Let’s keep the dividend affordable

Discussion is blooming once again on how big the Alaska Permanent Fund Dividend should be.

Many members of the House think we should go for the full amount authorized under the existing statute, a nice $2,350 for each of us. Those are mostly Democrats whose enthusiasm for such ventures drives me up a tree.

Though the rules seem to say that a portion of the money generated by the fund is ours to spend as we see fit, I think we should be cautious and set the dividend amount at something that will be sustainable in the long run.

It’s a worthwhile discussion and there is no easy answer. Not unless you want to dip deeper into taxpayer pockets. Unfortunately many of our Democratic members of the Legislature say “go for it.”

Our Democratic friends tell us not to worry, but that is largely because their generosity with the Permanent Fund dividend would be partially supported with tax money drawn from corporations doing business here. And that is where we should be drawing the line.

The dividend is a wonderful little bump in our incomes each year. But we should not be levying taxes to pay for or support our dividend checks. Those taxes paid by the companies who do business here provide essential support for the state’s many essential projects. And levying taxes to pay dividends is a weird form of welfare.

Taxes are an essential part of what is expected from our corporate world. And the companies that do business here have lived with and paid those taxes since they first came. They expect to pay their share and generally do so.

That is appropriate and expected. But we should be very careful that no part of those taxes go to pay for or to support Permanent Fund dividends. That would create a bizarre and unsustainable cost of doing business here that the corporate world might consider a strange and unacceptable cost of doing business in the Great Land.

Let’s pay nice dividends as long as we can without drawing down the balance of our great savings account beyond what it is earning. And let’s make sure that we are not actually levying tax money to fund the dividend payments. That is a line we should never cross, one that would set off alarms in many corporate offices. It would seem to be a form of welfare for many people who do not need such assistance.

Alaska’s government funding comes primarily from the organizations that do business here. In recent years that situation has taken a weird twist. We seem to have reached the stage where personal taxes will once again be necessary in Alaska.

That is no surprise. We knew it would come again sometime and have been hoping the day could be put off as long as possible. But the Democrats’ insistence on a $2,350 dividend check would dip too deep into our reserves. It could only be paid by dipping into tax revenues.

The Permanent Fund is a marvelous community resource that Alaska established when money was flooding into the state treasury.

It is well managed and our state’s greatest asset. Let’s keep it that way.

Tom Brennan is an Anchorage columnist and author of six books. He was a reporter/columnist for The Anchorage Times and an editor and columnist at The Voice of The Times.