Dunleavy and Begich share a penchant for pandering

Former Sen. Mike Dunleavy and former Sen. Mark Begich have this much in common—both are pandering to the public about the Permanent Fund Dividend and paying for government services.

The third candidate in the race for governor, incumbent Bill Walker, doesn't have the luxury of hiding from the impossible math of Alaska finances. Because of the collapse in oil prices that began four years ago, Walker found himself doing what had been unthinkable—telling Alaskans the hard truth about paying for state and local services.

Walker is not a great politician, but he’s been a good governor. His gas line remains a dream, made more so by President Trump's bluster, but Walker has at least offered a sensible fiscal plan—cut some of this and that and enact taxes to reduce oil dependence and extend savings. 

His move to cut the Permanent Fund Dividend, one that was accepted by the majority of legislators, came along with budget cuts and proposals for new taxes.

The recent rise in oil prices may slice the deficit, but amnesiacs Begich and Dunleavy want Alaskans to believe that we can depend on oil prices to save the day once more. Over and over again, Alaska has seen that this won't work.

Under Walker the state is now paying for a big slice of the budget with earnings from the Permanent Fund. This is one of the biggest changes from four years ago. Other big changes are that the state has spent $14 billion from savings, money that can't be replaced, and the state budget has dropped by more than $1.5 billion. The state cutbacks have led to a $2 billion backlog in maintenance and unmet needs that are increasing across the state.

The shift to use Permanent Fund earnings to help pay for government has been necessary not because Walker wanted to lead an unpopular charge, but because oil prices fell off a cliff and the state has run out of easy options. 

The state no longer has a capital budget that goes much beyond road projects backed by the feds and the state Senate blocked the approval of taxes proposed by Walker and the state House. We don't have a balanced fiscal plan in place, which means that larger and larger withdrawals from the Permanent Fund will be made in the years to come.

Now that it is campaign time, Walker's challengers, who have not had to propose real cuts or real taxes, have fallen back into the Alaska fiscal fantasy of pretending that oil will fix everything and no one needs to feel any pain.

The grandstanding on the dividend and state finances is what unites Dunleavy and Begich, who are trying to avoid saying anything that might upset the electorate. 

They won’t deal openly with taxes, cuts in services  or how a larger dividend means more taxes and/or cuts and threatens the Permanent Fund in the long run.

Dunleavy was unable to even get fellow Senate Republicans to back his absurd plan to permanently cut the operating budget by $1 billion over four years. Now he says he wants the budget to grow 2 percent a year, which is about the rate of inflation. He is also promising unidentified budget cuts, which are always the most popular kind.

The Dunleavy shadow campaign, which has had twice the resources of the "real" Dunleavy campaign, is still claiming that the Dunleavy plan to cut $1 billion is the secret to higher dividends and no new taxes.

Begich is spinning a yarn in which he does not declare his support for a specific tax, but wants more money for education, public safety, revenue sharing, etc. He wants the state to borrow money to finance a capital budget. Unidentified taxes would be a last resort, he says.

Begich and Dunleavy are both promising efficiency in government as a miracle cure.

They are making much of cultural/social issues and skipping the tough money questions. The lack of rigorous press coverage has allowed them to skip the unpleasant part of informing Alaskans of the need to either pay more or get less.

The biggest issue in the governor's race is how to pay for state government. Dunleavy and Begich want to talk about the dividend, as if nothing else matters.

It is reckless to focus on the Permanent Fund Dividend without saying where the rest of the money is to come from to pay for state and local government.


Dermot Cole7 Comments