Why is New Mexico poor and what should be done about it - Research Paper Example

?Why is New Mexico poor and what should be done about it? Introduction New Mexico is a sunny land with tall mountains that appear to touch the sky. Here, plains are as wide as sea with lakes and rivers sparkle in the sunlight. It is situated in the southwestern part of United States with its border with Texas on the eastern side. A very small part of Oklahoma also touches New Mexico in the east. Colorado is in the north of the state and Arizona is in its west. Republic of Mexico borders some parts of New Mexico in its south (Simmons 1-2). Historical Outlook The history of New Mexico is just like an adventure story. Thousands years ago, Indians were the first who settled there and developed their traditional way of living in the area. Next to Indians, Spaniards arrived and started living there with their own way of life. They had different set of ideas and customs as compared to Indians. In a short, it can be well said that Spaniards created a style of living and government on the footing of Europeans. Later on, Americans invaded the area and conquered the territory of New Mexico. Americans introduced their own way of living. So, through history it can be judged that several nations came over the territory of New Mexico leaving behind the life style of the people blended and more complex (Simmons 1-2). Economical Conditions of the Region Before enclosing the reasons of poverty in New Mexico, it is significant to have a look on the economic conditions of the region in general. New Mexico is most often described a very poor state among all other states of America. This description is correct if studied in the light of the average capital assets/ possessions of the total population. However, the natural as well as human resources of the state are far better as compared to average property count of the population. Over past few decades, the per capita personal earnings have remained constant. In the year of 1978, among 50 states of America, New Mexico ranked 43rd as far as comparative analysis of state per capita earnings were concerned. However, this figure lowers down from late 1970s onward. In 1990s, the per capita personal income allows the state to rank at 48th among 50 states of America. Later on, in 2000, this figure further goes down and New Mexico ranked 49th as far as per capita personal income is concerned. At that time, New Mexico was just above the state of Mississippi. In 2003, local estimates and statistics revealed that the ranking of New Mexico had raised to some extent, however, the Census Bureau still ranked the state of New Mexico at 49th. In 2004, Census Bureau also concluded that the wages paid to the workers were also the lowest with a great number of economically poor and depressed citizens as compared to any other state of America. The countries of Guadalupe, Mora and McKinley are at the lowest end of poverty and at the bottom of socio-economic scale in the region of New Mexico. These countries are mostly dominated with Indian and Hispanic populations. Being the poorer state in America, New Mexico always receives more shares from federal government as compared to what it contributes in the national income. In 1988, this state ranked second in terms of federal aid it received. However, in 2002, the conditions were bit changed and got some improvements and New Mexico ranked fifth among the top aid receiving states. In addition, the people of New Mexico are taxed at a very high rate. Tax rate per capita is very high in the region when compared to their personal incomes. In 1987, the state of New Mexico ranked fifth among all other nations in percentage of the personal income of people paid for government fees and other taxes. In 2004, the state ranked eighteenth as far as the tax payment is concerned. However, tax collection does not produce fruitful results on the economy as the wages of the residents are very low. Revenue generated from taxes is not enough to cope with the economic pressures of the area- in order to minimize the federal assistance which is proved to be an imperative towards the development and smooth running of the state (Garcia 5-6). Important Indicators to Measure Poverty in New Mexico According to US Census Bureau, New Mexico has the worst poverty rate just above Mississippi. According to 2011 statistics, 16.60 percent families are living in poverty including 21.5% individuals that are living below poverty line. The two common indicators used to measure poverty in New Mexico involve the percentage of families living below poverty line. Basically, this depends on the number of people that are living in a single household. The second indicator involves the percentage of all the individuals who can be classified as poor beings (Scott 2012). In general, the poverty level in New Mexico is relatively so high that every country and city of the state is under very poor condition, yet, McKinley is the country where poverty rate is very critical as compared to rest of the countries of New Mexico. The poverty rate in this country is 27.4%. According to the American Census Bureau, critical rates of extreme poverty in the State of New Mexico are directly related to those areas where American Native are residing and have their reservations. Most often, these people are forgotten and kept sideline by the government of the United States. There are serious issues of American native speakers that make it quite harder to turn the situations better. These people are unaware about their rights and have very little or most often no political voice. It is quite harder to expect that anybody among the natives comes forward to fight for the rights of these people or even come in order to improve their socio- economic conditions. In this region, negative stigma plays negative role. So, areas which have negative stigma lead it becoming a quite unattractive place for livelihood, businesses and market. People who might consider the area favorable may find it unattractive