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Alaska journalism is enjoying a good, old-fashioned, coming-out party as the mainstream media loses all pretense of objectivity under the crushing weight of the internet.
Kevin Baird, a former legislative reporter at the Juneau Empire and before that the opinion page editor at the conservative Fairbanks Daily News-Miner, is the latest to free himself from the shackles of journalism’s staid, old rules and confess to his experiences as a frustrated, closeted liberal watching Gov. Mike Dunleavy try to yank the 49th state into line with fiscal reality.
“Mr. Dunleavy, you ran on a campaign slogan of ‘Standing Tall for Alaskans,’ but what you’re proposing to do is take a shit on them,” Baird writes in an AlaskaLandmine commentary from his new home in Portland.
It is the same commentary in which he later observes:
“Journalists get a lot of bullshit criticism based off reader assumptions or readers being blinded by their own bias (Yes, you can read your own bias into a completely neutral story. Think about that!). As frustration with the Dunleavy administration and this legislative session grows, I’ve seen important discussions on Alaska Twitter about journalism, its quality, its purpose, people’s frustrations with the media – journalism in Alaska is being critiqued. Good. Journalism must improve.”
The logical disconnect is positively Bunyanesque.
After offering his journalistic opinion that the governor of the state of Alaska wants to “shit on” Alaskans, Baird offers his journalistic opinion that any opinions readers might have in the past formed as to the author’s biases are “bullshit criticism” based on “reader assumptions” or “readers being blinded by their own bias.”
Readers are wrong
Of course it’s the reader’s fault if he or she concludes Baird’s view of Dunleavy as scum might in some way influence Baird’s reporting on Dunleavy and the Dunleavy administration.
Or maybe Baird just doesn’t understand the words he’s typing into the tubes. He isn’t identifying himself as some journalist who thinks Dunleavy’s solution to fixing the state’s fiscal problem by reducing expenses as opposed to raising revenues (ie. taxes) is misguided.
Oh no. We’re talking about someone who thinks the governor wants “to shit” on Alaskans, an observation that is on its face absurd.
The one thing politicians want is to be popular enough to get re-elected, and nobody ever got re-elected by shitting on his or her constituency. Dunleavy’s plan to balance the state budget by reducing state spending might be the wrong approach, but the governor clearly thinks it is a view supported by most Alaskans voters.
Dunleavy has actually gone beyond proposed budget cuts in this regard to propose Constitutional amendments that would allow Alaska voters to lock in place spending constraints.
To underline just how bizarre the reporting on this has all become, former Alaska Dispatch News and former Fairbanks News-Miner reporter Dermot Cole, who gets a shout out in Baird’s commentary as a fellow traveler, has labeled Dunleavy’s call for a vote of the people part of a conspiracy of “backroom deals.”
Proposing a vote of the people on anything so sensitive as state spending is clearly criminal. No real American politician (or apparently journalist) would want the idiot peasantry involved in trying to help determine how the state is run.
The idiot peasants, in Baird’s view, don’t even understand it’s their responsibility to support the media.
Cheap bastards
“There’s this sense of entitlement among news consumers who feel that news must be free,” Baird writes. “That is infuriating. During a fairly recent conversation at the Triangle Club Bar in Juneau, a man told me news should be free. He scoffed at the idea of paying for a newspaper subscription. I asked this man what line of work he is in. He said he was a helicopter pilot. I asked him how successful his business would be if patrons demanded free helicopter rides simply because they were entitled to free rides.”
Again we enter the land of logical disconnects.
People pay for things because they think the service, as in the case of a helicopter ride, or the product, in the case of a newspaper, has value. People are reluctant to pay for newspapers these days for a variety of reasons: they don’t think the product has much value; they can get an equal or near equal product from television and/or radio websites for free; and/or they do indeed recognize that to a certain extent news has always been free.
You can get it from the guy on the next stool over at the Triangle on any given day if you want. And in the Age of the Internet, you can get a virtual stream of it free from government.
Or click here to read the latest in news from the Alaska Department of Fish and Game, or here if you’re interested the state’s meatier monthly magazine.
If Baird had a better sense of how markets work, maybe he’d be pondering why government is paying former journalists more money than Baird ever made as an Alaskan journalist to act as government journalists providing the kind of information private sector journalists once provided.
