Does State Budget Really Need Drastic Action This Year?

Last week I attended a meeting of the new political group “Our Alaska” at the hip urban “coworking space” downtown that is The Boardroom. If you are someone, who even in your late thirties, wants to feel old just check out a meeting of these guys. It’s not that they consciously say or do anything to make you feel old, it’s more the boundless enthusiasm and capra-esque naivete towards government that just makes those jaded cynics among us feel dated.

The main gist of the meeting I attended, along with probably 70 young urban professionals, was that the group needs to mobilize to get the simple message across of just how bad the fiscal situation is, and how something needs to be done to address the problem this year.

“Sigh”, I thought as I rolled back in my over-stylized, no-back, high chair, “another one of these groups?” After all there are a lot of groups out there selling this same message: GCI/Alaska’s Future, Rasmuson Foundation’s Plan4Alaska, and now Our Alaska. They all say how large the problem is; they all say how we have to address it this year; and they all say this while avoiding any specific recommendations about where to cut or what new sources of revenue can be found to fix the problem. Alaska’s Future is by far the loudest and all they are saying is that Permanent Fund revenues need to be a part of the solution, but won’t say a peep about spending cuts or new taxes.

“This effort seems pointless” I mentioned to some of the attendees, after all the Governor himself seems to be already on board with that message. Hadn’t he spent the summer on a massive listening tour of the state? Hadn’t he already crafted and submitted to the legislature an entirely new fiscal structure for the state? The presentations by Rasmuson Foundation, UAA’s Institute of Social and Economic Research (ISER), and Alaska’s Future along with all the rhetoric coming from Republican and Democrat legislators would indicate everyone gets that there is a problem, it’s massive, and we have to do something about it pretty darn soon.

These slides from the Rasmuson polling proves it:

In my all knowing way I told the youngsters they needed to move on to the next message, this mission had already been accomplished.

Then last Thursday happened.

The Senate State Affairs Committee Chairman Senator Bill Stoltze invited economist Dr. Scott Goldsmith from ISER and self-made expert Brad Keithley to present their ideas on the state budget. A good overview of their presentations was done by the ADN’s Dermot Cole.

More importantly than substance of their presentations is what elected representatives want to take from it. Stoltze is a master at this. He knows how to invite someone to testify and then glean the 1-2 points he wanted on the record to use to craft policy discussions going forward.

What did Stoltze and other lawmakers want to get from Goldsmith and Keithley? Undoubtedly they first wanted to get a reduced spending/sustainable spending concept on the record as a counterbalance to ideas put forward by the Governor and Alaska’s Future which are more focused on new revenue streams.

Equally as important, and certainly more interesting, is the point committee members took from Keithley’s presentation embodied in this slide:

At the end of Keithley’s presentation Sen. Charlie Huggins brought the committee’s attention back to this slide to say:

“This slide got it more right than any other you have. We as a society knee-jerk things. We don’t have the Chineese 100-year, 200- year sort of vision and you recognize that here. On the other hand myself, and there are some others here who share this concern that we almost always get it quite wrong.”

Stoltze’s decision to invite Keithley to testify knowing full well what he would say, since he has been saying it for some time, and Huggin’s on the record admission that he and many of his colleagues agree with it, even if not openly or loudly is telling.

Many lawmakers clearly don’t agree with the the Governor, Alaska’s Future, Plan4Alaska, and our new friends at Our Alaska that Alaska’s fiscal sky is falling. They don’t believe that Alaska’s government would be doomed or economy wrecked if something less than a complete overhaul of the system is done, taxes created, PFD’s forever garnished, and spending cut to the bone is done and done today. They, as senators are want to do, favor a more measured approach.

I’ll leave it to you the reader, or perhaps a future post to decide which position is correct, but the fact there isn’t agreement among legislators is itself a troubling as we go forward.

The major problem leading to political gridlock in America today isn’t our inability to collectively choose solutions to solve problems. That has become the  relatively easy part. The problem is we increasingly lack any agreement on the basic facts before us that define our problems. We lack a shared truth.

Think about it: global warming, guns, immigration, and on and on. We don’t even agree on what the problems are. How then could we ever agree on solutions?

A week ago things in the State House and Senate looked bad enough when I thought everyone agreed on the problem.Then it only looked like our elected officials needed to take on regional and business interests and demonstrate some exceptional political courage to find a solution.

Now it appears before they even get to that point they first need to agree on a definition of the depth and structure of the fiscal problem facing the state.

I don’t know about you, but the longer this legislative session goes on the worse I feel.

And to the those crazy kids in Our Alaska, keep doing your thing, and don’t listen to us late thirty jaded fuddy duddies.  Also, I enjoyed the BYOB approach to political meetings.