WC must be the only one in the room who remembers the middle 1980s in Alaska. Half the financial institutions in the state failed. Businesses departed and never returned. WC, who represented banks back then, would go to the courthouse and conduct half a dozen nonjudicial foreclosures each day. Condominiums were given as door prizes. Some of Fairbanks’ best known businessmen wound up in bankruptcy.
No sensible person wants to go back there. Except, apparently the Republican coalition controlling the Alaska Legislature.
The economy of the State of Alaska is heavily dependent on the state budget. Like it or not, state spending plays a major role in the health of many parts of the gross state product. The multipliers – the number of times a dollar circulates through the economy – are much higher for state spending than, say, the oil industry, where a significant part of the wages paid leave Alaska every two weeks.
For example, if a state-spent dollar goes through the economy three times before heading outside, then a dollar cut from the state budget cuts three dollars from the state gross product. A dollar cut from an out-of-state oil field worker’s wages who lives in Oklahoma when not working on the North Slope might only go through the economy one third of a time, making it a 33% loss.
So when the state senate finance committee proposes to cut 7% of the state education funds, after already whacking the school bond reimbursement program, embarrassments like Senator Pete Kelly (R, Ignorance) are really cutting $150-200 million from the state gross product. That’s hundreds of jobs lost. That’s possible departures from Alaska by folks we really need to have stay.
What Senator Kelly and his buddy, Senator Mike Dunleavy (R, Wasilla, of course) are doing is knocking the state economy down and then kicking it a couple of times. A perpetually frail economy like Alaska’s can’t take that kind of abuse; there’s a clear and present danger that the state will spiral into another 1980s-era recession.
Of course, it’s also incredibly short-sighted on the education front. The result will be more students in each classroom, larger class sizes and the very well known impact on the quality of education delivered. Understand that fewer teachers means higher drop out rates, lower achievement scores and a permanent lowering of the performance of Alaska’s kids.
The Republican caucus has decided, in effect, that it will sacrifice the voters’ home equity, the voters’ jobs, the voters’ kids’ education, the state’s infrastructure and public safety, rather than adopt a sensible tax policy. Cowards, all of them.1
A Legislature with the moral courage of a moldy sponge might recognize that trying to balance the budget a serious risk to the state’s economy and the long-term well being of it kids might be a bad idea. But we’re talking about the Alaska Legislature here, and WC should not be slandering moldy sponges.
Does anyone know how to get the smell of moldy sponges of your hands?
- WC excuses from this rant Rep. Paul Seaton, R-Homer, who has introduced a bill that would impose a new income tax. And a double-damns Rep. Lance Pruitt (R, Cowardice), who when asked what he thought of Rep. Seaton’s bill, laughed. and said he didn’t want to take the “easy way out” of the state’s fiscal predicament ↩