The Weekly Top 3
The Weekly Top 3
The Weekly Top 3 (6.2.2025)
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 June 2, 2025.
This week, our top 3 issues are these: 1) we explain why the Permanent Fund Corporation’s April results demonstrate our point about its deficient returns (2:03); 2) in the wake of the visit from three of its cabinet officials, we examine the potential impact of the Trump Admin’s focus on Alaska (18:58); and 3) putting all the pieces together, we discuss which “working people” exactly Angela Rodell really seems concerned about (34:02).
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 Kiefle, 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 June 2nd 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 6 to 8 am.
Speaker 1:I join Michael weekly in the first hour of Tuesday's show from 6.10 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. This week, our top three issues are these First, we explain why the Permanent Fund Corporation's April results demonstrate our point. Second, we examine the potential impact of the Trump administration's focus on Alaska. And third, putting all the pieces together, we discuss which working people exactly Angela Rodale really seems concerned about. And now let's join Michael.
Speaker 2:Well, Brad, let's get started, for today We've got a lot of stuff to cover and some interesting things. It wasn't too long ago what was that? Just last week. Maybe Do you remember the Permanent Fund Corporation's recent brag session about how well they were doing. What's the update on that, Brad?
Speaker 1:Well last week or a couple of weeks ago, but in any event, one of our segments was on the Permanent Fund Corporation's press release that got picked up by Must Read Alaska on how well they were doing through March. It was odd because it was like 20 days after the end of publishing March results, but nonetheless they had a press release and they said how well they were doing on the fiscal year basis and how well they were doing on a longer term basis. Since that time they've published April and this is a lesson. This always should be a lesson Never publish something on a monthly basis when you know the next month could undermine what you were claiming on in the previous month. So let's take a look at what the April results are for the Permanent Fund Corporation and monthly after the Permanent Fund Corporation publishes these results, we do a post, we do a table of what the Permanent Fund results are, permanent Fund Corporation results are, and publish it as part of our monthly chart series. So this is April's chart and if you've got it we can pull it up. This chart shows it's a running tab since FY12 on an annual basis and then on a fiscal year to date basis and then on a five-year average, three-year average, rolling one year 12-month average basis. It looks at what the permanent fund results have been in the left-year average rolling one-year 12-month average basis. It looks at what the permanent fund results have been in the left-hand column, what the Vanguard S&P 500 results have been their ETF have been, what the total fund return objective, which is the CPI 5% plus inflation, what that standard has been. That, to me, is the most important standard to use as a comparison because that's the basis on which the POMV draw is based. It's based on a 5% taking, 5% real return off the permanent fund. So that standard sort of tells you how we're doing, how the permanent fund's doing against the POMV draw, whether it's keeping up with the POMV draw, running ahead or lagging behind. And then off to the right we have all of the various benchmarks self-created benchmarks that the permanent fund has used over time to judge its own performance. It's sort of like, hey, let me set a standard that I can judge myself against, that the permanent fund has used over time to judge its own performance. It's sort of like, hey, let me set a standard that I can judge myself against. And that's what all of the ones over to the right are the year-to-date results are below the line, below the yellow line. The yellow line is an average of FY12 through FY24. The line below that is the fiscal year to date average.
Speaker 1:This is part of what the Permanent Fund Corporation was bragging on for April. It shows that the permanent funds return year to date. Fiscal year 25 to date, through April, is 4.7%, which is actually a little bit higher than what they were saying in March. But here's the rest of the numbers. The S&P number's down. The S&P number is 2.92, but I checked this morning and, taking into account the futures market through the end of June, the S&P has bounced back up. This was its low point, has bounced back up and it's now showing an 8 plus percent return on the year by the time we get to the end of the fiscal year. The total fund return objective, cpi plus five and again this is the important standard because it's the one that is used for the POMV draw sort of reflects the POMV draw. That's 6.24. Now in the March release the permanent fund was congratulating itself for being relatively near the total fund return objective. But now the total fund, when you roll a month forward, the total fund return objective is now 6.24%, 1.5% ahead of where the permanent fund is.
Speaker 1:Permanent fund is again. These are the permanent fund's own benchmarks that they create for themselves. So permanent fund is exceeding slightly its performance. Its own performance benchmark 4.63%. The permanent fund's got a 4.7. But look at the passive index benchmark. This is the benchmark created by the permanent fund to say, look, if we didn't actively manage this fund, we sort of put it on autopilot. It's another way of putting it on autopilot. If we put it on autopilot, this is what would be the returns that we'd be generating. And the passive index benchmark is 5.81, a point and a half a point, 1.1, ahead of where theermanent Fund Corporation's return is. So last month they were extolling how good a job they were doing for their active management of the Permanent Fund. This month's results are showing no, they're lagging. Their active management is actually costing Alaskans.
