Home Forums Hunting & Shooting Alaska Richest state to ever go broke

The Alaska Permanent Fund is about to make history again.

The international investment market is strong, the Fund’s portfolio is robust. On Monday, barring a weekend catastrophe, Alaska’s piggy bank will very likely top $60 billion.

For perspective, Bill Gates’ net worth is about $89 billion. We Alaskans have about 67 percent of the Gates fortune. We’ve never been richer.

Or broker, according to Gov. Bill Walker and the Democrats, who want to implement a tax up to $700 million on residents.

The Permanent Fund is making nearly 9 percent gains this year. Not bad for a little sovereign wealth fund that started with merely $734,000 in 1977.

The Earnings Reserve Account portion of the Permanent Fund is now about $11.7 billion. That’s the money that can be used to pay for state government. In addition to that fund, the government has nearly $5 billion in the Constitutional Budget Reserve, the CBR, as legislative types know it.

There are a few other accounts around state government, but those are the big chunks. Together, the State has well over $65 billion in its piggy bank, and $16 billion of it is more or less available for appropriation.

And yet, the Democrats in control of the House won’t pass a budget unless they get an income tax that would take $700 million from Alaskan families. HB 115 is their vehicle, which was designed by Governor Bill Walker’s Department of Revenue.

In his latest compromise package, the governor asked the Senate to accept a “head tax” (aka still an income tax) that would bring in $100 million.

But with the House Democrats quickly rejecting his proposed compromise, the governor is likely to ratchet up his request for taxes to something closer to what the Democrats want.

Over in the Senate, controlled by Republicans, lawmakers say no tax is needed. All that’s needed are some modest cuts and a restructuring of the Permanent Fund, per Senate Bill 26, which is the governor’s bill.

The House agrees in principle with the framework of SB26, but are holding it hostage in order to force through their taxes. The upshot is that pink slips have gone out to state workers in advance of a government shutdown on July 2.

[Read: Walker’s plan: Camel’s nose under the tent tax]

Stay tuned for Monday, when the Senate should hear back from the governor with his responses to a list of questions asked by Senate leadership that pertain to the compromise Gov. Walker is trying to reach.

Very likely, some of those answers will be unpalatable because they will involve even higher taxes than his first compromise offer of $100 million.

Senate leadership sent a letter to Gov. Walker last week asking for answers for why the governor:

Offers no spending cuts, but actually agrees to the Democrats’ $200 million increase in state spending.
Cuts down his tax request, while providing no documentation to the public as to why he needed $700 million two months ago, but only $100 million now.
Accepts a shortfall of $300 million that could be paid for with savings, even though just weeks ago he said he would not accept anything but a fully funded plan.
Shrinks the Permanent Fund dividend.
Accepts the Senate’s version of SB 26, a restructuring of the Permanent Fund.
Establishes a compromise on oil taxes, but only if he gets his “head tax” and only so long as there are no cuts to the budget.
Insiders at the Capitol say it is no secret that the governor’s head tax is a gateway tax, to get something on the books, and come back later for more. His team has told several people in the Capitol this week that the tax is just to get the infrastructure in place

Senate Majority Leader Peter Micciche, a Republican from Soldotna, says the struggle is over the philosophies about the role of government. Democrats see government as the economy and have little concern for the private sector, he said.

“This Permanent Fund milestone proves the percent-of-market-value numbers in our SB 26 model is conservative, and doesn’t even reflect the gains made by the fund this year,” he said.

Sen. Mike Dunleavy of Mat-Su, has been an opponent of an income tax. He’s a Republican who no longer aligns with the Senate Republican majority because of his budget hawk approach that is stridently anti-tax.

“This has nothing to do with the budget. They don’t need a tax. They want a tax,” Dunleavy said.

“This is like begging your relatives for money and telling them you’re broke when everyone knows you aren’t broke. The public isn’t buying it. They know you can live on your savings for at least 13 years. Meanwhile, you get your other investments going, like Armstrong and Caelus (and other oil companies) and you put more oil in the pipeline.”


http://mustreadalaska.com/alaska-richest-state-broke/

Gov Walker is a douche! Sean Parnell isn't looking so bad now..

Can Walker be recalled? If he can, it sounds like it's about time.

There was a recall petition floating around but have heard no more of it.

I hope Dunleavy runs!

