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Tuesday, June 26, 2012

Back On The Econ Beat: Jobs Famine Still Here; More Fed Cuts In Los Alamos; Mixed Signals On Tourism, Also: Ben Ray Climbs DC Ladder And The Media And Emailgate 

Helen Greene Blumenschein
The value of most New Mexico real estate isn't going anywhere until the jobs train gets back on track. And that is going to be a long, long time. In May 2011, the ABQ metro labor force numbered about 398,000. A year later, the state reports, it has not grown at all, with seasonally unadjusted figures showing a decline of several thousand.

And that's the story.

The jobless rate continues to go down not because we are creating jobs but because the labor force is shrinking. It is jobs that drive housing demand so with a flat work force, expect a continued flat housing market. Meantime....

The job retrenchment is becoming especially vicious at Los Alamos National Labs in northern New Mexico. While that may not seem directly important to ABQ, it is. These are some of the highest paying jobs in the state and that money finds its way not only to Los Alamos and neighboring Rio Arriba County but also to Santa Fe and the Duke City. The latest news:

The workforce cuts are not finished at the Los Alamos National Laboratory. In a memo sent to all employees, lab director Charlie McMillan said that 80 contractor positions would be eliminated. In March, 557 employees left the lab as part of a voluntary separation program and the next month, another 60 people were terminated from the flexible workforce.

That's nearly 700 jobs and more to come. When the Labs announced work force cuts in February, it said there would be an 11 percent cut from its permanent staff of 7,600, or about 800 jobs. It did not say that some of the 3,000 contractors for the Labs would face cuts. So not only is Los Alamos slated to cut 800 jobs from the permanent workforce, but now the knife is falling on private contractors who we assume will have to lay off people who work for them.

For the sake of discussion, say each job is valued at $100,000. That giant sucking sound on "The Hill" is $70 million in payroll disappearing--with more to come. It's true that a large cut to a single Los Alamos project is the primary culprit, but these dramatic job losses showcase the state's vulnerability in Washington. Soon we enter an era with no congressional seniority. Heck, even the seniority we have now isn't enough to stop the Los Alamos cuts.

RADICAL R'S

Radical Republicans who argue that cutting taxes and regulations even more will pave the way for an economy here that replaces these six figure jobs at Los Alamos and other government funding are smoking some of the most powerful pot east of the Mississippi. Their dream is only going to happen in a psychedelic haze--not in the real world.

It is argued (and effectively so) that a stalled plutonium research facility at Los Alamos is a multi-billion dollar boondoggle and had to be cut and thus the job cuts. Maybe so. But what of the future? Who is going to be there to fight if the budget cutters come for Kirtland Air Force Base and Sandia National Labs--the economic engines of the ABQ metro? What of the billions in other dollars that flow here for health care, nutrition, education etc. ? And the budget cutters will come with even more fervor if they sense political vulnerability.

These federal jobs (and other federal funding) make possible the profit for the local dry cleaner, the mom and pop restaurants and other small businesses that employ so many of our neighbors. We don't have the numbers, but we would bet when all is said and done at least 50% of this state's economy is tied directly or indirectly to federal spending.

That's why this year's election for the open United States Senate seat is one of the most critical in the state's modern history. We are going to get a new  Senator with no seniority, but one who must perform as if they already had 20 years under their belt. Who is that? Martin Heinrich or Heather Wilson?

CONGRATS, BEN RAY 

And speaking of that badly needed seniority, northern Dem Congressman Ben Ray Lujan is starting to slowly but surely move up the ranks. From Washington this news:

Congressman Ben Ray Luján announced today that he has been named Ranking Member of the House Natural Resource Committee’s Subcommittee on Indian and Alaska Native Affairs....

“It is an honor to be named to this important position that is critical for the many states that are home to native communities,” Congressman Luján said.  “As Ranking Member, I look forward to building on my efforts to strengthen an effective government-to-government relationship that respects the sovereignty of Native American tribes.  From protecting sacred sites to improving the health and educational opportunities for Indian Country, it is important that we work with tribes and pueblos across the country to build a stronger future for Native Americans.”

Lujan is also head of the Congressional Hispanic Caucus political action committee known as "Bold PAC" and down the road is expected to become chairman of the caucus.

