In a tumultuous primary, incumbent Republicans reap the whirlwind

Tuesday’s primary election saw an upheaval of the Alaska Republican Party, as a crowd of Permanent Fund dividend-focused hardliners cruised to likely victories over some of the party’s most prominent legislators. It was a fork in the road for the Alaska GOP — and likely for Alaska, as several of the newcomers’ general election races will be in districts that strongly favor Republicans. Barring drastic changes in party preferences or massive turnout by non-Republicans in November, the GOP members of the Legislature next year will be far less inclined to compromise or share power with those outside their party. That realignment will have major implications for the now-existential budget crisis Alaska is facing.

Those who were paying attention could see this clash coming from far away. “Barring some transcendent healing of party rifts, we’re headed for one of the most contentious Republican primaries in decades, with the two wings of the GOP going head to head,” we wrote in this space 11 months ago. “Nearly every Republican-held seat is likely to result in a primary challenge.” And so it did.

What does it mean for the Legislature?

There’s no question of who among Alaska Republicans turned out in numbers on Aug. 18. In most of the high-profile contests, the majority of Republican voters in the primary cast their ballots for candidates who argued that incumbent legislators had broken faith with their constituents by abandoning Gov. Mike Dunleavy’s austerity budget and opting for a smaller PFD in order to balance the budget. It’s still possible that some of the apparent results on Election Day could be overturned by the tens of thousands of absentee ballots remaining to be counted, but in many cases, that’s a tall order. And it means most of the GOP candidates on the ballot in November will support Gov. Dunleavy’s budget plan of super-sized dividends and massive cuts. In 2019, legislative leadership restored considerable funds initially cut by the governor; absent a major change of heart on fiscal policy, the Republican candidates advancing to this year’s general election are far more likely to champion the governor’s approach.

The brunt of Republican primary voters’ ire fell on figures such as Senate President Cathy Giessel, who trails challenger Roger Holland by more than a thousand votes before absentee ballot counting starts Aug. 25. It would take a mammoth swing for her to prevail — about 75% of the remaining vote — which is almost certain not to happen. With Giessel, and potentially Sens. John Coghill, Natasha Von Imhof and Gary Stevens, falling in their primaries, the Republican Senate majority caucus seems all but certain to take a hard swing to the right.

In the House, a similar number of moderate Republican incumbents who are members of the bipartisan majority caucus trail their hard-right challengers, meaning that 2021′s freshman class of legislators will be far less inclined to compromise or work across the aisle. That’s bad news when crucial long-term budget decisions are staring Alaska in the face.

What does it mean for Alaska’s budget situation?

The budget debate during the 2021 legislative session was already set to be contentious; the likely new arrivals in the Legislature may make it intractable. A double-whammy of lackluster oil revenue and the economic rout of the pandemic will leave Alaska with a budget deficit well in excess of a billion dollars, and the state’s primary savings accounts are near empty. Even without the 1982-formula PFD championed by the new crop of insurgent Republican hopefuls, balancing the budget next year was going to be a fierce debate between more big cuts to state services, new revenue measures such as sales or income taxes, or both. And if that weren’t hard enough, many of this year’s primary winners are promising a no-compromises approach on back payments for the reduced PFDs Alaskans have seen the past several years. There’s no way to make that math work without robbing the Permanent Fund earnings and, ironically, endangering the future of the PFD itself.

Regardless of your opinion on the size of the PFD or whether the 1982 formula or the Senate Bill 26 statute should prevail, the ousted Republicans in the Legislature had one thing in common that benefited Alaskans: They were budget realists. Faced with two bad options — pare back the PFD or drastically cut services — they realized that we can’t have our cake and eat it, too. They chose a path that proved unpopular with their constituents, but they acknowledged that we no longer have the luxury of having government provide us with the services we need and also pay us money directly out of the state’s coffers.

Their challengers, so far, have said they favor cuts to balance bigger PFDs. But the scale of cuts required to make the budget balance while paying out PFDs that large would run afoul of the Alaska Constitution’s mandates to provide services such as education, as well as requirements for federal health care funds (a problem Gov. Dunleavy himself encountered when he tried to pare back Medicaid by hundreds of millions of dollars last year). If legislative hopefuls plan to cut more than a billion dollars from the state’s budget, they owe voters a specific explanation of how they plan to accomplish that. There isn’t a realistic path to do so while maintaining the services we need to keep Alaska’s economy running, and pretending otherwise is dishonest.

With the pandemic ongoing and the economy severely damaged, 2021 looks to be a tough year for all Alaskans. It will be even harder in Juneau, where legislators will have to decide what happens when an unstoppable force — their PFD and spending promises — meets an immovable object in the form of budgets for state services such as public safety, transportation, education and health care. Our state’s future will depend on their ability to hammer out a solution.