But today’s journalist are so attached to protecting the jobs of their friends in government that this sort of idea wouldn’t even enter the thought process. Today’s journalists identify with government employees as fellow travelers on the path to a better society.
The reality is foggier. Alaska is lucky in that most state employees are intelligent, hard-working, dedicated public servants, but there are some misfits in the bunch, too.
Some folks in state government are about as useful as the guy two stools over at the Triangle who shows up there ever day at 2 p.m. to share the “news.” It might not be very accurate, and it’s almost certain to come with bias, but it is news.
Good-bye standards
Plus, it is free, and we are nearing a point where its accuracy might be approaching that of a lot of other news.
Snopes, the “fact checking” website, just published a glowing fact check, if one can call it that, of Rep. Alexandria Ocasio-Cortez, D-N.Y., written by a journalist whose claim to fame is that he started the website Social News Daily.
Wait. The latter is a “news” story when it’s so old? Who didn’t know Elvis abandoned rock and roll to become a street-preacher in the South and is still at it now at the age of 84?
Or something like that.
One must concede some of the so-called journalists pissing all over journalism these days at least make for jolly good fun at times. Maybe the Onion or National Lampoon could start its own online “fact checking” service.
The internet could use more humor. Journalists who have endlessly denied liberal bias only to come out as flaming liberals are not funny. They are just adding more train cars to the smoldering heap of a train wreck of journalism.
Baird’s name calling in this case is the least of it. I have no problem with him calling Dunleavy names other than the damage name-calling – the cheapest and easiest of behavior – does to the idea that journalism is more about reason than emotion.
Children engage in name calling because they are not yet fully developed intellectually. Adults should be able to do better, but what the hell, there are some journo types who’ve built their Alaska careers on name-calling, and being called names pretty much goes hand in hand with being a pol.
“You can please some of the people all of the time; you can please all of the people some of the time; but you can’t please all of the people all of the time,” as the English poet John Lydgate observed several hundred years before President Abraham Lincoln appropriated the phrase, or didn’t, and twisted it a little by changing please to fool.
My personal view on politicians is this: I’ve really never met one I didn’t like on a personal level (Dunleavy included) and I’ve really never met one I’d trust because they can’t be trusted. They are invariably in the business of getting re-elected, and that entails sniffing the way the political winds are blowing and, all too often, trading principle for votes only to rationalize it all away after with the comfortable observation that it’s hard to fix the system if voted out of office.
So what is truly troubling about Baird’s commentary is not what he says about Dunleavy, but what he says about the bureaucracy. He has a huge bias there and doesn’t even seem to understand.
Jobs for life
Baird’s interest clearly isn’t about what is good for Alaska. It is about what is good for his friends in the bureaucracy and their constituencies:
“Gov. Mike Dunleavy’s budget has instilled fear among state employees, teachers, and university staff as they stare at the prospect of unemployment….Mr. Dunleavy’s proposal to privatize and limit the services of the Alaska Marine Highway System has many Alaskans in coastal communities wondering if they will be left stranded. Seniors worry about their future in the Pioneer homes. Others worry about Alaska’s future as Dunleavy buries his head in the thawing permafrost and ignores climate change. The list could go on.
“Since Dunleavy and many in his administration do not seem to give a damn about the people who will lose their jobs as a direct result of Dunleavy’s budget, I have an idea….My proposal is for Alaska’s Senate or House Finance Committees. I want to see the creation of a finance subcommittee on Thoughts and Prayers Assistance, or TAPASS. The purpose of this TAPASS subcommittee would be to comb through the budget bill and find each provision that would result in a job loss or cut needed services. The TAPASS subcommittee’s next task would be to add amendments to the budget bill containing language that assures those soon-to-be-unemployed Alaskans, or other effected(sic) Alaskans, that the Dunleavy administration’s thoughts and prayers are being sent to those people. I’m sure it will alleviate their pain.”
And there you have a near perfect definition of the Nanny State, the place where government exists not just to provide vital services and give people a hand up when they really need it, but to take care of everyone all of the time.
It’s a great and wonderful idea in theory. On a global level, it has historically failed again and again, and the human suffering, not to mention deaths, associated with the failures have often been great.
America has been lucky in the latter regard in that at least at state levels, government bureaucracies that grew too big merely imploded as California’s did a decade ago.
The results were not pretty. “Government job cuts ravage California,” the Los Angeles Times headlined in 2010.
