Should Permanent Fund dividend be your ‘right’?

  • Wednesday, October 26, 2016 12:22pm
  • News

In 1976, Alaskans amended our Constitution, creating the Permanent Fund. In 1980, the current dividend program was created by statute, mandating that roughly 50 percent of the earnings from the fund be dispersed to Alaskans annually as a Permanent Fund Dividend.

Should the PFD become your right?

Continuing the PFD dilutes the Permanent Fund that should be available for the Legislature to disperse, some argue. Our Constitution requires spending bills to originate in the House, where the needs of the people can be prioritized through elected representatives acting as a body. Our governor has line-item veto authority, which restrains legislative spending. Does a guaranteed PFD unreasonably bypass this balance of power? Or worse, by converting a financial benefit to a constitutional right, aren’t we opening a Pandora’s box? Would guaranteed housing be next?

Does the PFD do anything to reduce overall government spending, or does it just force the Legislature to find alternative sources of General Fund revenue — like taxes?

While these concerns are valid, they do not outweigh considerations for your constitutional rights. For example, do Alaskans have a constitutional right to live free of economic burdens stemming from excessive debt and spending? At what point does fiscal instability undermine equality of opportunity? While your dividend is not a natural right, it flows directly from these as logically as your right to free speech.

Our constitution holds that certain rights vest in the individual. These rights are not administered; they are inalienable — to be protected and defended by the people. Article 1 describes the people’s inherent, natural rights include “life, liberty, the pursuit of happiness, and the enjoyment of the rewards of their own industry.” Policies and decisions which deprive Alaskans of equality of opportunity — the very embodiment of the above principals — and the just rewards of their initiative, violate this clause.

When should a benefit become a right? The answer is “When it is just, equitable and sustainable.”

The PFD is all of these: just — since it delivers benefits to the people in a direct, efficient, and self-prioritized manner and does not burden future generations; equitable — since everyone receives the same amount regardless of who’s in power or of their philosophy, and every resident is “compensated” equally for the consequences of resource extraction; sustainable — since, if left untouched, your PFD will generate returns forever with NO new injection of cash from taxpayers — more than can be said of Medicare or Social Security!

Alaska’s fish and game — long recognized as a means of subsistence and a “harvest dividend” — is managed according to a sustainable yield principal. It is unique in history that the people’s biggest earning asset is not land or infrastructure, but cash, and in 2016 dividends totaled $1.5 billion, eclipsing the value of subsistence activity. Is it not logical that Alaskans should manage their biggest asset according to a similar principle — providing a present-day “harvest” that helps meet their subsistence needs?

When proposing the Fund and the PFD, then Gov. Jay Hammond clearly believed that Alaskans had a right to a direct share in Alaska’s resource wealth that would exist beyond the reach of politicians. With few exceptions, he believed the people would make wiser spending choices on their own behalf than the legislature would. Aside from Hammond’s respect for individual liberty, what larger collective rights exist in support of the PFD?

This generation’s struggle is mounting debt and the erosion of economic opportunity. Government money is doled out in ways that seem unfair. Even with the Fund in place, our governor and legislature have been unsuccessful controlling the growth of Alaska’s budget, the highest per-capita in the nation. History proves that if cash is within their grasp, politicians will spend it — sometimes in ways that steal initiative from the private sector.

As taxes increase, economic returns diminish until they bear no proportion to one’s investment of time, effort and risk. As private sector investment contracts, equality of opportunity is displaced in favor of the well-established. To re-gain prosperity, public-sector spending must be controlled.

In the future, the Permanent Fund will be under relentless attack and unless we protect dividends, both are in jeopardy. Gov. Walker’s veto of half your dividend is evidence of worse to come.

To combat this, a guaranteed PFD will check spending by forcing legislators to trim the budget or face unpopular alternatives for revenue generation. Moreover, the PFD creates considerable pressure not to raid the corpus of the Fund for public “investment.” The PFD also motivates the public to remain engaged. Finally, a constitutional amendment will not carry any negative consequences into the future that cannot be reversed by the people.

Given both your right to the PFD, and your need to protect the Fund, what constitutional principle supports a direct distribution, bypassing the legislature’s authority to appropriate and administer it collectively? If the PFD is to survive, an answer will be essential to gaining legislative consensus.

The answer is that Alaskans’ right to the PFD supersedes political gamesmanship and interpretations by the courts, and therefore deserves constitutional protection. Under the laws of nature and man secured by Alaska’s Constitution, it is the people’s right to restrain their government by means of amending their Constitution to correct ills perpetrated against them. Among these are unstable levels of debt and spending.

The best remedy is to deprive those who would erode our savings account of access to it, and to vest Alaskans with an incentive to protect it. The people have this power, which we use to protect our precious lands and waters, so why not our cash?

Henceforth, we should view the PFD as necessary to secure our individual and collective rights to happiness and to economic opportunity. In this way, your right to a dividend supersedes current statutes that appropriate money in ways that are wasteful, and that erode — rather than protect — your future.

Jon Faulkner is the owner of Land’s End Resort and is a lifelong resident of Alaska.

More in News

A diagram presented by Teresa Jacobson Gregory illustrates the proposed extension of the Beachcomber LLC gravel pit and the impact it may have on the surrounding state recreation area. The red markers indicate the current gravel mining area, and the orange represents the area the extension may allow for mining if approved. (Image courtesy of Teresa Jacobson Gregory)
KPB Assembly to consider gravel-pit ordinance revisions

Proposed gravel pit ordinance follows Superior Court ruling that planning commission can deny permits.

The Kenai Peninsula Borough School District Board of Education meets on Monday, Dec. 6, 2021 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
School board works to highlight students’ voices

Within the first hour of the meeting students would have up to five minutes each to address the board about any issue

Furniture awaits use in a bedroom at a cold weather shelter set to open next month on Monday, Nov. 22, 2021 in Nikiski, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Half of beds at Nikiski shelter are occupied

The shelter opened at the end of December 2021

A group of community members gather together on Thursday, Jan. 6 at WKFL Park to protest the insurrection at the U.S. Capitol on the one-year anniversary of the attack. (Photo by Sarah Knapp/Homer News)
South Peninsula residents turn out to ‘defend democracy’

Members of the Homer community and the Unitarian Universalists of Homer gathered… Continue reading

This image available under the Creative Commons license shows the outline of the state of Alaska filled with the pattern of the state flag. The state on Thursday reported a modest population growth between April 2020 and July 2021. It's the first time since 2016 the state has reported a population increase. (
State reports small population growth

Net migration still negative, but not as negative.

COVID-19. (Image courtesy CDC)
Health officials: Some monoclonal treatments widely ineffective against omicron

The new guidance comes from the Centers for Disease Control and Prevention

State Sen. Peter Micciche fields questions from constituents during a joint chamber luncheon on Wednesday, Jan. 5, 2022 at the Kenai Chamber of Commerce and Visitor Center in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
State Senate president lays out vision for upcoming session

Micciche seeks path forward on budget, looks to pass legislation on fishing permits, alcohol regulations

Snow covers the sign on Thursday, Dec. 9, 2021, at the South Peninsula Hospital Bartlett Street COVID-19 testing and vaccination clinic in Homer, Alaska. (Photo by Michael Armstrong/Homer News)
Local COVID-19 alert rate quadruples

State alert level per 100,000 people now is above 1,100.

Most Read