Gov. Mike Dunleavy, now in his final year in office, has spent more time talking about Alaska’s resource potential, whether getting oil and gas and minerals out of the ground or getting paid to store climate-warming carbon dioxide underground, than he has spent dealing with the reality of today’s state checkbook.
It’s kind of like telling your family that a big payday is just the other side of the rainbow, if someone would only extend credit until the leprechaun leads the way.
Nothing wrong with promoting what Alaska has to sell, whether minerals, oil and gas, wild-caught seafood or tourism. But in all those promotional speeches, a governor also needs to tell people the truth about today, tomorrow and the future.
Dunleavy’s last budget of his eight-year career on the third floor of the Capitol is much like his previous efforts. Talk about big fat Permanent Fund dividends, dismiss any tax talk, propose huge draws on savings to balance the budget for while he’s in office, and then close it out with a tantalizing pledge for more details to come about a long-term fiscal plan to pay the past-due bills in the years ahead.
Only the details of an achievable fiscal plan have never materialized. Sure, he has talked, and one year actually proposed sort of a half-baked plan that sank as quickly as the lead weight at the end of a longline. The governor’s plans have been like vaporware, a term used to describe flashy, promotional announcements of new computer software that never gets developed or falls far short of promises.
The governor unveiled his final spending plan on Dec. 11, just shy of six weeks before legislators convene in Juneau to start work on next year’s budget. To his credit, he acknowledged that drawing down half of the state’s $3 billion Budget Reserve Fund to pay the bills this year “is not a sustainable plan.”
And he further acknowledged that the billions of dollars that don’t exist but are needed to cover spending over the next 10 years “demonstrates the stressed fiscal situation Alaska is in.”
But none of that is new — the state has been drawing on savings for years. And yet the governor continues to submit an irresponsible budget with a Permanent Fund dividend approaching $3,700, costing $1 billion more than the state spends on K-12 education.
The Legislature will deflate Dunleavy’s PFD bubble, as it should. Alaska needs to live within its means, and talking about an unaffordable dividend is meaningless.
Not that the Legislature is blameless in all this either. Though committees and working groups have presented the start of several fiscal plans over the years, none have won majority support in both the House and Senate. That’s not surprising, when all included the word “taxes” and Dunleavy has pledged to veto any taxes, giving hesitant lawmakers a reason to avoid a vote.
The governor has over the years backed up his rigid no-tax pledge, vetoing several that passed with overwhelming legislative support: A tax on e-cigarettes; a tax on online car-sharing rentals, taxing them the same as traditional rentals; and a tax on corporations that make money selling goods and services to Alaskans online, not a sales tax but a tax on corporate profits.
He talks about taxes as bad, talks a big dividend and talks about how Alaska should offer a quality of life and public services that attract new residents and businesses to the state. But a governor’s job is to lead, not talk. Dunleavy has 12 months left to lead, to show where the money is going to come from.
Larry Persily is a longtime Alaska journalist, with breaks for federal, state and municipal public policy work in Alaska and Washington, D.C. He lives in Anchorage and is publisher of the Wrangell Sentinel weekly newspaper.
