"The POMV is nothing more than a spurious carrot, dangled in front of the public. The carrot is a generous dividend we're supposedly going to receive in exchange for government finally being allowed to claw its way into our Permanent Fund."
- Rep. Kohring
Once again our Permanent Fund is in grave jeopardy of being consumed by politicians. This time we are being told that a really safe and creative way of protecting our dividend and paying for the bottom line needs of government could be done at once. But like all of the past ideas to raid the Fund, the "Percent of Market Value" is just another variation of politicians attempting to get their hands on our money.
POMV is a bad idea whose time has come. Fifty-five "open minded" delegates met last week in Fairbanks, carefully picked to give us a predictable outcome. I say predictable because I believe most of the delegates have bought the notion that government has cut its spending as much as possible and that any means, POMV most probably, is the way to close the fiscal gap. The prominent facts that Alaska's deficit is the direct result of politicians' wasteful spending over the last 30 years and the creation of programs of dubious constitutionality have been lost to most of the "open minded" delegates.
The POMV is nothing more than a spurious carrot, dangled in front of the public. The carrot is a generous dividend we're supposedly going to receive in exchange for government finally being allowed to claw its way into our Permanent Fund. When examined closely, it's clear the proposal is just a different way of raiding the Fund and calling it a public benefit. It will be a first class act of consuming our "seed corn" instead of wisely keeping it from the politician's grasp.
If we permit this to happen, we will have lost our dignity as thinking Alaskans. Dividends should be paid only out of earnings, not savings, so that there will be continued earnings in the future. The so-called "stable and predictable payout" of this plan is a smoke screen to spending the Fund and represents poor money management. If actuaries running a private fund were to suggest such a plan, they would likely be fired immediately.
We cannot simultaneously pay out a dividend each year while tapping into the Fund's principal and expect to "save" the Fund. This proposal does not protect the Fund; instead it protects government's profligate spending. If this is carried out we will have a continuation of Juneau as kingmaker instead of a strong private sector with a healthy free market.
The POMV is a notion we cannot afford to turn into reality. All the more reason why we should continue to rein in spending by making government more efficient. We must find new ways to let free enterprise perform its miracle of productivity as the oil industry has been doing for us since the 1970's.
If we allow the POMV to go into nefarious action we will have removed all protection of the Fund's corpus. We will have set the precedent for dipping into the Fund the following year and there will be no stated principle left to defend it.
The worst part about POMV is that state government, which has always lusted after the Fund's corpus, is seeking to blow $1.6 million to advertise the plan in such a way as to convince the public into voting for it. They're trying to spend our money to persuade us to allow the heist of the decade. Talk about giving the victim the rope to hang himself!
Oh, that conference in Fairbanks, it cost us $274,000.00 of our money too!
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Vic Kohring, a Republican, represents Wasilla and the Mat-Su in the Alaska State Legislature. He's an Honorary Chairman of "Alaskans, Just Say No," a group formed to fight for the existence of the Permanent Fund.