Speaker 1:In terms of returns.
Speaker 1:Relative to the Perman's own permanent fund corporation's own passive index benchmark, the averages below the five-year average.
Speaker 1:The permanent fund is producing, on a five-year rolling average basis, returns that look pretty good compared to the other benchmarks. Well, except for the S&P. The S&P is at 15.5, six points ahead of where the permanent fund is. But the total fund return objective. The CPI plus five is at 9.59. They're about in the ballpark. And then on the five-year average, the permanent fund is a little bit ahead of that.
Speaker 1:But when you look below that, when you sort of take the cover off or take the hood up, lift the hood up and look what's going on underneath that, the three-year average, which will become the five-year average at some point, is rolling into the five-year average and a much better review of how the permanent fund's done recently compared to a few years back. That may be distorting the results. When you look at the three-year average, the permanent fund is doing 4.9% on a three-year average, compared to the S&P at 12.09, fully seven points ahead of where the permanent fund is Total fund return objective. The CPI plus five is 8.53, well ahead of where the permanent fund is. The performance benchmark, the permanent fund's own performance benchmark. They're lagging it 4.9 to 5.2. And they're lagging the passive index benchmark again, the autopilot benchmark. The three year average is 4.9 compared to 6%.
Speaker 1:So I think what these numbers are telling us and you can see in the year-by-year results that there is one year FY21, the bounce back year from COVID that the permanent fund did exceptionally well. They did a 29.73, not as good as the S&P would have done. The S&P had a 41.1, 41.0% return in that year. But the permanent fund did well in that year. And what's really going on when you sort through these numbers is that year FY21 is driving the five-year results. When you sort of exclude it and say, okay, well, what have you done for me recently? And look at the three-year results, you see that the Permanent Fund Corporation is lagging significantly, not only the S&P, not only the S&P, but also the CPI plus five objective and even its own passive index benchmark. So I don't think we're going to have another press release at the end of this month. I think they cherry-picked the month they wanted to stand on and then, well, just don't pay attention to that guy, don't pay attention to those numbers behind the curtain Right.
Speaker 2:Well, what this tells us, even if you just look at the bottom three rows there, which is the five-year, the three-year and the one-year average, the story is told the permanent fund is not earning enough money, with the CPI plus five, to be able to make the draw, especially compared to the S&P or the Vanguard fund. The S&P 500 Vanguard fund which is, you know, I mean it's twice, almost three times, what the permanent fund is earning on a passive basis. I mean you know that should tell the whole story right there. I don't care if you've got one or two good months, what's the five, three and one-year average look like? And the bottom line is that we haven't made enough money to pay for everything and to keep the fund up to the proper amount and we've lost out on well a significant amount of money, almost three times the amount of earnings we could have got if they had just sat there with the Vanguard 500.
Speaker 1:Yeah, and this rolls in, Michael, and explains why the press for merging the two accounts is so important to some people.
Speaker 1:Because you look at the permanent fund returns, the earnings the permanent fund is achieving compared to the CPI plus five, which is what the POMV draws based on, and you can see that the permanent fund is consistently running below what they would need to be earning to keep up with the CPI plus five.
Speaker 1:So one answer to that would be hey, maybe we ought to change our investment strategy. Maybe we ought to go on autopilot, because autopilot would do better than we're doing. Or maybe we ought to look at the S&P strategy, because that would do a heck of a lot better than what we're doing. But instead of that, instead of hey, maybe we ought to be reevaluating our investment strategy. What they're doing is they're talking about merging the permanent fund earnings and the permanent fund corpus together in a way that, as we've talked about on the show before, opens the back door into the permanent fund corpus, so that when you have as they are doing, when you have this string of performances that are lower than the CPI plus five and you're not earning enough to cover the POMV, draw what merging those two accounts are going to do is allow them to come into the corpus and start draining the corpus to keep the money rolling, even though they aren't earning enough to cover the draw.
Speaker 2:That's not to mention the fact that if they did go on the set it and forget it scheme of the Vanguard 500, they'd save themselves nearly a billion dollars in management fee. A billion one like $890 million in management fees per year per year, yeah, exactly per year, uh, which is a lot. When you're talking about an 80 billion dollar funding, you start chipping away at it one percent at a time. That's not a, that's not a small amount, uh, by any strange stretch of the imagination. Um, I mean, this is just some astonishing stuff, and I am surprised that more people, more news outlets, more folks they're just not, they're not picking up on it. Well, I mean, what, what? What are we missing here quickly?
Speaker 1:Well, legislators aren't talking about it. If you look at the news media, they follow what legislators say and legislators aren't talking about this. They're talking, instead, about merging the two accounts. They see these numbers, legislators see these numbers, but they're talking about merging the two accounts together to allow the backdoor into the corpus, and that's what the media is following. They're following the legislators about that. If we had legislators that were talking about this instead, I think the media would start picking up on it.
