The Weekly Top 3
The Weekly Top 3
The Weekly Top 3 (4.14.2025)
Welcome to The Weekly Top 3 — our look at the top 3 things on our mind here at Alaskans for Sustainable Budgets — for the week of April 14, 2025.
This week, our top 3 issues are these: 1) we explain the difference between an accounting balanced budget and a distributionally balanced budget and why the Legislature is continually failing to produce the latter (2:06); 2) we discuss former Sen. Joe Paskvan’s excellent op-ed in a recent Fairbanks Daily News-Miner attacking the Permanent Fund Corporation’s proposed backdoor raid on the Permanent Fund corpus (21:40); and 3) for those interested, we do a Michael Dukes Show “Finer Things” segment on my recent Ireland trip (38:01).
The Weekly Top 3 is a regular weekly segment on The Michael Dukes Show. The Show broadcasts on Facebook and YouTubeLive as well as via streaming audio from the Show’s website weekdays from 6–8am. We join Michael weekly in the first hour of Tuesday’s show, from 6:25–7am, for a discussion between the two of us about our three issues.
Hi, this is Brad Keithley, managing Director of Alaskans for Sustainable Budgets. Welcome to the weekly top three the top three things on our mind here at Alaskans for Sustainable Budgets for the week of April 14th 2025. The weekly top three is a regular segment on the Michael Duke show. The show broadcasts on both Facebook live and YouTube live, as well as via streaming audio from the show's website. Weekdays from six to 8.
Speaker 1:Am. I joined Michael weekly in the first hour of Tuesday show from six 10 to 7. Am For a discussion between the two of us about our three issues. We post the podcast of our discussion following the show on the Alaskans for Sustainable Budgets Facebook, youtube, soundcloud, spotify and Substack pages, also on the Alaskans for Sustainable Budgets website, as well as the projects page on national blog site mediumcom. You can find past episodes of the weekly top three also at the same locations. Keep in mind that, in addition to these podcasts during the week, you can also follow and participate in the discussion with us of these and other issues affecting Alaska's fiscal and economic condition by following us on the Alaskans for Sustainable Budgets Facebook page and through our posts on Twitter.
Speaker 1:This week, our top three issues are these First, we explain the difference between an accounting balanced budget and a distributionally balanced budget and why the legislature is continually failing to produce the latter. Second, we discuss former Senator Joe Paskvan's recent op-ed in the Fairbanks Daily News Minor attacking the Permanent Fund Corporation's proposed backdoor raid on the Permanent Fund Corpus. And third, for those interested, we do a Michael Duke Show finer things segment on my recent trip to Ireland. And now let's join Michael.
Speaker 2:So the weekly top three we've got some good stuff. We're saving that for saving that for the end. Number three, we're going to talk about a little bit about your trip to Ireland and all the fun stuff. We'll have a mini top three inside the top three. But before we get to that let's you know I hate to do it, but we've got to talk about it. There's been a lot that's gone on, uh, over the last couple of weeks while you've been gone, and there's going to be a lot more coming up in the next two weeks. I mean we have seen some chicanery, we've seen some, uh, some deceptions and some fifth dimensional chess moves and you night, late night things and everything else. But this balanced budget thing that we keep talking about, I mean they keep using that word but I don't think it means what they think it means. Give me the rundown here. The number one is the balanced budget that they keep talking about. Is it really, brad? Is it really?
Speaker 1:Well, michael, it's funny, over the two weeks I'm not sure anything's changed all that much. When I left, we were talking about the budget that was in house finance. When I come back, we're talking about the budget that's just barely made it out of house finance and onto the floor. So I got rested over the two weeks. I'm not sure about anybody else. So we're going to hear a lot this week and next and maybe the week following that, maybe the week following that maybe into a special session.
Speaker 1:We're going to hear a lot of talk about a balanced budget and achieving a balanced budget, that that is the goal of everybody to achieve a balanced budget. And what I want to talk about is there's really two balances. When you talk about fiscal policy, there's two balanced budgets. One is an accounting balance, where revenues equal spending or spending equal revenues, where you have an accounting balance across the top. But there's also, when fiscal policy experts talk about a balanced budget, they're also talking about a distributionally balanced budget. That is, that the contributions toward the budget and the distributions out of the budget are roughly equal. That no one bracket income bracket or no one industry or no one. That no one bracket income bracket or no one industry, or no one segment of industry is taking a bigger hit than any other. They're all contributing in a fashion that is distributionally balanced.
Speaker 1:What we're going to hear over the next couple of weeks or three weeks is we're going to hear a lot of talk about accounting balance. We're going to hear a lot of talk about, at the top level, spending equaling revenues or revenues equaling spending, and I'm not sure they're even going to achieve that. If you look at the numbers that are in the House Finance version, if you look at the numbers that are being talked about on the floor, if you look at the amendments that are on the floor thus far, we have more amendments to go, but if you look at the amendments on the floor, I'm not sure. And also, at the same time, look at where FY26 revenues are going. With the oil price slide, I'm not sure that we're even going to achieve an accounting balance budget. People talk about dipping into the CBR to balance this year's budget because we're having a slide in revenues and there's been additional spending added on top in terms of the supplementals. And now people are talking about dipping into the CBR to balance next year's budget, the FY26 budget, because of the slide, ostensibly because of the slide in oil revenues. It's a combination of being unable to control spending and the slide in revenues. But we're going to have a lot of discussion about that accounting balance and I suspect that the majority in the House and the majority in the Senate are going to claim victory if they come close to that accounting balance spending equaling revenues. But that's not the only balance that's important. When fiscal policy people talk about balanced budgets, they're also talking about distributional imbalance and we've already given up on that. The amendment Friday night to significantly cut the PFD below the statutory levels and transfer the remainder, transfer that difference, the cut, to the general fund essentially tax middle and lower income Alaska families and transfer that difference to the general fund ensures virtually ensures that there's not going to be a distributional balance.