“Weighed down by a struggling economy, government agencies in California shed 37,300 workers last month — more jobs than were lost in the private sector — as cities and counties made their biggest payroll cutbacks since at least 1990,” the Times reported.
“What’s more, analysts see more job cuts ahead as California faces an estimated $10-billion shortfall in the state budget that the next governor must address. Cities and counties, meanwhile, are still struggling with tepid sales and property tax revenue.”
California put about 9,000 more people out of work than are employed by all of state and local government in Alaska today. California had little choice. The state was out of money.
Lucky Alaska
Alaska is far better off. It’s sitting on about $1.7 billion in the Constitutional Budget Reserve Fund, and another $19 billion in the Permanent Fund Earnings Reserve along with $47 billion tucked away as principal.
The governor’s Office of Management and Budget concedes the California-scenario remains a distant threat here.
“An alternative to addressing the fiscal issues currently facing the state is to simply ignore them and hope they solve themselves,” says the State of Alaska Fiscal Plan for FY-20 – FY-2029. “While it is possible for oil prices to increase, or (Permanent Fund) investment returns to beat projections, hoping for those outcomes cannot be considered a plan.
“This scenario completely depletes all savings balances by FY28, due to overdrawing the Earnings Reserve. As a result, only the principal of the Permanent Fund balance remains, and its balance is limited to just $63 billion at the end of the 10-year period. With no accessible savings, this scenario leaves few options and fewer assets for future Alaskans.
“Taxes or budget cuts would still be required, but the conversation would just be delayed for a decade. The short-term benefits are highest in this scenario, as no money is removed from the current economy, and PFDs are greater than in FY19. As a result, total household income in FY20 increases by about $1.3 billion, and no subtractive impacts are felt by the current economy.”
Huh, I’d be happy if I had $63 in my bank account today let alone $63 left by 2028. And growing household incomes and an intact economy don’t sound so bad.
If you’re old, like me, this scenario actually looks pretty good. I’ll be 75 in 2028. It might be a good time to think about giving up on the state, as nearly all the old timers once did, and retiring to some place warmer with a lower cost-of-living.
There’s no good reason I can see to change things now, but it appears Dunleavy wants to be a troublemaker.
“The Governor does not believe it is just to saddle future generations with the questionable fiscal decisions of today,” OMB says. “Therefore, he does not support this scenario.”
Grab the machete
Instead, he wants to slash the budget down to what the state can afford to pay without tapping into savings, an idea that is either noble or insane.
More often than not, massive budget cuts come back to haunt governors as they did Republican Gov. Scott Walker of Wisconsin, once a rising star in national politics. Slate attributed Walker’s demise to budget cuts for education and the University of Wisconsin, the same kind of cuts Dunleavy has proposed in Alaska.
Obviously, Dunleavy is playing with political dynamite. It could be he’s doing so out of stupidity or a desire for self-immolation. It is, however, more likely a calculated conclusion that a majority of Alaskans share his view that Alaska government is too big.
What he thinks a majority might well be a minority. People, in general, don’t like giving up anything government has been giving them from road maintenance to Permanent Fund dividends to regular state ferry service in Southeast Alaska that has never made economic sense.
But even if Dunleavy’s constituency for budget cuts is a minority, it no doubt constitutes tens of thousands of Alaskans, probably hundreds of thousands of Alaskans, and what do they all think when a former journo who has run away to the liberal enclave of Portland observes that the governor is only proposing budget cuts because he wants to “take a shit” on them?
Do they think, “OK, now there’s a guy we can trust for an objective assessment of the pros and cons of budget reductions?”
Do they think, “Yeah, the media doesn’t have a liberal bias. Clearly we’re just reading this into the news?”
Do they rush out to buy newspapers thinking those are going to give them a fair assessment of the pluses and minuses of cutting the budget versus somehow raising taxes to cover the deficit or the many options in between because journalists can be trusted to at least try to be objective?
No, they think the obvious. They think journalism has turned to shit. They think journalism has been overrun by people more interested in opinions than facts, and if you wants opinions you can get those for free at the Triangle or in any other bar in Alaska.
Simple realities
The facts here are pretty simple:
Dunleavy wants to cut the budget. There are costs and benefits associated with cuts.
The last governor and the Legislature agreed to use some of the earnings of the Permanent Fund, thus reducing the beloved Permanent Fund Dividend (PFD), to fix the budget. There were benefits associated with that plan and a cost – smaller PFDs – a lot of Alaskans didn’t like.