Speaker 2:Brad, here's what I don't understand. I'm just looking at these numbers 15 plus 12 plus 11, I mean it's 22. We're looking at, I mean this is almost a 30%, that was 30, almost a 40, almost a 42% increase over the 5, 3, and 1-year average, versus barely a 20% increase over the five, three and one year average, versus a barely a 20% increase. You know, and if these guys were really about making as much money for the government as they could, you'd think they'd be clamoring to get to the S&P 500 model instead of the current managed model that the permanent fund has. What's the? You know why? What's going?
Speaker 1:on. Well, a couple of things, michael. One is the current approach employs a lot of people down in Juneau. They've got a lot of analysts, they've got a lot of investment advisors, they've got a lot of people on contract that are friends and friends on contract, friends and advisors on contract, friends and advisors on contract, and so it's like undoing any bureaucracy. We don't want to do that because, oh my gosh, how many people would we have on the street in Juneau suddenly? The second is this is sort of a classic case of safety first right. A classic case of safety first right.
Speaker 1:If I rely on a bunch of advisors, if I do a bunch of you know risk management and spend a lot of time on risk management, then I'm not subject to being I'm likely not going to be criticized because I can always say, hey, I just relied on these guys, I relied on Wall Street, or I relied on these advisors, or I put my money with these guys. You know, don't blame me, I'm the one you know I relied on all these, or I put my money with these guys. You know, don't blame me, I'm the one. You know, I relied on all these other people and we had all these risk management tools that we were using. So it's aversion, risk aversion in a big way, you know.
Speaker 1:And when they're asking about the S&P, they say, oh well, that's volatile, it goes up and down, it goes up and down, it goes up and down, it goes up and down, and it does. I mean, the S&P is more volatile than the boring thing that they've put together. But the thing about the S&P, if you look at it over time, it goes up and down, but it's going steadily up. It has corrections at times, but it's going steadily up. What this is doing, what the permanent fund is doing, is sort of flatlining. So they're saying, look, we are less risky, we're less volatile than the S&P and so we're better. If you look at the beta, which is a measure of volatility, we have a better beta than does the S&P because the S&P is more volatile. They're not looking at the end result of where the S&P is taking you.
Speaker 2:Sure, if you're looking at it month to month, the S&P is much more volatile, even sometimes year to year. But if you're looking at it in a 10-year, which is what investment is supposed to be about it's supposed to be about the long term. If you look at it in the one and three and five-year averages is you can see that it's 50 to 100 to 150% higher returns if we go with a more volatile plan.
Speaker 1:I mean, I don't understand. And I guess the third thing I would add is we've got a highly unsophisticated board. We've got political appointees on the board of the permanent fund and they're the ones that are ultimately responsible for what's happening here. So they don't know. In all honesty, I don't think they know enough to ask questions, they don't know enough to pose alternatives, and so they're being advised by this staff. That again alternatives, and so they're being advised by this staff. That, again, is well paid.
Speaker 1:A bunch of them in Juneau, a bunch of advisors that they're able to keep on contract. A billion dollars worth of advisors they're able to keep on contract. So if they ever want to jump ship, they've got friends out there they could jump to, I mean. So we've got a combination of things, but I think I think at the apex of it is a board that's really very unsophisticated in this stuff Likes to take selfies of going to board meetings. We saw that this past week when they were on their way to a board meeting Likes to take selfies and say we're board members, but they really don't know what they're doing.
Speaker 2:Yeah, this is some crazy stuff. And a boy, I'd love to put you in a room with all these guys for about 30 minutes and, just, you know, ask them some questions, but you know, that's, that's, that's never going to happen.
Speaker 2:That's never going to happen. Uh, unfortunately. All right, brad Keithley continues. The weekly top three continues. We're on to number two, and number two is what should we expect from Trump's not his upcoming visit, but he just had three. I mean, maybe he'll be having an upcoming visit. I put upcoming into what I meant was his visit. That just happened with all of his talking heads from the EPA and the Corps, and I mean all the guys that just showed up. So, brad, we just had all the luminaries in town. What should we expect from this visit?
Speaker 1:Well, we've got three major ones in town We've got the Secretary of the Interior, we've got the Secretary of Energy and we've got the Director of the Administrator of the EPA, environmental Protection Agency, and that's who have been in town and they brought a lot of attention, I think, to issues that Alaska has had, significant issues that Alaska has had in the past with getting permits and getting leases and getting access to additional lands and getting the permits timely to develop those lands when they found oil and gas on those lands. And I think they've done a great job this past week of of bringing those issues to attention and bringing attention to the fact that the Trump administration is different about that and has and has progressed that. It's been interesting to watch Dan Sullivan, who's up for election in two years is or in 20 next year. It'd been interesting to watch Dan Sullivan sort of glue himself to those three and take a lot of credit for and he deserves some of it take a lot of credit for progressing those issues and getting the administration to pay attention to them.
