Dunleavy says he will have a fiscal plan before his second term ends

As he has promised on multiple occasions since 2019, Gov. Mike Dunleavy says he will have a comprehensive fiscal plan for the Legislature. It will be out this year or next year, he says.

What makes his latest claim impossible to believe is not only his constant refusal to confront Alaska’s financial troubles during his 6-plus years as governor, but also the grab bag of preconditions that will weigh down and sink his alleged yet-to-be-seen plan.

His preconditions are strikingly similar to those he promoted during the ill-fated 2019 road show during the Donna Arduin regime, a combination of bad ideas that nearly led to Dunleavy’s removal from office.

Unless there is a state spending limit—which means a limit on state services that he doesn’t want to define—and unless the state makes it nearly impossible to enact or raise taxes, Dunleavy will oppose taxes. That’s the position he took in 2019. It is similar to what he outlined this week as he grumbled through a press conference.

“You might have higher thresholds to increase taxes. Whole host of things to ensure that we don't find ourselves in this position constantly, constantly, constantly. So you're going to see a comprehensive plan put out next year. I can guarantee you, because I've been around for a while, there will be those that will pick apart each part of the plan. But as a whole, I think it's going to be a plan that gets Alaska out of this reliance simply on a diminishing resource over time as oil.”

“We're gonna roll out a, I think a plan that if it's adopted, will solve this issue so we can get out of this mess, to be honest with you,” he said.

Dunleavy blames the Legislature for a lack of leadership on fiscal matters. Some of the blame is on the Legislature, but he is the chief culprit.

It is absurd for a governor—who can act or refuse to act unilaterally—to say his position on creating a fiscal plan is at all comparable to that of legislators who can do nothing single-handedly.

But that is the story he is trying to tell.

When Anchorage Daily News reporter Iris Samuels said at the press conference that legislative leaders told her that Dunleavy hasn’t led on developing a fiscal plan, Dunleavy was clearly irritated and condescending in his reply.

She said legislators are saying that he hasn’t been as involved as he could have been. He wanted to know how he should be involved.

“What does that look like Iris? I’m just asking. What does that look like? Does that look like um? What does it look like? Right. Because seriously, it's a very important question, right?”

“I'm part of the executive branch, right? I’m not the 61st legislature, (sic) big daddy or whatever they want to call somebody. I am an executive, I got a state to run, right? It's big state, so I can't be here all the time.”

“So what does that look, like? I would love, that'd be great if they said, if they could just map it up, this is what it looks like. Because this is year seven, six-and-a-half, seven. There are times that I've been here, especially during the close, last month, two months, almost every day. You still get the same results,” he said.

“I think they really want you in the room” for negotiations, Samuels said of the legislators she talked with.

“In the room,” Dunleavy said.

“That’s what I’ve heard,” the reporter said.

“Ok. In the room. Alright. And that’ll do it? Alright, I’ll be in the room.”

But it’s not just that Dunleavy hasn’t been in the room since he began fleeing the recall.

He hasn’t been in the political mix, refusing to do anything about state finances that carries a political risk. He won’t propose taxes or dividend changes or state spending rules, all of which would generate opposition. He has proposed big dividends and giant deficits, allowing the Legislature to take the blame for cutting the dividend.

He has to do more than be in the room.

The Anchorage Daily News has good coverage of why legislators are skeptical.

Dunleavy said of his alleged plan, “You’re gonna see it this year.”

But then he shifted back to his whining about why individual legislators are not proposing comprehensive packages, as if it is unfair to expect the governor to bear the political weight.

“Is there some reason that I’m missing that they can’t also propose comprehensive packages? The internet tax and the vape tax aren’t going to get us over the hurdle,” he said. “But is there anything stopping them? What is preventing them from doing that as well?”

Asked about closing the Hilcorp loophole and the proposed reduction in oil tax credits—two ideas he supported in 2021—Dunleavy said he opposes any taxes without “sideboards,” the new euphemism of choice for a state spending limit and new obstacles for enacting taxes.

“It’s all a tax-and-spend without sideboards. It’s all a tax-and-spend without sideboards. And we’ve also got to look at our investment climate so we get more investment in the state so we can diversify our economy. It’s all got to be part of that. If not, it’s just a tax-and-spend,” he said.

“Hey look it, some of those guys would love me if I came up with an income tax only. They’d love me. I would have solved the issue. Not really. It would have caused other problems. So I’m willing to come in. I’ll be in the room. I’ll be in the room. I’m willing to come in with a package. OK? But there’s also got to be agreement on sideboards, which was difficult for some folks."

“And there’s also got to be agreement on do we make our permitting, our permitting processes, our, our land use processes, our land lease, land ownership processes, more conducive to having investors come up here and invest. As opposed to hanging onto every piece of land, piece of land we have as if it’s a national park. Are we going to compete with the Texases, the Floridas and the South Dakotas? Because that’s who we are competing with. Or is just going to be tax-and-spend?

“So I’m saying the entire approach needs to happen.”

Nothing will happen with Dunleavy’s approach.

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