Within a month of working for Alaska Legislative Audit in 1974, I realized the entrenched specific hatred of the Alaska Marine Highway System and especially its union by Southcentral / Railbelt / Fairbanks; it has never abated.
I was an auditor jointly allowed by the Legislature and University of Alaska to actually outside review university accounts in 1975. Admittedly, the university system has spent a lot that should have been done with far more efficiency.
But the initial Dunleavy $120 million cut, eventually lowered to $70 million, was a long awaited first strike and an end run to bring the university to heel. It got the university’s attention.
Yet, there was no real justification as to the amount other than a long-desired petty score settling by the Dunleavy Administration.
Both AMHS and UA were created to serve a well-established and wide public need; they were not intended to make a profit. No different than the military, public schools, public health initiatives. Or for Anchorage / Fairbanks, etc. roads mostly paid for by federal and/or state government debt and grants, with maintenance minimally funded by local user fees.
Yes, oil prices crashed, but Alaska has gone through that many times before — even borrowing pipeline revenues in advance of its operation in the late ’70s.
Remember, it’s seems OK for Alaska to pay billions in oil industry credits under a “crisis” budget while prices crash. But cutting vital mass Southeast transportation ($43 million, less than 5% of oil credits) was deemed absolutely critical to state survival?
Dunleavy used a favorite tactic: Import a nationally renowned political sycophant outsider consultant Donna Arduin for his OMB director, who would senselessly destroy on cue.
The blow to AMHS is realistically unrecoverable in its new form and Dunleavy had to know that from the first strike. It’s a well-known management strategy — “an overwhelming blow or end run” followed by “the slow roll or creeping commitment.”
Of course another inevitable favorite strategy of a working group to address the fallout soon followed — mostly to sooth rankled party-line voters who actually helped to destroy their own communities. With the disingenuous promise of “no worries, trust me”.
Now to be followed by newly concocted legislation to rework AMHS governance that already has some Southcentral legislators working hard at to seal the AMHS coffin. The working group and the new legislation are the “slow roll or creeping commitment” that never eventually gets accomplished, and that are used to shift the blame to a new committee for unaccomplished fixes, rather than the sword of Dunleavy that got the ball rolling.
This is very reminiscent of the 2004-05 Murkowski Administration and Sitka Sen. Bert Stedman’s purposeful destruction of the PERS and TRS member-controlled retirement system. Dunleavy and Stedman’s GOP colleagues used the same (don’t let a phony crisis go unused) budget strategy Stedman used in 2005 to inevitably permanently hobble AMHS. “It’s called a cruel irony.”
For AMHS, and particularly UA Southeast, the remaining or reconstituted entities won’t realistically survive on profit-making revenue streams — even as unworkable unrealistic and sham privatization models are offered.
Most public services live on public subsidy. Even the most zealous private business crony capitalist knows that.
But it’s OK for an Alaska quasi-government entity to use a $35 million socialist subsidy for essentially the private industry 22-mile Ambler road. But AMHS’s funding cuts are just fine where it services 3,500 miles of Alaska coastline since 1963.
Dunleavy tells us “our hearts go out to Southeast Alaska” for Haines landslides — after he destroyed a critical transportation system extremely vital to Haines’ and Southeast’s basic survival. While Dunleavy decries the loss of independent tourism dependent on AMHS; as $3 billion in cruises are stopped.
Now Dunleavy pushes fiscally irresponsible massive increases in the PFD (blatant vote buying), and massive new borrowing for projects that are budget-wise simply unsustainable.
And Fairbanks, your university stuff will march to Anchorage-Wasilla-Palmer, like the stealth Capitol move has for years.
As a state we are clearly not “all in this together.” No conspiracy: just insular regional destruction politics — unjustified by simple analytics or economics.
Anselm Staack, is registered non-affiliated, is a CPA and an attorney who has been an Alaska resident for over 47 years. He was the treasury comptroller for Alaska under Gov. Jay Hammond and worked directly on the creation of the Alaska Permanent Fund and Corporation. He resides in Juneau.