In recent weeks, discussions surrounding the establishment of a national security fund have been circulating among President Joe Biden's top aides. This proposal aims to finance crucial national security interests in the United States. Interestingly, former President Donald Trump also voiced support for a similar state-owned investment fund during a recent campaign stop at the Economic Club of New York.
While the specifics of how an American fund would be funded and operated remain unclear, lawmakers may look to the Alaska Permanent Fund as a potential model. The Alaska Permanent Fund, initially funded by revenue from mineral extraction such as oil, has evolved to primarily generate revenue through investment returns. This fund distributes annual dividends to the state's residents, resembling a form of universal basic income.
However, the Alaska Permanent Fund differs from a true universal basic income in several ways. The dividends are paid only annually and do not amount to a livable wage. Federal lawmakers may envision a sovereign wealth fund serving a different purpose, such as supporting industries or financing supply chain initiatives. Establishing a national fund would involve significant legislative hurdles, requiring collaboration between the executive and legislative branches.
Sovereign wealth funds, like Alaska's or Norway's Government Pension Fund Global, are typically funded by wealth generated from state-owned natural resources. However, in the United States, natural resources are mostly owned by individual states, complicating the consolidation of revenue streams for a national fund. As the discussion around the establishment of a national security fund continues, it is evident that careful consideration and collaboration will be essential in navigating this complex process.