Speaker 1:Here's what I think is really going to be the result not so much of this visit but of the efforts by this administration to loosen up the rules and open up lands and promote development. I think that the Willow project Conoco's Willow project, which had a number of additional pieces to it at the time that Willow applied for it, in addition to the core project, had a number of additional step-out projects in its application that were denied essentially by the Biden administration. I think those additional projects likely will go forward, be permitted and within the four-year span of the current administration, conoco will be able to get so far along with those that they likely won't be able to be undone. So I think that's a plus of what the Trump administration is doing. I think there will be additional leasing. There'll be additional leasing in NPRA, there'll be additional leasing, there'll be leasing in ANWR and I think people will respond to that not by paying high prices but will respond to that by putting some risk money in to see what happens. You're not going to get a project in ANWR and you're not going to get additional projects in NPRA developed within the four-year window of the Trump administration. Npra developed within the four-year window of the Trump administration. But if the leases are available, I think people will put up money to buy those leases and will begin the process of evaluating whether the oil and gas underlying those additional leases is economic to produce and we'll get sort of down the road. Here's the key. At the end of that four-year window we'll have another election and if the election the presidential election is a continuum of the Trump approach, then that spade work begun during that four-year window will start to produce results in terms of finding prospects and applying for permits and beginning to go forward with new projects. But you're not going to find people putting a huge amount of money, investing a huge amount of money into those projects until they know what's going to happen at the end of that four-year window is put a bunch of money in in trying to define and identify a project and start putting your arms around a project during the four-year time period and then at the end of that come back to a Biden administration again and all of a sudden have all that stuff denied. So we'll see outside of Willow, which I think will make some solid steps toward additional development, which I think will make some solid steps toward additional development. I think we'll see some beginning steps in MPRA, other parts of MPRA and in ANWR during that period.
Speaker 1:Ak LNG, one more AK LNG. You know God love it. We'd all wish that project to go forward. But even when you look at the article in the ADN today about the results of their trip to the slope and all of the talk that they did, those officials did about the AKLNG project, you see very little response from potential customers from Japan or from Korea or from Taiwan or from the Philippines. Everybody's being careful, all of the potential customers are being careful. Until they see hard and fast numbers on what the project costs are going to be and what the prices are going to be, and Dunleavy, sullivan and all of the federal officials can talk all they want about how this project's going to go forward. Chris Wright said. The Secretary of Energy said we're going to twin the TAPS pipeline. They can talk all they want about that, but until we see hard and fast numbers we're not going to see a lot of progress on that.
Speaker 2:Brad Keithley, alaska's four sustainable budgets, the weekly top three, I mean. Overall, though, this was a good visit and it shows that the Trump administration, I guess, is pretty serious about what's going on, right. I mean, that's the kind of the whole point, that's the, that's the direction they're going.
Speaker 1:Yeah, I think it shows attention to Alaska, which certainly the Trump administration is giving, and in Sullivan term you get some of the credit for that. Governor Dunleavy gets some of the credit for that. I think it shows attention to Alaska and I think it shows incremental steps. But aside from Willow, which I think it does show it is going to show concrete benefits from this, aside from Willow, I think I think it's all going to depend first of all on what the perception is about what's going to happen in four years with the next election cycle, on what the perception is about what's going to happen in four years with the next election cycle, and secondly about what the numbers are going to say on AKLNG and to some degree the Trump administration is working at cross purposes on AKLNG.
Speaker 1:When you look at steel costs, when you look at machine costs used in the pipeline business, those costs are escalating rapidly. It's hard to do economics in this cycle. We've got friends down in the pipeline industry in the lower 48, and I'm asking them about how they're doing their projects. They said we're taking vacations. We're going to wait until this settles for a while before we make big decisions about big money, because we don't know where the costs are going. So I think on AKL&G we can talk a lot, and they certainly have talked a lot. We can encourage potential markets to look at it and they've certainly done a lot of that and they can talk a good game about how they're going to be supported. But until those numbers come in, and until the numbers stick, until they translate into hard and fast projections, offers of what the rates are going to be for the, for the pipeline costs, uh, until those numbers stick, we're not going to see a whole lot of real progress on that, on that front.
Speaker 2:Well, and this has been your and my contention for well ever since we started talking about it uh, at least 10 years. And this was something that I had changed my mind on about, probably close to 15 years ago, because I was very much you know, gas tomorrow, let's get gas tomorrow. Until I started talking to some folks much smarter than me and I said how come we can't get it done? And they laid it out and they said it's all about the economics, right, it's all about the. We've got to get it and somebody's got to pay for it, and then they've got to be paid back. And I started looking at it and realized until the economics of this project work out, we can talk about it all we want, but it's just pie in the sky until we get solid numbers and somebody who's willing to take that investment.
