Some experts say Alaskans are benefitting from a socialist policy. Just don’t tell anyone in the Tea party, fiercely Republican,
“However, a little known fact is that Alaska taxes the oil and gas corporations operating there and distributes the proceeds on an annual basis equally among every man, woman, and child living in the state,” San Diego Free Press reported.
The Alaska Permanent Fund is a constitutionally established state-owned investment fund under Governor Jay Hammond. It was established using oil revenues. Since 1982, it has paid out an annual dividend to everyone in Alaska. It grew from an initial investment of $734,000 in 1977 to approximately $53.7 billion as of July 9, 2015.
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“In 2015, with oil prices high, the dividend totaled $2,072 per
Despite the success of the program in the heart of a red state, conservatives say similar proposed plans for other states will lead to people not wanting to work and lead to economic disaster.
Economists Damon Jones of UChicago and Ioana Marinescu of UPenn decided to look into this claim. The focus of their study was to look into whether the annual cash payments caused Alaskans not to want to work. Their conclusion: not really. According to the two, “the dividend had no effect on employment” overall.
According to Jones and Marinescu, the state of Alaska has been able to use its oil wealth to give all its residents cash for free and erase extreme poverty. And this has not had a negative effect on its economy.
So why can’t this be done in other states? Ad why do Alsanks — and Republicans — refuse to say this is a socialist or socialist-type policy?
“But there’s a big caveat: Alaska pays these checks out of an investment fund financed by oil money. Taxing or collecting royalties for natural resources is just about the best way for the government to pay for stuff. Oil is in the ground, there’s a limited supply of it, and taxing it doesn’t reduce the amount left in the ground. It might reduce companies’ incentive to bring it out of the ground, but frankly, given climate change, that’s probably a good thing. Relying too heavily on oil money can cause political dysfunction, but distributing the money as cash to citizens helps reduce opportunities for corruption,” Vox reported.
Others have thought about taking the Alaska concept to other locales. Hillary Clinton, for example, thought about proposing a national expansion of the Permanent Fund under the title “Alaska for America” during the 2016 campaign. She didn’t’ because she couldn’t make the financing make sense.