The Weekly Top 3
The Weekly Top 3
The Weekly Top 3 (12.15.2025)
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
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 December 15, 2025.
For those who follow us, this is our last podcast for 2025. After taking a couple of weeks off for the holidays, we will return on January 6, 2026.
This week, our top 3 issues are these: 1) we explain what the Department of Revenue’s Fall Revenue Forecast tells us about state petroleum revenues (2:07), 2) we explain what OMB’s 10-year forecast tells us about the outlines of a potential solution to the state’s never-ending fiscal crises (17:08), and 3) in our wrap-up to this, ourlast show of 2025, we do our annual “Christmas Top 3” (35:43).
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 December 15th, 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 a.m. I join Michael weekly in the first hour of Tuesday's show from 6.10 to 7 a.m. 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, medium.com. 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 what the Department of Revenue's fall revenue forecast tells us about the future of state petroleum revenues. Second, we explained what the Office of Management and Budgets 10-year forecast tells us about the outlines of a potential solution to the state's never-ending fiscal crisis. And third, in our wrap-up to this, the last show of 2025, we do our annual Christmas top three. And now let's join Michael.
SPEAKER_01:Let's dig into it, the weekly top three. It all begins with a simple it all begins with the simple message of what does the revenue forecast tell us about petroleum reserves and everything else? Let's get started, Brad.
SPEAKER_00:Well, uh there's not much in the in the governor's in the Department of Revenue's tenure forecast to talk about. All of the detail that usually go into uh a strong analysis of what's going on with the state revenues wasn't included in the Friday release. They they issued something like three pages of summary tables. So it's not the the detail work on some of this stuff will uh will come after the first of the year uh for the show at least. Um, but there is a couple of things that you can take from the the revenue forecast that are that are important. Um and and it looks at petroleum revenue. Now they don't have the summary forecasts, don't have royalties and production taxes and property taxes and corporate income taxes into divided into the subsets. So you can't look in and see it, look under the under the hood and see what's causing these things to to go around. But you can get some sense of what's going on with uh with petroleum revenues. And and and the the upshot of looking at petroleum revenues is the same thing, is the same as we've talked about all year. Petroleum volumes, oil volumes are going up. State revenues from oil are going down. Um, and we've got a couple of charts that uh that show that. If if you yeah, very good. Yeah, we're even on the same wavelength here. Um, so this first chart shows by year uh the uh both the oil volumes, the projection of oil volumes contained in the revenue forecast, and then in that's the upper line, uh, and then the projection of petroleum revenues, overall oil revenues, production taxes, royalties, uh corporate income taxes, and property taxes combined. And you can show that, as we've talked about on the show throughout the year, there's this huge divide between what's going on with production volumes and what's going on with revenues to the state. Production volumes are escalating. I think this year's forecast shows an increase of in excess of 30% between the base year, which is now FY25, and the farthest projection year, which is FY36, shows an increase of something like uh uh uh uh uh 30% in petroleum volumes, but shows uh revenues from those petroleum volumes as down uh through nine of the 10 years below the the 2025 base year, a negative number from uh from using the FY2025 as the base. Uh bare and then finally barely getting ahead, barely, uh by uh FY36. So it shows as production volumes are increasing, uh revenues from uh uh from those production volumes, revenues from oil, total revenues from oil, are in steep decline uh and then uh sort of creep back up, but only get to the same place they were in FY25 on a nominal basis, nominal dollars uh uh by FY uh by FY36. Um the line below the red line, the red line is the nominal dollars of petroleum revenue. The line below uh that red line, the the darker blue line, is real dollars, dollar, inflation-adjusted dollars, so dollars after inflation. And it shows that what's really going on from FY26 forward uh is that petroleum revenues are sort of rising with inflation. Uh, but when you put it in terms of real dollars, when you when you take out the inflation effect on on those revenues, uh real dollars from from petroleum from oil are staying flat throughout the entire period. They never get back to the uh level of uh FY25. And so, and so the reason that I that I've done this is those people who say, oh, oil's just a temporary, this oil price decline, or this oil revenue decline is a temporary thing, it's gonna come back. Don't worry about it. Uh, we're gonna we're gonna grow with these production volumes, uh uh and and we'll be fine. We don't. We hit we take a deep dive. We've taken a deep dive in FY25 over FY24. We've shown that before on the show. We take another deep dive in FY26 uh over uh FY25, and we stay down. Uh we we grow only with inflation. So to the extent anybody's thinking, oh, we can justify additional spending on the basis that the fact that on the basis that oil's going to come back, these oil production volumes are gonna produce additional revenues, it isn't gonna happen. I mean, it's just it's just shows that we're that we're that we're staying in decline.
SPEAKER_01:This looks like another K chart, Brad. I mean, it's a K chart where they're getting all the revenue and the and the production and the monies, and we're taking it in the keister uh on this uh on the lower side.
