July 2016

The 10 Microeconomies of New Mexico


Alan M. Webber


 We New Mexicans know that our state is doing far too poorly in too many important categories. We hate the ratings, but we can’t ignore them unless we’re willing to accept the status quo. Because the hard truth is, the headlines and the numbers don’t lie.


We have some of the worst unemployment statistics in the country. We’re at the bottom when it comes to children living in poverty; when it comes to the overall well-being of children, we rank next to the bottom. Too many New Mexicans find themselves trapped in a vicious cycle of poverty, which leads to poor schooling, which leads to poor jobs, which leads back to poverty.


When you look at New Mexico today, you have to agree with the advice James Carville gave Bill Clinton: “It’s the economy, stupid!”


The other truth is this: It doesn’t have to be this way.


We know because we live here and we love it here. When we look around the state, we see unmatched natural beauty, unique culture and history, remarkable diversity and great pride in that diversity, phenomenal natural resources, terrific talent, resilience and resourcefulness among the people of New Mexico. There is so much to celebrate about New Mexico, so much untapped potential, so much strength and opportunity, we all agree: New Mexico’s future is hiding in plain sight.


Here’s the question: What do we need to do to change our future, so every New Mexican has more opportunity, better work, better pay and more meaningful employment—a better life?


Let’s go back to James Carville: “It’s the economy, stupid.” Bill Clinton got the idea when he said, “The best social program in the world is a good job.”


New Mexico’s future depends on getting our economy going and our people working. A good job solves a lot of problems. It fights poverty, puts food on your table and a roof over your head, helps kids do better in school and creates real opportunities.


The question for New Mexico is not whether we need to create jobs; it’s how we’re going to do it.


This is where it gets interesting. This is where, to borrow from Abraham Lincoln, we “disenthrall” ourselves from old ways of thinking. This is where we get to create an approach that is unique to New Mexico—just as New Mexico is unique in America. We get to utilize our strengths and think differently about a strategy that grows New Mexico from the grassroots up and from the inside out.


Our New Mexico Method is based on two big ideas:

The first big idea is that New Mexico doesn’t have “an economy.” A state as large and diverse as ours has many microeconomies—10, in fact. The more we talk about “an economy,” the more we obscure the uniqueness of New Mexico and fall into the trap of adopting a generic approach, like chasing out-of-state smokestacks as a solution to the New Mexico economy.

The second big idea is that New Mexico’s future is hiding in plain sight. Our 10 microeconomies give us a huge competitive advantage. If we develop microstrategies for each of these 10 areas and then knit them together so the pieces fit together and also reinforce and strengthen each other, we will have a powerful, dynamic and original New Mexico Method. No other state can copy, borrow or steal it. It will be grounded in those remarkable things that make New Mexico what it is: our land and sky, our history and culture, our character and experience. It seems obvious, but it’s worth saying: We won’t win by being cheaper than Texas or dirtier than Arizona. We win by being the best New Mexico we can be.


So what are these 10 microeconomies? How can we describe them? How can we use them to create jobs and opportunities, first within each area and then between and among them? How does this kind of thinking and doing change what’s possible for New Mexico and for all the different regions and communities in our state?


Here are the 10 microeconomies:


1.     Energy. We are extraordinarily gifted as a state with energy resources; in fact, when all of our potential BTUs are added together, we rank in the nation’s top five states. For a long time, we’ve lived off our oil and gas resources. Now, with sustainability as New Mexico’s calling card and climate change a global concern, it’s time for us to lead the nation in renewable energy: solar, wind, hydrothermal, and the cheapest source of energy—conservation. As is true for almost every one of the 10 microeconomies, if we do energy right we will create multiple wins for New Mexicans: more jobs that are sustainable and future-facing, plus cheaper electricity and more local control over our own energy future, plus a cleaner environment that will help preserve our quality of life, plus more tourists—and tourist dollars—coming to our beautiful state.


2.     Water. There are two ways to gain a competitive advantage: Make the most of an abundant resource—energy—and take advantage of a scarce resource—water. New Mexicans have always known that water is scarce and precious. Water is life. Now, the whole world is learning this lesson. We should be able to sell our expertise, knowledge and technologies to create good jobs in New Mexico out of the hard truth of water scarcity.


3.     Farming and Ranching. We’ve always depended on farming and ranching both as a way of life and as a way to make a living. Today, there are huge new—and some very old—opportunities to take New Mexico to the forefront of the future of food and food production. Industrial hemp is one opportunity; it is a perfect fit for New Mexico. Hemp requires a lot of sun and very little water, and it can be transformed into tens of thousands of products. We have entrepreneurs in Silver City working to make biochar a New Mexico industry, reintroducing old farming practices into a new economy that wants better yields and better crops.


4.     Tourism. We need to think and act more creatively than ever to grow tourism in New Mexico. Yes, we have amazing land, sky and mountains. We’re also home to more history, culture and art than any state in America. Our tourism should be focused on experiences, ecotourism and cultural tourism. Chaco Canyon can be our Machu Picchu. We need apps—not maps—that guide tourists to our state’s unique offerings, from the pueblos to the wineries to music festivals to dark skies.


