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MacKinnon, Giessel: 'Alaskans have enjoyed a government we can no longer afford'

Alaskans deserve to know the truth, even if it's unpleasant. Routinely, constituents contact our offices asking us to tell it like it is. They're right, we will never find a solution unless we are honest about our problem.

So here's the truth: we Alaskans have enjoyed a government we can no longer afford. The price of oil collapsed last year, taking with it the bulk of state revenues. For every two dollars we are paying out this year, only one dollar is coming in.

In real terms, this means every man, woman and child would need to pay $4,211 this year to prevent a draw on our savings accounts. If you have two children and a spouse, your bill is $16,844. Visa and MasterCard are not accepted.

Thankfully, Sen. Lyman Hoffman was in charge of the Senate Finance Committee from 2007-2012. He and other leaders resisted pressure to spend more, and stashed billions away in savings. Our rainy day accounts will cover your family's portion of Alaska government, but only for two to three years at best.

Alaskans have to ask themselves a fundamental question: What is the role of government, and how do we want to pay for it?

A budget is a reflection of a family's values. The same is true for a government. The things we care about most, we prioritize in our spending.

Every year that we have been in the Senate, the highest funded items have been public education, health care and roads which consume over 60 percent of the budget. No other programs even come close.

This year, the Senate passed a budget which significantly reduced spending. We were called all kinds of names for being stingy. Our inboxes are full of nasty grams. But the downsizing of government spending by nearly $800 million dollars saved each individual Alaskan $1,086.

As always, this year's budget reflects our values. Once again, education and health care received the bulk of every dollar, nearly $3 billion between them. Add that to the $746 million for the University of Alaska -- nearly $21,000 per student. Follow the money and our values are unmistakable.

If we only funded education, health care and roads, Alaska would still be swimming in red ink. Imagine: no police, no spill response, no prisons, no fish management, no environmental permitting or protection. That's a place few people would really want to live.

Some have suggested the solution is to simply repeal oil tax credits, implying that Alaskans are receiving no benefit. Yet in just the last three years, Cook Inlet tax credits have taken us from brown out drills in Anchorage to affordable energy for another decade.

On the North Slope, the Nuna Project being brought on-line by Caelus Energy is projected to add 15,000 to 20,000 barrels of oil to the pipeline, per day, starting in 2017. Thanks to Alaska's competitive tax regime, we have a new player on the North Slope.

Which should we have, incentives for oil and gas exploration or North Slope stagnation and railbelt brownouts?

The last time Alaska faced such a sharp drop in revenue, the government slashed spending, sending a shockwave through our economy.

We are working hard to not repeat the mistakes of the past. The Senate majority has been unified in our effort to bring Alaska's government down for soft landing on the hard earth of reality.

Gov. Walker boldly called for a 16 percent reduction in government spending. After months of debate and hearings, the Senate agreed to a 10 percent reduction. To read our email, you would think the sky is falling.

I don't doubt the sincerity of Alaskans' concerns, but every dollar we spend today is a dollar we do not have for schools, employees and roads next year.

The private economy knows the reality: many of Alaska's 16,000 construction jobs are at risk this year because of deep cuts to the capital budget. These are Alaskans who may not be receiving any paycheck.

A budget agreement was eventually hammered out this session. But next year we'll face an even tougher challenge and layoffs in the public sector may be unavoidable. We know that every one of these jobs represents a livelihood for an Alaskan family.

When times are tough, we simply can not spend more of what we don't have.

Sen. Anna MacKinnon, a Republican, is co-chair of the Senate Finance Committee and represents District G, which covers Eagle River, Eagle River Valley, Southfork Valley, Birchwood, and JBER.

Sen. Cathy Giessel, a Republican, is chair of the Alaska Senate Resources Committee and represents District N, which covers East Anchorage and the Hillside as well as Turnagain Arm.

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.

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