T. Greg Merrion, President Prosperity in New Mexico New Mexico Prosperity Project NAIOP, May 20, 2013.

T. Greg Merrion, President

Prosperity in New Mexico

New Mexico Prosperity ProjectNAIOP, May 20, 2013

DisclaimerMy comments do not necessarily reflect the opinions of my associates, the opinions of my company, or the opinions of any of the organizations I represent. In fact, if I say something really controversial, my comments may not even reflect my own opinions!

Economic Well-being• Improved economic well-being is something most people need — and strive for — or should. The one percent already HAVE prosperity

• Almost everyone has a mental list of ways their lives would be better with more income

• “A rising tide lifts all boats” (President Kennedy, 1963)

What is prosperity ?

Source: Bureau of Economic Analysis, US Commerce Department

PER CAPITA INCOME

Revealing Numbers-1

Colorado ranks 15th in the nation with a per capita income of $44,088

Texas ranks 25th with a per capita income of $41,470

Arizona ranks 41st with a per capita income of $35,979

New Mexico ranks 43rd with a per capita income of $34,575

Colorado Texas Arizona New Mexico

$44,088 $41,470 $35,979 $34,575

What is prosperity ?

“New Mexico took the biggest tumble, down 11 spots to No. 43 as its current economic climate and growth prospects declined relative to the rest of the country last year.” *

Forbes ranks the Best States for Business and Careers using its Scorecard for Business Climates, December, 2012

Revealing Numbers-2

What is prosperity ?

New Mexico tied Kentucky at 36th. CNBC uses 43 measures of competitiveness gathered into ten categories and weighted according to state use in economic development marketing material.

CNBC ranking:

Our performance in two categories pulls down New Mexico’s overall rank – • 46th for education • 47th for business friendliness

Revealing Numbers-3

“Dead Last” - That is New Mexico’s record for job growth over the past three years compared with the other 49 states. The details are not pretty…

• “New Mexico is one of only two states still showing negative jobs growth during the 34-month period.”

• “New Mexico’s nearby states — Colorado, Texas and Utah — have among the best economic growth in the nation.”

Source: Bruce Krasnow of the New Mexican, January 7, 2013

Revealing Numbers-4

1. Massachusetts4. Colorado

7. Utah16. Arizona

22. New Mexico

Also note that in the Human Capital Category…• NM is last (50th) in percentage of households with computers • NM is 45th in recent degrees in science and engineering per 1,000

civilian workers

Milken Institute State Science and Technology Index 2012 Overall Ranking

Revealing Numbers-5

WHY is New Mexico not doing so well?

• Enduring, deeply rooted limitations - We need cooperative efforts and strategy rather than “the blame game.”• Relatively fewer robust N.M. businesses compared to other states (small private sector compared with government)

• Some decline and more to come on major component of our economy — the Federal government.

• A long-standing reputation for . . .

Part One

• Not being business friendly• Too much illogical micro-managing via regulation

(costly to business and not cost-effective for the public’s interest)

Part Two

WHY is New Mexico not doing so well?

• Poor job market is a national, not just a state problem.

Part Three

• Businesses have become more risk-averse. They’re more reluctant to hire.

The reasons: a) Doubts about the recoveryb) Government policies raising labor costs (e.g., the

Affordable Health Care Act’s insurance mandates)c) Unwillingness to pay for trainingd) Fear of squeezed profits

Robert J. Samuelson, The Washington Post, May 5, 2013

WHY is New Mexico not doing so well?

What Can We Do?

1. Streamline regulation — cost-benefit analysis

2. Taxes — fair and competitive and simplified

Part One

3. Improve government efficiency - cut “marbled fat” throughout — not just “across the board”

4. Improve education — career paths, tutoring and home engagement, reduce dropouts

5. Improve infrastructure — not just transportation, but also fiber-optic regional networks

What can we do about this ?

Broaden private-sector engagement in public policy, not just the CEOs, EDs and lobbyists, but inform the tens of thousands of private-sector employees

How do we do this ?

2012 BIPAC Market Research

Employers are most credible source for political infoEmployer-provided info is useful Increased employee awareness & involvement37% visit employer website for political infoEmployee involvement encourages early voting

SLIDE

a) “News and Views” — e-newsletters b) “Voter alerts” — reminders to register, early vote c) Our website: www.newmexicoprosperity.org d) Conduct events e) Brochures and posters for you here today

New Mexico Prosperity Project

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