Why the #AKLNG hearings have us thinking about Don McLean’s “the day the music died”

As readers will know, in addition to this blog we also regularly publish more frequent, shorter pieces on our Facebook, Linked In and Google+ pages.  Links to those pieces are available in a box down the right hand column of this page, but on infrequent occasions we also have published them here when we believe they have more than the usual significance and want to ensure they have the widest possible distribution.

Yesterday’s piece summarizing our view of the two days of legislative hearings this week on the #AKLNG project is one such instance.  The piece follows:

Friday’s “First Post” from Alaskans for Sustainable Budgets: We are considering nominating Don McLean’s “The Day the Music Died” (official title, “American Pie”) as the official theme song for the last two days of hearings before the Joint Senate and House Resources Committees on the#AKLNG project.

For those of you that weren’t born when the song was popular (a larger segment of the population than used to be the case), the song is McLean’s early 1970’s reflection on the day three idols of late-1950’s pop music died in an Iowa plane crash. It was, in his terms, “the day the music died.” Continue reading

This week (August 23, 2016) on The Michael Dukes Show …

Each Tuesday morning at 7:20 am Alaska, I join KBYR AM700‘s The Michael Dukes Show to discuss the latest in Alaska oil and fiscal issues. This week we discuss what the results from last week’s primaries mean for #AKfiscal policy going forward, and my view that the #AGDC is taking a huge step backwards on the #AKLNG project. I join Michael at 14:55 into the segment.

Listen here or at the widget below and for past episodes, go here.

This week (August 16, 2016) on The Michael Dukes Show …

Each Tuesday morning at 7:20 am Alaska, I join KBYR AM700‘s The Michael Dukes Show to discuss the latest in Alaska oil and fiscal issues.  Because today is the Primary Election Day edition, we started at the top of the hour (the 7:00 am segment).  I join Michael at 1:00 into the show.

Since it is election day, the discussion focused on what I think is the most significant issue facing voters this year — how we go forward on the PFD.  While the issue itself isn’t on the ballot, it is showing up in various ways in several primary races because of the positions various candidates have taken.  We discussed how the old Hickel v. Hammond debate is resurrecting itself in the current PFD debate, the role of the PFD in the Alaska economy and the importance of this election to the future of the PFD.

The recent piece by Charles Wohlforth on the differences between Hickel and Hammond on the role of Permanent Fund earnings that Michael and I use to start the discussion is here.  The guide to candidate positions on the PFD that I reference in the second segment is available here.

Listen here or at the widget below for today’s discussion; for past episodes, go here.

There are two state fiscal issues that matter this election cycle and many candidates are getting one badly wrong …

fiscal-cliff-pulling-backAs we close in on the end of the first round of this election cycle — the primary is this coming Tuesday, August 16 — it is important to remember that there are two state fiscal issues that matter this year.

The first is how the candidate stands on state spending levels.  The second — injected into this cycle by the Governor and the Senate — is how the candidate stands on cutting the PFD.

Some try to minimize the second, arguing to one degree or another that the state’s financial condition is too far gone to be salvaged without permanently cutting the PFD and converting the difference to support state spending.

But that attempt to minimize the importance of maintaining the PFD is wrong and overlooks the fundamental reason both issues are important. Continue reading

The start of my 2016 Independent Expenditure effort …

Fiscal Cliff (pulling back)Starting today I am running some radio ads and, on Monday, will be putting up a digital campaign to support two candidates in the coming Republican primary. The ads will run through election day next week.

I explain my support for David Eastman in the House District 10 (Susitna River Drainage and Wasilla) Republican primary here.

I explain my support for Craig Johnson in the Senate District L (South Anchorage) Republican primary here. Continue reading

Alaska’s Fiscal Situation: Past, Present & Future — an update

As regular readers will realize, at the request of Daniel Hamm, its Chair, we occasionally brief the Alaska Republican Assembly on the current status of state fiscal issues and our thoughts on how to deal with them.

We did that again this week, with a focus on what happened this past session(s), where that leaves the state’s fiscal condition, what the current outlook is as we start to think about FY 2018, and alternatives for dealing with that, admittedly somewhat initially dismal, outlook.

As explained in the presentation, I continue to believe there is a solid fiscal future ahead for Alaska — without resorting to permanent PFD cuts or significant taxes.  But it requires taking steps to implement Jay Hammond’s vision for Permanent Fund earnings and getting immediate control over what has become one of the biggest current expenses in state government — reimbursed oil credits.

This coming session may provide the last great chance to bring the state’s fiscal situation under control before more drastic measures become necessary.  The presentation outlines how we think that can be accomplished.

The update is above, or also available here (video) and here (slidedeck).

Why we need to halt the reimbursement of oil credits — and how …

Fiscal CliffThis column will not be popular with some readers. But it needs to be written.

As readers realize, Alaska is facing a significant financial challenge.  Part of that is self-inflicted by not tapping all available revenue sources.

Untapped revenue

As we have previously discussed on these pages, part of the Permanent Fund earnings stream always has been intended to be used to support government.  As former Governor Jay Hammond said when discussing his vision behind the Permanent Fund:

“I wanted to transform oil wells pumping oil for a finite period into money wells pumping money for infinity.”  Once the money wells were pumping, “[e]ach year one-half of the account’s earnings would be dispersed among Alaska residents …. The other half of the earnings could be used for essential government services.”