Some legislators now want to raise taxes in various ways to fund the deficit instead of shrinking the budget. There are costs and benefits associated with taxes, too.
Journalists, even closeted liberal ones, used to at least make a good faith effort to lay out the costs and benefits on a broad scale in the interest of an informed democracy. Granted a lot of people ignored those stories. Numbers are boring unless you’re an accountant.
But numbers at some point cannot be ignored.
What Dunleavy has done – whether Alaskans like it or not – is outline a budget that faces the reality that the days of riding on the back of the oil industry are over because oil prices just aren’t what they were in the days before technological advances and high prices combined to spur a U.S. oil boom.
Oil prices that punched above $150 per barrel in 2008 took a beating from the old law of supply and demand. As supply exceeded demand, prices began falling and falling and falling. Oil is today hovering near $65 a barrel, and the forecast is that it will stay near that price for the forseeable future.
Even if Alaska can generate more revenue with taxes, and there are lots of taxes options, some cuts in the state budget are probably still necessary. To try to understand this issue, you almost need to ignore the traditional media – the kind for which Baird worked – and go elsewhere.
Alaskans for Sustainable Budgets has been talking about the state’s budget problem for a longtime now. It leans toward imposing a flat-rate income tax to close the deficit while maintaining maximum PFDs, but it backs its argument with plenty of numbers.
The Alaska Policy Forum is more in line with the Dunleavy philosophy of “right sizing government,” a definition hard to explain, but largely makes its argument with numbers as well. If you want to know who the high-paid government employees are, you will find them listed there.
The condensed version
And if you just want a short, solid, snapshot view of the essence of the problem, Larry Persily – a former journalist, a former Deputy Commissioner of the Alaska Department of Revenue and the new Atwood Chair of Journalism at the University of Alaska – summed things up well in an old-style, journalistic way for the Juneau Empire in February.
Here’s the crux of it:
Persily didn’t rant, didn’t rave and didn’t accuse anyone of shitting on anyone. He did what journalists once tried to do: define the problem.
It’s a pretty simple problem. The state either needs more money or fewer people.
Each new immigrant to Alaska makes the state’s revenue problem worse. Even those who use only minimal services, cost the state the money. Those who use more services – welfare, Medicaid, food stamps – cost the state a lot.
Just firing a bunch of state employees and watching them leave would help with the fiscal problem. Along those lines, Alaskans should thank Baird for leaving. Bye, bye. Enjoy Portland.
Others who left before him actually helped the state’s revenue picture. It would help if even more left. The state is generating enough revenue that it could support the Alaska population circa 1987.
The problem is that more than three of every 10 of your neighbors would have to leave to reduce the population by that much. Alaska has a problem. It can figure out a solution now or wait until it has even fewer options and fewer choices.
Whether you agree with Dunleavy or disagree with him, he deserves credit for making Alaskans at least, at last, face their collective problem. And on a fundamental, human level, he’s morally right in the contention that a failure to act soon – no matter what action is taken to fix the problem – saddles future generations with the cost of the state’s past largesse.
Or maybe he just cooked up a really crafty, secret plot to get Baird and others to add to the shit heap that is increasingly burying journalism.
Correction: In an early version of this story, principle and principal were misused in two places.
Categories: Commentary, Media
I give Mike credit, accidental as it may be, that people are more focused than past years.on the trade-offs in balancing our budget.
I am somewhat surprised that many more people now feel the Dividend should be cut to help pay for government. And many more now agree that the Dividend should be zeroed out before imposition of income or sales taxes. This has been my long-advocated position as well.
The truth, as Craig pointed out, is we are very fortunate in our financial situation. Annual Earnings of the Permanent Fund now exceeds all other revenue combined (not counting federal funds).
We have the capacity to balance the budget, remain a low-tax-state, and STILL afford a modest Dividend.
I would go one step further and reform the Dividend program into a tax exempt/deferred individual trust account. It could actually basically give each person a piece of the Permanent Fund through annual contributions from the Legislature (same as the current Dividend system).
We now have a situation where we can annually legislate the budget to contrast the size and efficiency of the budget versus what remaining revenue is available to fund Dividends.
