For years, too many Alaskans have whistled their way past Alaska’s fiscal graveyard, scurrying along, averting their eyes when deficit ghosts drenched in red ink reared their heads.
Those days are gone.
Alaskans are getting the idea: We have too much government and not enough dough; and we cannot spend what we do not have. Underscoring that, state Office of Management and Budget Director Donna Arduin says since fiscal 2013, state spending has outpaced revenues by $16 billion, and lawmakers have drained state savings accounts to close those gaps.
Gov. Mike Dunleavy’s heart-stopping budget proposal that rips the Band-Aid off Alaska’s current $1.6 billion budget shortfall aims to stop the bleeding. It is the first shot in what likely will be a long, raucous budget fight. The budget gores everybody’s ox and grinds herds of sacred cows to hamburger.
Dunleavy’s proposal is about more than just money. Make no mistake, if adopted intact by the Legislature - and that would take a major miracle - it fundamentally would transform Alaska’s government, drastically changing its size, scope and operations. Education, Medicaid, corrections, even snowmachine trail grooming, for crying out loud, would face draconian cuts to help make ends meet.
“It’s going to touch all Alaskans, no matter where they live or what they do,” Dunleavy said of his offering. “We can’t continue to be all things to all people.”
From the media drumbeat after the budget proposal was released, you could be forgiven for thinking the world is about to explode. You might think this Dunleavy character popped up out of a crack in the sidewalk and, right out of the blue, delivered an unnecessary haymaker to state government. The wailing, the gnashing of teeth from pundits and those feeding at the government trough is deafening. Worse for them, Dunleavy seems to want it now - right now.
"We have to get it solved this year and I'm determined to get it solved this year," he said when he introduced his budget. "We can't kick this down the road anymore. It's got to be solved.”
Who could have seen that coming? Everybody certainly should have. In fact, Dunleavy the candidate promised during the election to do just what he has done and he was no shrinking violet about it, either. Dunleavy said he would balance the budget, pursue a fully funded Permanent Fund dividend as required by state law, and repay Alaskans three years of dividends shortstopped by former Gov. Bill Walker and the Legislature. Oh, and he opposed an income tax.
The only way to make ends meet without taxes or filching money from the Permanent Fund Earnings Reserve or slashing dividends is to cut, cut, cut. The 145,631 voters who put Dunleavy into office surely knew that before they trooped to the polls. A reasonable person could argue that is exactly what they wanted.
Slashing state government not just to the bone, but to the marrow, is viscerally appealing on several levels. But history tells us the only thing that happens quickly in politics usually happens just after large groups of cranky people show up with guns. We might as well face it: This Legislature is about halfway through its 45-day constitutional session limit - the House was not even in session for most of that - and doodly-squat has been accomplished.
We likely should not expect much. My guess is the bare-bones budget proposal left lawmakers in shock, gobsmacked, deer-in-the-headlights goofy. They do not know whether to blink, fight or commandeer a plane for parts unknown. And they are frustrated, lacking even what Sen. Natasha von Imhof says are the Dunleavy administration’s “broad strokes” explaining the proposal.
The issues are beyond thorny. Do we pay full and past Permanent Fund dividends while eviscerating state government? Is that not what we voted for? What about taxes? What about the economy? What about the politics? What about jobs? Those questions must be answered. It would be surprising on an unprecedented scale if the budget actually were cut $1.6 billion this year.
Dunleavy’s proposal was a wake-up call, for the Legislature and for Alaskans. The good news is that the process finally is underway to address what should have been taken care of years ago - and by some of the very same folks who got us into this mess. The process of right-sizing state government is going to take time and talk. Pressing ahead willy-nilly for quick decisions and not demanding good decisions seems foolish. If it takes time, it takes time.
To frame the budget discussion, two questions first must be answered: How much government do we need? How are we going to pay for it?
We no longer can whistle our way past this graveyard.
Paul Jenkins is editor of the AnchorageDailyPlanet.com, a division of Porcaro Communications.
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