Speaker 2:Now, if Trump did it as a national security or national infrastructure project and the government paid for a big chunk of it, well, maybe it's doable, but if you're looking for private people to pick up the pieces, I don't know how they get it done. Brad, I really don't. I don't care how many press conferences you have and how many people you sign letter of intent of oh yeah, we'd love to have your gas, but you know again, nobody's going to jump when it's 30 or 40 percent over market value.
Speaker 1:Yeah, exactly right, michael. And and you know what, what? What the AKLNG project has done is has done a good job of sort of creating a scenario under which all this would work. If they filled the pipeline completely, if they had it going up 365 days a year, if producers were willing to sell, develop and sell gas at a dollar, which is the assumption if they were willing to do that, then the economics would look sort of marginally okay. And they've done a great job, I think, of creating that scenario under which things might be okay, but the likelihood of that scenario coming to pass being the actual scenario that develops is relatively low.
Speaker 1:One other thing that I will add a lot of my friends in the lower 48 say, oh, this is just kabuki theater. I will add a lot of my friends in the lower 48 say, oh, this is just kabuki theater. What's really going on is Japan, korea, taiwan all of these people are looking at AKLNG and saying good things about it and listening to Trump and letting Trump talk about it a lot as a negotiating tool for lower prices out of the Qataris, who, gutter, has a huge amount of LNG that they're marketing, and other LNG projects throughout the world, including LNG projects on the Gulf Coast, and so what Alaska really is again from my friends in the lower 48, what Alaska is really being used for is a stalking horse saying you know, yes, if all these numbers came together it might be an economic project we're going to, we would tilt toward that project. If it was otherwise economic, we would tilt for that project because of the strategic benefits and sort of just trying to get gutter to say, okay, well, we'll drop our price another 50 cents If that's what it's going to take to get you to buy from us or Australia or the US Gulf Coast projects.
Speaker 1:My friends in the lower 48 say that's really the game that's being played here. And maybe it is. And, as I said, aklng has put together a scenario under which maybe it could all fit. But when the numbers, when the true numbers come in, when the true economics come in and it's time to lay down real money, that's the point at which we will find out whether any of this works.
Speaker 2:Wow, brad, you're on track, not off the rails. As usual, brad's been saying the same thing this whole time. You know, why do I even bother? Why do I even bother? Look, I'm cautiously optimistic that maybe, with all this attitude of development and everything else, some things will happen. Are all the things going to happen that everybody's talking about? Like, do I believe that we're going to have an Alaska LNG project? I don't think so, but maybe some other things will come out of it. I don't know, you know, but I don't believe that it's the end-all, be-all that everybody's back-slapping each other over.
Speaker 1:Yeah Well, again, some of this is the Dan Sullivan re-election tour and the back-slapping is oh, dan, you did a great job in getting these guys to come and getting a positive attitude and look. A positive attitude is come and getting a positive attitude and look. A positive attitude is much better than a negative attitude and in the case as I say in the case of Willow I think it will produce some positive results, some additional development that otherwise isn't going to occur. Actually, that puts the budget, the state budget, in a weaker position because of the way oil and gas tax credits work. It'll extend out the time that we actually get revenue out of these projects, but nonetheless, it's a good thing to have additional oil and gas development in the state.
Speaker 1:But we can't. I mean those people who say, oh well, that's going to solve the problem, we don't need to worry about anything else. That's wrong. And those people who say, oh, if we get AKL and G, that'll solve all of our problems. That's wrong. A we're not going to get. It's very unlikely. We get AKL and G and B. Look, akl and G is predicated on a field price for gas of a dollar or less. What's the royalty? There's not a whole lot of royalty that gets produced out of a, out of a, out of a dollar sales price. So it it's it. It is. It is better to have a positive attitude. I think it will serve in terms of willow some additional development. I think it will position Anwar and some parts of NPRA for additional development If in four years the nation looks like it's going to continue down this road, as opposed to deviating yet again. But you know, we've got to temper this back-slapping within the bounds of reality.
Speaker 2:Right and again the other back. You know, the backhanded problem with all the things that the president's doing is obviously it's driving the cost of oil down worldwide. He said he had a goal of wanting to get oil in the low fifties was his goal, and we're struggling at 65. What happens if he gets it down into the mid fifties I mean, it's a you know then it creates a real problem.
