For the people: A case for a state Permanent Fund Dividend
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 health care. 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 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 health care. However, if modeled after the Alaskan system, only a portion of the surplus is channeled to residents, leaving substantial funds for stateled initiatives and developments.