Not all residents of New Mexico can count on a regular paycheck. New Mexico legislators are aware of this and are considering instituting a Universal Basic Income (UBI) program. 

What is a UBI?

A UBI is defined as “a government-guaranteed payment that each citizen receives”. The concept is that a UBI will provide enough money for citizens to pay for living essentials but not for other things. People receive such a flat payment whether working or not. When it comes to paying for them, UBIs are normally funded by grants and/or increased taxes on the wealthy and/or corporations. 

What is the State Considering?

The State of New Mexico’s contemplated take on providing a UBI is somewhat different from that of the general definition. Only low income New Mexicans would receive a regular paycheck, while most versions of UBI in theory and practice provide a set amount to each individual or household. Providing the stipend to everyone is what puts the “universal” in Universal Basic Income.

What are Santa Fe and Las Cruces doing?

The cities of Santa Fe and Las Cruces are exploring UBI programs. Most state legislators are waiting to evaluate the success of these local measures before supporting a statewide UBI program. This is also the approach in other parts of the world where UBI programs are typically created on a small scale in order to gauge their effects.

Santa Fe

Santa Fe’s now approved pilot program is very selective. Rubber stamped by the City Council on June 30, the program will target 100 young families with children, specifically parents/students who attend Santa Fe Community College. Families will receive between $400 – $500 per month for a year. According to a recent article in the Santa Fe Reporter, the goal of the program is to “provide students with a reliable source of income to help parents stay enrolled in college while raising their children.” 

The project is being funded by a $500,000 grant through the Mayors for Guaranteed Income Project. 

Las Cruces

Las Cruces City Council has not yet approved but is considering a guaranteed basic income project. Councilwoman Johana Bencomo is spearheading the effort targeted at a select group of low income folks. 

Councilwoman Bencomo favors funding the project through proceeds from a $24 million grant the city received from the Federal Government’s American Rescue Plan Act. 

Not all Las Cruces City Councilors are as supportive though. Councilwoman Yvonne Flores wants more data in the form of an economic analysis. “People are starving, and that’s very true. I’m not sure that this is going to be the answer. And I still see it as a Band-Aid,” Flores is quoted as saying in an article posted at krwg.org.

What is Lea County doing?

As far as Lea County is concerned, no city councils nor the county commission have formally addressed the subject. On the state level District 62 State Representative Larry Scott (R-Hobbs) has expressed uncertainty as to how New Mexico’s unemployment rate might be affected by a guaranteed basic income program. He is quoted in an article by Dan Boyd in the Albuquerque Journal as saying that New Mexico “was tied for the nation’s highest [unemployment rate] in June, at 7.9%, along with Connecticut. “New Mexico employers are having a very hard time finding people to work now.”

New Mexico’s unemployment rate

It is true that New Mexico and Connecticut currently have the highest unemployment rates in the US. However, New Mexico’s rate has been trending downward from 8.7% in January to 7.9% in June. More troubling than the high unemployment rate is the state’s low labor force participation rate, which is significantly lower than the national average. This rate has been “steadily declining since September 2020, dropping 0.8 percentage point to 57.2 percent in June,” reports the June 2021 New Mexico Labor Market Review. What all of this translates to is that many people in New Mexico do not have steady jobs and do not receive a regular paycheck.

However, it is important to note that UBI is not thought of as a replacement to work. In fact studies suggest people on UBI programs would be likely to continue their jobs or take up part-time work.

Conclusion

Andrew Yang, a presidential candidate during the 2020 campaign, was a proponent of UBI, which he called “Freedom Dividends” as an outgrowth of the hardships created by the COVID-19 pandemic. The major objection expressed about Yang’s support of instituting UBI for all Americans was that people would receive “free money”. However, whether free money or not, an important UBI study concludes that having a UBI “boosts recipients’ mental and financial well-being, as well as modestly improving employment.”

With positive and negative aspects to consider, New Mexico legislators will continue to weigh in as to whether instituting a UBI program is or is not a good idea for the state. Solid arguments exist on both sides. Time, the pandemic situation, economic conditions, unemployment realities, health and well-being issues are a few of the many factors that will be debated before solid legislation is brought forward and a decision is made.