The Permanent Fund Dividend vs. income tax

Letter to the editor

Posted: Friday, February 20, 2004

Over the past 22 years I have received $23,009.38 in Permanent Fund dividends. My immediate family of four has received $92,037.52 since this program began. This has been free, unearned cash we have enjoyed just for being Alaska residents. Have we spent this money wisely? I think we have.

Our daughters' money went into a college fund account, and my wife and I used our money for vacations and other non-essential items that brought us enjoyment. Did we come to depend on this money to meet our everyday needs?

No. We understood that the good times would last only as long as oil revenues were able to pay the bills, but eventually permanent fund earnings would be needed to fund education, transportation, social, safety and other important programs the state currently provides.

Now there seems to be a large segment of the population wanting to redefine the Permanent Fund from a "rainy day account" to an "endowment fund," a "social welfare program," or a "constitutional right" in order to receive free money in perpetuity. There are even suggestions to re-institute the dreaded income tax that was riddled with tax exemptions for special interest groups, and leave the Permanent Fund as a cash cow for everyone.

This is like giving all residents free money with one hand and taking it back from the salaries of hard-working Alaskans with the other. Instead of simply reducing the Permanent Fund dividends to supplement declining state oil revenues, this would create a whole new bureaucracy to manage and police the collection of a new income tax. This makes no sense.

All these years of free money have made us crave for more, and like some welfare recipients it's hard to break away and go our independent way. I personally agree with the original intent that when oil revenues can no longer fund programs like education at an appropriate level, that the Permanent Fund earnings be tapped to protect those programs. We may receive smaller dividend checks, but what is more important, free money or our kids' education? We should remember President Kennedy's words, "Ask not what your country (state) can do for you, but ask what you can do for your country (state)". This will be especially true into the foreseeable future or until new sources of revenues like the Arctic National Wildlife Refuge or the gas pipeline are constructed.

Rich Poor


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