Dermot Cole

The Republicans who lead the Alaska Legislature are comfortable talking about the desire to “right-size government,” the ideal one-size-fits-all euphemism. Every time I hear those words I think of someone picking out a new pair of pants for the seat of government. Or the time my daughter Anne had to give up on getting a favorite couch into her apartment because she didn't have the right-size door for the right-size couch. Soon we'll be seeing red baseball caps emblazoned with “RIGHT-SIZE GOVERNMENT,” the best thing for the legislative fitting room since former House Speaker Pete Kott ordered hats for the various heads of the Corrupt Bastards Club. Just as some claimed the CBC was a harmless joke and others found proof of wrongdoing, Alaskans will never agree on the right size of...Dermot Cole
Tom Gorman has learned firsthand in the last few weeks about the power of the ever-restless Tanana River. Now he's just hoping to keep his 7,000-square-foot house from going down the drain. In an unusual move, the Alaska Department of Fish and Game allowed a contractor to set off repeated blasts of hundreds of pounds of explosives on the ice, hoping to clear an ice jam and save the house. Department officials said that while some fish will be killed from the blasts, the chance of saving the house justified the action. The ice has diverted much of the open water toward the south bank of the river, eating up most of the ground between the water and the building. Whether the blasting plan will work is unknown, as breaking the ice into smaller pieces doesn't necessarily open a channel and...Dermot Cole
More than one Alaskan has probably already called the new legislative budget-cutting hotline, 1-844-414-5949, to suggest the state could save some money by dumping the Anchorage Legislative Information Office lease. The Legislative Council, a joint Senate-House committee of legislative leaders, plans to meet again Thursday to try to make a decision on competing claims about costs and a buyout plan. What’s most disturbing about the events of the past two and a half years is how little energy the council devoted to this matter early on when its members could have made a difference in shaping the outcome. And how much time and energy they have wasted since the “Taj MaHawker" began to occupy a grossly exaggerated role in attitudes about profligate spending. I agree with House Speaker Mike...Dermot Cole
Alaska’s budget problem will improve if oil prices rise high enough in the future and oil production doesn’t fall so fast. It will get worse if oil production slides more and prices remain close to where they are now — overall state oil income could drop to zero. Every prediction combines gambling and guesswork, with no guarantees, though the professional prognosticators agree oil prices won't remain below $40 forever. They are probably right, as commodity prices are subject to wild gyrations. Exactly when prices will rise and by how much is impossible to say. There was much of value in the presentation to legislators Thursday by veteran economist Scott Goldsmith about various plans to transform the Alaska Permanent Fund into an endowment. The Permanent Fund earnings are the largest...Dermot Cole
The dream of the $4.5 billion “sustainable budget, ” based on the notion that oil prices will quadruple from current levels, refuses to die, even among those who should know better. “Our state-funded budget of approximately $5.3 billion needs to be reduced by about $800 million to bring it down to a sustainable figure of $4.5 billion as per the ISER/Goldsmith model,” Sen. Mike Dunleavy said in a posting on Facebook Monday. “If we can agree on reductions this year and next we should be in a fairly good position to have a sustainable budget of $4.5 billion going into the future that could be sustained through the revenues we currently bring in as well as a draw on the earnings reserve account," the Wasilla Republican said. The problem is that the budget is not sustainable at $4.5 billion...Dermot Cole
In 2013, veteran political operative Art Hackney hired workers to try to obstruct the signature drive for a public vote on the repeal of the oil tax law, MAPA (also known as Senate Bill 21). Hackney even started an “I Made A Mistake" website purporting to offer people who signed the petition a chance to recant and withdraw support for putting it on the ballot, an election contest that the oil industry and its allies didn’t want. Almost no one fell for his gimmick and the website is now defunct. All that remains is a dopey YouTube video in which a woman in the shadows acts heartbroken and confesses her regret about signing the petition. “They told me it was good for Alaska,” she says, bordering on tears. “Now I know better. Every signature tells oil companies to go away. 'We don’t want...Dermot Cole
If there's one thing we've learned in Alaska over the past year and a half, it's that we can count on oil prices to change. I say that before daring to mention that if by some chance oil stays near $30 or $35 a barrel for the next couple of years, we could reach an unprecedented moment in modern Alaska history — net revenues from oil could drop to zero or close to it. This week the world price jumped a bit on rumors that Russia and Saudi Arabia might conspire to trim production, desperate as they are for more cash. Alaskans recognize the dilemma and the desire for more dollars per barrel, living in one of the most heavily oil-dependent regions in the world. While the oft-repeated claim that we rely on oil for "90 percent of the state budget" has been out of date for years, that is mainly...Dermot Cole
Ask Alaskans if they will support an income tax based on 6 percent of their federal tax bill, 15 percent of their federal tax bill or 25 percent of their federal tax bill, and the responses will be different. That's obvious. It's also obvious that no one is proposing a tax at 25 percent of the federal bill. But a Senate majority survey, which anyone with basic technology skills could have answered dozens of times, asked: "Do you support or oppose enacting a statewide income tax at 25 percent of federal income tax liability to raise $1 billion (about 30 percent of the current budget gap)?" There will be little support for that approach among Alaskans. But that's the point, I suspect. It's one thing for Senate leaders to ask Alaskans for their views on such critical issues as daylight...Dermot Cole
JUNEAU — When adjusted for inflation and population growth, per capita Alaska state government spending for day-to-day agency operations today is about as low as it’s been over the past 40 years. Alaskans never look at the budget this way, but it’s a vital piece of evidence if we are ever to find consensus on the proper size and shape of government. “Once you take inflation and population growth into account, the operating budget has not grown. It’s shrinking,” David Teal, director of the Legislative Finance Division, told the House Finance Committee Wednesday. A large contingent of Republican legislators say government must be "right-sized," though they won’t or can’t define what it means to make things right or what exactly they find wrong. The Democrats, for the most part, defend the...Dermot Cole
Sen. Pete Kelly doesn't like the news coverage the Legislature has been getting. In what has become a common theme for the Fairbanks Republican, he chided reporters at the conclusion of a finance meeting Thursday for failing to live up to his standards. In a similar spiel in October, he used the words “horrible” and “pathetic.” On Thursday, he complained about an Alaska Dispatch News story from a year ago about the $20,000-a-month subsidy for operating the legislative lounge in the state Capitol. He also complained about special session coverage that focused on the “little nit-picking stuff between people and the meanness and all of those things and the overall fiscal picture was lost.” “The biggest thing that has been lost over the last two years has been that we have cut the size of...Dermot Cole

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