Alaska took a step toward insolvency and collapse with last month’s primary election. The Big Dividend Party won.
Traditionally, Alaska had two major parties, the Republicans and Democrats. Since 2016, however, when the state’s dire financial problems forced reduction of Alaska Permanent Fund dividends, our politics have devolved into a war between the Big Dividend Party and the Reality Party.
The Big Dividend Party, led by Gov. Mike Dunleavy, lives in a fact-free world in which the state can give away enormous checks — they’re now talking about more than $7,000 each — from dwindling savings accounts, and still have plenty of money left to keep a no-taxes pledge and continued services.
Explaining why that doesn’t work falls into their trap. It’s a lot easier to tell people they can have more free money than to explain why that would ruin the state and its economic future. If you want an explanation, there are plenty of places to find one, including many of my past columns.
What I want to talk about here is how to get out of this mess.
Alaska’s future has never been darker. Surely something new and better lies beyond the hungry winter that’s coming, beyond the pandemic, when we all hope tourism will return, fishing will go back to normal, and perhaps a bright young person will devise a yet-unimagined path to economic growth.
But if Alaska blows the money in the Permanent Fund Earnings Reserve on big dividends, there won’t be a basis upon which to grow a new economy. Even with high taxes, Alaska won’t be able to afford essentials, such as police and prisons, transportation, schools or the university.
Alaska’s tax base was never big enough to pay for governing this huge state. The founders' plan was for resources — mostly oil — to pay the bills. The Permanent Fund was supposed to transform finite oil wealth into lasting income after oil declined. Now that has happened and fund earnings are what we’ve got.
But the Big Dividend Party would rather give away the fund’s saved-up earnings to buy votes. Its platform is “free money for all,” a proven winner until the bill comes due.
This fight is about whether we give those freebies and make things much worse — so much worse, Alaska could enter its dark ages, unable to afford the basics that allow an economy and society even to exist.
In August, the Republican Party purged members who had moved over to the Reality Party.
Republican leaders such as Sen. John Coghill, Senate President Cathy Giessel and Rep. Jennifer Johnston may not have started in the Reality Party, but they came to recognize the calamity facing us and decided to put the good of the state above their own political prospects.
All are worthy, but Coghill is a giant, perhaps the most widely respected legislator of his generation. Despite his extreme conservatism, he is admired by thoughtful people of all political stripes. His loss is a loss for the state.
After more than five years of fiscal crisis and diminishing savings, Alaska remains in dire straits, but the Reality Party didn’t fail completely.
Even through the repeated removal of Reality Party leaders — Gov. Bill Walker, Rep. Paul Seaton, and now Coghill and the others — the party brought about enormous budget reductions, increased oil industry contributions, and restructured the Permanent Fund to keep the state afloat.
Private polls have shown that Alaskans support smaller dividends over drastic further cuts in services. If democracy worked, the Reality Party would be doing better in elections.
One solution would be to change the way we vote. Ballot Measure 2 this fall would do away with the closed Republican Party that allows a tiny slice of the electorate to punish bipartisanship and advance extremist, oddball candidates. Everyone would vote on all candidates, not just Republicans. The measure also regulates campaign finance and puts in place a ranked-choice voting system.
Republicans and Democrats both oppose Measure 2 (with some notable exceptions).
The reason for Republican opposition is obvious. Party bosses would lose the ability to threaten, discipline and remove officials who don’t obey them.
Democrats oppose the change for other reasons. They are the smaller party in Alaska, and they think, probably correctly, that fewer Democrats would be elected. No Democrat has won a statewide race since 1986 without a lucky break or a split vote. Those flukes would become even rarer.
Democratic strategists also like the closed Republican primary because it produces some Republican candidates they can beat. In fact, they see the August purge as a gift, since it nominated some weak candidates in place of respected incumbents no Democrat could seriously threaten in a general election.
Keeping the Democrats and Republicans in charge of the system also strengthens single-issue activists. Democrats have to be pro-choice, pro-union and pro-environment. Republicans have to be the opposite. A moderate, thinking person could have a different mix of those positions, but not as a good party member.
Take Coghill. Strongly pro-life and dedicated to small government and individual freedom, but also open to reforming the justice system and reducing the dividend. Not good enough for the Republicans, and they rejected him.
Under Ballot Measure 2, the Legislature could move to the right, with right-of-center moderates replacing both right-wing Republicans and left-of-center Democrats.
I’m willing to accept that.
The extremes are pulling our country apart. The primary system feeds that entropy.
Imagine a Legislature of moderates without fear of party. It probably would have solved the fiscal problem by now. With more reserves to survive the pandemic, and a stable government, the day Alaska recovers would be closer.
Or perhaps not. Maybe the majority of voters would vote for the Big Dividend Party, get their checks, and leave when the state collapses.
But at least we should have that choice clearly in front of us.
Charles Wohlforth was an Anchorage Daily News reporter from 1988 to 1992, and wrote a regular opinion column from 2015 until January 2019. He is the author of a dozen books about Alaska, science, history, and the environment. More at wohlforth.com.
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