Over the weekend I wrote a piece that, among other things, criticized the Alaska Dispatch for its lack of reporting balance.
As if on cue, the Dispatch wrote a news story today that proves my point. The story is about Byron Mallott's announcement in a conversation yesterday that he will be running for Governor as a Democrat. I have no problem with that part of the story and believe that Byron will become an important candidate.
But in writing the story the Dispatch reporter also decided to editorialize about the state's oil tax policy. Here is the quote:
But the fiscal picture is rapidly changing. And some opponents such as Walker and possibly French hope Parnell's flagship success -- pushing through a major tax cut in 2013 to spur oil production -- will be his undoing.
State revenue officials say the cut will remove billions of dollars from the Alaska treasury in the coming years, throwing it into severe deficit spending. The tax cut generated surprising opposition in the form of a repeal initiative signed by 51,000 Alaskans, about two-thirds more than the minimum amount needed.The bias? The story fails to report that ACES -- the tax approach favored by those signing the initiative -- also will throw the state into "severe deficit spending."
My source? Easy, the University of Alaska-Anchorage's Institute for Social and Economic Research (ISER) January 2013 report, Maximum Sustainable Yield: FY 2014 Update. Their conclusion, after analyzing revenue and spending trends based entirely on ACES:
Right now, the state is on a path it can’t sustain. Growing spending and falling revenues are creating a widening fiscal gap. In its 10-year fiscal plan, the state Office of Management and Budget (OMB) projects that spending the cash reserves might fill this gap until 2023, as the adjacent figure shows. But what happens after 2023?
Reasonable assumptions about potential new revenue sources suggest we do not have enough cash in reserves to avoid a severe fiscal crunch soon after 2023, and with that fiscal crisis will come an economic crash.ACES: "can't sustain," "fiscal crisis, "economic crash." Three phrases you would think from reading the Dispatch story apply to SB 21, but not the tax approach to which the state will revert if the repeal -- supported by "surprising opposition" -- is adopted. But three phrases ISER applies directly to the policies flowing from ACES.
Why is the bias important? It misleads the public into thinking that what Alaska is facing is a revenue problem, solvable by changing tax structures. That isn't the problem Alaska faces -- instead, Alaska faces a spending problem. Under either tax structure -- ACES or SB 21 -- at current spending levels Alaska is headed for a crash. Blaming it on one tax approach or the other misses the central point, and in doing so, diverts Alaskans from focusing on finding real solutions.
Previous Dispatch political and economic reporters never would have reported with that bias. It is disappointing that their successors do. The credibility of the entire organization suffers for it.