This week was that glorious time of year when anticipation of receiving the PFD was on many minds. The Permanent Fund Board met last week in Fairbanks to discuss the state of this marvelous fund and its future. It has been more than a generation since the creation of the fund, and many Alaskans aren't really clear about what the fund is for, how it is invested or what is at risk.
The Permanent Fund has been a great success and many of its original protections and benefits have served us well. But we are entering a time when things will change. How we view, and ultimately use, the Permanent Fund is going to be a question we will need to face. Not many folks mention this, especially politicians. But oil production is virtually certain to decline during the next 10 years and other options aren't going to be revenue sources quickly enough to fill the gap that oil declines will cause.
An interesting slant on all this was suggested to me by the title of the Annual Report handed out by the Permanent Fund Corporation at their meeting. It was titled: "Designed for Sustainability." My response to this rather intriguing title was: "Really? And how exactly are we going to sustain the Permanent Fund?"
I raise this because it is a hugely important question. Without doubt, if the Alaska Permanent Fund is in fact to be permanent it must be "sustainable," in the true sense of that word. It must last for future generations. And that is the crucial point I want to make in this community perspective.
Times are uncertain. The economy is unhealthy and the "old future is gone," as a John Gorka song says so well. By 2025, we will have taken most of the oil out of the major North Slope reservoirs, converted it to money and invested it in the world economy through the Alaska Permanent Fund. The experience of Fall 2008 ought to have warned us all, and it certainly warned the Permanent Fund Board. Their deliberations at this recent board meeting were muted but clearly cautious and concerned about how to weather the storms of the world economy. That is very good, but it may not be enough.
The time is right for wider, serious discussion and confrontation of the need to first provide for a future sustainability for the Fund and, in that context, determine how to most wisely and safely use it for our sustainable future. Alaska's prosperity and future quality of life has much to do with the crucial decision of the role for the Permanent Fund. So enjoy your dividend and be grateful for the management success of the past. But beware that things in the future may not be what they were in the past. We need to raise public dialog and discuss how best to mix the Permanent Fund, its earnings and investment into our best future for Alaska. That is what the Permanent Fund is for, after all. It is a great opportunity, and unique in the United States. And it may be time to consider investing in Alaskan infrastructure instead of outside the state. But if it is going to be sustainable, it will be through making the right choices and not by keeping things as they are. Let the discussion begin, and the Permanent Fund Board should get behind these discussions. A public objective entity should facilitate. We all need to realize our great Permanent Fund could disappear in a world economic calamity if we aren't more careful and cautious with our precious oil legacy. Time is fleeting, and the future is tomorrow.