Speaker 1:Everybody talks about distribution. They don't say they're talking about distributional balance. But everybody talks about distributional balance. When the oil industry says, oh, you can't increase revenues from us because it will affect our industry, they're talking about distributional balance. They're talking about you can't take more from us because it will affect our business and it will cause us to have adverse consequences in our business. That's a discussion about distributional balance. When people say oh, you can't have taxes, you can't have sales taxes or income taxes because that would take from Alaska families separate. Apart from the fact that PFD is taking from Alaska families, the PFD cuts are taking from Alaska families. They're talking about distributional balance. And so I think it would be useful if we sort of fessed up in this discussion that we're going to have and admit that we're talking about distributional balance and focus on distributional balance as an issue.
Speaker 1:When the oil companies say they can't afford any more, dig into that. Can the oil companies afford more? They can't, and we've talked to you on the show a lot about the economics of the oil industry. We've talked on the show about the revenue you take from the oil industry and they can't afford more. When we talk about sales taxes and income taxes, we're talking about really a distributional balance affecting Alaska families, but we're also talking about a distributional affecting non-residents. We don't take from non-residents.
Speaker 1:Currently Non-residents get off, as Governor Hammond put it at one point, scot-free. They don't have to contribute to the cost of government in Alaska, unlike in the 49 other states and the District of Columbia. Non-residents in Alaska, tourists, non-resident employees, don't have to contribute to the cost of Columbia, non-residents. In Alaska, tourists, non-resident employees don't have to contribute to the cost of government and the result of that is a shift. The share they would otherwise pay over to residents increase the burden on residents of Alaska.
Speaker 1:So we would gain a lot, I think, if we would just confront the fact that we're talking about distributional balance when we're talking about these issues and try to develop a budget and work to develop the budget and set as a goal of a budget that not only is accounting balance in the sense that revenues equal spending, but also in terms of distributional balance, that we're spreading the burden of who pays for the costs of government in a balanced manner across all categories, including industry, including oil, including non-residents and including residents and within residents, looking at finding a way to distribute the burden that we're going to shift to Alaska families.
Speaker 1:Finding a way to shift that burden in a way that's balanced across Alaska families, as opposed to the way we're doing it now with PFD cuts, pushing that burden almost entirely on the middle and lower income Alaska families and letting the top 20% escape from sharing any of the costs of that burden.
Speaker 1:So, as we have this discussion over the next two weeks and as people in the legislature talk about oh, we got to achieve a balanced budget. People in the legislature talk about oh, we got to achieve a balanced budget. It's in two ways it's in. One is an accounting balance across from spending and revenues, to spending and revenues equal out. But also it's distributional balance that takes from all categories, uh on a in a in a balanced fashion and make sure everyone is contributing in a way that is balanced, uh, across across the whole spectrum. And right now we don't have it. Um, I would love to give a reward to the first person who would go on the, on the house floor, on the Senate floor, and talk about a distributionally balanced budget, who would go on the House floor or on the Senate floor and talk about a distributionally balanced budget, because I think it would elevate the discussion in a huge way from where we've been.
Speaker 2:Well, good luck with that. I mean, we watched Nellie Jimmy's speech about this impassioned speech about the people and how they're affected and everything else, uh, you know, by pfd cuts and how it drives people her people into poverty and all this other kind of stuff uh, really tearful. And then it was all and at the end she was like and to save you, I'm going to cut the pfd. Wait, you just spent five minutes telling us why this was horrible for people. You're, and now you're gonna. I mean it, it makes no sense.
Speaker 1:Brad, that was a great opportunity to talk about distributional balance. That was a great opportunity to say look, you're taking it out of, out of my constituents, you're taking it out of middle and lower income Alaska families in my district, you're taking it out of subsistence, you're taking it out of elders. It's a great opportunity to say and we need to finish that off by saying and we need balance across all categories of Alaska industry and people in contributing to this budget. Great opportunity. She set it up perfectly to do that and then she just gave up on it. I mean, she backed off and said oh no, we've got to, we've got to spend instead of instead of focusing, instead of focusing on. It was a great, it was a great setup, I mean absolutely great setup.
Speaker 2:It was a great. I mean, it was completely bipolar. At some point You're like all these bad things about taking the PFD and to save you I have to take the PFD. I mean, it is the prime example of we know better than you how to spend your money.
Speaker 1:Yeah, it's a combination. What's going on? The Senate, or the House majority, rather sold their soul to Chuck Kopp To get Chuck Kopp to come over and give them a one vote majority. What Kopp insisted on was no taxes on the oil companies and no taxes, no personal taxes in the form of income or sales taxes, and that's. I mean that's what's gone on, and COP is.