5.     Digital Entertainment. New Mexico is already known as a great place to film a movie or produce a TV show. But we’re leaving money on the table. America’s largest export today is video games. We should be creating every form of digital entertainment right here in New Mexico, using our own talented designers and programmers to bring games and apps to life. There’s already a popular game called “The Oregon Trail.” Why isn’t there “The Santa Fe Trail” or “The Camino Real,” or games and stories set in Pueblo life and history?


6.     Entrepreneurship and Innovation. In cities across the country, entrepreneurs and innovators are challenging the business establishment with new products and services, using new technology, the web, smart phones and new business models. It takes talent, ideas, an ecosystem that encourages risk taking and a place where people want to live and work. New Mexico has all the components to become the next cool place for the entrepreneurial economy to take off, if we make key investments in high-speed Internet connectivity, air service and education that make startups easy to launch.


7.     Small and Medium-Sized Business. New Mexico has never been, and most likely never will be, home to the large corporations of America. It’s not who we are and, frankly, it’s not who we aspire to be. We are a state of small and medium-sized businesses, which makes it all the more surprising that we put so much of our money and time into wooing large out-of-state corporations. If you listen to our mom-and-pop shop owners, they’ll tell you the kind of help they need: cutting through red tape, workforce training and development, permits and the permitting process, issues of zoning and transportation, better access to their businesses and better marketing of their businesses.


8.     The Border. Very simply, we’re not making enough of our border with México. These days, it’s politically popular to talk about our border with México as if it were a problem and the only solution is a wall. We know differently, based on history, language, culture and relationships. Right now, México’s own entrepreneurial economy is growing. Manufacturing, investment, exports and imports continue to evolve and develop. We have México and Latin America at our doorstep. We need to do more—and do it smarter and better—to build on existing relationships and opportunities.


9.     The New Aging. New Mexico is one of America’s “grayest” states: We are home to a large number of people who are 50 years old and older, and this is a huge opportunity. Aging is being disrupted and reinvented. People are living longer, healthier and more engaged lives. People want to find ways to contribute, to make a difference, to make some money, to add some meaning to their lives. It is all part of the New Aging, and New Mexico can be at the forefront of writing the new rules and providing the new goods and services that come with this underappreciated phase of life.


10.Health Care and Well-Being. It’s part of the New Aging, but it’s also part of farming and ranching and entrepreneurship and innovation. We’re seeing how technology can deliver healthcare to rural and frontier communities. Wellness and prevention are smarter, cheaper and better than treating diseases. This is another microeconomy in which New Mexico has so much to offer in the way of technology, experience and practice, as well as much to gain by moving to the front of exploration and commercial application of working solutions.


Those are the 10 microeconomies, with just a small suggestion of what each could contribute to New Mexico and how some could connect with others to create an internally consistent, self-reinforcing strategy for the state—a method that makes sense and works.


The goal is to invest in those areas that open up opportunities in others: Growing hemp, for example, creates new possibilities for entrepreneurship, micromanufacturing, smarter water use, and small and medium-sized businesses Focusing on digital entertainment supports entrepreneurship and innovation, but it also becomes a vehicle for tourism and rural communities to thrive.


Once we stop thinking about “the economy” and think instead about our microeconomies, we begin to see new opportunities and larger strategies for job growth that help all our communities and our future.


What will it take to make it happen?


It’s simple and hard:

We have to look at each of these 10 microeconomies and design working programs and policies for each of them.

We have to develop ways for the private sector and the public sector to work together toward common goals for New Mexico.

We have to want change and believe that there is a way forward for a better New Mexico.

We have to work hard and work together.

We have to embrace new possibilities and demand new leadership.


Our future is hiding in plain sight. The truth is, it’s there if we want it.

Now it’s up to us to see it, to want it and to create it.




Alan M. Webber is a businessman and entrepreneur in Santa Fe and was a candidate for the Democratic nomination for governor of New Mexico in 2014.





Diversifying New Mexico’s Economy

New Mexico is the second most federally dependent state in the nation, behind only Mississippi, according to a WalletHub report released in March. The financial website evaluated state residents’ and state governments’ dependency, share of federal jobs and federal funding as a percentage of a state’s revenue.

New Mexico is home to two of the three U.S. nuclear weapons laboratories, multiple military bases and federal land-management agencies such as the U.S. Forest Service and Bureau of Land Management. With a high poverty rate and an aging population, the state also draws a large share of federal social spending. Government employment is down, and budget cuts have lowered federal spending here. Hiring at both Sandia National Laboratories and Los Alamos National Laboratory (LANL), however, is expected to pick up in the coming year as more money for waste cleanup, energy and weapons development flows into the state.

New Mexico’s concentration of employment in the mining sector, which includes oil and gas, is three times the national average.

In May, at a Legislative Finance Committee hearing to assess ways New Mexico can diversify its economy and grow beyond its dependence on government, extractive industries and cattle, a panel of economic-development experts cited education and workforce development as essential to creating jobs and long-term economic growth.

Kathy Keith, director of community programs at LANL, told the committee that building the next generation of employers might mean finding ways to support people who start businesses in a garage or small workspace, although creating many new jobs from these enterprises may not happen overnight.




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