Jan 15, 2016

A time to act: Will Alaskans give up ownership of their country and their citizen dividend?

Since the Alaskans started to get their citizen dividend three decades ago, there have been many nasty attempts by "their" politicians. "Their" politicians want to take their citizen dividend away.

(See this post for more information about the Alaska dividend: Alaska: Protecting their citizen dividend (Bill HJR17 CONST AM: GUARANTEE PERM FUND DIVIDEND) )

"Their" politicians are at it again. 

See this: Alaska's fiscal plight: So bad it's good, because lawmakers must act Tim Bradner January 13, 2016. It has some sweet talking reasons on why Alaskans should give up their citizen dividend, or agree to cap their dividend. 

See this: As Alaska leaders eye Permanent Fund earnings, cost will be felt in dividend checks. The current Alaska governor wants to take away the goose that is laying the golden eggs for every Alaskan. He wants to take the Alaska Permanent Fund (the goose) away, and in return he promises to find a few silver or bronze eggs from somewhere else.

If the Alaskans don't protect themselves and their citizen dividend, they are going to lose it. First, the dividend will be capped; then, it will be reduced; soon, it will be gone. Say bye-bye to your citizen dividend.

That will be the end of the first big scale citizen-ownership democracy, where citizens really own their country and enjoy yearly citizen dividends from their ownership.

Let us see what confiscating the citizen dividend means for three families, each with 2 parents and 3 kids, using the 2015 dividend of $2,072 in the calculations:

Very poor family:
 Work income: $10,000
 Ownership income:$2,072 * 5 = $10,360
 Total income: $20,360
 Confiscating their citizen dividend means an effective tax of more than 50%.

Moderate family:
 Work income: $40,000
 Ownership income:$2,072 * 5 = $10,360
 Total income: $50,360
 Confiscating their citizen dividend means an effective tax of more than 20%.

Very rich family:
 Work income: $1,000,000
 Ownership income:$2,072 * 5 = $10,360
 Total income: $1,010,360
 Confiscating their citizen dividend means an effective tax of 1%.

It is clear. Confiscation of citizen dividend means a very bad regressive tax. Poor and moderate income families are going to be taxed very heavily (in terms of tax rate) while the rich will not even feel the tax.

It is also clear why rich politicians and businessman prefer to take away everybody's citizen dividend. A normal progressive tax will give them pain.

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