Speaker 1:There was a press conference a week ago, a couple of weeks ago, it's all blurring in my mind but where Kopp said something to the effect of I would have joined the minority, I would have made the minority a majority if they just would have agreed to a balanced budget. And what he meant by that was the accounting balanced budget. He certainly didn't mean the distributionally balanced budget, right, but I joined the majority. I joined the current majority. I joined Bryce and the others because they promised me he didn't say this, but if you read between the lines and look at his votes and look at the votes along the way, because they promised me that they would not tax all companies and they would not have a personal tax other than PFD cuts tax. They would not have a personal tax other than PFD cuts. And so what they got. What the majority got was cops vote to spend. But they gave up any effort, any votes, to get distributional balance.
Speaker 1:Nellie Jimmy should have. Well, she should have called a spade a spade and said look, this is what's going on. You know we need distributional balance. This is why we need distributional balance. This is who's being affected by having distributional imbalance. This is the consequences of distributional imbalance. We need to have distributional balance and I urge my colleagues to work on distributional balance. But she didn't. She adhered to the party line that Bryce and Kopp had set up.
Speaker 2:Well, even even Neil Foster didn't talk about this, even though he voted against it. It's the same guy I mean. This is it's again. I'm not holding my breath because I don't think they're going to talk about that. They don't because it would take away their ability to spend. That's the whole thing. They again. This is a symptom of the politician's disease. And if we did talk about some of those distributional things again, without that spending cap, they're just going to spend it anyway. So it's kind of where we're at right now. Final thoughts on this Brad, we've got a break here.
Speaker 1:Well, they're going to spend it anyway. But at least the cost of it would be distributionally more balanced than what we have it now. At least the top 20%, at least the oil companies, at least the non-residents would contribute to the cost and that would reduce the burden on Alaska families. Having the oil companies contribute more, having non-residents contribute more, would reduce the burden on on alaska families. Having the oil companies contribute more, having non-residents contribute more, would reduce the burden on on alaska they, they want to talk about it, they, they, I mean they want to.
Speaker 2:they they're well, they don't care about distributionally, they don't care about it, but they want to talk about it. That press conference that you're referring to, where cop told that which, by the way, turns out may not have been true I mean, I'm just you know, he said he had a conversation but turns out that may not have been true Was the same one where Josephson said the quiet part out loud. But we don't yet live in a world where the Alaska people are ready for themselves to invest in their state government.
Speaker 1:Yeah, but they do. I mean, that's the fallacy of all this they do through PFD cuts. We're reducing the income of middle and lower income Alaska families to increase spending.
Speaker 2:You and I know that, but see, they're not treating it like that. See, they're saying the quiet part out loud. We need people to invest in their own state. Remember I said what did I tell you? You guys need to pay your fair share. That's what he's saying there. You guys need to pay your way, and this is where we're at right now, brad, you're talking.
Speaker 2:this is pie in the sky, baby. I mean, you're talking about these people actually wanting to talk about distributional fairness between who's paying and everything else. It's all about protecting who they're protecting and, most importantly, because they would throw their top 20% donors under the bus in a hot second if they thought they could get away with it, just so that they could protect their spend. That's what this is all about, right? I mean, this is already what this is all about.
Speaker 1:Yeah, I understand that. But here, keep this in mind. Keep this in mind If we had distributional balance, if we had the oil companies paying what they're supposed to pay under the Constitution, if we had the top 20% contributing, if we had non-residents contributing, we might spend more, but the share of that and the burden on Alaska families would be less because of the contribution coming from non-residents, which is about 15% of revenues, could be about 15% of revenues because of the contribution coming from non-residents, because of the contribution coming from the oil companies, because of the contribution coming from other industries. We might be spending more, but the burden on Alaska families, which is what we really should be focused on, would be less because we have these contributions coming from from the other segments. So it's you've got. We need to keep in mind. We need to keep the focus on what Alaska families are paying, as opposed to what the overall spend is. The overall spend is important, but even more important is what the burden is that you're shifting to Alaska families.
Speaker 2:Well, again, my fear is and I mean, I see what you're saying, I understand what you're saying intellectually, but my fear is, if we did get more oil taxes and we did start taxing outside interests you know, tourists and out of state employees, et cetera, et cetera taxing outside interests, you know tourists and out of state employees, et cetera, et cetera they already know what we, what they're willing to take from us, so they would just expand it to what we were already paying before and take all that additional money and spend it. This is the danger and while I'm I'm happy to talk about you know, we need to talk about the taxes and the different types of taxation, the fear, my fear has always been, is that that spending will expand to consume all the available money.
Speaker 1:But think of what you're, but also think about what you're picking up. All of a sudden, you're picking up the old companies, pushing back on spending because they're having to pay a share of the increased spending. You're picking up the top 20%, pushing back on spending because they're having to pay a share of the spending. You're picking up the non-resident industries tourism and fish pushing back on spending because they're having to pay a share of the spending. So the dynamics are shifting. Yes, you may have a slight increase in the overall spend, but you're picking up a lot of opposition to that overall spend by allocating a portion of it to the additional segments and you're collapsing or you're reducing the share that Alaska families have to contribute because you're bringing in contributions from non-residents, from the oil companies and from other industries, and you're right.
