There are two ways for a government to reduce its deficit: spend less or earn more. And there are two ways for a government to earn more: tax something or sell something. We spend a lot of time talking about how to tax, but we don't spend much time talking about what to sell. And so, a modest proposal for the United States: sell Alaska. (But, you know, wait until real estate prices recover.) Economist David Barker makes the case:
The United States purchased Alaska from Russia in 1867 for $7.2 million. Mr. Barker notes that in 2007 dollars that's $144 million. But then he adds another adjustment, for the relative size of the national economy, then and now, and comes up with a price tag in today's dollars of $16.5 billion. Mr. Barker notes that the United States let Alaskans, as a condition of statehood, keep 90 percent of the profits from the oil fields and has drawn very little in taxes. "Total revenue from onshore oil rents and royalties from Alaska peaked in 1982 at $24 million, a small fraction of the $1.3 billion collected in internal revenue in Alaska that year," he noted. By contrast, he writes, Alaska is very expensive to govern. Highways, railroads, ports: All are terrifically expensive. In sum, he seems to suggest, he might give it back to Russia.
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