Lujan, who turned 40 this month, has the potential to accumulate more power as Democrats look to Hispanics for increased voting strength. The congressman told me previosuly he would like a slot on the powerful energy and commerce committee which would get him into the funding process for the national labs. Ultimatetly, political pros hope Lujan can get a seat on the powerful House Appropriations Committee, a crucial spot for a state so dependent on Uncle Sam's treasury.

THE HOME FIRES

While Lujan is playing a strong hand in Washington, he has looked somewhat ham-fisted recently when dealing with the folks back home. His recent interference in the Dem state House primary for his retiring father's Santa Fe area seat is a prime example. His door-to-door campaiging for Dem Dave Coss--who lost to Carl Trujillo--raised eyebrows, as did his open support of Danny Maki for the northenr Public Regulation Commisssion seat. Maki was also a loser. And then there's Ben Ray's disagreement with senior Senator Bingman on the future use of the Santa Fe Indian School. That also made the young lawmaker appear to be over reaching.

As he goes along one suspects the congressman will more fully realize his political future is very bright--as long as he devotes himself accumulating power in Washington and not trying too hard to play in the murky waters of La Politica. And if he does play there--to do so quietly.

MIXED SANTA FE SIGNALS

It's hard to figure out exactly what is going on in Santa Fe economically. First you get this:

Jobs numbers confirmed that the tourist and hospitality industry is operating on all cylinders in Santa Fe--and has returned to pre-recession levels. In fact, due to continued cutbacks in the government sector, the leisure and hospitality industry accounted for all the job gains in Santa Fe County in May, according to the state Department of Workforce Solutions. 

And then you get this from a local restaurateur:

“The Santa Fe economy has not rebounded, especially for the high-end restaurants. We see the lower-priced restaurants along Cerrillos often busy and it’s been hard to compete with them,” said General Manager Kate Campbell. “

It appears state government jobs cuts are being balanced by a slight uptick in the tourist biz. If tourists are starting to return that's all the more reason for Tourism Secretary Monique Jacobson to start pounding the table for more money to promote our state. Don't be shy, Monique. The TV spots you commissioned landed like a thud, but if we've learned anything about the business of promotion it's that even a mediocre message will make a big difference if repeated often enough.

Speaking of Jacobson, did you know her mother is former ABQ GOP City Councilor Sally Mayer? You did if you are a regular blog reader. The news about Sally is that she has apparently joined her daughter in the state administration. We are told she has gone to work at New Mexico Expo in ABQ, after working in constituent services for ABQ Mayor RJ Berry. We blogged some time ago that it looked as if Sally was headed to the state Workforce Solutions Department, but that didn't happen.

Mayer had a pretty good record on business during her city council days. Maybe she can pull her daughter aside and tell her that in order to make money, you often have to spend money.

JOURNAL WATCH

The ABQ Journal comes with its editorial on Susana's directive that private email no longer be used to conduct state business--at least among employees who fall under her authority.

Dems are going to call this a wrist slap and complain that if this were Big Bill the paper would be going apoplectic on its editorial pages. They have a point. The editorial innocuously dismisses the scandal and the operation of what amounts to a shadow government run by unaccountable Martinez political advisor Jay McCleskey as a "bad idea." The newspaper does not question the motives--or the abuse of power--and that's why the Dems will say the Journal is protecting the Governor--not covering her. From the editorial:

The governor’s order sends the right policy message and removes the onus on state workers to determine what should be communicated on state email and what should not. And it will make it much easier to apply IPRA. Using private emails to discuss government business isn’t limited to the Martinez administration. It would appear legislators and previous administrations also used them. The governor challenged lawmakers and other officials to adopt similar policies. They should do so.

The paper, which now leans Republican and does little to disguise it, has extensively covered the ongoing scandal--although they don't call it that. The Journal has a long history of insisting on open government in the state and it has made a major difference. However, in the email case the editorial indicates that the paper sees it as pretty much over now that Martinez has been busted and partially owned up. That may be wishful thinking. If more emails surface showing more government business being conducted out of public sight, the scandal will blossom anew. Insiders continue to say there are indeed more emails--messages we suspect we will be reading of in the mainstream media.

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