Speaker 1:It's a real problem for sure, yeah, we've got a lot of cross-purposes going. We've got the desire to get oil prices lower, we've got the desire for all these trade issues, trade resolutions that result in higher import prices, that drive up the price of steel and drive up the price of machinery and other things that we've developed foreign supply chains for, and we've got the desire to develop, which relates to cost, which relates to the cost going up, so cost going up, revenue is going, price is going down, so it's um it. There. There's a lot of moving parts and a positive attitude about some of the moving parts is good, uh, but we've got, we've got to see where all these moving parts land before people start putting down hard and fast uh, hard and fast commitments to take gas the weekly top three continues with number three.
Speaker 2:Gas weekly top three continues with number three. And that is, of course, uh, angela rodell. She only cares about the working people, she just cares about the working people. All right, brad, tell me, tell me all about it. What do we got here?
Speaker 1:this is. This is. This is we could we could almost classify this as the humor segment of the show Angela Rodale, former director, executive director whatever the hell the title is of the Permanent Fund Corporation, after she left that job, somewhat unceremoniously. After she left that job, she stayed in Juneau. She stayed active. She ran for mayor of Juneau in the last election, lost but ran for mayor of Juneau and has become active in Juneau politics.
Speaker 1:She wrote an op ed, a my turn, what they call a my turn in the Juneau empire, the title of which is time for a government that works for working people. And what this is built around is a three-pronged petition that's being circulated with Angela's support, to do three separate things with respect to Juneau. One is impose a property tax cap. The Juneau Assembly keeps increasing the property tax rates and it would impose a cap. The second is to exempt groceries and utilities from a sales tax. Juneau currently has a sales tax, doesn't exempt groceries and utilities and the proposal is to have petition, is to have by petition, to have an election that would exempt groceries and sales tax. That would exempt groceries and sales tax. And the third is to restore what she refers to as restore poll-based voting. Juneau has elections by ballot now, basically, and it would restore the obligation to go to the polls to cast a vote. So that's what she's promoting.
Speaker 1:And here's the paragraph where I started chuckling. The paragraph is this the current system hits working families the hardest. She's talking mostly about the property tax cap and the exemption for groceries here. The current system hits working families the hardest. It's regressive, it's unsustainable and it's driving people away. If we want to keep Gino livable, not just for the wealthy but for teachers, nurses, fishermen, caregivers and retirees, we need to act now. So Angela is focusing on working families and concerned about a regressive tax system and concerned about a system that focuses just on the wealthy and she's trying to undermine it.
Speaker 1:This is the same Angela Rodale who, maybe a year, maybe two years ago, in a debate that had me defending the PFD and Larry personally saying we need to change the PFD, had Angela Riddell as the third person arguing that we ought to eliminate the PFD and all of the money ought to go to the state. And keep in mind that the PFD is one half of what happens with POMV distributions. It's the part that goes largely to middle and lower income Alaska families. The other half protects the wealthy and protects all companies by substituting for taxes that they would otherwise pay, and she wanted to eliminate the PFD and use all of the POMD draw for this tax protection, tax substitution role that helps the wealthy and, by using PFD cuts, undermines working Alaska families, middle and lower income Alaska families. This is the same. We now have the same Angela Rodale talking about protecting working families against regressive taxes. We have the same person doing that now, who you know a couple of years ago, or a year a couple of years ago, was arguing for eliminating the PFD entirely.
Speaker 1:What's the? You know, when you look at the event, sometimes you look at Venn circles or, and you try to figure out where the overlap is, who they're, who they're trying to protect. When you look at the Venn diagram of of what happens with PFD cuts, which she advocates, and you and you look at the Venn diagram of of what happens with PFD cuts, which she advocates, and you and you look at the Venn diagram of what happens with, with, with what she's proposing, with the property tax cap and the and the sales tax exemptions and so forth, the, the, the group that's getting protected is the wealthy. The wealthy is going to get protected by the property tax cap. The wealthy is going to get protected by uh, to some degree, by by, by groceries and the exemptions for groceries, and uh, uh and and utilities. Um, so what's really going on is the working families that Angela is really interested in, really interested in protecting her, the wealthy families that Angela is really interested in, really interested in protecting her, the wealthy families?
Speaker 1:She's couching it like Zach Fields does and Elise Galvin and a number of others at the legislature. She's couching PFD, or she's couching her proposal at the Juneau level. She's couching it as oh, we're going to look out for working Alaska families. That's what Zach Fields and Elise Galvin and the others do at the legislature. They say, oh, PFD cuts are to protect working Alaska families. We're going to take that money and we're going to spend it so much better to protect working Alaska families than they can themselves. So it's a tool, it's a device. Saying you're trying to protect working Alaska families is a device. To try to sell a product, In the case of Zach Fields and Elise Galvin, is to sell PFD cuts. In the case of Angela, it's to sell property tax caps. Sort of funny to see the juxtaposition of what she's saying now compared to what she said, uh, just a year or a couple years ago. Right, uh, about pfds. It's not about working alaska families.
