignore this support, do so at their own political peril.

First, Gov. Richardson must place the issue of generating additional tax revenues on his call for the Special Session. Then, lawmakers can debate and vote on rolling back tax cuts for the wealthiest New Mexicans. These tax cuts were passed by lawmakers in 2003 when the state treasury was overflowing with surplus revenue. But, times have changed.

It’s time for the richest among us to share the pain of this recession. It’s morally wrong for those who benefit the most from tax cuts to continue to receive largess when there is no largess.

Second, during the October 17 Special Session, lawmakers must debate and vote to close tax loopholes which allow out-of-state corporations to escape paying their fair share of taxes on profits they earn in New Mexico.

New Mexico is one of a few states left which still allow corporations like Wal Mart, Target, Lowe’s, Home Depot, and other big-box chains to report their profits in other states. Often, these states, such as Delaware, don’t levy taxes on corporate profits.

Of course, there's been an increase in state government spending. Especially, when we take into account that Gov. Richardson and conservative Democrats have spent our tax revenues on the wealthiest New Mexicans and out-of-state corporations.

Last March, I took a group of Northern New Mexico College faculty and maintenance employees to the Governor’s Office. We asked him to roll back tax cuts for the wealthiest and close corporate tax loopholes. His spokesperson, Gilbert Gallegos said, “We won't touch those tax cuts, they’re worth $1 billion a year. They’re using the money to create jobs.” Gallegos was quoted in the Rio Grande Sun.

Using the money to create jobs? Really? Let’s do the math --- $1 billion a year since 2004 equals $6 billion for economic development and job creation. But, where are the jobs?

In one month, New Mexico’s unemployed increased from 27,000 to 31,000. We have the highest unemployment numbers since 1944. If the wealthiest among us, and out-of-state corporations used this money to create jobs, it didn't work. Now, some lawmakers want to layoff more employees? No way.

Public school children and students could use that $1 billion in tax breaks. They need more teachers, education assistants, secretaries, clerks, custodians, maintenance workers, cooks and bus drivers. They need more text books, computers and classroom materials. I could go on for days about the unfunded needs of New Mexico's public schools.

AFT New Mexico isn't asking Gov. Richardson and legislators to do something which hasn’t been tried before, something which isn't working in other states. There are plenty of states where lawmakers have successfully reversed course, produced much-needed revenues, invested those revenues in school children and public services, and created more jobs.

Arizona, Colorado, Alabama, Georgia, just to name a few, recently rolled back tax cuts granted to the richest during better times. They also closed corporate tax loopholes. These actions prevent cuts in education spending, stimulate consumer spending, and help the economy recover faster.

Of course, New Mexico needs long-term solutions to the issue of declining revenues. AFT New Mexico's proposals for October 17 action are the tip of the iceberg. But, our lawmakers must get started now.

Unfortunately, Sens. Tim Jennings and John A. Smith, as well as Reps. Ben Lujan, Kiki Saavedra, Lucky Varela, Ken Martinez, Rick Miera and Jeanette Wallace say they have no choice but to cut education spending again. They propose lawmakers vote on October 17 to cut the student value again, this time by 3.5%. They also propose to cut teacher and education employee pay by 2.5%. These proposals are completely unacceptable, and the wrong thing to do. It bears repeating: they passed education cuts in January. It didn't work then, it won't work now.

New Mexico’s school children can't stand another cut to their educational value. Education employees can't stand more pay cuts or layoffs. New Mexico's economy can't stand another public spending cut.

Instead of cutting education, our elected lawmakers can and should be more creative and do something different. They have better choices. This time, they can cut private spending by rolling back tax cuts for the wealthiest New Mexicans and closing corporate tax loopholes. Otherwise, New Mexicans will look to legislative candidates in November 2010 who will not hesitate to get the job done, and get it done right.