Alaska is on the verge of something we have never faced as a state before: the possibility of a government shutdown. This could and likely would be a catastrophic scenario for our state, and is largely due to the Senate leadership's demands for excessive cuts to education, blocking Medicaid expansion, and violating contractual agreements with state workers.
So why are we on the verge of all this chaos? For the simple reason that two people are determined to impose their will on the entire Legislature, the governor, and the people of Alaska. And it appears to be their way or the highway — an unnecessary game of high-stakes poker over a relatively insignificant percentage of cuts. Yes, $60 million is a lot of money, but when you're talking about the difference between a $4.05 billion operating budget and a $4.1 billion operating budget, it's about a 1 percent difference.
So why are we at this major logjam? Because our Legislature's political process is broken. The state is being held hostage because of the actions of two out of the 60 legislators in Juneau. Maybe it's more than two, but it is certainly only a few. By all accounts it appears the standoff lies squarely on the shoulders of Senate Finance co-chairs Pete Kelly, R-Fairbanks, and Anna MacKinnon, R-Anchorage.
The legislative majorities have imposed some silly procedural rules on themselves. One of them is that everyone in their caucus is required to vote for the final budget bill on the floor or risk getting booted from the caucus. This centralizes all the power to the two finance co-chairs. Legislators are not permitted to vote their values, or they can be stripped of committee assignments, staff, and even their office furniture. They are required to vote for the finance committee's budget. Period. This is anathema to representative government and an affront to the democratic process.
Kelly and MacKinnon took the House budget bill, HB 72, which added another $125 million in cuts to the $250 million in cuts proposed by Gov. Bill Walker's budget and decided to make even further cuts without, apparently, discussing it with their own caucus. And they did it with zero public input. The primary victims of the additional cuts? Public education and the previously negotiated contracts for state workers, which had been approved by former Gov. Sean Parnell and the previous Legislature.
So where do we stand today? The Legislature has to find about $3.5 billion to cover the budgets, oil tax credits, and other debt obligations. A couple of the choices of where to get the funds are untenable politically. No one wants to touch the Alaska Permanent Fund earnings reserve account or the Power Cost Equalization Fund. So the most likely place is the Constitutional Budget Reserve, which was created for exactly this situation, and it requires a three-fourths vote of the Legislature to do so. It requires bipartisan agreement, not a one-party budget.
This means votes are needed from the House minority caucus to access the CBR funds. And this is where the stalemate exists. The Republican majority is not accustomed to having to negotiate with independent and Democratic legislators. Typically, because of their numbers, the majority treats the minority with little or no regard.
So now the majority expects the minority to roll over, massively cut education, block state savings from Medicaid expansion, and give huge credits to oil companies. Why? Because Kelly and MacKinnon say so. By all indications, the House minority is willing to give the majority the CBR vote if they simply restore the aforementioned cuts. The House minority is simply standing up for the values of honoring commitments already made to children, seniors, and workers.
My suspicion is that an overwhelming majority of the Legislature will support these modest adjustments to the budget, as opposed to plunging the state over a massive cliff. The state is not broke yet. We have over $70 billion in surplus funds, around $10 billion of which is liquid. We are better situated financially than any other state in the union.
Yes, there is more work to be done. Further cuts in future years and analysis of alternative revenue sources will be on the table over the interim and in the next sessions. But honoring commitments that were made is an Alaskan value. Bullying the rest of the Legislature to break those commitments through fear of being booted from a caucus is akin to stamping your feet and holding your breath until you get your way. Risking the state's credit rating because you want a one-party budget is just not Alaskan.
Vince Beltrami is president of the Alaska AFL-CIO, the state's largest labor organization, representing 60,000 union members belonging to over 50 affiliated unions statewide.
The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com.