Speaker 2:There's something else going on here and and I can't, I I pulled the article up this morning and read it real quickly and then I just went back to it and, of course, the paywall at the juno empire, just you know now I can't read it, but but there was a, there was a, there was a paragraph there where she talked about again talking about working class families and how the people are disconnected now from their government because they're not. I mean, it's like she's taking some of the greatest hits from people like Ben Carpenter and things like that and she's twisting it to her, she's making herself sound so reasonable and so all these other things, when you know she's a big government gal. That's what she does. She's all about. She doesn't care about the working people. It's a, it's a, you know it's. It's again like you said, she's selling the product. But you can see how they cherry pick some of this verbiage and they use it and twist it to their own, to their own ends yeah, and, and you know, and so it's a well-worn path.
Speaker 1:Because when you look at the legislature, when you look at zach fields, when you look at andy joseph, so when you look at elise galvin, when you go down the line on the on the uh, on the on the house majority and, to some degree, some members of the house minority, when you go down the line, it's all, it's that verbiage. It's we're protecting you, we're protecting you with child care credits, we're protecting you with spending on this and that government program. We're working on your behalf. It's at the same time they're doing that, they're saying they're protecting you. At the same time, they're taking money out of your pocket, out of middle and lower income Alaska families, through PFD cuts, and they're taking more money out through PFD cuts than it would cost, than the benefits that they're redistributing. So it is never buy into the words, just like Angela, and never, never buy into the words just like Angela. Don't buy into the words that she's saying.
Speaker 1:Understand the economic impact of what's going on with their proposal and the economic impact that she's, the totality of the economic impact that she talks about, both at the local level and at the state level, is not pro-working Alaska family. It's pro-wealthy and the totality of what Zach Fields and Elyse Galvin and Andy Josephson talk about at the state level is not pro-working Alaska family. It's pro because of the way that they're using the POMV draw to protect against taxes. It's pro all companies, pro toptop 20%, pro-non-residents. That's the economic effect of what they're arguing. And Angela's? I just had to chuckle as I was working through this op-ed because it's just a bunch of words. It's, you know, whole tested words. This gives the response you want. Just throw them out there. Have some sort of idea about how that sort of relates, but throw them out there and then do whatever you want in terms of, in terms of the actual proposal.
Speaker 2:Right, no, and and again. This is just again another snapshot of the mindset that's in Juno, right now. For what's going on? Like you said, Galvin Fields, these kind of people who are taking these things and twisting them to the point to where you're saying you know you need us. This is why we're here to protect you from you. Essentially I mean, that's essentially what the whole fallacy is is that we know better than you how these money should be spent, and so let us do that. And if we put put it under the guise of protecting the working class, well, that just sounds sexy, right? I mean, that's really what it all comes down to. It's all about how is it packaged at this point?
Speaker 1:Yeah, exactly Right, we. I did some numbers, I did some calculations over the weekend, I used my weekend for that, and we have like a billion $500 million that's been transferred. With these PFD cuts, the PFD cuts that the legislature just enacted We've had a billion $500 million about a billion and a half that's been transferred out of the pockets of middle and lower income Alaska families and is being transferred to being a tax shelter for the top 20%, the old companies and non-residents. But they say they're doing it. They say they're doing it for the benefit of working Alaska families, but we've had $1. Half dollars taken out of their pockets to fund the additional tax shelters. But the words, when you look at their words, oh, we're just doing it to protect you, Government's here to protect you and we're taking your money. We're taking money out of your pocket and sort of sprinkling some of it back on some of you to protect you. Same way with Angela we're taking money out of your pocket and we're sprinkling some of it back to protect you.
Speaker 2:Boy Kyle comes into the chat room like a bomb and tries to tell everybody and apparently he missed the whole part at the beginning where we talked about how the governor is responsible for what's going on with the Permanent Fund fund board. But what we were talking about with the legislature is their fascination with combining the corpus of the fund and the era and how that is wrong. But he's telling us how wrong we are. Um, so I, you know, I, I, kyle, you can't just pop into the room, read one comment and go off without context oh yeah, kyle can well, that's easy for him to do.
Speaker 2:He can, he can, but it's not the right thing to do. Is what I'm saying? I guess you know, uh, and then get heated when somebody tells him to, uh, to, to, you know, pound sand or whatever, but anyway, um, I mean, this is, this is the, this is the reaction of what's going on. The problem is they're all to blame, right, they're all to blame. The legislature is to blame, the governor is to blame, the historically past legislatures are to blame, the Republicans are to blame, the Democrats are to blame. Everybody has got a fair share of blame on what's going on right now, even the electorate for putting these numbskulls back in office over and over and over again.
