Michael Tavoliero: The feds give Alaska the money, and the feds get to call the tune

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By MICHAEL TAVOLIERO

Have you ever wondered what Alaska gets for the total tax contribution its citizens give the federal government?

Alaska, a Russian-owned 665,384-square-mile piece of property, was $7.2 million sale to the United States in 1867. It remained a territory until 1959 when it was admitted to the Union as a state.

Its original admission was due to a combination of geopolitical, economic and strategic factors. This played out as a mixture of geographic military strategies and natural resource development potentials which offered its residents greater control over their affairs and resources. Alaska residents sought full representation and self-governance through statehood.

With statehood, the proliferation of military strategy development helped build and benefit several communities in Alaska, however, the long-sought dream of Alaskan natural resource development appears to have been bogged down by bureaucratic intransigency and lethargy.

In 2021, Alaskans filed income tax 349,810 returns based on an adjusted gross income of $29,233,555,000 with 641,450 individuals filing. This produced a total income tax liability of $4,216,090,000 or 14.4% of all reported income.

Today, Alaska has a population of some 710,000, yet we are the most federally dependent state in the nation with over 57% of Alaska’s revenue coming from the federal government. 

Alaska gets a great return on the taxes its residents pay to the federal government. For every $1 that we as residents pay to federal taxes the state of Alaska receives $2.47 in federal funding or $10,389,233,000 (2021).

Alaska also receives a lot of federal jobs. Almost 5% of the state’s workforce is employed by the federal government compared to other states whose share is between 1% to 3%.

But what do we really get from that dependency?

The federal government through its funding controls the vertical and the horizontal of virtually every governmental function in Alaska. This includes and may not be limited to education, public welfare, hospitals, health, highways, police protection, corrections, natural resources, parks and recreation, governmental administration, utilities, liquor stores, and insurance trusts. With the majority of control, Alaska’s sovereignty as a state is actually a colonial dependency.

Simply put, if Alaska wants this money, Alaska must dance to whatever the piper is playing.

Think of this on a personal note, if you receive more than 57% of your income from the government, it typically means that you are heavily dependent on government assistance or support. This level of dependency on government income has various implications for an individual’s financial stability, self-sufficiency, and overall socioeconomic status.

Being highly dependent on government income affects an individual’s sense of financial independence and autonomy. It limits our ability to pursue opportunities for personal and professional growth outside of government assistance programs. Additionally, such a high level of dependency leads to concerns about long-term sustainability and reliance on taxpayer-funded resources. It also impacts one’s motivation to seek alternative sources of income or engage in productive activities outside of government support. 

This high level of dependency on government income has broader societal implications. It strains government resources and budgets, leading to increased fiscal pressure on taxpayers in the form of additional varieties of taxes and potential cuts to essential services.

Moreover, a significant portion of the population relying heavily on government support hinders economic growth and innovation within a society. It contributes to social inequality and disparities, as individuals who are less dependent on government assistance have greater opportunities for economic advancement. Therefore, reducing dependency on government income is essential for fostering individual self-sufficiency and promoting economic prosperity.

It limits one’s ability to pursue personal goals and aspirations independently, as decisions and opportunities become more constrained by government assistance programs. This reliance creates a sense of dependency and diminishes feelings of self-worth and accomplishment. With that the creation of generational entitlements as currently happening in many lower 48 communities manifest to almost irreconcilability.

Financially, being highly dependent on government income leads to vulnerability during times of economic uncertainty or policy changes. Government support programs subject to budget cuts or policy reforms, which result in reduced benefits or eligibility criteria, affecting one’s financial stability.

Moreover, a high level of dependency on government income influences personal attitudes and behaviors towards work, education, and financial planning. It discourages individuals from seeking employment or pursuing higher education opportunities that lead to greater economic self-sufficiency in the long term.

Socially, relying heavily on government assistance impacts relationships and perceptions within communities. It leads to stigmatization or judgment from others, affecting social interactions and self-esteem. Additionally, individuals feel disconnected from broader societal norms and values associated with personal responsibility and contribution to society.

Overall, the personal implications of dependency on government income underscore the importance of fostering individual agency, financial independence, and resilience to navigate life’s challenges more effectively.

Have you ever wondered what Alaska gets for the total tax contribution its citizens give the federal government?

Michael Tavoliero is a senior contributor at Must Read Alaska.

18 COMMENTS

  1. I have reminded pretend-Senator Sullivan about how we will have conditions that we will have to follow when we keep taking fed money. He does not care. It really makes me wonder how much of a kickback he gets in return for playing the fed’s game?

  2. “The feds give Alaska the money, and the feds get to call the tune……….”
    And you’d better dance, you’d better dance the right step, or they’ll pull back the money, and they’ve got piles of other tricks they can pull out. Dealing effectively with tyranny can be a dangerous activity.

