Dividend means responsibility

Posted: Monday, October 14, 2002

Alaskans started receiving their dividends last week. The distribution of earnings from the Alaska Permanent Fund is welcomed by young and old, urban and rural. The dividend binds us all together.

Some Alaskans wonder if citizens really understand that the dividend is more than just a handout. It is a return on invested capital. We receive the dividend because pioneering Alaskans opened up state-owned Prudhoe Bay to oil development and prudent Alaskans acted to preserve our oil wealth flowing from public lands by connecting commonly owned assets with each Alaskan's pocketbook.

The dividend is a fantastic technique for getting Alaska's wealth back into the hands of the owners the people. But something has happened since the dividend was first put into place. A new generation has grown up with the notion that the dividend is something they are entitled to just because they live in Alaska.

There has been a significant weakening of the knowledge that defines us as Alaskans. There exists now in our Alaska a weakened civic culture with little sense of what binds us together as unique people of the north.

There is a need to connect the individual with Alaska's common good. Alaskans are more than the sum of their individual self-interests. They are the holders of a rare heritage linked with a special set of values. Northern values. Some citizens assert that it is time for us to re-establish the true nature of the Alaska character. A key aspect of this character is the notion that Alaskans are owners in common of our natural resources. Alaska is indeed an "owner state."

The permanent fund dividend is evidence of this common ownership. We enjoy the financial rewards of ownership, but not the responsibility that goes with it. Re-sponsible owners of wealth understand the importance of being either personally involved in the management of their assets or have full trust in their managers.

Unfortunately, the managers of Alaska's resources (our state government) do not have the full trust of the people. This was shown by the overwhelming rejection of the past proposal to balance the accounts of the state. Is it possible for trust to be restored? Is there a way for the owners of Alaska's resources to participate in deciding what investments must be made in order to get the best return on their assets?

The Alaska 2020 initiative has the potential to restore trust between the people and the state. It also provides a way for the owners to actively participate in making asset allocation decisions. However, the effort should be significantly expanded. The next governor could direct all departments to support this civic effort by moving beyond missions and measures to include the notion of a business plan for the owner state.

This business plan would have each department present their proposals for getting the best return on public resources and investments over a multi-year time horizon. Benchmarks would be developed through the Alaska 2020 process. The benchmarks would be a statement of public will defining the quality of life values held by individual Alaskans.

This public discussion will result in development of a strategy for the state that generates the best return on all assets held in common by the owners the people. How can you make sure that the owners will participate in the decision-making process? The Legislature could suspend inflation-proofing the permanent fund and even suspend distribution of the dividend. The funds would be held in trust until the people decide where, as an owner, they want to invest Alaska's assets. This would give real and urgent meaning to the dialogue.

The owners will decide what needs to be done by actively participating in the Alaska 2020 initiative. The results of this great civic discussion would determine the future of inflation proofing, the dividend, taxes, the wise development of our natural resources and the strength of our northern commonwealth. Alaskans would actively exercise the responsibilities of ownership.

So as you are thinking about how to spend your dividend, take a moment to consider whether you are fulfilling your ownership responsibilities. When those who desire your vote come before you, ask for their commitment to a fiscally wise business plan that you, as an owner not just a recipient of a dividend, help put together.

Allen Kemplen represented Anchorage District 16 in the House of Representatives from 1996 to 2000. He continues to be active in civic affairs and owns a consulting business.

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