because of negative stigma of the natives. As a result of such scenario, high risk of jobs occurs in the state of New Mexico leaving behind very high unemployment rates. Poor health care facilities and low level of education turn the situation worse. Such situations multiply the problems of the area and poverty becomes even worse. Public as well as private investments are lower than required. This situation may further raise the poverty levels. However, many of the issues related to poverty could be solved by proper urban planning and policies offered towards the betterment of the general conditions. It is also significant to spot the exact ongoing trends and causes of poverty in the region in order to evaluate the conditions towards betterment because it is a fact that every individual is different so trends and traditions of specific areas are also changed accordingly. Issues that give rise to High Poverty in New Mexico There are various issues that gave rise to poverty in New Mexico. The education level and standard, the family structure, the well being of the population and the health conditions are the main indicators that define the poverty levels in the region. However, these issues, if handled carefully may decrease the poverty and may improve the living standard of the people in New Mexico. 1. Historical and Cultural Facts: Colonial System and its Impact on Poverty: New Mexico remained French colony from 1861 to 1867. The city also faced various invasions and battles. This resulted in making New Mexico a place where people belonging to different origins, different ethnic and social backgrounds and different culture settled. Moreover, as the state was ruled by different empires, rulers and countries in different periods, so it also created a hurdle in developing an overall culture of Mexico. These differences have made Mexico a place without any defined cultural, ethical and social background. Thus, the residents of the state are also loosely bound to one another. This has not only affected the social relationships of the people but has also hampered the social and economic lives of the area. The differences among them also results in clashes. This hampered economic life and loosely bound society is also a major reason of the poverty in New Mexico. 2. Demographic Facts and Figures: Effect of Aging and Poverty: The overall rate of poverty for the old age Americans who are 65 years or older in age is about 10%. However, in New Mexico, the poverty level is higher and the old age poverty is 15%. However, the major portion of such poor population constitutes women and minorities groups. The poverty rate in women is 22%. However, this level is drastically high in children which are 31%. This may be described as such that each third child of New Mexico is living below poverty line. The deepening recession period of America and the world as a whole may cause severe issues for this population in the future and thus, the poverty level may increase more in New Mexico. However, the steps may be taken by the people to safeguard themselves from being fallen in poverty level at the attainment of old age by adopting different techniques such as asset building and participating in public benefits plans regarding provision of, for example, free medical services at old age and other social security plans. 3. The Economic Facts and Impact on Poverty: Economic Opportunity and Poverty: The unemployment rate in New Mexico is quite high and approaches to 7.4%. The unemployment is a basic factor in poverty. A raising unemployment rate decreases the pay scale of the jobs which consequently results in low standards of living even for the employed people. Thus, the unemployment has two-fold effect on poverty scale; the unemployed people itself do fall in poverty level and it also reduces the wages for employed people which affect their living standard and, in some cases, also push them below poverty line. However, this may be dealt with by increasing the minimum wage rates from $7.5. This will improve the wage rate of the employed people. The development of industry may also be encouraged in New Mexico by reducing the tax rates and tax payments and also by allowing tax credits and exemptions for the industries opening their businesses in the region. Relationship between Family well being and Poverty: The family well being also affects the poverty level of a region. About 42% of the children in New Mexico are living in single parent family. 21% of the children are living in immigrant families. This high level of children living in single parent and immigrant families do not represent good conditions of family well being. 30% of the population is living on rent while 112,007 people pay more than 30% of their total salary I paying the rent of their houses. Such high expenditure towards the housing lowers their net income after housing and may also push them below poverty line. 3,601 people are homeless which shows their living conditions. Thus, family well-being and poverty are inter-related. The higher the family well-being, the lesser will be the poverty and the decrease in poverty will increase the family well-being. 4. Education and Poverty: There is a deep link existing between the education level and the poverty. Graduation from a high school is necessary for a secured and safe future. However, in New Mexico, the rate of High school graduation is quite low. In America, this rate is about 70% while in New Mexico, it is 64.8%. 56% of the students consist of those who are not able to bear educational expenditures. These increasing educational expenditures and poverty forces the students to leave their studies uncompleted. Thus, the rate of college completion has dropped down to 25% which is drastically low. It means that only one of the four students enrolled in college completes the college degree. Moreover, 12% of the teen ages falling in the age group of 16 to 19 years do not attend school which also reduces the level of education in New Mexico. 