Speaker 1:But yeah, it's a problem, right? I mean this is an overall problem. It is, and it starts with the perception that the legislature knows better than the citizens. The legislature knows better how to use citizens' money than the citizens do, and so the legislature can take money out of the pockets of middle and lower income Alaska families huge, you know, a billion and a half out of the pockets of middle and lower income Alaska families and redirect it over to their chosen uses of the money because they know better. But the problem is they don't.
Speaker 1:The problem is, while it may benefit a few, why a few may get more benefits out of redirecting that money than they would have had they got the money in their pockets. It's taking money out of all middle and lower income Alaska families. It's taking money out of all middle and lower income Alaska families, is taking money out of all of the economy that's driven by middle and lower income Alaska families in order to redirect it to a few. So, yeah, when the Republicans think they can do that, when the Democrats think they can do that, when voters think they want to elect people who do that it causes a problem because we are redistributing money that otherwise, by statute, is supposed to go to the pockets of middle and lower income Alaska families and the legislature is redirecting it into the pockets of a select few, and that's going to be a problem.
Speaker 2:Yeah, no, it is. And, of course, the more they talk about this, the more anxious I get. The more they talk about combining the corpus of the fund and the ERA, the more anxious I get. The more they talk about combining the corpus of the fund and the ERA, the more anxious I get, because most people, most Alaskans, don't understand how it works. They don't understand the mechanisms for how all these things work, and so they just believe what they're told in the news media, because the news media is not digging deeper into it, not giving you the problems or the foibles or the pitfalls of it, and they just go oh, ok, you have to do this to save us.
Speaker 2:Ok, go ahead. You know, and you know it's because it's complicated and most people are just not paying attention and the news media is not doing their job in digging into this and saying, ok, why, why would what? Ok, so you want to do this? What are the downsides? Saying, okay, why, why would what? Okay, so you want to do this? What are the downsides, what are the pitfalls, what are the problems? Oh well, nowhere, because this is how all sovereign wealth funds work. No, no, that's not what we're. No, that's not what's going on, but you know, this is this, is this thing. This is what really makes me nervous about the future of Alaska is, if we get to this point, to where they're able to slap these things together without any kind of real resistance, where does it go from there?
Speaker 1:Yeah and we don't have. I mean, people don't back up and step back and say, okay, why do we need to combine these two accounts, the earnings reserve? I got to say Joe Pasquan, former Senator from Fairbanks, who I disagree with on a lot of stuff. Pasquan's got this right. Pasquan has backed up and he said, okay, let me understand this. The earnings reserve is being drained, so we need to do something to protect, to allow, to ensure that we continue to get money out of the POMV or out of the permanent fund, but the earnings reserve is being drained. We aren't earning enough money to keep the earnings reserve whole. There's a problem there and the problem is, of course. The problem is, of course, the permanent fund corporation isn't generating enough earnings well, shouldn't that be a red flag to begin with?
Speaker 2:shouldn't we either, you know, stop, we're not earning enough to draw from here to make, so shouldn't we stop drawing at that point, or find a way to earn more? You know, I mean one of those two things, that's the you know, and the fact that they they purposely have done this by transferring $8 billion into the corpus of the fund over the last five years. So, you know, for future inflation proofing, right, for future inflation proofing, uh. And now they're like oh, now we don't know what to do. I mean, no, now, what do we do? Now? You know, um, and it's a crisis of their own making. It's exactly what they, it's exactly what they wanted to do, which is a little spooky at this point for sure.
Speaker 1:Yeah, but Pascavan's got it right. But but Pascavan's one of the few I mean Joe, joe's asking the right questions. But if you read the media, if you read Sean, if you read the ADN, or you read the Alaska Beacon, or you read, you know, the Fairbanks News Minor, or you read any of them, they're all going oh yeah, well, there's a problem, the earnings reserves. So let's just, let's just combine the two, that'll do it. It does it only because you then set up an opportunity to drain the corpus. Yeah, think, think, think about what the consequences are. But we don't have that.
Speaker 2:No, it's some crazy stuff, but you know, don't worry, angela will save us. She's here to fight for us. She's here to fight for us for sure, yeah, yeah, for the working man and woman.
Speaker 1:She's here to protect us from arsenal it's almost michael, as if they walk into their pr consultants and they say, okay, what? What phrases poll test the best? Forget what I'm proposing. Just tell me what phrases poll test the best and I'll use those. Yeah, and I'll, and. And then I'll do what I want behind the scenes. But I'll use those phrases, um, and claim and claim that that's what I want behind the scenes. But I'll use those phrases and claim that that's what I'm doing. I'm protecting Alaskans. I'm looking out for working Alaska families.
Speaker 2:All right, Brad Well, thank you so much for coming on board. We will talk with you again soon, okay, Michael? Thanks for having me.
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 on the Weekly Top Three.