Speaker 2:I just don't know if the pressure is great enough to hold down the spending. And that's that's the biggest part of the problem. Rob Meyer says investing implies we're happy with our return. Well, but I mean some people are. We saw that meeting in Anchorage. I mean tax me, tax me harder, daddy, right, I mean that's what they want. They there's, there's, there's a group in there that's like just tax it, give it all to the government. They know better than us how to spend that money. So there's a whole group out there that believe that. And you know. And of course now, like I said, with them saying the quiet part out loud, we're on the verge, brad. I mean, you know, do you think we're going to see taxes? Right, I mean I think we're in agreement, we're going to see taxes in one form or another. Now that people like Josephson and others are saying that more and more. That's not the first time it's been mentioned in the last eight months and I think it's just going to continue. I think that's the new refrain.
Speaker 1:Yeah, but the focus I mean as we enter that era we need to keep the focus on distributional balance to make sure that the beneficiaries of the contributions by the additional, to make sure that the additional segments can contribute to that spending and make sure that the share being borne by Alaska families is at least held constant, if not reduced, as a result of the additional shares coming in from other segments.
Speaker 2:Well, like I said, I'm not going to hold my breath, because that's how you suffocate, that's how it happens. Right there, brad Keithley, alaska's Four Sustainable Budgets, the weekly top three. I'm looking forward to number three, number two I'm looking forward to number three. I mean, you know, while Brad was gone, apparently hell froze over because Joe Pascovan wrote an opinion piece that Brad Keithley actually agrees with, which is unusual. I know there's been a little bit of a tete-a-tete between Brad and Joe on this. Joe wrote a piece talking about the permanent fund and the earnings reserve and the principle of the fund and everything else. And, my golly, you guys actually agree on something, brad.
Speaker 1:Yeah, I'm not sure I've ever agreed with Joe before. I mean, usually Joe's op-eds are about oil taxes and while you and I talk about that, there's a justification and a need for additional oil taxes. Joe sort of goes to the extreme. Additional oil taxes Joe sort of goes to the extreme of that and I think, goes beyond what's a balanced approach with respect to the oil companies. But this op-ed was on something different. This op-ed was on the permanent fund corporation's proposal that's currently before the legislature to combine the earnings reserve and the permanent fund corpus. We've talked about it on the show before.
Speaker 1:I oppose it because to me it's opening a backdoor. Well, to a lot of people. It's opening a backdoor into the corpus. It allows the permanent fund corporation to draw, to take a 5% draw, even if they're not earning a five percent draw, and that additional amount beyond what they're earning, between what they're earning and the five percent draw, would come from the corpus, and this proposed constitutional amendment opens that door and allows them to do it. There's also some other incentive issues with that. The Permanent Fund Corporation really wouldn't care anymore about its performance because it's going to generate 5% with this combination consolidation. It's going to generate 5% regardless of what it does. If it produces a 1% return, 2% return, 3% return, they're still going to take 5% by drawing the additional amount out of out of the corpus.
Speaker 1:To my somewhat to my surprise, pascavan, in an op-ed in the in the Fairbanks News Minor, agrees with that. This is what he said the proposed constitutional change converts the current two-component system to a single-component system. The 5% POMB would be withdrawn from this single-component system Because that amount becomes spendable. The permanent fund can be spent down to nothing. The word permanent is gone. Risks to maintaining safety of principle arise.
Speaker 1:Consider this question, and I think this is a perfect setup for it. If the 5% withdrawal rate for the current POMV is a factor in fully depleting the ERA, that is, the ERA is being depleted because we're taking 5% even though the permanent fund corporation isn't generating a 5% return. Isn't it obvious that if constitutional protection of the principal is removed, a 5% withdrawal rate from the single component permanent fund can and will deplete the principal? The answer is yes, of course. Removing constitutional protection of the principal destroys safety of principle. Permanent becomes impermanent, and Joe's got that issue exactly right.
Speaker 1:What we're doing with this proposed constitutional amendment that's currently before the legislature, that's being pushed by the Permanent Fund Corporation. The current Permanent Fund Corporation is opening a back door into the principal and allowing the permanent fund corporation and the legislature to get in and take from the principal whenever it needs it to make up the difference between what the permanent fund corporation is actually earning and 5%. Here's the fundamental problem that's going on. That's causing this issue. The permanent fund corporation is not earning what it should. 5% isn't a bad standard in terms of withdrawal, but the permanent fund corporation has become so risk-averse, so protective in its investment policy, that it isn't earning the 5%. If you look at the S&P, if you look at other standards of earnings, they're all well in excess of the 5%. The permanent fund has become permanent fund corporation which manages the permanent fund has become so tied up in its efforts to become risk averse that it's reduced the earnings of the permanent fund on the Alaska permanent fund below that 5% standard. That's the problem.
Speaker 1:The problem is the way in which the Permanent Fund Corporation is managing its investments. The problem is they aren't earning enough on the investments Secondary to that. They're spending a hell of a lot of money not to earn very much. I mean they're spending almost a percent of the annual earnings on management fees and consultants fees to advise them on how to do this complicated investment approach. So they're not only not earning 5% on return, they're reducing what they are earning by a percent to pay all of the management and consulting fees.
Speaker 1:That's the problem and they're trying to get out of there rather than address that problem.
Speaker 1:Rather than address the fact that they're not earning what they should, they're not pursuing investment policies, that they're spending way the heck too much in order to produce those inadequate returns.
