A U.S. Sovereign Wealth Fund, inspired by Wyoming’s Permanent Mineral Trust Fund
Imagine you find a gold nugget in your backyard. You could sell it and spend the cash now, or invest the money and let it grow to pay for your kids’ college or a new house later. That’s what Wyoming does with its mining revenue—and it’s what a U.S. fund could do. The federal government made $109 billion from minerals in 2023, but most of that gets spent immediately. A fund would set aside a small portion, invest it in things like stocks or real estate, and create a steady future income. This could help pay for roads, schools, or cleaner energy without raising taxes.
It could also help U.S. miners compete with China, which controls most of the global supply of critical materials like rare earths and lithium, used in batteries, phones, and military gear. Interior Secretary Doug Burgum has floated the idea of using such a fund to invest in U.S. and allied mining companies to ensure domestic supply.
Secretary of the Interior Doug Burgum said this during a conference organized by the Hamm Institute for American Energy.
We should be taking some of our balance sheet and making investments, The U.S. may need to make an equity investment in each of these companies that’s taking on China in critical minerals,
A sovereign wealth fund for the critical mineral industry is like investing in a farm to grow your own food instead of relying on a store that might stop selling to you.
How Wyoming’s Permanent Mineral Trust Fund Works
Wyoming’s PWMTF, started in 1974, is a state piggy bank for mining money. Here’s how it works, in simple terms:
Where the money comes from: Companies mining coal, oil, gas, or other minerals on Wyoming state lands pay taxes and royalties. A portion—around 2.5% of mineral tax revenue—goes into the PWMTF. In 2022, Wyoming collected about $1.2 billion from minerals, with a slice going to the fund.
How it’s saved: The fund’s principal is protected by Wyoming’s constitution. It can’t be spent—not even by politicians. As of 2023, it was worth over $9 billion.
How it grows: The state invests the principal in stocks, bonds, and real estate. It’s like a savings account, except the fund buys assets that generate returns over time.
How it’s used: The fund earns dividends and income, which Wyoming uses to pay for schools, roads, and other services. In 2022, investment income totaled about $400 million—money spent without touching the original fund.
Wyoming’s model turns one-time mineral revenue into permanent income. It also cushions the state from boom-bust cycles. When oil or coal prices crash, investment income keeps coming in.
How a U.S. Fund Could Work
A national fund could follow the same model, scaled up. The federal government owns over 600 million acres of land used for mining and drilling. In 2023, it collected about $15 billion in royalties and fees. A U.S. fund could take 5% of that and set it aside. Over time, this could grow into hundreds of billions, just like Wyoming’s fund grew from scratch to $9 billion.
The fund could invest in stocks, bonds, or mining companies in the U.S. and allied countries like Canada and Australia. This supports Burgum’s idea: use the fund not just to save, but to invest directly in mining companies to secure our own supply chains. It’s like backing a local bakery so you’re not dependent on imports for your bread.
To avoid misuse, the fund would need clear rules. A board of experts—not politicians—would manage investments. The principal would be untouchable, and only the returns could be used. Earnings could fund infrastructure, cleaner energy, or even direct payments to citizens, like Alaska’s Permanent Fund does with oil money.
Why It’s Doable and Why It Matters
Critics like former Treasury Secretary Larry Summers has expressed skepticism about the practicality of a U.S. sovereign wealth fund, particularly given the lack of budget surpluses. In a Bloomberg Television interview, he stated,
It’s hard to believe that setting aside lots of funds for unspecified investments made in unspecified ways, where you don’t even know what it’s going to be called, is a particularly responsible kind of proposal.
There are broader skepticism about a U.S. sovereign wealth fund due to fiscal constraints, often citing the national debt and lack of surplus:
Salar Ghahramani, a Penn State professor, noted that sovereign wealth funds typically rely on surplus wealth, which the U.S. lacks due to its deficit and $36 trillion debt.
Colin Graham of Robeco in London said, ‘Creating a sovereign wealth fund suggests that a country has savings that will go up and can be allocated to this. The economic rules of thumb don’t add up.’
The Washington Post argued that the U.S.’s $35 trillion debt and annual deficits make a fund impractical, echoing the sentiment attributed to Summers.”
But Wyoming didn’t wait to be debt-free. It started small, investing a little each year. The U.S. could do the same—using mining revenue, tariffs, or other sources. More than 20 U.S. states, including Alaska and Texas, already run successful permanent funds.
A U.S. fund like Wyoming’s Mineral Trust Fund would save mining revenue to build long-term wealth. Wyoming turns coal and oil taxes into a $9B piggy bank, investing in stocks to fund schools without touching the principal. A national fund could use federal mining cash to back U.S. miners, counter China’s supply control, and fund mining or expand energy projects without shifting the burden onto the taxpayers. Starting small with clear rules, this would help secure the economy for future generations.