ON THE ISSUES
Our legislature is broken. They have failed to lead. They have enforced partisanship. They have failed to promote or protect our interests. We need a new coalition made up of loyal, pragmatic leaders from both parties. If we can elect a few new people, we can make our legislature responsible and responsive. We cannot afford to continue with the status quo.
With our state barreling off a fiscal cliff, the legislature failed to change directions. They had years of plenty to prepare for the day oil money started to run short. They failed.
This legislature spent a record breaking five special sessions trying to come up with a budget. They failed. In the last session, they scheduled a House Finance meeting Tuesday, Wednesday and Thursday. They canceled every one.
The majority blamed the minority for its unwillingness to cut education, services, infrastructure and jobs. The minority refused to make such cuts without reducing the hundreds of millions of dollars given to big oil producers as tax credits. Rep. Seaton (R), proposed a bill to address the budget crisis, the majority killed it. They do not seem interested in real solutions. They failed us.
We need to get past dogma and back to pragmatism. We must put loyalty to Alaskans before loyalty to party. The majority coalition is as fragile as it has ever been. It is composed of Bush Democrats, Tea Party radicals, “Industry Friendly” Republicans, and a few Moderate Republicans. The majority leadership has led by offering them the carrot of generous state funding. That’s no longer a tool they have.
Replacing two or three of the incumbents would be enough to form a new majority: a coalition of loyal pragmatists, Democrat, Independent, and Republicans alike. We have an unprecedented opportunity to retake our state legislature. They have made an expensive spectacle of their failures. We do better. We need leaders who can pass a budget. We need leaders who will put Alaskans first.
The Fiscal Crisis
This year, 72% of our spending is from our savings. Of that spending, $775 million were allocated for “oil tax credits”. The governor vetoed $340 million of that, but his veto only defers payment to next year. Next year is expected to be even worse. We expect to pay out $771 million in oil tax credits than we take in as production taxes. On top of that we have the $340 million in deferred payments and the $300 million our legislature voted to forgive from oil taxes next year.
Most of the majority adhere to the delusional belief that we can cut our way out of the budget crisis. If they fired every single state employee, every trooper, and every teacher, we would still have a budget gap. Eight of our legislators,have signed a pledge to “oppose and vote against any and all efforts to increase taxes”, my opponent is amongst them. That is not realistic or fiscally responsible.
The lack of leadership from our legislature has cost us four credit rating downgrades. That means loans are going to be harder to get and outside businesses will be less likely to invest in our state.
This year, our budget gap stands at 3.2 billion dollars. Although reducing no-strings-attached oil tax credits is a big part of the solution, it is not adequate. We need to raise revenues. That means taxes on corporations, non-residents, and Alaskans alike. We’ve had a good ride from the sale of our oil but now we need to stand up and start paying our own bills directly. We will also have to develop our local economies and support small entrepreneurs and innovators.
Critically, we will need a legislature that can pass a fiscal plan. We need to show the world that we can handle a budget crunch responsibly. We need to pass a fair and balanced plan that we can maintain into the future. We need to let our workers know that we have their backs. We need to let businesses know what conditions are going to be like in five years so that they can make informed investments. Our legislature has been volatile and irresponsible. We need stability and practicality.
If you elect me, I will work for a fair fiscal plan. We all need to work together to get our state back on track. For those of you who want more detail, I think H.B. 365 is a good place to start. It comes from one of the moderate Republicans and is the most likely path forward. It’s not perfect but it’s far better than doing nothing.
The Oil Tax Structure
Two years ago, Juneau voted 2 to 1 to overturn SB 21, the Legislature’s oil tax scheme. Anchorage voted to keep it. Now we are dealing the the consequences of that plan and the low price of oil. We are writing checks for the better part of a billion dollars to enormously profitable oil companies. We need a better deal. We can drive a better bargain if we can be sure our legislators are working for us.
We have starkly different options. We could continue with the current majority. They would bankrupt our state to bankroll outside interests. They have a history of wasteful spending. They are unwilling to consider an income tax. They will continue to sacrifice our interests for their ideology and personal ambitions.
We could require more of our leaders. We could demand accountability and brave leadership. We could choose innovation and a diverse economy. Our state is second to none in natural resources and natural beauty. Alaskans do whatever is necessary to get the job done. We should ask no less of our leaders.