By Kay Monaco, Executive Director
New Mexico Voices for Children
Half (50%) of
New Mexican children are Hispanic, almost one third of whom live in poverty. New
Mexico Voices for Children's recently released report, "Minority/Majority
- A Profile of New Mexico's Children" documents the disproportionate poverty
among New Mexico's Hispanic, Native American and African American children as
compared to Anglo children. Extensive poverty persists, particularly within these
majority/minority communities, in spite of public assistance, and even in spite
of work: people are staying poor even when they access the assistance they are
eligible for, and when they work. Reducing poverty is key to improving the quality
of life and future prospects for all of New Mexico's children, and especially
for its minority children.
Common
wisdom holds that employment is the path out of poverty. Yet, less than half of
Hispanic parents who were employed after leaving the New Mexico Temporary Assistance
to Needy Families Program (TANF) in 2000 were earning an income above the federal
poverty threshold. So, work - even full-time work -does not automatically lift
families out of poverty.
Public
debates about poverty, and social programs ostensibly designed to reduce poverty,
are misguided by a terribly outdated yardstick: the federal poverty threshold.
This threshold underestimates poverty dramatically (for a number of reasons, including
that it is not regularly updated to factor in the current cost of living). New
Mexico Voices for Children conducted extensive research to accurately measure
the real cost of living at a 'bare bones' level in New Mexico. A bare bones budget
for a family of four (defined as a father, mother, infant and child) is $30,777.
This poverty threshold is 170% higher than the official federal poverty level.
In other words, the federal poverty threshold underestimates by 70% what the real
poverty threshold is in New Mexico. The federal threshold continues to be used
as a benchmark to determine income eligibility for federal programs such as Medicaid
or TANF. To design poverty reduction programs that actually lift people out of
poverty instead of perpetuating it, we must at least understand what level of
income is required for a minimal standard of living.
Adequate
funding of 'safety net' programs is essential. A clearer understanding of how
these programs benefit middle-class families, businesses and the state economy
(as well as low-income families) would probably broaden support for them. We must
stop viewing funding of these programs as unaffordable luxuries or as 'compassion'
spending. In addition to being a safety net for low-income families, these programs
also serve to stimulate our economy in very important ways, and to subsidize the
low wages paid by too many of New Mexico's businesses. Over 400,000 New Mexicans
who do not receive health insurance through their low-wage jobs receive Medicaid.
Over 80,000 receive Food Stamps. Our tax dollars pay for what employers cannot
or will not.
The Medicaid program
provides a good example of this. For every dollar that the state spends on Medicaid,
it receives three dollars from the federal government. That federal "match",
along with the state's investment, supports over 28,000 jobs in New Mexico. And
these are good health care jobs that pay an average weekly wage 13% higher than
the state's average wage in any other industry.
To
achieve a bare bones standard of living requires a job that pays $15 per hour
in New Mexico. The creation of thousands of jobs that pay a wage to support a
family at a bare bones standard of living would both reduce public spending on
subsidy programs, and stimulate the economy across the state. The quid pro quo
for investment of public dollars in economic development, including direct investment,
tax expenditures and workforce training programs, should be an insistence on wage
levels that support families at a bare bones level. Public monies should not be
invested to develop more low-wage jobs. Creation of jobs that pay family sustaining
wages and benefits should be a public policy priority. Poverty will be reduced,
and our children's future options expanded, when policymakers understand that
investment in the social infrastructure - such as quality health care and educational
systems - is non-negotiable, and when jobs that pay a family-sustaining wage are
the norm rather than the exception in the state.
