Opinion: Alaska should be the richest place on Earth

Has been updated: 9 by the time release date: 9 by the time

Alaska has the resources to become the wealthiest jurisdiction on earth. With an $83 billion sovereign wealth fund and the highest per capita federal investment in the nation, we have the extraordinary privilege of allowing our citizens to fund our state’s operations and capital programs without paying a dime in state taxes. I am. We are so wealthy that in most years, we have paid nearly $1 billion a year in cash payments to our residents through the nation’s largest Universal Basic Income (UBI) program.

The question is, with all this wealth, how do we manage to fund so many underfunded schools, crumbling basic infrastructure, and almost no police in some of the state’s most populous areas? The question is whether we can maintain a depleted law enforcement agency.

The answer is simple. Alaska’s second largest budget item is the Permanent Fund dividend payment. His PFD cost $883 million last year, which is about as much as the entire secondary education system, twice as much as his university system, and more than Alaska’s largest health insurance program (Medicaid). . To put the scale of this spending into context, it will build multiple new dams in the rail belt, replace diesel-dependent power in dozens of rural areas with cheaper renewable energy, and solve pending heating shortages. $881 million would be enough to develop Cooke Inlet gas. .

Alternatively, the roughly $883 million in surplus could be spent on a combination of energy and education to create transformative investments in creating class sizes of 15 students or fewer and providing affordable energy across the state. can. There is no need to create all new taxes.

Over the past decade, we’ve spent nearly $10 billion in dividends, all while class sizes have increased, local school districts have been forced to close, and our reliance on increasingly expensive natural gas Energy prices are getting higher and higher. And diesel. In retrospect, it is painfully clear that handing out PFDs blindly results in disastrous missed opportunities in the form of collapsed education systems and rising energy costs that threaten to cripple entire economies.

I think it’s time to take a step back and consider our biggest budget items with an eye toward efficiency and economic growth. I don’t know a single educated, productive family who moved to Alaska to get a PFD, but I do know highly educated families who left as the education system and infrastructure collapsed. . I don’t know anyone who can pay their rising heating bills with her PFD, but $10 billion could rebuild almost our entire state’s energy system and provide our daughters with affordable clean energy for the rest of their lives. We know that we have the potential to provide.

For a long time, most political observers thought the PFD was an inviolable program that represented the top priorities of most voters. Not so anymore. I highly commend Governor Mike Dunleavy for changing politics around PFD. When the governor presented a budget proposal that indicated that a “statutory” PFD would require a complete elimination of public services, voters from every region and across party lines supported needs such as education, transportation, and a functioning criminal justice system. It loudly chose moderate funding for programs and balanced modest dividends. .

It was the right choice, but the population exodus and massive labor shortages that have persisted over the past five years show that we are not yet committed to the deeper budget reforms needed for long-term economic growth.

This year, we reversed about half of recent education cuts, restoring $680 per student to base student allocation funds, matching federal matching costs for infrastructure programs, and reducing spending on PFDs last year. can afford to pay the same $883 million. But compare the numbers. Half of the education funding cut (yearly Does it really make sense to recover just $175 million? Will we create career and technical education programs, or indeed an education system that attracts skilled workers from other states?

Does it make sense to comprehensively develop our energy resources to avoid dependence on ultra-expensive foreign LNG, but fail to secure an energy-comparable federal infrastructure?

No, there is no point in accepting mediocrity or economic stagnation.

Given our sovereign wealth fund, small population, and incredible supply of world-class energy resources, we need to invest in ourselves with the goal of becoming the wealthiest jurisdiction on Earth. Instead of “competing” with Mississippi State and Alabama to come in 49th place. [pick your dismal statistic], we should compete with Norway and Iceland for longest life expectancy, highest educational attainment, highest labor force participation rate, and highest labor productivity. All we have to do is spend less on cash benefits and instead use that vast wealth to finally deliver on Alaska’s promise.

Zach Fields is in his third term as a member of the Alaska House of Representatives representing the Downtown, South Addition, North Star, Fairview, and East Ridge districts.

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