The Rio Grande Foundation recently completed a report in which it analyzed dozens of state regulations that are holding back our economy.
The need for deregulation has never been more apparent with our economy losing jobs and seeing an outflow of workers.
Unlike many issues in Santa Fe, deregulation has not historically been a partisan issue.
At the federal level, President Jimmy Carter deregulated trucking, freight rail, and airlines to positive effect in the 1970s.
President Reagan continued those efforts in ways that led to significant economic growth throughout the 1980s.
To further illustrate the point that deregulation can and should be bipartisan, Think New Mexico has been working to pass House Bill 194, legislation sponsored on a bipartisan basis by Republican Rep. Tom Taylor and Democrat Rep. Carl Trujillo.
The bill attempts to overcome many of the most absurd barriers to free competition in transportation services.
The barriers harm both New Mexico’s economy and reduce options for consumers.
Today, entrepreneurs seeking to open new taxi, shuttle, or moving companies must gain the approval of the incumbent providers. Imagine Wendy’s having to gain the approval of McDonald’s before opening up a restaurant.
According to the staff of New Mexico’s Public Regulation Commission (the body charged with actually regulating motor carriers), “The Albuquerque Cabs appear to operate as a cartel: they are the only certificated taxicab companies in Albuquerque, they share the market evenly, they charge identical rates, and they have the same attorney. As a cartel, their interests may be best served by maintaining rates above the market rate and by discouraging competition, not by ensuring that the public is served by quality, affordable, and plentiful taxicab service.”
Cartels are creatures of government policy, not the product of a healthy free market.
Another barrier is pricing. In a free market, price competition is a primary determiner of market success. Under New Mexico’s arcane motor carrier laws, the state/government must approve all prices charged by these companies. Making matters worse, motor carriers have a special exemption from state antitrust laws that encourages them to form state-sponsored cartels and price fix. HB 194 would change all that.
The aforementioned PRC staff brief concluded, “There has been a great deal of economic analysis of taxicab regulation in the past thirty years, with most experts agreeing that the public is best served by increased competition and limited barriers to entry.”
It is time for the New Mexico Legislature to do what is in the best interests of consumers and entrepreneurs alike by truly deregulating New Mexico’s motor carriers by supporting HB 194.
Paul Gessing is president of New Mexico’s Rio Grande Foundation, which promotes limited government, economic freedom and individual responsibility. Contact him at:firstname.lastname@example.org