Here's a whole new approach to resolving the budget deficit and the permanent fund earnings question all at once:
Why not take the Alaska Permanent Fund, give about half the money to Alaskans - $25,000 each - and use the interest from the rest as a means to balance the budget every year?
It sounds far-fetched and has been called everything from ingenious to wacky, but it's a plan that's out there for discussion.
Sen. Jerry Mackie has offered just such a plan as a way to resolve the budget deficit problem once and for all. Mackie says the plan will provide a stable funding mechanism to cover the state's multi-million dollar budget deficits without resorting to a state income tax.
What we like about this plan is:
It would require a vote of the people.
It would use the permanent fund for its intent, which is to help pay for state government when oil money becomes more scarce.
In the near future, Alaskans may well not have a dividend anyway.
It provides a revenue source for the state that avoids new taxes.
Obviously there are questions, such as: What would this plan do to welfare recipients and those whose benefits are based on income? Would we be killing the goose that laid the golden egg? What impact would it have on the Alaska economy, both short- and long-term? What would it do to real estate prices?
Voters already said they didn't want to use the earnings from the permanent fund to help balance the budget, largely because people were concerned about what it would do to their dividends. Perhaps Alaskans would be more agreeable to using the permanent fund earnings if they received a big chunk of it.
The permanent fund dividend is a privilege, not a legal right. It has become a sacrosanct ``right'' that everyone expects. Maybe it's time to end that mentality and use the fund for what it was set up to do.
Is it a good thing? That's a question voters will decide if it goes that far. Before this plan is dismissed, Alaskans should do some soul-searching and have a serious discussion about the original intent of the permanent fund and the impact of this plan.
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