  3. Thank you for a vital piece of commentary and journalism.

    I love living in AK, but one of the worst parts of it is how much the feds have bought and paid for so many people here. It is a heavy, capricious and black hand that involves itself in so much and leaves almost everything worse in its wake.

    There is a better way then to be a whore for the feds. I look forward to that day of liberation and freedom for my fellow Alaskans.

  4. In my opinion, the money we receive from the Feds should be considered a tax for all the land that they control in this State and do not allow the public full usage of. The Feds should be paying a leasing fee each year for every acre of Alaska that they keep away from the Alaskan residents. I think this is the way Senator Stevens looked at the tax money that came into this State. This money should not be reflected against taxes paid. It should be considered a lease fee for each and every acre the outside public wants to keep away from the citizens of this State!

  5. Thank you Michael! We are treated as a colony and our leaders like it that way. Begich is the only statewide politician I’ve ever heard in Alaska who says we have to stop this and instead of money from DC we develop what we have. Maybe that is political suicide but we are bankrupting our grandchildren with all this spending. We must really hate them to leave them with this much debt.

  6. Great outline of the problem, but what’s the solution? Should Alaska simply swear off all federal funding, while still sending 14.4% of our hard-earned income to Washington? Do we really think we have a population willing to endure that level of pain in the short term, even if the eventual results are desirable?

  7. Yep. If Alaskan leadership both Democrats and Republicans want to be taken seriously by Congress and the White House all you guys can’t be going to DC asking for money. Alaska’s local community pay for their community’s own budget without Federal and State help. Alaska’s leadership is going to have to One day pay for their own budgets when there is no federal government. That day when there is no federal money, when America goes to a tier 2 country instead of a 1 is coming. I think todays Alaska elect are cruel they still borrow rather than cut their budgets. Alaskans won’t be ready when federal money is gone.

  8. Y’all make fun of adult children living with their parents and not contributing anything to help their aging parents, what made Alaska’s leadership living off the federal and state governments any more different than an unemployed adult child living off their generous parents not contributing anything at all. No difference.

  9. at least the article started with some facts Too bad he went in to spewing total nonsense. A male realtor talking about self worth and accomplishments. Maybe we should ask how many of the homes in Eagle River are occupied by people associated with the military. Maybe Tavoliero missed the 80’s in Alaska. Sure many people dependent on the state lost jobs but the private sector did not fare much better. I certainly did not see the absence of government support creating economic growth and innovation. The only thing holding back personal growth is that individual.
    What do we get from the feds? How about the port of Anchorage getting dredged. How about 600,000 visitors a year coming to Denali National Park. They are not coming to see Denali State Park. How about getting bailed out every time Dunleavy declares a disaster? The federal government operates 9 miitary bases in Alaska. Maybe they should just go away?
    “This high level of dependency on government income has broader societal implications. It strains government resources and budgets, leading to increased fiscal pressure on taxpayers in the form of additional varieties of taxes and potential cuts to essential services” Seriously if you want to see strains on government resources and fiscal pressure on tax payers let the state of Alaska pick up fiscal role the federal government plays in Alaska

    • There is no money! We are borrowing a trillion every three months. We are headed for bankruptcy.

      Also, you seem perfectly OK with dumping this massive debt on the young who have no say on this at all. Very sketchy morally.

      • Americans have been talking about the national debt for over 200 years. I am not losing sleep over it. Sure I would like it to be gone. Personally I live my life debt free and have taught my children the same thing. I am just not buying into the premise that having the federal government out of Alaska is going to lead to financial independence, and resilience to navigate life’s challenges more effectively. Seriously, do you really think the feds closing nine bases or ending the 8A program is going to lead to economic growth in Alaska?

    • No one is saying we don’t need a government, we are saying we can damn sure run our state (the whole thing) better than DC in every possible way. Or we can continue this train wreck called usury.

  10. Alaska could have its own bank and opt out of the Federal Reserve. In reality we could do what ever we can muster the collective will to. If everyone in Alaska wants to leave the Union no one can do anything about it, if we don’t want to allow the federal reserve to run our Alaska banks then that’s our business. We either have agency and self determination or someone else does.

  11. We get Project Blue Beam! What federal government is pushing for! Plot to facilitate a totalitarian world government by destroying traditional religions and replacing them with new age belief system. Using NASA to do this.

    Serge Monast book; Project Blue Beam
    1994 a Canadian

  12. Maybe I’ll change my mind about Eagle Exit. It would do the entire state good to have a designated place for the bomb throwers and Libertarians and the grievance barkers and the Christian Nationalists and the cosplay militias to meet, try to govern themselves, and fail. And of course when Eagle Exit fails, they will blame it on the federal government and the elite Leftists, but never on themselves. In short, if you eliminate the federal dollars, we all fail.

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