Democrats Tackle Alaska’s Fiscal Gap ...

Or: Memoirs of an Invisible Plan


Medium Grind – Analysis and Opinion

On Feb. 23 the House minority caucus, self-styled as the Alaska Independent Democratic Coalition, held a press availability. When the Q&A session began the AP’s Becky Bohrer initiated a scene that has played out a thousand times in Democratic press events. She said there are several proposals out there for use of the Permanent Fund and then asked the Dems if they have a fiscal plan.

It happens every session, usually more than once. Capitol reporters have built up calluses to the inevitable non-reply reply, but reporters are an eternally optimistic and dogged lot. Like the pain of child birth, eventually the sadness of dejection wears off and some intrepid reporter decides, “What the hay. I might as well chuck that old dart into the blackness and see if I hit something this time.” Only the sound of unrequited hope skittering along the floor comes back.

“Right now,” said Minority Leader Chris Tuck (D-Anchorage) “we need to have those dialogues taking place. We have a lot of bills in committees right now. What we’re asking,” he continued “is as we look at the budget, we do more looking at the revenue so we can have a complete package going forward.”

Tuck went on to praise the governor’s courageous plan that says we’re all in this together with oil taxes, mining taxes, sin taxes, gasoline taxes, potentially an income tax and different ways of “doing the Permanent Fund.”

Rep. David Guttenberg (D-Fairbanks) said there are still bubbles moving in the air and, “My concern is the impact on Alaskans as much as how the revenues move, where the dividends are, and when we start talking about cutting people’s dividends, we’re impacting different Alaskans differently.

Yeah, but what’s YOUR plan?

Rep. Les Gara (D-Anchorage) took a crack at it. “I’m hoping the Legislature will listen,” he said. “We shouldn’t make our decisions based on polling, but we should listen to our constituents. The one thing the constituents favor the most is logical, that we shouldn’t have the oil fields that produce zero percent production tax, that we should fix that as part of a plan; that getting no oil taxes for oil fields after 2002 and all future fields is a pathway to poverty for the state.” Gara had opened the press availability by talking about his new oil tax reform bill.

Gara said he can’t support a Permanent Fund only plan, but he didn’t say what plan he could support.

The pursuit continued. Another reporter asked the Democrats if they can’t support the level of cuts proposed by the majorities, and they can’t settle on a Permanent Fund proposal what is the biggest part of their fiscal solution.

Gara said we’re beyond cutting fluff, and now we’re cutting to the bone. He repeated his oft-repeated call for everyone to “get out of their ideological boxes” and work together to create a broad fiscal plan. Tuck said there’s no silver bullet. He acknowledged the need to look at revenues, but that people should step back and look at everything and not “compartmentalize” things. Guttenberg said there’s been no economic analysis so nobody knows how bad the cuts will hurt.

... no plan

Why Does it Matter?

Our government is explicitly designed to disperse and limit power. Separation between the three branches of government is supposed to keep one branch from running the table, and a free press is supposed to keep an eye on all of them. It doesn’t always work like that, and lately money gets stuck between the gears all too often, but it’s a pretty good idea. In the Legislature we have two separate bodies, and within those bodies are minority and majority caucuses – well, these days there’s one minority caucus in the House, the Senate has no such luck. The minority has several important roles to play. When Ethan Berkowitz was House minority leader he called it “minorting.”

A minority serves a powerful public service by offering an alternative viewpoint or alternative options. Simple opposition is not an alternative. It’s why when a Democrat stands at the podium and says, “We would never do that!” a reporter is compelled to ask, “So, what WOULD you do?” That reporter is not trying to put politicians on the spot. She’s just trying to get them to do their jobs.

The other night the House Finance Committee took amendments to its current version of the FY 17 budget. Three minority Democrats sit on the committee, Gara, Guttenberg and Rep. Scott Kawasaki of Fairbanks. They offered 27 amendments that, combined, would return about $102.5 million back to into the budget. One amendment included a bunch of negative numbers, but most of it is money previously set aside for specific purposes and most of that will be swept back into the general fund if it’s not used anyway – they are not actual budget cuts. Most of the attempted add backs were funds for programs that help abused children, physically-challenged adults and the elderly.