Speaker 1:Rather than address those fundamental issues, they're trying to backdoor it by saying well, you know, if we don't produce 5%, we'll just go into the principal. We'll just open this backdoor into the principal and keep generating, keep giving you a 5% return over time. Generating, keep giving you a 5% return over time. We need, instead of this constitutional amendment, instead of consolidating the two accounts, instead of opening this back door into the permanent fund principle, we need to focus on the legislature, needs to focus on the core of the problem, which is the permanent fund corporation is not producing the type of returns it should and it's spending way the heck too much to produce those inadequate returns. We need to focus on the permanent fund corporation and on its performance, rather than permitting them and permitting the state to open this back door so that they can begin to drain the permanent fund corpus when they don't have the type of returns they should.
Speaker 2:It's the next step, right? I mean, this is the next logical step because they don't. You know they're going to in their whole appetite for spend. The next logical step is access to the corpus, because it kicks a can down the road, prevents them from having to talk more about taxes, and this is why the Republicans will get on board with this, because they don't want cuts. Willie Keppel just mentioned that again, there was an amendment yesterday to remove six positions that haven't been filled in two or three years and it failed on a party line vote. It would have saved a million bucks and they said no, I mean cuts. We all think, we all know that cuts would work. But again, that's just more proof right there that we're never going to get there at this rate. With a group of people we have down there now, because they're not going to cut anything, it's too easy to gather more revenue, to steal from the PFD, to combine the PFD and go to the corpus. This is the direction they're going.
Speaker 1:Yeah, you and I have talked on the show probably since the mid-20-teens about where do they go next after they drain the SBR, the CBR, and once they started into the permanent fund dividend, where do they go next? And the question was whether they go to taxes or the question was whether they go to the permanent fund corpus. And what this is doing. What SJR 14, I think it is is doing is opening the door to the permanent fund corpus to allow them to start taking from the permanent fund corpus, even though the permanent fund is generating less in earnings than what they're taking out. So it's a bad, bad policy that they're wrapping up as, oh, it's necessary to make the permanent fund permanent. It's not. It's necessary. What they're doing is trying to make the permanent fund impermanent by allowing them to have a backdoor into the corpus. And Joe Pascovan has it exactly right.
Speaker 1:If SJR 14 gets out of the legislature, it's going to have to be voted on by the people because it's a constitutional amendment to the constitutional provisions that currently set up the two-account system for the permanent fund, and it's going to be interesting. I hope it doesn't get out of the legislature. I hope that they don't get the super majorities that are required to pass the constitutional amendment out of the legislature. I hope the Senate Republicans, for one group, stand up against it. I hope the House majority or House minority rather stands up against it. Calling it what it is a raid on the permanent fund. But if it gets out of the legislature it's going to go for a popular vote and it's going to be interesting to see the division between those who, excuse me, are lining up to raid the permanent fund to keep the spend going, to keep the revenues going, as opposed to those who really do want to keep the permanent fund permanent.
Speaker 2:Yeah, no, it's the next step. It's the next logical step in their progression to basically consume everything in sight. That's essentially what it comes down to. All right, brad, we're up to the end here of this segment. Any final thoughts before we move on to more happy times.
Speaker 1:Yeah, I guess the one thought is this is not a partisan issue. This is do you understand numbers issue, do you understand what's going on and what they're trying to do? Issue. It's not a Democrat issue. I mean Paskavan's proving it's not a Democrat issue. Republican issue it's do you understand numbers and do you understand the effect of SJ-14 issue. And that's encouraging that it's not a partisan issue. But then you start to wonder about how many legislators really do understand accounting. So it's, it's the. The important point I think out of this is it's not a partisan issue, it's a. It's a are we going to protect the permanent fund or not?
Speaker 2:issue rob says. Here's his prediction SGR 14 might pass the Senate, but it won't pass the House. I mean, I just cannot even fathom why somebody in the Senate who is ostensibly a fiscal conservative would look at this and think that's a good idea. This is a good idea. Um, you know, I I just I can't even understand, but I mean what Willie was talking about yesterday. Uh, that amendment to remove six positions that haven't been filled in two years, um, uh, is just is part of our problem.
Speaker 2:For some people who are saying we should just just focus on the cuts, I agree that would be the ultimate way to fix the problem that we have is to just focus on the cuts. The problem is we bring up a simple line to remove six positions, to cut just a million to a million. That's pocket change. A million dollars, that's's it Out of a $6 billion budget a million dollars. And they voted down Dude, there is no. We have to acknowledge that at some point. Tilting at windmills does nothing but break your lance and hurt your horse, right? I mean, that's where we're at right now.
Speaker 1:And as they continue to spend without having a distributionally balanced approach, as they continue to spend it, it's all coming out of the PFD, they're taking it out of the, out of the permanent fund dividend, they're taking it out of the pockets of middle and lower income Alaska families. So it's got to be. I mean, I think the incentives change. I think if we have distributional balance, if the oil companies have to contribute more responding to increased spending, if the top 20% have to contribute, if the non-resident industries tourism and fish and others have to contribute to respond to additional spending, I think the dynamics change. I think the incentives change. I think the pushback on spending starts to have an effect. But right now there's not that effect.