5. Health and Poverty: The health and poverty are also closely inter-related. Poor health may result in poverty as this will increase additional medical costs which may amount in thousands. On the other hand, the poverty also results in poor health. The poverty causes tension in the subject which may result in a number of hearts, physical and psychological diseases. 6. Effect of Participation in Federal Programs on Poverty: The participation of the people residing in an area in the Federal programs established for their benefits affect the poverty level in that area. These programs are usually devised for the benefits of the poor people. However, in some cases, these programs also mean to provide financial assistance to the people residing in a particular area or serving the government or a particular government institution. The assistance may be provided in terms of cash or other perquisites. Various programs have been introduced by American government for the benefits of the poor public. These programs have also been introduced in New Mexico. However, the participation of the New Mexico residents in these programs is quite low. The total population of New Mexico is about 2 million. Only 51,268 children and adults receive welfare out of total adult population of about half a million. 174,000 children receive food stamps. 26,941 households receive rental assistance provide by the federal government. 13,600 families receive the subsidies provided by the federal government on account of child care. 390,008 children have been enrolled in CHIP and Medicaid. Only 63,844 children and women receive payments from the Women, Infants and children (WIC) nutrition program. 82,573 households receive the payments from assistance program established by the federal government for the purpose of providing financial assistance to the households having low income. Recommendations for Poverty Reduction in New Mexico The government of any regions plays a significant role in the development of favorable policies that can support the low- income groups to improve their living conditions in order to minimize poverty rate in the region in general. Some poverty control recommendations are briefly enclosed here, 1. Asset Generation and Tax- Building Policy In order to implement successful strategies towards poverty reduction, it is very essential to build opportunities so that the common people may be self- sufficient. Moreover, tax system should be promoted in order to promote economic growth. This can be done by the improvements to collect income tax and by broadening the tax incentives. Barriers should be removed that prove to be obstacles in the collection of taxes. 2. Subsidies Government should offer subsidies on the products of daily consumption so that the standard of living of the common people can improve. Subsidy is, basically, a price of the product below market level that is given by the government to support the development of the common people. This may consider as the direct or in some ways, an indirect support of the government for the welfare of the people. Subsidies can be in form of interest- free loans, insurance or cash grants. 3. Fix Minimum Wages Fix minimum wages are another way towards poverty reduction especially in states like New Mexico where labor is so cheap and people are living below poverty. Minimum wage, basically, offer security to the workers and reduces inequality and poverty in a region. It is also helpful to boost the morale and efficiency level of the workers due to psychological security that it offers. 4. Reasonable Allowances for Unemployed Government can also fix reasonable allowances for unemployed people which will result in stability and psychological comfort for the people. With the help of allowances, people can better fulfill their needs if not the luxuries. This will allow them to relieve from the stressful conditions of unemployment and poverty. Moreover, with such agendas, government can minimize the risks for people to go below poverty line. 5. Saving Incentives It is a fact that savings can better facilitate the higher income groups as compared to middle and lower class. However, old age population can get benefits through savings which will ultimately lead to decrease the chances of poverty in old age. Government should participate to encourage such organizations that could better direct people to save for years to come. This will help to eradicate poverty. 6. Reduction in Social Conflicts As mentioned above, New Mexico has complex heterogeneous structure as far as the society and culture are concerned. This simply gives rise to conflicts regarding social status of the inhabitants. Moreover, with complex cultural dynamics, New Mexico has no defined pattern that has left the country loosely tied. Such situations directly impact the economic as well as societal well being of the people. So, single framework and equality must be forced by the government to encourage national integration process. This will definitely raise the standards of living by minimizing the risks of clashes. 7. Improving the Standards of Education Poverty plays a vital role in constraining the process of progress for any country. In New Mexico, the percentage of high education is very low when compared with other states of America. So, government should pay keen attention to this issue. Technical know- how and professional education policies must be introduced so that more industries, developmental programs and infrastructure could flourish for the betterment of general public. References 1. Garcia, Chris. Governing New Mexico. New Mexico: The University of New Mexico Press, 2006. 2. Poverty Rates in New Mexico.Suite101. web. 25th November 2013. . 3. Scott, Damon. New Mexico has Second- worst Poverty Rate in U.S. ALBUQUERQUE Business First. 8 November, 2012. Web. 25th April. 2013. . 4. Simmons, Marc. New Mexico. New Mexico: The University of New Mexico Press, 2004. 5. Spotlight on Poverty and Opportunity. The Source for News, Ideas and Actions. Web. 26th April. 2013. . Read More