Alaska already has a dividend – it’s popular and effective.

Public support for pricing carbon is highly dependent on how the revenue is used. By far the most popular use – by a ratio of 3 to 1 – is returning the proceeds directly to all citizens in the form of dividends.1 The reason for this popular appeal is obvious: over two-thirds of American households would be financial winners under a carbon dividends plan. Recent polling reveals that a majority of Americans favor a carbon dividends plan, including support by a 3 to 1 margin among Republican voters.2 Among 18-35-year-olds – the cohort that will determine the future of any party – support reaches 4 to 1. No other approach to carbon pricing comes close to this level of popular support.

The Alaska Permanent Fund Dividend illustrates the enduring popularity of dividends. Enacted in 1982 by a Republican Governor in a Republican state, it provides over $1,000 per year to each state resident. This program has consistently proven popular across all income groups, turning it into a “third rail” that has withstood all efforts to tamper with it. The dividend is particularly popular among the 72% of Alaskans who make less than $50,000 per year. But even Alaskans making more than $100,000 per year prefer the dividend to income tax cuts.3 The durability and popularity of the Alaska dividend provides an important lesson for carbon fee advocates.