Speaker 1:I mean, right now it's okay, we're going to spend a little bit more. It's going to come out of the PFD. We've managed to take it out of their pockets before. We'll just take a little bit more and a little bit more and a little bit more. We'll take it down to a thousand. We'll tell them that's good, even though a thousand is like 8713, the split between the POMV split at a thousand dollars is 8713. Then we'll take it down to 900. Then we'll take it down to 800. That's what's going on. We have to broaden the base that's pushing back. We have to change the incentives to broaden the base that's pushing back and if we do that, if we have a distributional balance, we reduce the burden on Alaska families by having a significant share of the burden borne by non-residents, an increased share of the burden borne by the oil, and that's, I think that has the effect of improving life for middle and lower income alaska families and it has the effect of increasing the pushback on spending frank asked the question.
Speaker 2:This is the million dollar question how do we change the mindset in the legislature? Then? It's a great question, frank. Frank, I wish I knew. I mean, we've been talking about it for 10, 12 years now on this program with Brad. How do we change the mindset in the legislature? I don't know. I mean, we had legislators on the program where we'd ask them back in the late mid-20 teens will you follow the ICER example where they said you couldn't spend over $3.9 billion? And they said yes, and then it was $4 billion and they said yes, and then it was $4.1 billion and they said yes. And what do they do? They just keep blowing past it. I don't know, frank. I wish I had the answer.
Speaker 2:You know the answer is yes, we need a mindset of trimming government. The problem is nobody in there is doing it and the few that are trying to do it and the holdouts they're holding against the tide. That's all they're doing. Again, this is like one of those all-consuming things that just sucks up everything in the room and you could scream and shout and wave your hands all you want, and it's still coming for you, baby. That's what's happening right now. How do we fix it. I don't know, maybe we let the whole thing go, just flow apart. I don't. I have no idea at this point.
Speaker 1:Well, one of the ways to fix it is to have a governor who will stand up. I mean, we we Dunleavy has essentially checked out. He's been checked out for maybe the last six years but Dun't want to be essentially checked out. He doesn't get involved in the discussions about revenue. We've got a revenue commissioner, adam Crum, who's on vacation in Hawaii during the session. We've got an administration who's just checked out, and so you're leaving the power in the hands of Bryce, bryce, Edgman and others, gary Stevens and the legislature, who are who are developing these policies without the governor, governor's involvement or governor governor taking a lead or the governor's vetoes. You know, at one point you may remember this conversation way the heck back in 2019. At one point, we said look, the governor ought to just veto the entire budget. If you're not going to, if you're not going to preserve the permanent fund dividend, veto the entire budget, start over again. But he didn't do that and he's not taken positions along the way that have helped address the problem.
Speaker 2:All right, we're continuing now. Brad Keithley Alaskans for Sustainable Budgets the weekly top three. We're on to number three. We're trying something a little bit different because you know we knew it was going to be painful, uh. But now we want to do something a little more fun. Brad just spent two weeks over in ireland. Uh, he was a, he was a groupie for a celtic man thing. He just basically followed him around like the grateful dead. Only it was the celtic version of that. Of course, I'm sure everybody's first question is did you run into rosie o'donnell while you were? Not? I did not. I'm sure that's the, I'm sure that's the first question that everybody's asking. Uh, but you got some top three moments for, uh, while you're over there. You said you've been over there several times and this was still the best. Give us, uh, give us a rundown man, give us your it, your itinerary. What, what happened?
Speaker 1:Well, this is an old Michael Duke's finer things segment. One of the one of the my favorite things that you ever did was your, was your finer things program, that that that talked about, talked about. You know the things that places to eat, places to go, places to see, places to stay, right. So this, this is a. This is a. This is a michael duke's finer thing segment.
Speaker 1:Um, I've been to ireland a lot, uh over my life, um, and I've done it several different ways. Uh, sometimes I've gone over and I've just rented a car and driven myself around. Basically, I've sort of set the agenda by where bands that I want to hear are playing, and I've just sort of wandered around the country, going from music festival to music festival in the summer. That's one way I've done it. Another way I've done it is to go on various tours that are set up as musical tours and they kick off and every night there's music and somebody comes in and plays. You have a tour guide, you have a tour director who is a musician themselves. They arrange for other musicians Irish musicians to come in and play and and and you, you get music every night and then during the day you sort of tour the country. You see castles and you see different things about Ireland. This one was different. This tour was different in this respect. The tour guide, the tour director, was Ciaran Casey who, for those who follow Irish music, was one of the original members of the band Sullis back in the 1990s.
Speaker 1:A great Irish musician who has Irish singer, who's gone on and done several things. But Karen is interested not only in the music but she's also interested in the history. She's dug into the history of Ireland and one of the things that I've missed about either A doing it by myself or B doing it through the music tours, has been digging into the history. I'm really fascinated particularly by the early 1900s segment of Irish history the Easter Rising of 1916, the Civil War or the War of Independence from 1919 to 1921, and then the Civil War that followed the War of Independence, which it was Irishman against Irishman and I've never quite understood that. But this tour was great because Karen not only is a great singer, not only a great musician and not only did she bring in musicians on the tour, but we also had three or four academic quality graduate lectures on Irish history, particularly on the Irish history of the early 1900s. To understand that you had to dig into, you had to go back in Irish history quite a ways, and these lectures did, and some of the tour was visiting these various locations that were important to Irish history.
