Two questions

There really are, and have been, only two questions that must be answered when its comes to the annual Alaska Permanent Fund dividend.

First, are we going to continue to even have the dividend, set up in 1980 to ensure continued public support of the Permanent Fund to keep politicians’ mitts off the fund’s corpus?

If the answer is yes, then the second question is obvious.

To protect it and ensure the annual payout, should we ensconce in the Alaska Constitution the calculation of the annual payout to protect it from the whims and vagaries of politicians facing chronic budget deficits.

While lawmakers only now are talking about doing that, it is something Gov. Mike Dunleavy asked for in the opening hours of his administration. Lawmakers have been unable to take the dividend off the table as it is a hefty political club.

But with the state’s reserves running dry and a continuing budget deficit, maybe now they will act to protect the dividend from themselves.

5 Responses to Two questions

  1. David January 13, 2021 at 6:23 am

    I believe that the actual calculation is: After “inflation proofing, 50% of the profits are split and half of that goes to dividends. My question is under that formula how is it possible to run out of money? They just want more.

    Reply
  2. Randy S. Griffin Fairbanks Alaska January 12, 2021 at 7:28 am

    No, don’t enshrine the PFD in the Alaska Constitution. Left-wing politicians who advocate for a national “Universal Basic Income” for all adult Americans, might very well point to Alaska’s elevation of cash handouts into the Alaska Constitution, as evidence that it is a “basic human right”.

    It should never be a “human right” to steal money from hard working people, and then to give it to other people sitting on their couches watching TV. This would cause the whole country to spiral down into destruction.

    It is OK for government to hand out public assistance for the needy. But this is an act of mercy and kindness by the taxpayers who work hard for their money. The recipients should not sneer at their benefactors and say that they are “owed” a handout as a “human right”.

    Should a company chisel into unbreakable stone, that they “must” pay a dividend to their shareholders every year, whether or not they have made a profit?

    Of course not, this could lead to the collapse of the company. The shareholders understand this. They don’t want their company to go bankrupt and then have their stocks become worthless.

    They recognize that the company must first pay for employees, debt payments, maintenance, raw materials and production machinery. After this, if there is a profit or surplus, then a dividend can be paid.

    A dividend that is not guaranteed in stone, will cause the shareholders to be motivated to seek efficiencies, so that there will be a surplus.

    Reply
  3. Harlow January 11, 2021 at 7:17 pm

    Well said, A.V.

    Reply
  4. OGLila January 11, 2021 at 1:55 pm

    Why bother putting The PFD into the State Constitution when our lawlesslature heeds no laws of any kind?

    Reply
  5. Angry Viking January 11, 2021 at 12:08 pm

    The calculation for the PFD is simple. Take the amount earned by the fund and average over 5 years. Give half to the state and half to the people. Note this is money ALREADY EARNED and deposited in the account.

    Saying “The PFD is unsustainable” is a lie. We already have the money. The real truth is, government has spent their half and now wants our half too. THAT is what’s “unsustainable”.

    If we write this into the Constitution, then state lawmakers will be forced to pare back government during lean years. Which is, last time I looked, their job.

    Reply

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