Its a perfect check and balance
The Alaska Individual Trust Account (AITA) I propose could build a very nice nest egg because the AITA Fund would increase in Principal every year from the Legislative allocation- in addition to the market earnings. So the longer you live here the more principal and interest you accumulate. So a parabolic rate of increase in value.
Of course the folks pushing for greater PFDs are needing them to spend (snow machines, outboards, atvs) and aren’t looking for a financial investment such as yours IMO. So…….all those not needing theirs can get on your bandwagon as it does appear to be a form of retirement income.
Yes Bill, people have other ideas what to do with the money. But to do the fiduciary responsible action is to stop government borrowing., We borrowed $700 million from the CBR last year. Can we at least stop that?
To me, the most ridiculous thing is we owe the oil tax credits $1 billion and the CBR over $12 billion. We have Earnings Reserves of over $17 billion. Let’s pay our debts early at a discount!
Chris, just a guess here but should this legislature borrow from CBR the line-item veto should take care of whatever amount was borrowed. Obviously the entire budget could be veto-proof but that “could be” is a big if IMO.
Also pretty obvious he won’t veto the appropriation for PFDs. What would be the point?
Two years ago the State of Alaska could balance their budget and pay a $1000 dividend. Now they can balance the budget if they pay a $600 dividend. Two years from now it will be a $200 dividend, and then it will take income taxes……and those taxes will have to go up every year to support the bloated state budget. Just say no….alaska’s oil tax revenue is way way down and its time to right size the state government to reflect reality.
In 1988/barrel was $14.87 ($31.83 adjusted for 2019). In 2019 a barrel averaged $63/barrel.
By 2050 they are predicting $108.
Oil output fluctuations are a bit misleading. The big guys will cap new wells as they have a set profit to market price per barrel.
Also, they will reduce output to reduce supply for demand. Output is a numbers game by those smarter than us. And by game I mean methotical game. Kind of sad Alaska bet it’s financial future on a welfare check written by big oil. “Free” money. Love it!!
Bryan, since 2019 is not over I find a problem with your average price/barrel and further we’ve gotten an approximate $10 premium/barrel because our oil is shipped to West Coast where it’s needed. And when you say big guys you are evidently talking about those bigger than BP and EXXON since neither of them are capping NS wells when they are getting that premium. Who are these big guys controlling the market?? Heheh!
OPEC . Trump often requests they produce more to ease prices .
Enjoyed your article. Disagree with you on a couple of points it’s not simply oil prices not being what they were. It’s a combination of price and the decline of production.
Additionally when saying, or were you paraphrasing, “It’s a pretty simple problem. The state either needs more money or fewer people.” I really don’t think it’s as simple as a that. The whole just of Gov Mikes proposal is to right size government, i.e. cut gov. spending.
Perry: well, we are only producing about a quarters of what we were at peak production in 1988, but today’s production is still above 80 percent of what it was at the start of the decade and slowly creeping upward. if oil was at $100 bbl., we’d be fine.
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=mcrfpak2&f=a
i was paraphrasing solutions. if we had that 1987 population and the size of state government that went with it, the budget would balance because so little of state revenue is dependent on population. the drop in tax revenue from cigarettes, booze and gas would go down with fewer people here, but those taxes are such a small part of the big picture they wouldn’t be noticeable.
Other than tired, century-old references to Sinclair, has anyone ever offered a coherent argument explaining what benefit is brought to the actual _public_ by the existence of public employee unions?
In the private sector, perhaps one can still make a none-puerile argument about the need of labor to collectivize to offset the “eeeevil capitalist owners,” but in the Public Sector there are none such. The “employers” are just fellow citizens and taxpayers, the public employee’s friends and neighbors.
Is the union proponents position that, absent the union, gov’t workers would be forced into wage-slavery by their neighbors, or something equally asinine? Fact is, “We the people” have elected representatives who are perfectly capable of setting wages and benefits mirroring the private sector, and prospective state employees are perfectly free to work for those packages, or decide not to and take (or create) jobs in the private sector. Government employment on one’s own terms is no more a “right” than in any other job, “You were looking for work when you got this job.”
If enough don’t take the job as offered, or if the citizenry feels they need to pay more to get the level of services they desire, then the people are free to lobby their representatives to offer better pay and benefits. There is no need for any union at all.
No more than there is a need for them in the modern private sector, where, at least, the employees actually help produce value and increase wealth, as opposed to simply living off the wealth created by others.
The likes of well know conservative President Franklin Delano Roosevelt said the following:
“All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters.
Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees.”
https://www.presidency.ucsb.edu/documents/letter-the-resolution-federation-federal-employees-against-strikes-federal-service
You can safely cut education at all levels by 50% at all levels by going to online / distance education. Note that the homeschoolers do the best job in this state educating their kids spending a few thousand dollars per student per year. Money spend in education is a negative indicator of performance. Technology is well on its way doing to education what Thomas Edison did to the community bands and theater troupes in the latter stages of the 19th century.
That will handle over half of the deficit.
There are a number of things you can do with Medicaid / Medicare to cut spending and get better performance per patient. Rolling back Walker’s Medicaid expansion is a good first step. Medical savings accounts is another. So is concierge care.
Basic principle here is putting control of the spending as close to the student / patient as possible. When you do that, you no longer need the standing army that are state employees. Dunleavy is starting a good discussion. While he might be a one-term governor, he very well might not. All we have to do is return to spending levels around the time Palin was elected. Cheers –
Total crock!
Sure ag,re:Public school costs vs homeschooling.
Its amazing how much $ u can save if u dont pay anybody.
With regards to tele-schooling,u might have been the rare kid who had the discipline to stair at a screen for your lessons all on your own,but I sure wouldnt have been.
No thanks,I’ll pay for human interaction,even if it means school tax(which there used to be if i remember right)
I agree Dave.
And I’ve been there with homeschooling as I have one child who graduated from Yukon-Koyukuk program and another who spent several years in it. Those were years with Alaska having lots of oil money and I suspect these programs got subsidized some but I’ve mentioned many times about a school teacher flying into our cabin once a month to go over lessons, etc. that people thought that was extravagant (wasteful). On the other hand, when you don’t have to provide a school building suddenly the costs don’t seem to outrageous.
Dave: your memory is correct. up until 1980, every wage earner over 19 years old paid $10 out of his or her first paycheck to support schools. the tax generated $2.6 million in its last year.
i’d guess a similar tax today would generate about $3.3M given our labor force of 330,000 or so, and i’d guess a majority of Alaskans would agree to pay it.
the problem is that given our current education costs that would pay for educating fewer than 200 of the state’s more than 130,000 students. we now have a hugely costly educational system.
https://ballotpedia.org/Public_education_in_Alaska
even if we boosted the payment to $10 per month for the year, we’d still be looking at covering the costs of only about 22,000 students. our problems are big and complicated.
Ah yes – the old “school tax”. It had less to do with funding schools as targeting seasonal and non-resident workers. It was actually a high-rate income tax on the first $xx of your wages. It was a great idea then and I would support it now. I seem to remember $25 so I don’t know if it went up from $10 or not. Anyway today I would make it 25% tax on your first $400 in wages = $100.
Yes Chris,$25 is what I remember as a lifeguard in high school.As far as absorbing the PFD for gov’t,Im ok to a point.I just think everybody should pony up something to live or transit thru the state,WE ALL use something provided by some agency here.
Its time to pull up the big girl panties and move into the 20th century(well actually 19th)
Wow – kudos sir.
Cheers!
“People, in general, don’t like giving up anything government has been giving them from road maintenance to Permanent Fund dividends to regular state ferry service in Southeast Alaska that has never made economic sense.” Craig, this statement is part of the problem IMO because you’ve not made clear what you mean by “economic sense.”
If you mean a particular government program needs to make a profit by “economic sense,” then you might also include that almost no government programs are designed to do that (other than taxes and perhaps the PF). And there are other economic “benefits” besides profitability. These benefits are not always easy to quantify buy you know them when you see them.
Bill,
I don’t want to try and speak for Craig so I won’t.
To me “economic sense” when it comes to government spending is reminiscent of what Supreme Court Justice Potter Stewart said about obscenity “I know it when I see it”. The cost to transport a car on a terrestial state highway is about $0.02 per mile, the cost to transport that same car on the marine highway is about $4.60 per mile. You’ve been on the AK Marine Highway, I assume, do you think there is nothing they can do to contain costs? I know everytime I’ve been on the marine highway I see wasted money all over the place.
Steve-O, one man’s waste is only that and I suspect what you are speaking to have to do with Coast Guard requirements. There are also union regs. that are negotiated along with salaries that many consider waste. For that last bit many have tried to go with “dayboats” to get away from some of those union regs.
