While preparing for the day I noticed that the Fairbanks News-Miner today is running my recent op-ed piece, titled "Morning in Alaska." It captures the theme I want to talk about today:
"[Alaska's] spending crisis has developed only recently. In fiscal 2011, the state spent $5.48 billion, as with most years before that time a rate within sustainable levels. In the fiscal year just ended on June 30, however, the state spent a record $7.9 billion, almost 50 percent higher. This year, the state is spending $6.8 billion, the second-highest in the state’s history, and, in April, the governor proposed to continue spending at the same rate for the next five years.
To be blunt, at these levels Alaska’s leaders are spending the state into the poorhouse. Indeed, they are acting the same as a young family in their late 30s, deciding between putting a portion of their income into a 401(k) to build an asset that will sustain them through the remainder of their life or spending it all now on a new ATV, snowmachine, cabin, house and repeated vacations in Hawaii. Alaska state government is buying a lot of ATVs, albeit in the form of indoor tennis courts and new baseball and football stadiums.
There is time remaining to sober up from the state’s binge spending spree and leave a significant legacy to our children and grandchildren, but we need to start now. If not, continued overspending will reduce future sustainable levels. The $5.5 billion will become $5.2, then $4.9 and less and less as we delay.
There is an opportunity for a 'Morning in Alaska.' But we have to take it before it evaporates."We will see how the day goes.