Speaker 1:But to me, the great thing about it was we combined the music and the culture with this sort of focus on the history. That's not for everybody, you know. Some people want to focus on different things, but but I, my point is that there is really, if you, if you look for it and you spend enough time researching it, you're going to find a tour for whatever it is you you want to do, what you, what you want to learn about about Ireland. If you want music all the time, there's tours for that. If you want just to go around from castle to castle, there's tours for that. If you want to go around from city to city, from shopping center to shopping center, there's tours for that.
Speaker 1:But what this really brought home to me is if you dig deep enough and if you follow enough, if you understand what people are trying to accomplish, enough you can get into. You can find a tour that really hits all of your hits, all of your buttons, and that's that's what this tour did for me Great country, great people, great music. This was as much a foodie tour as it was a music tour, because Ireland also has great food these days. You have to dig a little bit to find it, but it also has a great food uh, great food, great uh. Great views, great uh, uh, uh uh. Geological uh uh, things to to, things to do and things to see, um, but, but at the core, you can find a tour that does whatever it is you want.
Speaker 2:So when Terry, finally, you know, prevails on you Michael it's not that I don't want to go to Ireland, man, it's not that I don't want to go there. Um, well, name, you know I'm I'm curious about the cause. The food thing is definitely part of the finer things. For those of you who don't know, it was a podcast that I did. I think there's still 12 or 14 episodes up on iTunes or wherever it's at. You can go back and listen to it.
Speaker 2:It was one of my kind of my passion projects that I just I ran out of time and money to do, where we went around to various areas in Alaska and the Pacific Northwest and we visited them and interviewed different people and talked about how did they get started, and it was just, it was fun, it was really enjoyable. I, too, enjoy the history of how people get started and things like that, but you know Ireland would be that would definitely be bucket list stuff for that. You talk about food. What was you know? I don't know if I think of traditional Irish fare. You know I mean my wife does, we do the corned beef, obviously, and the shortbread and all the things, the hot cross buns, those kind of things, but what was the things that stuck out to you? What is traditional Irish fare in your mind?
Speaker 1:So Ireland is an island right, and there's a huge amount of fishing that goes on from Ireland, and so the seafood was frankly it is, it is ever bit the equal I'm going to get in trouble for this, but it is every bit the equal of the seafood that we have in Alaska. I love Alaska seafood and I and I eat a lot of seafood, but the Irish seafood was every bit the equal of that. So you had some great seafood restaurants. Ireland typically was the breadbasket, the beef breadbasket for England.
Speaker 1:One piece of history the Irish famine in the 1850s was a famine and it was the failure of the potato crop, which is what the Irish people relied on. But they were growing a lot of beef, they were growing a lot of other vegetables for export to Great Britain, and the famine was not because Ireland didn't have food. They did. It's just that the British kept taking, the English kept taking the food that was traditionally exported to them and the crop that the food source that the Irish relied on potatoes failed and that's what triggered the famine. But Irish beef has always been a favorite of mine.
Speaker 1:I've got a couple of steakhouses in the country that I always go to whenever I'm over there and and the Irish beef was good and lamb. So you, so you think about Ireland and and a lot of the country is is cheap. I mean a lot of wool, they generate a lot of wool, but as a consequence of that you have a lot of lamb, and so lamb is also a wonderful, a wonderful dish over there, and you can find restaurants that have a selection of the of the three of seafood, you know, beef and and lamb. Or you can find restaurants that focus on one of those great potato dishes, other vegetables, but it's those big three seafood, because it's a big fishing country, beef, because that's historically what they've done a lot of, and lamb.
Speaker 2:I love me a good mutton dish. I'll tell you, it's not often that we get a chance to have that around here anymore, but that's good stuff. Where do you recommend starting off in Ireland? Is there a good primer? Is there a good starting thing before we get two minutes here?
Speaker 1:Well, you have to just look up Irish tours and start digging down through that. Or if you have a favorite Irish performer, a favorite Irish singer, see if they lead a tour and start trying to dig into that. Ireland's basically there's four different parts. There's the South, which is centered around Cork. There's the West, which is centered around Galway. There's the East, which is centered around Dublin, and there's the North, which is more or less centered around Belfast, although there's still the division between Northern Ireland and the Republic of Ireland in the North. But there's four different regions. They generally emphasize different things.
Speaker 1:There's a lot more history, particularly around the early 1900s, the period that I've been focused on. There's a lot more history around cork than there is perhaps elsewhere in the country. But you just start digging in. I mean there's Wild Atlantic Way tours is one, there's Inish Free Music Tours is another, and just start with those and then just start digging in from there. Another, and just start with those and then just start digging in, digging in from there. Or you can go on your own, but have some focus when you're doing that. Say, you're going to go to Galway and you're going to go to Cork and you're going to go to Dublin.
Speaker 2:Say you're going to follow a certain musician around.
Speaker 2:All right. Well, I'm looking forward. I mean, you know me, I would have to do the whiskey, the Jameson's, the Irish whiskey tour as well. On top of all that, it would be, uh, it'd be an amazing time. Well, brad, like you said, you left and it was a mess, and you came back and it was a mess. We can go away for five years and come back and it would still be. I mean, this is what happens every time when I, you know, at the end of the year, when I go on vacation, I come back and it's everything's still there, all the problems still there, all the things still there. I mean, going back to Frank's question, how do we change the mindset of the legislature? I don't know. I mean, at this point I used to think we could change the players and that would do it. I just don't even know, man. I just don't even know. You know, man, I just don't even know.
