The Alaska Permanent Fund Dividend was established by statute in 1982 to distribute half of the five-year average net income of the Permanent Fund directly to every eligible resident. The idea was that money would be distributed based on the population, not the political capital of a particular politician. For more than three decades, this formula was followed without exception. Many Alaskans remember waiting for the PFD board meeting in September to find out the PFD amount.
That changed in 2016 when Governor Bill Walker used his line-item veto to reduce the dividend from the statutory $2,052 to $1,022. In the years that followed, the Legislature repeatedly declined to appropriate the full statutory amount, instead directing a larger share of Permanent Fund earnings toward general-fund spending. The 2018 switch to a percent-of-market-value (POMV) draw rule formalized a new framework, but the pattern of prioritizing government services over the original cash transfer to households has continued.
Based on this year’s operating budget, it appears Alaskans will only receive “government services,” and thus far, nothing to place those services where the population is located.
The money wasn’t “saved.” It was redirected away from Alaskan families and into bigger government.
What if the state had deposited each year’s unpaid statutory dividend into a tax-free account invested in a broad S&P 500 index fund and left the balance untouched? If that account belonged to an Alaskan born in 2015, the child would now be 11 years old and in roughly fifth or sixth grade. The table below shows the result of that exercise.
These figures illustrate the cumulative opportunity cost of the policy shift. The average eligible Alaskan has foregone $32,683 in wealth that would otherwise exist today in a simple, passively managed equity account. That forgone capital represents real household purchasing power and potential investment returns that were redirected instead toward expanded public spending.
The numbers don’t lie. Because lawmakers chose government spending over your dividend, the average eligible Alaskan has lost $32,683 in today’s dollars – money that would be sitting in a tax-free account right now, growing for you and your family. That’s not pocket change. That’s real opportunity taken from every man, woman, and child in Alaska.
Next time you hear a politician say, “We can’t afford the full PFD,” show them this table. The money wasn’t “saved.” It was redirected away from Alaskan families and into bigger government. What do you think – was trading your PFD for more government services worth it?
Calculation Notes:
— “Traditional Formula” = Hypothetical PFD under the pre-2018 traditional statutory formula (AS 43.23.025).
— “Unpaid” = Traditional Formula minus Actual/Budgeted.
— S&P 500 Cumulative Balance assumes each year’s unpaid amount was invested Dec. 31 of that year into an S&P 500 index fund (total return, dividends reinvested) and left untouched.
— For 2026, the unpaid amount has been added at face value (no market growth applied yet).
— Grand total today (including 2026): $32,683 per eligible Alaskan.
The views expressed here are those of the author.
18 Comments
Politicians like to believe they know best how to spend money…allowing voters the option of allocating dollars for their families does not advance the politician’s career!
Our legislator are thieves that think they are gods.
The citizens keep voting for it. If you don’t believe me, just look at how one RINO in the legislature became 7 in just two terms!
Liberal voters are laughing at us. Liberal legislators (both in the D-party and the R-party) laugh their way to the bank and their next election.
Honestly, all the politicians who support stealing the PFD should get out of office. And all the stupid people voting them in office should have their voting rights taken away.
The PFD is a perfect example of socialism: free money for doing absolutely nothing. Yet hypocritical conservatives demand something they didn’t earn and doesn’t belong to them individually.
Did you earn your freedom, your right to vote and numerous other advantages you have, or were they created via a government? The government voted to create the permanent fund, did it not? This same government voted to withhold it. What do you think? Can this same government vote to cancel other rights they have granted you? BTW, the citizens of the State are the true owners of any minerals that belong to the state, not the government of those citizens…
You’re absolutely right Bernie and don’t know about you but I want my $32.683 paid back TODAY!
But I’ll bet you liberals have had no problems spending those PFD checks. Have you refused to accept and donated yours back to the state? Talk about hypocrites.
“…….. Have you refused to accept and donated yours back to the state?………”
Of course not. I’m not going to be a fool. I can oppose the PFD and cash mine simultaneously because your greed isn’t going to get paid while my good sense goes insulted.
First of all the PFD is my money. Now we get down to the why me and my fellow Alaskans can spend our money wiser and at the same time help the overall economy more than the self-serving morons in Juneau. The money taken and spent by the morons over the years amounts to around 12.5 billion ($20,000 x 625,000 reciepants) X 1.2 (the benefit of govt spending to the private sector) equals 15 billion
If the same amount were spent in the private sector with a modest multiple of 3 the value balloons to 37.5 billion. Most economists use a multiple of 5 to 7.
Now as for socialism, I’ve been here for over 30 years and like most Alaskans have a ” the PFD saved my bacon” story”. I actually have two or three. The PFD spent by private citizens raises all boats. The morons in Juneau stealing the PFD drills holes in bottom of all boats.
I’ll leave you with this factoid. In order to equal the $1,000 PFD issued in 1980, thanks to inflation todays PFD should be $3800. $3650 is a little shy of the mark; but it’s a lot closer than zero.
Pissed off yet?
Nope. That’s @ $42.2 billion that the state hasn’t charged me in taxes.
Absolutely!
Walker knew exactly what he was doing and so did the hyena’s, the jackels passing themselves off as legislator’s claiming they are doing the will of the people. In fairness we DO have a few and would have had more if it weren’t for the turncoat republicans that lied before the elections and went straight over to the demonrats as soon as hitting Juneau. Gotta wonder how many gained their seats fairly. Voter rolls messed up, RCV, Alaska Supreme Court corruption? You can pick your poison, there’s plenty of it.
The author is to be commended for bringing this problem to light. Obviously, Governor Jay S. Hammond inadequately codified the PFD enough to keep politicians that are obscured away in Juneau from raiding the fund every year.
Anyone notice the high level of angst We the People have about politicians? And I’m talking in general. We’ve been played over and over and have remained complacent, conditioned to accept it, and law abiding and tax paying. In other words we trust the system to treat us fairly. But that’s not what’s happening. We are apparently nothing more than votes and ATM’s for government thieves. I hope this house of cards experiences a nice crash. 39 trillion in debt and growing tells me it’s just a matter of time of time. Let’s rebuild as our founding fathers envisioned. Constitutional Republic baby!!!
How about lawsuits against all our State politicians that were party to this theft from we Alaskans! Unless these crooks feel the pain themselves, why would they stop screwing the public for their own gain. Most of them are very wealthy from their dirty deeds.
I fail to understand how people say this money “does not belong to the people of Alaska”. A brief history lesson is that the PFD was established by Gov Hammand so that the resources of Alaska when produced for sale, would be shared by the people who lived in the State and not just used by the State to fund programs the State wanted to fund. It is a royalty for the citizens from a type of stock account that was funded by the enormous tax profits that were made off the state resources such as oil, minerals, etc. The citizens who owned land, by constitutional decree loose the right to those resources if they are found on their private lands and the Governor felt it was a way to give back the resources, in part, to the citizen. The PFD was voted on and put into law by the citizen. This is not a government hand out or social program but an interest bearing account no different in principal to an interest bearing bank account. To argue otherwise is akin to saying the interest earned in your bank account should be taken by the State to fund budgetary needs. Or even more irrational, the profit made from stocks you invest in is to be taken by the State for similar reason. Socialism it is not.