© 2008 by Michael Swickard, Ph.D.
“There cannot be a crisis today; my schedule is already full.” – former Secretary of State Henry Kissinger
Chisme has it that there is a financial crisis due to hit the next New Mexico Legislature. Where I grew up in New Mexico, the Spanish word “chisme” means something said as an unconfirmed rumor, perhaps gossip, provocative in nature, and not necessarily untrue.
While it has not been announced officially, several analysts told me New Mexico has taken a big hit financially in the last couple of months. The projected $400 million surplus is a lost dream and instead there will be a huge shortfall next year which appears to be about to affect all New Mexico government services. That is, unless we find a solution as quickly as possible.
Last year the New Mexico budget was around $6 billion. The projection is a shortfall of $1 billion or more, I’m hearing, forcing a $5 billion budget or less. We have little time before this happens.
While all branches and operations of government are important, I am most concerned with our public schools. They are about one half of the state budget, and about 90 percent of that money is used to employ people. So we are not talking about solving this financial problem by cutting back on pencils. Unless some other plan for this shortfall is made, this will require laying people off so as to be able to balance the public-school books.
It will be many people unless the state discovers a huge replacement financial resource. Some think New Mexico could raise the personal income tax dramatically or the gross receipts tax to a level of at least 15 percent. Supply-side economics indicates that this will not work.
Of course the state cannot go in the red, so cuts might have to be made somewhere. Talk about an ugly scene. New Mexico is said to be a state that cherishes the ability of leaders to hire their cousins. Hence, I see a lot of bitter fights to protect cousins along with protecting turf.
How bad will it be?
How bad will it be? Who knows? Maybe the world economy will have a miraculous recovery, though that is not expected. As for public education, the average pay of the 37,098 direct educational personnel is a bit more than $42,000 a year. Of that number about 60 percent are teachers. The administrative average is about $60,000, while the teacher average is about $46,000. Then there are the educational assistants and support personnel such as nurses. Outside that number are the bus drivers, cafeteria workers, janitors and maintenance workers.
Recently the Gadsden Independent School District was several million dollars behind due to accounting problems. At the start of this week there were two plans to deal with the shortfall, neither very attractive. They were laboring over how to save $ 4 million and finally were able to one-time use some capital outlay money as a stopgap. Imagine if, come Legislature time, the additional financial number to cut for Gadsden is $15 million. Then what happens?
Where do they get the money?
With all of the restraints on school districts, I do not think they could cut that much money without a massive disruption of the education of the students. So where to get the money?
The place I hope the state does not fix upon as the easiest to cut is the long-term teachers who have been prodded and pushed into getting higher education degrees with the promise of hefty raises. There are three general pay levels for teachers in addition to a computation for the years of service: beginning (level one, $30,000), journeymen (level two, $40,000) and master teacher (level three, $50,000), with again, years of service additional. Long-term, level-three teachers can be making nearly $60,000, while first-year teachers make $30,000.
I am not arguing the merits of the pay differential, only the effect of the money. What I worry about is that one plan quietly mentioned would reduce the number of level-three teachers to save money. If there was retrenchment of those teachers statewide it would save millions. It would also be a betrayal if the state dumps those more educated teachers simply because they make much more money. You see, for the last couple of decades the state has been pushing teachers to get their masters degrees. The increased pay is an incentive for them to get the degree.
Of course, as many teachers say, it does not matter if we have well-qualified teachers since the state seems to uniformly rely on experts with no classroom experience and does not listen to teachers at all when it comes to instructional practice. There is merit to this statement.
The bottom line is we have to deal with this shortfall quickly. When the Legislature is in session is no time to figure out a solution. Between now and the start of the session is when the solution must be made. We have to talk about it now.
This may be the “rainy day” that the permanent fund was intended to save. Taking at least a billion from the financial reserves of the state seems drastic, but I believe this is the time we must protect the integrity of our state. We cannot let the schools decay; we have no other place really to get the money. Before the session starts there needs to be this plan in place.
Swickard is a weekly columnist for this site. You can reach him at michael@swickard.com.