Speaker 1:You know that's a question. I'm sure you put it to him, but that's a question for Rob Myers. I mean, that's a question for somebody who's inside dealing with these issues, albeit in the minority Senate minority, but inside dealing with these issues and trying to figure out, you know, how you make your way through the morass that's the legislature to get something that makes more, that makes more sense. I'm not I. I, I'm not I. You know we've been doing this for however long we've been doing it, we've never solved it. So I think that's a question for you know, for somebody who's on the inside trying to deal with these issues.
Speaker 2:Yeah, I mean at this point, I just you know, I know that a lot of these people I'm sure that they believe I don't I don't ascribe like evil to everybody you know, or anything. I know some people are like that, that feel that way. I think that these people think that in their heart of hearts they're doing the right thing, but I just don't see how, in the big picture, they can continue to think that what they're doing is sustainable and will work out in the end, especially based on the history of what's happened so far. You can't keep doing the same thing that you've been doing for the past 30 years and expect that it's going to turn out differently.
Speaker 1:Yeah, and one of the problems and again, I think Rob would be a much better commentator on this than I am but one of the things that strikes me as I look at this stuff is it's always just get me through this session.
Speaker 1:I'll be better next session, but just get me through this session. Or, in the case of Gary Stevens, just get me to retirement and if I need to raid the permanent fund, you know that'll be fine, it'll get me through the end of the session. It's just there's not an overarching long-term view, and that's where the governor comes in. I mean, the governor is elected, in my view, to have that overarching long-term view, to have that plan, to have that vision. Thank you, that vision that we're working toward and you know, I'm sure Governor Dunleavy has a vision. I'm just not sure what it is and I'm not sure it's relevant to what's going on in the legislature. So that's, I mean, to me that is where the process could be helped a lot by having a governor with a consistent vision who is going to step in the battles and fight those battles.
Speaker 2:I think the first step would be to have a governor that doesn't have larger aspirations, right? I mean, it would be interesting to have a governor who'd be like I'm willing to just do one term. If I'm only here for one term, that's fine. I'll make as big a mess as I can to try and solve the problems. As you said, I mean, the governor could have vetoed the whole budget when it was up against it. He could have vetoed the whole budget. He could have taken a strong stand and and Dunleavy's checked out.
Speaker 2:Dunleavy, I mean, he got called out by James Kaufman, of all people, the other day for not engaging and not being part of the whole thing. You know, just like not not being there, um, and whether he's planning on running for Senate or what. I don't know what he's planning on, but he you just can't. He has an inordinate amount of power in all the States. The governor of Alaska is one of the strongest executive positions in the entire country and yet he has done virtually nothing, um, uh, other than propose some real mealy mouth budgets and everything else. It's, it's frustrating to watch.
Speaker 1:He's absolutely done nothing. I mean, the budget this year proves that. The budget this year showed deficits, showed running out of the constitutional budget reserve, draining the constitutional budget reserve. About four years in and nothing but red numbers from from there on out. And he, and that's what he submitted. The statute says you have to submit a balanced budget. He didn't. He just ignored it and kept on going. So he's absolutely done nothing in terms of providing vision for where this state ought to be going.
Speaker 1:One could say or Bill Walker would probably say in his defense he was that governor who stepped in and agreed to do and, you know, made the hard decisions in that one term. Problem is Walker made the wrong decisions. Problem is Walker ultimately took the easy road out and took the PFD because that's where the political forces, the top 20%, the oil companies and the non-resident industries wanted to take it from, because that protected them. So you have to have a governor who's not only willing to get in the battle but you have to have a governor whose heart is in the right place in terms of fighting these battles, and maybe that's asking more than is out there, but we'll keep looking, but that's that's part of where this starts Having a leader, having a governor who will drive these issues home, who will, who will veto when necessary and send them back to the drawing board when necessary. That's that's, I think, part of where this starts.
Speaker 2:Well, and Frank points out the problem with this mindset. He says so, if I'm correct, no-transcript.
Speaker 1:Yeah, yeah, If you look at Trump, I mean, if you look at Trump, I don't think we go back to the same old, same old after after Trump. I don't think. I don't think there is a same old, same old to go back to. It's, everything's going to be. You know, we're going to be in 52. It's going to be a game of 52 pickup and somebody's going to have to sort of put some of Humpty Dumpty back together again. But I don't think you go back to the to the same old, same old. So if you have a governor who does that sort of thing, I think I think we break the mold and go forward.
Speaker 2:Yeah, I would agree. I think if we change the direction of the momentum, that is what we do. All right, well, brad Keithley Alaskans for Sustainable Budgets the weekly top three next week Maybe we should include a positive segment.
Speaker 1:every week I'll just have to travel more to do that.
Speaker 2:That's your mandate. Thank you, brad, appreciate you coming on board. We're out of time.
Speaker 1:Well, that's a wrap for another week's edition of the weekly top three from Alaskans for Sustainable Budgets. Thank you again for joining us. Remember that you can find past episodes on our YouTube, SoundCloud, Spotify and Substack pages, and keep track of us during the week on Facebook and Twitter. This has been Brad Keithley, Managing Director of Alaskans for Sustainable Budgets. We look forward to you joining us again next week for the next edition of the Weekly Top Three.
