MINOT, N.D. -- We’re going to end up doing something really, really dumb with the Legacy Fund.
It was created by the North Dakota Legislature, with approval from the voters, back in 2010. As of February the fund had about $5 billion in it thanks to revenues from oil and gas development.
Yet, at this point, there’s no defined purpose for what we’re actually going to do with all this cash.
A contingent of the fund’s backers - people I’ve dubbed hoarders - seem committed to growing the balance in the fund just for the sake of growing it. That's opposing other ideas such as a proposal to use earnings from the fund to buy down the state’s income tax, which lawmakers voted down last week.
I don’t know about the rest of you, but beyond reasonable reserve funds, I’m not in favor of the government stockpiling billions of tax dollars taken away from the private sector with no plan in place for what we’re doing with the money.
I’ve been hearing various politicians and politicos droning on for years now about how “visionary” the Legacy Fund is.
There’s nothing visionary about it. What we’ve created is a moral hazard. A giant pot of money the use of which has become the subject of increasingly intense political fighting.
Rep. Corey Mock, a Grand Forks Democrat, joined me on my podcast recently to discuss his legislation to change the state constitution so that Legacy Fund earnings aren’t automatically put in the state’s general fund. Mock would like those revenues to be automatically reinvested in the fund. His resolution would require the Legislature to act if they want the funds available for spending.
Which is all well and good, I suppose, but I asked him what would happen if some billionaire with a hobby horse (like the guy behind the Marsy’s Law campaign) or a group of Hollywood activists (like the ones behind the Measure 1 “ethics” effort last cycle) decided to launch an initiated measure campaign to spend the Legacy Fund.
As we’ve seen, it’s not hard for interests with deep pockets to buy their way onto the statewide ballot and then bamboozle voters with expensive marketing, cutting our elected leaders out of the process entirely.
With billions of dollars at stake, if lawmakers continue to leave a vacuum where a purpose for the Legacy Fund should be, some group of interests is going to fill it with their own ideas.
If we aren’t going to play with our piggy bank, someone else will.
Call me a cynic and a pessimist, but I suspect that’s what will ultimately happen.
The Legacy Fund hoarders will keep beating their drum until they’re broadsided by some campaign to use the billions we’ve hoarded for the benefit of one interest or another that has little to do leaving a legacy for North Dakota taxpayers.
Something like the Legacy Fund committed to a defined purpose could make a lot of sense. It could even be visionary.
But that’s not what we’ve done.
Instead we’ve launched ourselves on a fool’s errand that will likely end badly.
Rob Port, founder of SayAnythingBlog.com, a North Dakota political blog, is a Forum Communications commentator. Listen to his Talk Podcast and follow him on Twitter at @RobPort.