Contributed by Andrew Brewer
Are the mineral rights of this state held in common? That is, do Alaskans have common ownership of the state’s natural resources? The answer to that is, yes. The resources are held in common and managed by the State of Alaska. The constitution goes further by saying that those resources are to be developed for the maximum benefit of the “People”.
It does however stop short of guaranteeing an annual dividend be paid to the state’s residents. The dividend was established by statute. The question of the authority of those laws pertaining to the dividend were brought into question by the current administration, and the ruling of the AK Supreme Court was definitive: The dividend must be appropriated annually by the legislature, holding that the prohibition against dedicated funds applied to the statutes pertaining to the permanent fund dividend…
According to the State Supreme Court, “We the People” are not guaranteed an annual dividend. Could they have ruled differently? They did rule differently in Hickel vs. Cowper. (That ruling also stated that the entire earnings reserve was likely to be taken up by the dividend and inflation proofing.) The earnings reserve was judged to be a split-fund, half dedicated to the dividend and half available for appropriation.
Apparently, that precedent held no weight with the current court, since the decision was unanimously against the suit brought by Bill Wielechowski, and in favor of the state’s argument. It will take a constitutional amendment to guarantee an annual dividend, something the current legislature has been loath to take up. In its quest to fund state government, the revenue generated by the permanent fund is now being accessed to fund the operation of government. This use was foreseen from the outset, as was the dividend for the direct use of the state’s residents.
The right of the state’s citizens to the ownership of the resources held in common has not changed, nor the requirement that those resources be developed for the maximum benefit of the “People”. The interpretation of the “maximum benefit” is now what’s in question. And the state government is making that decision, not the “People of Alaska”.
Therein lies the rub. A reduction of the dividend is a tax, a head tax on all Alaskans. That it is borne disproportionately by the poor is another issue, which gives many pause. A flat tax could accomplish the same goal without the disparity, and that means the same revenue for state expenses without inflicting damage on society’s most vulnerable. Instead, the mainstream media has backed the plan to cut the dividend first. The result has been a deepening recession, and the departure of thousands from our state. Perhaps, that was their goal all along…
Thus, “We the People of Alaska” must take exception to the policy of cutting the dividend to raise state revenue. Half the earnings are available to fund state government. In fact, the cuts to the dividend have been piggybanked, and not dispersed as they should have been if statute were being followed. Holding onto approximately three billion dollars that should have gone to Alaskans during a recession is not morally justifiable, or economically viable. The citizens of the state and the state’s economy have suffered unnecessarily.
Apparently, our only recourse is vote in new representation, if such can be found. The ability of politicians to hold onto their seats, even in the face of such performance, seems remarkable. The mainstream press has backed the dividend reduction from the outset, marking its control by the very special interests that hope to benefit from the People’s share. If the recent primary is any indication, the status quo will remain in power, and the Big Money that’s behind “things” will continue to call the shots. We must console ourselves in what gains we can make, and hope our new governor has the political clout to overturn the excesses of previous administrations, and re-instate the dividend to its rightful place, constitutional amendment or not.