Rep. Dvorak has proposed House Joint Resolution 3 which would add language to the state constitution creating an “Indiana Permanent Fund” which would ultimately be used to pay annual dividends to Indiana citizens.
The way it’s structured, any year in which the State realized a budget surplus, half of that surplus would be placed in the Permanent Fund. (The state would have the discretion to put such additional money in there as it saw fit.) The principal of the fund would be invested in income producing investments designated by law. For the first twenty years, the fund would simply be allowed to grow. After that, an increasing percentage of the income earned on the principal could be distributed to eligible recipients. In years 20-40, it would be up to 5%; years 41-60 it would be up to 10%; years 61-80 it would be up to 15%; and in years 81-100 it would be up to 20%. After a century, the amount would jump and be up to 95%. (Kind of the big thinking about our tricentennial I mentioned a few years ago!) To be an eligible recipient, a person “must have voted in the most 27 recent general election in which the person was eligible to vote 28 occurring before the payment of the dividend.”
My initial impulse is to like the idea. But I doubt I’ve really wrapped my head around the collateral consequences of this sort of program. By locking up the surplus, the State wouldn’t have as much flexibility in dealing with short term problems. Maybe it would discourage saving because lawmakers wouldn’t have as much of a slush fund for their short term priorities? Obviously long term planning is a hard sell. None of us will be around in a century, and five percent in 20 years isn’t a huge carrot. On the other hand, we’re going to need to figure out some way of funding people’s needs that doesn’t necessarily rely on having a job, because the robots are coming. That’s great for the people who own the robots, but the people whose livelihoods are displaced by automation still need to live; preferably good lives.
Without the two billion dollars surplus things would have looked more bleak for Indiana during this pandemic. Having a surplus is always a plus. Has there been any estimates on the dollar amount that a citizen would end up getting?
What comes to mind is the court ruling that gave everyone ten cents to $15.00 due to the BMV financial mix up. There is so many BMV refunds out on unclaimed funds I just wonder if they implemented it how many checks would be sent to dead (three of the BMV refunds waiting to be claimed are to my dad, mom and nephew who are all passed away) people, bad addresses with no forwarding addresses. If the State of Indiana can’t figure whose alive (Indiana doesn’t see dead people) and whose dead this might not be the best idea. Since a lot of those checks will be going to older people.
I have no idea how much money we’re talking about. It reminds me of the Alaska Permanent Fund into which a percentage of oil revenue is deposited. According to Wikipedia, it’s currently worth about $64 billion and pays out an average of $1,600 per year.
In terms of the mechanics of paying out to eligible recipients, I’m sure there will be bumps in the road, but it sounds like Alaska has more or less figured those out.