With poverty rates that are 50% higher than the national average and low graduation rates at both the high school and post-secondary level, New Mexican policy-makers must act to address both poverty and education access in the state. A basic income distributed to students would encourage and enable students from low-income backgrounds to enroll in higher education and provide support to them during enrollment.
Education remains a critical area for improvement for New Mexico. High school graduation rates have been slowly rising across the state but they still fall well below the United States as a whole. The percentage of 18-24 year olds enrolled in post-secondary education in New Mexico is 5.7 percentage points lower than the national average. One way to address poverty and increase access to post-secondary education is a state-wide guaranteed basic income distributed to low-income college students. The Santa Fe LEAP program is already providing $400 monthly benefits to low-income parents enrolled at Santa Fe Community College and this proposal would be a crucial expansion of that program.
It is clear that the status quo for addressing poverty in New Mexico, especially among students, is not adequate and food insecurity among college students is a growing concern. A 2020 survey of students at the University of New Mexico found 37% of students experienced food insecurity within the past month. Additionally, college graduation rates for students from low-income backgrounds are dramatically lower than those for high-income students - at the lowest quarter of family income, college graduation rates are just 14% compared to 60% at the highest quarter of family income. At the University of New Mexico, both 4-year and 6-year graduation rates are lower for students who receive a Pell Grant.
I recommend the implementation of a $500 per month benefit to all post-secondary students in New Mexico who are eligible for a Pell Grant. When the likely increase in enrollment is accounted for, this $6,000 per year benefit would be available to nearly 50,000 students across the state. The annual cost would be $300 million or 4.2% of the state budget. I recommend $500 per month as a baseline because it roughly equals the deep poverty threshold for a single individual. It should be tied to inflation so the value of the monthly benefit doesn't decrease over time. Ideally, this benefit should also be excluded from eligibility determinations so that anyone who qualifies for additional benefit programs such as SNAP or TANF without the additional $500 per month should continue to qualify while receiving the basic income.
Students would not need to submit additional documentation to qualify for this program as the normal financial aid forms will cover eligibility criteria. Post-secondary institutions also already have infrastructure to distribute funds to students through a cashier’s office so there would be very little additional administrative work for either the participants or financial aid offices.
Any type of basic income proposal may raise concerns about how recipients spend the benefit. Some may be concerned about students misusing the funds to purchase goods viewed as non-essential such as alcohol, tobacco or leisure events. While this might occur in some cases, research has shown that those who receive basic income benefits overwhelmingly spend them on necessities such as groceries or utilities. Concerns regarding a reduction in labor supply may also extend to the part-time jobs often held by students. However, it’s unlikely that college students would stop working completely for $6,000 per year. It is more likely students would simply choose different types of work including unpaid internships or volunteer opportunities that may have been unavailable to them without additional financial support. Finally, some may argue that students should earn this benefit through maintaining a certain GPA, participating in certain activities, or making progress towards their degree. I contend that acceptable progress towards a degree is already covered within the academic standing and probation policies of higher education institutions and any additional requirements would undermine the goals of this proposal by increasing stress for students who may already be balancing requirements for scholarships, their degree program, and their classes.
I believe this proposal is highly feasible, effective in addressing poverty, and a creative way to increase education access in New Mexico. It would provide crucial support for students who may struggle to make enough to live while also attending classes. Providing a stable, monthly income of $500 would both encourage new students to enroll in higher-education and increase graduation rates for those already enrolled. As poverty has a disproportionate effect on people of color, this proposal would also be an important step towards equitable access to higher education in New Mexico. In the long-run, this could increase access to high-skilled workers, attracting and keeping businesses that help grow New Mexico's economy in a sustainable way. With federal relief funding offsetting the costs of other essential programs, this could be a perfect time to implement a new basic income program.
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