From the publisher

Alaskans need to understand budget facts

Could anything be more difficult than getting the Alaska Legislature to settle on a workable, affordable, sustainable fiscal plan for the state?

Yes. Getting a clear majority of Alaskans to accept the reality and the need for a workable, affordable, sustainable fiscal plan for the state probably is more difficult - and yet it has to come first.

Most legislators understand the numbers, even if they disagree or dislike the math and the choices. Many just need a permission slip from their constituents to take the tough votes, especially on the Permanent Fund dividend.

But Alaskans? We're as divided as two feuding neighbors fighting over whose dog left the bigger mess on the lawn. Rather than just cleaning up the mess, they keep walking around it as they argue.

A poll of Alaskans in June, commissioned by the state House majority caucus, found the public split-down-the-middle divided on the question: "If putting the PFD in the constitution meant that the state would need to make deeper cuts to state spending and services, would you support or oppose a state constitutional amendment to guarantee payment of the Permanent Fund dividend each year?"

Precisely 48% said they would support deep cuts and 48% said they would not. That's as close as a middle seat in the back of a full flight.

Sadly, however, many of the answers in the poll are based on false information.

More Alaskans said they believe the state gets more revenue from oil than from Permanent Fund investments. Wrong. The state gets about twice as much revenue from the fund's earnings as it does from oil. No wonder so many Alaskans think we can afford to put the dividend into the constitution, and everything will be OK if legislators just trim a bit from spending. They can't hear the echo coming from the hollow trans-Alaska oil pipeline.

The false belief that Alaska is still an oil-revenue state puts the Permanent Fund in jeopardy. Gov. Mike Dunleavy has proposed adding a formula to the Alaska constitution that would pay out a PFD of almost double the average of the past 10 years. For that to happen, the state either has to start withdrawing more money from the Permanent Fund than it can earn over time, reducing the account's value and shorting future generations, or Alaskans have to accept large cuts to public services.

And probably a state sales or income tax.

The state had an income tax from 1949 to 1979, until oil started flowing. But oil production has declined more than 75% from its peak. At the same time, the state's population that needs schools and other services has almost doubled. No taxes, less oil, more people needing more services - no wonder we're broke.

To cover big PFD checks from a constitutional amendment without new taxes, we'd have to take the knife to schools, municipal aid, road maintenance, health services and, yes, no doubt many would want to go after the ferry system, which gets about as much political love from the governor and many Southcentral legislators as a swarm of mosquitos.

What this means is that until more Alaskans hear and accept the factual information, they're not about to tell their legislators it's time to make honest decisions on state finances. The most ill-informed Alaskans on that revenue question in the poll were people under age 34, Republicans, men, and residents of Southcentral and the Interior - and Southcentral voters elect more legislators than any other region of the state.

Alaskans need to get that information from credible sources who know what they're talking about, not some Facebook rant, political campaign ad or ill-informed elected official.

Alaska needs honest leadership, and we need to listen.

 

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