The AK Senate plan will continue gobble up the CBR at almost a billion a year. (at that rate the CBR is gone in 4-5 years) Even with the POMV draw and dividend reduction, the Senate plan could kill the dividend program. Other than the corpus of the fund, the ERA, from which PFDs are paid, will be the only savings account the state has left after the CBR is gone. Thus, the "pass SB 26 alone plan" will put a great deal of pressure on the corpus of the permanent fund as well. I'm concerned that under the Sen. Maj. plan the PFD will end and conservatives will be hung with the blame. The blame for the dividend's death combined with the in-migration of a lot of lefties recently could result in a sizable shift to the left in our state's politics...

The state has lost 80% of revenue, cut 44% from its budget and burned through $10B in savings already in the last 3 years. If that's my business or household, I would be rather concerned.

To act like there's no real problem and kick the can down the road is a dangerous game who's end could result in power shifting to Democrats who are more that happy to give handouts to those feeling so entitled. The entitlement ideology doesn't care really about political philosophy or personal responsibility. I fear that those who believe that they are entitled simply by their mere existence will find new patrons who do not share our cultural values.

Is walker a democrat for hillary.

The senate doesn't want to gobble up the CBR. They don't want a state tax either. But since Walker refuses to make cuts, his democrats can pay for it along with the rest of us, rather than just the working class.

I'm happy to see Walker voters getting this broke off in their ass.



http://davideastman.org/articles/2017/6/9/house-goes-off-the-rails-in-morning-floor-session

Going broke and what do the democrats in the house want?

Well, beside keeping their private chef on the payroll?

A penny-per-barrel tax for a climate change commission.

It's as if they are unaware or unconcerned that after nearly 100 days into a 90 day session, there still is no budget nor fiscal plan - beyond more taxes.

The state has cut 44% from the budget, which budget?

If the state could stop threatening to raise oil taxes, and work with the oil industry to come up with some reasonable incentives to bring recent finds into production, we can be back to 1million bbl/day and state revenue will be back where it needs to be.

A radio talk show host put it most succinctly, the state needs to stop subsidizing people to live in places they can't afford to live.

Cutting proposed budget increases is not a budget cut!

Parnell was there when the problem really started and shares much blame. Look at the progression of the budget under his watch.

Don't forget the lovely sister Sarah in regards to being at the helm of massive government growth.

Agreed, but Captain Zero put the ship in overdrive...

Talk about the proverbial slippery slope. Fight as hard as you can to keep those out. I can't seem to figure out their problem with cutting the budget. That's what everyone else has to do when their income goes down.

I love to cringe when I listen to some of the radio talk show hosts and their 'snapshot' views of their world. One could carry such comments forward and ask, "Can Anchorage afford to sustain a population of 400-500,000 people?" or perhaps a 'commentator from a more remote part of the state might say, "If these developers and regulators would leave us alone, we would still be alright where we are." Of course, no bell can be unrung, so we need to figure out how to live with the sounds we have created with adding to it by ringing more.

That is what Walker claims. He's delusional.

If you Google on "state spending per capita"......you'll get an eye opener.

I expect it to be higher but $18K+ is a about three times other states.

The thing with that per capita spending is that the majority of it goes to less than 10% of the states population. I have no doubt that there are individuals that between handouts, law enforcement, courts, social workers, child protective services, medical, etc, etc, etc cost the state $100k a head.

I'm sure you are correct.

And while I am supportive of lending a helping hand when people need it, assistance is not subsistence. To that point, I wish the State would administer the SNAP program similar to WIC. Give people vouchers for specific items: 10 pounds of milled, unprocessed, white rice; 5 pounds dry beans, unprocessed; 2 pounds natural colby or cheddar cheese, 2 dozen eggs...etc. I know some people use their 'assistance' well, but I have seen so many grocery carts full of soda pop, Doritos, candy, Minute Rice, Sirloin, Banquet
chicken, Breyer's ice cream etc, while we get by on store brands of cereal, vegetables, on-sale meats sometimes, near-expiration milk and breads, etc. It ain't rocket science, but it's amazing how well some dignity can motivate a person, while stealing that dignity robs all of us of a whole lot more. I realize that businesses would lobby against the easy money to be made in the higher dollar stuff, but they can work a bit harder too.

but wait a minute, Bill Walker sez we're down to getting rid of road maintenance and teachers? If they've cut 44% (there's lies and damn statistics) then they should have cut about 80% (roll eyes here)

god no wonder folks hate politicians.