Inexplicably, instead of establishing a mechanism for doing just that, Governor Walker instead has done the one thing Governor Hammond strongly cautioned against — tapping the Permanent Fund Dividend, the portion of the “account’s earnings [otherwise to] be dispersed among Alaska residents.” This year the result is to have left roughly $1 – $1.25 billion in potential new government revenues on the table (50% of FY 2016 statutory net income), while at the same time taking roughly $650 million out of Alaska’s private economy.

The larger part of the problem

But the much larger share of the problem is driven by continued overspending.

As most readers will know, some legislators have claimed that the budget passed this Continue reading

Rick Halford & Brad Keithley on protecting the PFD …

Talk of Alaska (5.24.2016)

Click here for a link to the program.

Earlier this week, former State Senate President Rick Halford and Keithley Consulting President Brad Keithley appeared on Alaska Public Media’s “Talk of Alaska” to discuss why the Permanent Fund Dividend (PFD) should not be changed or “replumbed” as has been proposed this session by the Walker Administration.

Their joint appearance carries with it a significant amount of irony.

Following Walker’s 2014 election as Governor, Halford was selected to serve as Co-Chair of the Walker-Mallott Transition Team based on his deep understanding of and connections throughout the state, and Keithley was selected as the opening speaker at the first meeting of the full transition team following the election.  Keithley’s role was to outline the economic situation that Alaska faced and potential ways for dealing with it.

The irony is that each bases his opposition to the Administration’s “replumbing” proposal on the very reasons they were chosen to be part of the transition effort.

Halford believes that a PFD cut will have a deep, adverse and unjustified effect on the people of the state, and Keithley believes not only that it is unnecessary in the face of ongoing developments in oil markets, but also has the worst adverse impact on the overall Alaska economy of any of the fiscal options currently under consideration.

The website for this edition of Talk of Alaska is here.  A podcast of the discussion is available by clicking on the small speaker icon half way down the page.

Spending caps (or at least spending cap “guidance”) …

HFIN Hearing (4.13.2016)Last Tuesday afternoon I was sitting in my home office in Anchorage (working on taxes, actually) when I received a call, telling me that HB 311, this session’s version of a bill first introduced by Rep. Charisse Millet in 2013, was up for hearing before the House Finance Committee at 8:30am the following morning.  The bill, which requires the Governor to submit as part of his annual budget the “sustainable budget” number calculated consistent with the “Goldsmith/ISER” approach, had received two hearings in the prior legislature (2013-14) (here and here) but hadn’t received any attention from the Committee this session prior to the call.

As I described in my subsequent testimony, the approach contained in the bill could be used as a fiscal plan (which I have advocated in the past), as a spending cap (which I also have advocated) or as a spending guide.

Never one to pass up an opportunity to talk about sustainable budgets, by 8:30am the next morning I was in Juneau, with a presentation which combined my thoughts with those that Dr. Goldsmith previously had submitted in support of the bill (the slidedeck is below). Continue reading

Given my shot, what I think is important for Alaskans to understand about the #AKbudget and #AKoil …

At the invitation of Greg Huff, the Director of the Alaska Council on Economic Education, I was the evening’s guest lecturer at yesterday’s session of this year’s “Economics Spring Forum,” an annual 3 credit course for teachers focusing on economic and financial issues. The Forum is sponsored by the Council in conjunction with UAA’s Center for Economic Education. Continue reading

This week (August 9, 2016) on The Michael Dukes Show …

Each Tuesday morning at 7:20 am Alaska, I join KBYR AM700‘s The Michael Dukes Show to discuss the latest in Alaska oil and fiscal issues. This week we discuss how fiscal issues are playing out in the state primary electon campaigns, ‪whether the #‎AKLNG project will still be alive this tme next year‬ & is the University of Alaska ignoring explicit directions from the #AKLeg? I join Michael at about 15:00 into the segment.

Listen here or at the widget below and for past episodes, go here.

Craig Johnson in Senate District L (South Anchorage)

300x250 CJI am supporting Craig Johnson in the Republican Primary in Senate District L.   Here’s my radio spot — that goes up today and will run through the election — to prove it.

The script, if you would prefer to read the ad rather than listen, is here.  A digital campaign, which links to this piece, will go up Monday.

Why am I supporting Craig?  Here’s the longer piece I published last week at Alaskans for Sustainable Budgets to explain it: Continue reading

David Eastman in House District 10 (Susitna River Drainage and Wasilla)

300x250 DEI am supporting David Eastman in the Republican Primary in House District 10.   Here’s my radio spot — that goes up today and will run through the election — to prove it.

The script, if you would prefer to read the ad rather than listen, is here.  A digital campaign, which links to this piece, will go up Monday.

Why am I supporting David?  Here’s the longer piece I published last week at Alaskans for Sustainable Budgets to explain it: Continue reading

This week (August 2, 2016) on The Michael Dukes Show …

Each Tuesday morning at 7:20 am Alaska, I join KBYR AM700‘s The Michael Dukes Show to discuss the latest in Alaska oil and fiscal issues. This week we discuss whether Governor Walker is changing the state’s course in dealing with the producers on the #AKLNG project and if so, is it for the better or worse; what is going on with the state’s economy, do lower state headcount numbers represent true job losses and what does the AEDC outlook mean; and finally, what is going on with oil prices and why. Michael intro’s the segment at 13:35.

Listen here or at the widget below and for past episodes, go here.