They say hindsight is 20/20, and as it turns out, every once in awhile foresight is also 20/20. Want an example? Well, four years ago this weekend, I had this to say:
No one can dispute that oil and gas prices and the resulting tax revenue is cyclical in nature. So, why on earth would anyone be proposing new programs to be paid by these inconsistent revenues? It is a recipe for financial disaster.
Unfortunately, the link to the new program of the time is long since dead, but the premise put forth is still very much true. In fact, consider the following from a recent New Mexico Business Weekly article:
Revenue at the New Mexico State Land Office is expected to plunge by at least $250 million in the current fiscal year, a direct result of the drop in oil and natural gas prices.
Those falling prices are expected to have an impact on the state government’s overall budget, and they have some experts predicting a state budget shortfall of between $350 million and $800 million.
I hate to say it, but I told you this was going to happen. Just like I told you we were on our way to 10% unemployment.