Welcome back. Here's the latest from the campaign trail.

Both Republican Steve Pearce and Democrat Michelle Lujan Grisham say they're ready to start spending on everything from education to infrastructure. And veterans of La Politica say they both may have have it right.

They cite the recent energy summit hosted by Carlsbad Mayor Dale Janeway where experts said the oil boom that's creating an immense surplus in the state budget (projected at $1.2 billion for the year that starts July 1) is not a one time deal. In fact. NM Oil and Gas Association chief Ryan Flynn says this party is just beginning:

“We have more rigs in New Mexico than we ever have,” he said. “We don’t just expect this growth to continue next year, but for the next five years. This is sustained growth.” He also touted one third of the State’s revenue from oil and gas, while the industry employs about 100,000 New Mexicans.

The austerity hawks rightfully point out that the oil boom is bound to disappear like previous ones and are urging massive reserves be socked away to protect the state against a downturn. But if Flynn is right there is something more optimistic to ponder: How does the state handle billions of unanticipated revenue should it come in during the next Governor's term?

If the cash continues to cascade into the coffers not only could Santa Fe fund the state's reserves beyond what even the most conservative lawmakers desire but also resolve long-term problems like the state's pension shortfall; it's chronic underfunding of the judiciary; fully funding education to respond to a court ruling that the current formula is unconstitutional and discriminates against children at risk and give healthy raises to state employees and teachers who have received few during our decade long stubborn stagnation.

Perhaps this is the question for the Guv candidates:

What are your plans if the state continues to accumulate billions from the oil boom? How would you effectively invest that money to reverse the state's standings at the bottom of all major quality of life lists?

OIL VILLIANS?

It's interesting that it is the oil and gas industry and Pearce's ties to it that are the main targets of the Dem special interest TV ads in the Guv race. The oil boys never lead the popularity pack, but with their industry flooding Santa Fe with so much treasure will the public respond to their portrayal as the villain? This is not going unnoticed by Pearce supporters like reader Ron Nelson:

So, the Dems are criticizing Pearce’s connection to gas and oil? The very same industry that is flooding our state coffers with a billion plus surplus for them to squander. Meanwhile MLG and Sen. Heinrich are pushing huge solar and wind farms that will mar NM’s vistas, so they can sell energy to our neighbors. So much for access to public lands.

The ads against oil may help MLG get the progressives back in line but given the current backdrop of an epic oil boom their effectiveness with the broader electorate is questionable.

BOOM AND BUST

Okay, before we permanently join the glass-is-always-half-full crowd, let's take a look at what could put Flynn's prediction of a long oil boom quickly to rest. Some clues:

. . . The public markets have been valuing fracking companies not based on a multiple of profits, the standard way of valuing a company, but rather according to a multiple of the acreage a company owns. As long as companies are able to sell stock to the public or sell themselves to companies that are already public, everyone in the chain, from the private equity funders to the executives, can continue making money. 

It’s all a bit reminiscent of the dot-com bubble of the late 1990s, when internet companies were valued on the number of eyeballs they attracted, not on the profits. . .  As long as investors were willing to believe that profits were coming, it all worked — until it didn’t. . . Most things that are economically unsustainable, from money-losing dot-coms to subprime mortgages, eventually come to a bitter end.

Meanwhile, the Hilton Garden Inn in Hobbs, in the middle of the Permian Basin oil boom in the SE, will set you back a cool $360 a night. Bust? What bust? Party on, Garth.

ARNOLD JONES MISHAP

They call her Lady Sunshine because of her long record of pursuing government transparency but ABQ GOP congressional contender Janice Arnold-Jones stepped into a black hole last week when she appeared to question the heritage of Dem foe and Native American Deb Haaland.

It's a hole that may be nearly impossible to climb out of considering that even before her remarks on Fox and Friends (video here) the GOP nominee was the decided underdog, with DC pundits declaring the seat "Safe Democratic." She said:

“There’s no doubt that her lineage is Laguna (Pueblo), but she is a military brat, just like I am.” Arnold-Jones went on to suggest that Haaland’s mention of her Native American background on the campaign trail “evokes images that she was raised on a reservation.”

That indelicate phrasing was seized upon by a wide range of Dems who lambasted the Republican hopeful in a series of news releases. Arnold-Jones stood her ground and insisted she was simply dealing in facts not in racial bias.

DEBATE UPDATE

Speaking of Fox, it will be FOX NM on channel 2 in ABQ/ Santa Fe that will broadcast  the first televised gubernatorial debate at 6 p.m. September 19, not its sister station KRQE-TV 13. We were given incorrect information by a station staffer when we blogged that the debate would be on 13. The Fox face-off, however, will be moderated by a KRQE staffer and will last one hour. Our original point holds--the first broadcast TV debate is usually the most important one and will help set the tone for the final weeks of the campaign.

LUNDSTROM VS UNM 

Former ABQ GOP State Rep. Joe Thompson and other big name Santa Fe Fe lobbyists for UNM are going to have their hands full come the legislative session in January. That's because a name that's become big at the capitol has gone public with what appears to be an all-out war with the UNM Regents.

You probably heard that Dem State Rep. Patty Lundstrom, who recently took over as chair of the powerful House Appropriations Committee, is hopping mad over the way the UMM Regents treated her when she opposed cutting sports programs from the athletic budget. Peace is still not in sight as Lundstrom hits UNM hard in this op-ed:

Perhaps we should be calling for a different kind of leadership within the UNM Board of Regents – leadership that maintains humility and transparency, embraces diversity of opinion and remains flexible in the face of uncertainty.

Where is UNM President Garnett Stokes? Part of leading the university is to smooth the feathers of ruffled legislators. Sometimes it takes more than the lobbyists. How this all plays out in the appropriations process is the key question. If Lundstrom can't be pacified Lobo Louis may have to be put on a diet.

THE BOTTOM LINES

The city of Santa Fe has a much larger population than the 70,000 we had it at in a recent report. We based that on the city's official website but the actual population, according to the US Census Bureau estimates from 2017, is about 84,000. In any event many of them were celebrating the annual Fiesta this weekend, but as the NYT reports with a very major change. It's the end of the Entrada:

New Mexico Grapples With Its Version of Confederate Tributes: A Celebration of Spanish Conquest

This is the home of New Mexico politics.

E-mail your news and comments. (jmonahan@ix.netcom.com)

Interested in reaching New Mexico's most informed audience? Advertise here.

(c)NM POLITICS WITH JOE MONAHAN 2018