These things you call waste are done for a reason, similar to regs. that make commercial fishing wasteful and more uneconomic. If you and I were the committee to make Coast Guard regs. less wasteful the problem would be solved but many would then choose to not ride-get my drift? Safety is a concern here and just look at Boeing right now since they choose to limit some safety concerns of their 737 Max.
Bill,
Weren’t you just talking about strawman the other day? That’s quite the strawman you’ve constructed. Obviously I’m not talking about saftey, I’m not even sure how you could have read that into anything I wrote, but if you can only see safety as a cutting point on the AK Marine Highway System then you need to open your eyes. Look at their schedules, look where they go to, look how empty each ferry is and which routes make sense, the list goes on and on. Safety is not an issue, wasteful spending is.
Steve-O, the only thing you gave me was: “I know everytime I’ve been on the marine highway I see wasted money all over the place.” I had no idea about what your “wasted money” was and mentioned two obvious issues where Marine Hwys. is expensive to operate. Apparently you weren’t talking about safety or union issues as being wasteful. Next time put your waste issues in print so we know what you mean. I made an assumption and you didn’t like it, but I was not building a strawman-tough noogies.
The Ferry ridership is an issue that’s always been a problem but hardly one where you might observe as “wasted money.” As scheduled sailings have been reduced, we’ve seen decreased ridership and will no doubt see more. We’ve seen two jet ferries being sold because of their fuel costs but those ferries may well benefit another system where ridership is greater. Anyway, it comes down to what your objective is-this government program was never designed to make a profit but provide certain benefits to a geographical region and nothing wrong with attempting to make it more economic but there are going to be trade-offs no matter what your position IMO. Your “wasteful spending” is just your opinion and one who clearly doesn’t have a dog in that hunt (other than a selfish political one looking for a greater PFD).
I have my own ideas where costs may be more evenly dispersed but that depends on where you are coming from. The car deck space is sold by length (not height or weight) and makes the Ferries a different horse than say barge traffic (weight is the big thing here). For example, an acquaintance had a 6X6 that weighed 27k lbs and got it shipped on the Ferry for a small fraction of what it would cost to barge it to Juneau. Much freight is shipped similarly with trailers that allow for cheap groceries, etc.. These subsidies are spread over the whole system and consumers benefit from them but hardly help out with returning money to the system in fares.
There you go assuming things again Bill. As far as I’m conerned they can take every last penny of my PFD as long as they don’t waste it. Problem is they are currently wasting it and show no signs of stopping the waste (except for the Governor), the PF Earnings Reserve is sitting there with Alaskans money doing nothing but waiting for the spendthrift politicians to waste it. The wasteful spending is not just my opinion either, it is the opinion of the majority of Alaskans who voted last election cycle.
I will hand it to you, you have had a few ideas where money could be saved on the marine highway system, good on ya. Maybe you could share your ideas with those who think there is no room to cut spending?
Steve-O, these fare structures are designed for a particular constituent subsidy-they may be tweaked a bit from time-to-time but they have been around a long time.
A big example of ferry waste is when a former governor (Parnell) issued a no-build contract for the two newest ferries to be built in Ketchikan and thereby losing out on the Federal highway money. The further were built without crew quarters (to save money) so they cannot be used for long runs needing quarters.
Anyway, you get the idea that there is waste but it depends on whose ox is being gored as those shipbuilders in Ketchikan loved it.
This article was the journalistic equivalent of a breath of fresh air. Thanks, Craig.
Great! Once again word maestro. I am also of the belief that the Fairbanks rag is not conservative but to each their own.
HEAR HEAR!!!HEAR HEAR!!!!HEAR HEAR!!!!
Bravo Mr. Medred BRAVO!
I agree
Let’s see reduce the population of Alaska to 1987 levels that should really be healthy. Chances are you’d have an economy like you had in the late 1980s a disaster.
well, not exactly because the oil patch would still be healthy (which it wasn’t then), and the tourism economy would likely still be booming, and the state be generating the revenue to support the public side of the economy (which it wasn’t then).
so it would be better than in the ’80s. but real estate market would be a mess during the draw down, and a lot of people would lose a lot of value. former state economist Greg Erickson and i talked about this a few times a long time ago. he thought it would be fine.
i didn’t. even if the economics didn’t work out as a disaster, the psychological impact of draining the state would seriously mess some people up.