As each of those amendments predictably failed, one of the unfortunate realities of being in the minority, the three Democrats spoke passionately about the moral implications of making cuts that reduce the quality of people’s lives, rather than cuts to inefficiencies and real fat in the budget. Gara, who has long been a genuine and stalwart champion for children’s issues, spoke intelligently and passionately to each issue. He does his homework, and when it comes to children’s issues or helping people with real challenges no one can question his sincerity or bona fides. It’s always powerful to listen to Gara speak to those subjects, and it’s clear he’s making at least some of the Republicans in the room squirm in their seats.

Whether the majority caucuses, which are bi-partisan, by the way, are correct to make those cuts to services or not is a separate question. The problem here is that the minority members only address one side of the ledger, one of the political advantages to being in the minority. It’s too easy to cast moral aspersions when you’re not willing to step up to the plate and present funding for your moral imperatives.

Before you can argue that $100 million in cuts to programs is too much, you have to address the $3.6 billion revenue shortfall facing the state. Democrats are terrified to do so. They believe history has shown when a Democrat uses the word “tax” or suggests any use of the Permanent Fund other than writing checks to Alaskans, voters will show them the door. Talk of Permanent Fund use probably did contribute to the Republican takeover of the Legislature, but so did redistricting and a concealed carry initiative on the ballot. In any case if you’re legislating from fear of losing your seat you’re almost certainly not serving the voters anyway.

In a recent interview Rep. Sam Kito III of Juneau said, “If the legislature eliminated the dividend and used the money for government services I can guarantee 90 percent of legislators would not be reelected. It’s that much a part of the fabric of the state of Alaska.” Whether or not that’s true is immaterial. The seats in the Legislature and the Governor’s mansion don’t belong to incumbents; they belong to Alaskans. Gara said legislators shouldn’t make law according to polls, but that they should listen to their constituents. That’s true, but it’s problematic. Along with the checks and balances our government is also based on another powerful principle – that a constitutional republic is the best form of government because it prevents the mob from running roughshod over the Constitution. That’s why the job of representing other people is hard sometimes. Sometimes, like when the people are paying zero for their own government, collecting checks from that government and the government is $3.6 billion in the hole, you have to tell constituents things they’d rather not hear. It’s an inconvenient but necessary part of the job.

Kito wasn’t wrong, and he had the courage to lay out what he thinks would be one roadmap to passing a good budget this year. For Kito it would first require minimizing the damage to people’s lives and to the economy done by excessive cuts. It would also mean limiting the draw from the Constitutional Budget Reserve to no more than $1 billion – because he believes the Legislature should extend its savings as far as possible. It would also mean some kind of income tax, but also a guarantee of a PFD at a level of at least $1,000, and it would involve some use of the Permanent Fund’s excess earnings. Kito also favors reducing the amount the state pays oil and gas companies in tax credits. He wasn’t much more specific than the caucus, and he wouldn’t say if any or all of those things are must-haves, but at least he acknowledged that they’re all probably necessary.

Kito’s approach is thoughtful and reasoned, but he was quick to point out he doesn’t speak for the minority caucus, and of course, nobody really can. While some House Democrats are willing to admit some use of Permanent Fund earnings is needed, none of them will publicly speak to how it should be done, and as a group they simply can’t come together on anything substantive. In the meantime, in the Senate, Sen. Bill Wielechowski (D-Anchorage) is getting hearings for his SJR 1, an attempt to put on the ballot a measure to enshrine the PFD in the constitution. Gara says he’s not drawing lines in the sand, but also says a Permanent Fund only plan is not enough – though he hesitates to articulate what would be enough. Gara sponsored a similar resolution in the House.

Kito made the point that if the minorities start taking cards off the table they’ll kill the negotiations. However, if they don’t at least start talking about which cards they like or don’t like, there’s no negotiation at all, and the public is robbed of a potential alternative view of the situation. Nobody is asking the minorities to take cards off the table or to draw hard lines in the sand. It would be enough if they’d just step onto the beach and put together a hand they think would serve Alaskans best.

Whether you’re in the majority or the minority the people who elected you sent you to Juneau to lead. Leadership cannot simply be about saying “no” while offering no alternative. Leadership certainly can’t be about playing it safe in hopes of not alienating voters. In the minority it has to be about demonstrating how you would lead, given the opportunity. It has to be about minorting. Berkowitz also used to like to say, “If we’re a rock they’ll break around us.” It wasn’t because Berkowitz wasn’t open to negotiation or compromise; he was. It was because he understood that successful negotiation and compromise are won with a strong and coherent voice. He know that he couldn’t measure success if he hadn’t clearly stated his goals, and the path he preferred to achieve them.