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Fact Check: Palin's Alaska spreads its wealth

Friday, October 31, 2008

GLENDALE, Ariz. —  Republicans John McCain and Sarah Palin summon antidemocratic images of a communist state to attack Democrat Barack Obama's tax plan and his comment about spreading the wealth around. But in her home state, Palin embraces Alaska's own version of doing just that.

Palin and McCain seized on a comment Obama made to Ohio plumber Joe Wurzelbacher, who asked about his tax plans.

Obama wants to raise taxes on families earning $250,000 to pay for cutting taxes for the 95 percent of workers and their families making less than $200,000. "I think when you spread the wealth around, it's good for everybody," he told Wurzelbacher.

McCain said that sounds "a lot like socialism" to many Americans. Palin has derided the Illinois senator as "Barack the Wealth Spreader."

But in Alaska, Palin is the envy of governors nationwide for the annual checks the state doles out to nearly every resident, dividends from the state's investment of its oil royalties. She raised taxes on oil last year which, along with escalating oil prices, helped her to boost the checks this year.

McCain campaign spokesman Taylor Griffin said Thursday that spreading wealth through Obama's tax plan and doing it through Alaska's oil-profit distribution are not comparable because Alaska requires the state's resource wealth to be shared with residents, but it's not taxing personal income.

"It's how the revenue is shared between the oil companies and the state."

Alaska's state revenue Commissioner Pat Galvin added, "It's not a matter of taking something that's earned by someone and giving it to someone else."

A look at Palin's and McCain's comments and the record in Alaska:


"Barack Obama calls it spreading the wealth. Joe Biden calls higher taxes patriotic," Palin told a crowd in Roswell, N.M., and elsewhere. "But Joe the Plumber and Ed the Dairyman, I believe they think it sounds more like socialism.

"Friends, now is no time to experiment with socialism."

In Ohio, she asked, "Are there any Joe the Plumbers in the house?" To cheers, she said, "It doesn't sound like you're supporting Barack the Wealth Spreader."

McCain told a radio audience that Obama's plan "would convert the IRS into a giant welfare agency, redistributing massive amounts of wealth at the direction of politicians in Washington."

"Raising taxes on some in order to give checks to others is not a tax cut; it's just another government giveaway."


In Alaska, residents pay no income tax or state sales tax. They receive a yearly dividend check from a $30 billion state investment account built largely from royalties on its oil. Palin raised taxes on big oil last year. With oil prices soaring this year, she was able to increase the checks by $1,200 to help residents hit by higher home fuel and gas costs. Thus every eligible man, woman and child got a record $3,269 this fall.

She also suspended the 8-cent tax on gas.

"We can afford to share resource wealth with Alaskans and to temporarily suspend the state fuel tax," she said at the time.

Much as Obama explains his tax hike on the rich as a way to help people who are struggling, Palin's statement talked about the energy costs burdening Alaskans:

"While the unique fiscal circumstances the state finds itself in at the end of this fiscal year warrant a special one-time payment to share some of the state's wealth, the payment comes at a time when Alaskans are facing rising energy prices. High prices for oil are a double-edged sword for Alaskans. While public coffers fill, prices for heating fuel and gasoline have skyrocketed over the last six months and are now running into the $5- to $9-a-gallon range for heating fuel and gasoline across several areas of the state."

In an interview with The New Yorker last summer Palin explained that she would make demands of a new gas pipeline "to maximize benefits for Alaskans":

"And Alaska we're set up, unlike other states in the union, where it's collectively Alaskans own the resources. So we share in the wealth when the development of these resources occurs."

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.



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