People are already starting to walk away from their mortgages. The earthquake will compound this over the rest of the year.
I agree Craig, about the real estate market collapsing under Dunleavy plan, and for that reason I don’t believe this legislature will support Dunleavy’s proposed budget. US recessions are rare without a collapse in housing markets and I suspect the same can be said for Alaska’s economy. It just makes no sense that these lawmakers would choose to prolong our present recession, particularly in order to increase PFDs, IMO.
As for Dunleavy’s 10 year plan, a poster on another blog recently responded to this with “I’m not interested in his 10 minute plan.”
I was at the sharp end of the State’s budget battles from April of 1987 until July of 2006. If you look at the graph that Gov. Dunleavy uses in his presentation showing State spending in the oil era, you’ll see that Operating Budget spending was essentially flat from 1987 to 2004. When the bottom fell out of oil prices in ’85, the Legislature had the good sense to disapprove the 3.6% general wage increase for most State employees set to become effective July 1, 1985, and then the war began.
There were some layoffs of State employees, at most a few hundred right at the beginning, but it is hard to separate out which were budget-driven, which were program changes, and which were constructive discharges in which managers used the budget as an excuse or device for getting rid of somebody they wanted to get rid of for other reasons. It quickly became policy that we were going to hold back on layoffs and hold back as much as a Democrat Governor, Cowper, dared on giving the unions anything that cost money. The State killed the Capital Budget except for federal match money and that badly damaged the private economy, a dynamic we’ve seen this time too. Alaska’s economy wasn’t nearly as corporate back then as today, so Alaska businesses and groups like Commonwealth North and the Resource Development Council howled. Today nobody seems to much care what has happened to the private economy in Alaska; they may when the appropriated but unexpended Capital money runs out, and that will be soon.
We held the line on the operating budget through Cowper and Hickel. Knowles tried to make his union friends and the moocher and looter lobby happy but a veto-proof Republican majority in the Legislature wouldn’t give him the money to do it, so even through Knowles the operating budget stayed pretty flat.
When I joined the Murkowski Administration we were looking at, IIRC, a $700 Million shortfall between budget and recurring revenue. I believed I was walking into a war, probably a strike by major unions, and the only way those end is with the ritual killing of the princes; the head of labor relations and the head of the striking union don’t survive. I wasn’t eligible for retirement yet, so I insisted on return rights to my classified job if I took the appointment – I don’t much believe in return rights, but I much believe in taking care of my family.
We were met with all the labor agreements expiring in the first six months of the Administration, only a Democrat who expected to be succeeded by another Democrat would do something that stupid. Fortunately, one was scared and the other was glad of it, and we got them all under contract with a status quo rollover to buy some breathing room. The State was legitimately experiencing recruitment and retention problems due to lagging wages, and, really more importantly to the Administration, we needed those unions under contract before the 2004 General Election when Lisa Murkowski would seek re-election and AFSCME’s made-man Knowles would be her opponent. The price of oil had ticked up into the $50/bbl. range so we could afford to put some money on the table. We offered the unions mostly 3-3-3% contracts and generally status quo terms and conditions. State employees who hadn’t had a substantial general increase in over a decade couldn’t turn that down, so peace settled over the land.
Then came Sarah Palin and Tony Knowles running for Governor and promising every body and his dog everything they ever wanted and cherries and sprinkles on top. The Administration, I won’t say “we” anymore because once I got the unions under contract I forwarded my office phone to my cell phone and became ROAD staff, Retired On Active Duty, spending as much time as I could on my boat. Sarah became Governor and burned money like a train burns coal. Parnell couldn’t stop until the money started to run out. Walker was owned and installed by the Unions and his whole charge was to make sure that the unions didn’t take a haircut and if necessary everybody else in Alaska would pay. So, there we are.
Palin, Parnell, and Walker did what two governors and two legislatures wouldn’t; they let the operating budget go wild. The government isn’t really much if any bigger in the number of employees, but they sure do make a lot more money, and the program costs have simply exploded. The budget for the DHSS is bigger than most of the State Operating Budgets I worked under. I thought I’d died and gone to Heaven in 2005, and we could get back to a 2005 budget adjusted for inflation without too much pain. There is no way back with no pain, but there are ways to manage the pain.
I think your article is right on, except when you call the Newsminer conservative. Maybe it is compared to Rogoff’s ADN, but no one here thinks it deserves that title.