It’s an open secret that if you ever want to know how bad a particular bill is in Congress, just read the title. Too often, the more innocuous a bill sounds, the worse it is. It helps confuse voters as to what is actually going on. After all, how could you oppose a bill named The Patriot Act? Or how about The Affordable Care Act (Obamacare), or the For The People Act (the current attempt at a federal takeover of state elections)? Politicians often try to compensate for bad legislation by coming up with a really good sounding title. Sometimes it works.
Likewise, whenever you see politicians heaping praise on one another, your first instinct should be to grab hold of your wallet and wonder what it is they feel the need to compensate for.
This year, you will hear many politicians bragging publicly about giving you “the largest PFD in history”. But what does that really mean? Let’s break it down.
First, let’s remember that the PFD is not a gift from a generous politician. They didn’t earn it. It’s not their Permanent Fund. It’s yours.
Second, only 25% of mineral royalties even make it into the Permanent Fund. The state takes 75% off the top before it ever reaches the Permanent Fund.
Third, the amount of the dividend is in the law. State law doesn’t suggest an amount for the dividend. It states what the amount of the dividend “shall” be. You can read it for yourself (AS 43.23.025).
According to state law, this year’s dividend is estimated to be $4,200. Remember, this is only what’s left after the government has already spent it’s 75% of natural resource revenues, and then spent its portion of the earnings from the Permanent Fund.
But even this amount, required by state law, is too much for the governor and most legislators.
This year, the governor requested to the legislature that the dividend be cut to $2,600 (a 38% cut from the statutory dividend). He calls this his “50/50 Plan”, which strangely looks exactly like Mark Begich’s plan when Begich was running against Dunleavy for governor in 2018. You can find the particulars in the budget that Dunleavy submitted to the legislature in December. He also requested that a supplement of $1,231 be distributed to Alaskans to help offset the $2,754 that was withheld from last year’s dividend.
From 2016-2021, politicians withheld a total of $9,750 plus interest from every Alaskan’s dividend.
With Dunleavy’s signing of this year’s budget, that number is now well over $10,000 per person. When interest is included, that number now approaches $12,500 for every Alaskan.
Instead of a $4,200 statutory dividend this year, Alaskans will be receiving a partial dividend of $3,250.
Instead of reducing the debt of $9,750 owed to each Alaskan, that debt will now rise to well over $10,000, plus interest. Meanwhile, the state budget just signed by the governor has ballooned to more than 25% larger than the budget proposed by the governor when he first took office.
This is the victory that the lobbyists and special interests are now celebrating and that politicians are now publicly praising each other for.
This is the victory the governor and his supporters in the legislature are now describing as “the largest PFD in history”. This is the victory they want you to jump up and celebrate as well. The politicians found the courage to make the lobbyists happy, and they found a talking point that helps them go to sleep at night. Just don’t try to factor in what inflation will be in October when dividend checks go out. And don’t reflect on what the governor and legislators promised when they were running for election. That was then. They’ve moved on now, and they want you to move on too, so they are throwing a party to help throw you off the scent. After all, it’s time to celebrate their coming re-election.
But keep an eye on the invitation list to the party. Conspicuously absent are the few conservative legislators who cried foul when the surrender first began and then fought against it. In the eyes of the swamp, they aren’t “team players”. They failed to “move on” when the script changed.
That’s the perennial trouble with conservative legislators, of course. They just don’t know when to surrender and pull out the champagne.
