New Mexico stands on the cusp of a golden era, with its oil and gas boom enriching the state’s coffers to unprecedented levels. Now is the time to ensure that this wealth directly benefits the very people who make New Mexico vibrant and unique: its residents. Drawing inspiration from Alaska’s Permanent Fund Dividend (PFD), it’s time New Mexico adopts its own Permanent Fund Dividend (NMPFD) to secure a prosperous future for all its citizens.
One of the most compelling aspects of the Alaskan PFD is its tangible impact on the everyday lives of its residents. The dividend, which has ranged from several hundred to over two thousand dollars annually, directly contributes to individual and family well-being. A similar dividend in New Mexico would provide immediate financial relief and increased purchasing power to residents, helping families offset living costs and potentially reducing poverty rates.
Current statistics paint a telling picture: the median household income in New Mexico hovers around $54,000, which is significantly below the national average. Furthermore, a significant portion of our residents live below the poverty line, struggling with daily expenses, from groceries to healthcare. Introducing the NMPFD could play a pivotal role in uplifting our most vulnerable citizens. For a family of four, a dividend similar to Alaska’s could mean an additional couple of thousand dollars annually – a substantial boost for households subsisting on modest incomes.
This dividend would not just be a monetary relief but an active tool for narrowing the income disparity within the state. It would level the playing field for many, offering a more equitable share of the state’s resources. The infusion of this dividend into low-income households would not only support immediate needs but also potentially open doors to better educational and health opportunities, cementing a foundation for a brighter, more secure future.
Dividends often find their way back into local economies. When residents spend their dividends on goods, services, or even savings and investments, it stimulates local economic growth. This could foster the development of various sectors within New Mexico, from retail to housing to education.
The volatile nature of oil and gas revenues is well-known. Increasing government spending on ineffective programs and projects creates future liability. A PFD provides a cushion against future downturns. By setting aside a portion of the state’s surplus, New Mexico can build a financial safety net that ensures the dividend’s longevity, even if oil revenues wane.
Detractors might argue that introducing a dividend may deter potential state investments in infrastructure, education, or healthcare. However, if modeled after the Alaskan system, only a portion of the surplus is channeled to residents, leaving substantial funds for state-led initiatives and developments.
Others might express concern about the transient nature of oil and gas revenue. Indeed, such revenue isn’t everlasting. But that’s precisely the argument for an NMPFD – to maximize and sustain the benefits of this revenue while it’s abundant, ensuring its positive impact endures for future generations.
The creation of a New Mexican Permanent Fund Dividend isn’t just about immediate economic benefits; it’s about cementing a legacy of shared prosperity. As New Mexico experiences this boom, it has an unparalleled opportunity to create an equitable, forward-looking financial mechanism that echoes the spirit of community, ensuring that every New Mexican gets a share of the state’s natural wealth.
Alaska’s model provides a proven blueprint, but New Mexico can tailor its dividend to meet its unique needs and aspirations. Let’s use this moment of abundance not just to enrich our present but to guarantee a prosperous future for all New Mexicans. It’s not just an economic decision; it’s a testament to our values, our vision, and our commitment to every citizen of this beautiful state.
Originally published at lcsun-news.com on September 2, 2023.