SPEAKER_00:Yep. The second chart is is in response to what some people to to defense some people make. They say, some people say, oh, well, the reason oil revenues are declined, state oil revenues are in decline is because oil prices are in decline. There's a way of adjusting for that to take out the effective oil price uh in the analysis, and that is to do petroleum revenue, state petroleum revenues as a percent of gross revenues. So whatever the oil companies are getting, whatever the oil volumes are attracting in terms of revenues as prices go up or prices go down, that's sort of the baseline. And the calculation then is what is the state getting as a share of that of that overall gross revenues. And this this is what that's what this analysis does. And it shows that state production taxes or state, not state overall state revenues, petroleum revenues, corporate taxes, uh uh uh production taxes, royalties, and um uh uh property taxes, that the states it shows it as a as a percent of the gross revenues that the old companies are receiving for total production. And it shows that's in decline. Uh we're at 15%. We were higher in FY24, but starting at the new base year of FY25, we're at 15%. The state's getting 15% of gross revenues in terms of in terms of the state's share of petroleum revenues. That goes down to 13% in 26, goes down to 12% in 27, uh, goes down to 11% in 20 in 31, goes down to 10% by 34, and sort of comes back up to 11 uh, 11-ish percent by FY36, all compared to the base period uh FY25 of 15%. So what this is showing, it's showing that the state's share, regardless of what oil price is, it's still is showing that the state's share of petroleum of the gross revenues being received by the oil companies is going down. Now, part of this is driven by the fact that we're seeing an increasing amount of oil production coming from federal lands where the state doesn't get royalties. And so part of this reduction is as a result of that shift from state lands um and state royalties to federal lands and uh federal royalties. But that's only part of this. What's really going on, what these numbers really show, is that again, is that the the the state's in uh the state's tax approach is resulting in a deteriorating share, even as production volumes climb by 30 percent over the period, 30 plus percent over the period, the state's share in terms of the the the the way the state's tax system is working, the state's share is in significant decline. I mean, from 15 to 10 percent is a third. We drop a third of the of the state share, starting at an already low number of FY25, we drop a third of the state's share uh during this uh during this period. So yeah. And so these numbers continue to show it's a production tax system that the tax system is is is causing us to lose money, not gain money as production volumes go up.
SPEAKER_01:And what's interesting here is the delta on this is a 60% because they go the production goes up 30% uh on our gross, we go down 30%. So we've got a 60, 60 percentage delta in the middle there. I mean, that's I mean, it's pretty significant. I mean, again, producing more oil, pumping more oil out of the state, a finite resource, and receiving less money, a significant amount of less money. And uh we're wondering why, you know, why is everybody so happy about this? Well, I mean, we, you know, great, production, great, but when you don't make any money on it, not so I mean, if you were an oil well owner in I don't know, Texas, Oklahoma, some state where you could own the oil land, you would not be happy about them pumping out your finite resource and you getting actually less money uh on it. I mean, you would be incensed. You might ask them to stop, right? At some point. And now the president, of course, has been talking about wanting to pump, uh push oil prices down even further, which again that does not bode well for you. Uh, they're gonna try and make it up in volume while they but so I mean this is a this is a tough deal.
SPEAKER_00:Yeah, well, this is this is a very this is a very important chart. I mean, this what this is showing is that the promise of 2013, the promise of SB21, which is provide us incentives, we'll increase production, and you, Alaskans, will benefit from that increased production in terms of increased revenue, showing the promise of SB21 is not working in its second uh uh decade, that something has gone wrong uh with uh with SB21 its second decade. And those people who refuse to lift up the lid and start looking at what has gone wrong are part of the problem. I mean, they're part of they're part of creating these deficits that uh that that the state's running. So this this chart shows that regardless of oil price, however much you want to argue about oil price, regardless of oil price, the state's share of petroleum revenue um is going down significantly uh over the 10 next 10 years as production volumes increase.
SPEAKER_01:Kim says uh the legislature and the NEA don't care the petroleum recur uh revenues are in decline. Guessing they're going to ask for$1,200 to$1,500 BSA increase, even though the state is broke. I mean, we're already seeing that, right, Brad? I mean, we're already seeing that that was in that Fairbanks um the meeting between the Fairbanks North Starborough Assembly and the legislators, where the legislators, all of them, progressives, conservatives, were all saying, hey, fiscal crisis coming. And the assembly was like, we don't care. We what we need more money. That's that's already in the in the works, right?
SPEAKER_00:Yep. Well, yeah, it's not just the NEA. It is the NEA, but it's not just the NEA. We have a bunch of people screaming about the capital budget and uh and the and the the stability that the governor's trying to bring to the capital budget, uh and people screaming that they want more money spent through the uh capital budget, contractors and others want to screaming they want to spend more money through the capital budget. We're gonna hear the same thing, no doubt, from the municipality municipalities with respect to community uh funding. Uh, and we're gonna hear it from from other sources. So I it's gonna be, I mean, and and Kim's exactly right about this. We they don't really care about oil taxes. They'll claim that they care about oil taxes, but as long as they still have PFDs to cut or they still have the CBR, a little the little bit that's left in the CBR to drain, they don't really care about the funding source. They just care about having some funding source to be able to be able to increase the spend. And so it's it's you know, you would think that you would get people to be concerned about the fact our oil, our oil tax system is now broke. Uh, you would think you would get people to focus on that, but the people that should be focusing on that uh are are focused instead on grabbing somebody else's money, grabbing the grabbing the PFD from middle and lower income Alaska families or grabbing grabbing the CBR from future Alaskan generations. I mean, they're just they're just they don't care about where the money comes from, they just want the money. And she's and she's right about that.
SPEAKER_01:Frank, don't blame the messenger, Frank. Frank says the holiday edition with a report we just received is the Scrooge on is Brad the Scrooge. I mean, you can't kill the messenger on this. Uh, I mean, this is just this is just the truth as as we see it, the truth laid bare. Um, we got about two minutes here, Brad. Uh, I don't know if you want to take some time during the uh when we're back on the radio or not, but the governor's budget, I mean, again, delivering another budget that's only balanced through savings, which I don't think fulfills the letter of the the spirit of the constitutional mandate. Uh you you can't just you can't just say, oh, we've got money in savings, so I'm gonna spend more than we take in in revenue and call it balance. That just doesn't seem that just doesn't seem right.
SPEAKER_00:Yeah, it's a statutory statutory uh mandate. And so and so everybody just ignores the statutes anymore. Um it's it's uh yes, the governor's supposed to submit a a budget that balances on rev between revenues. But we have no governor, well, no, no governor has done that since 2013. And no legislature has done that since 2013. We got into this great debate, dear people got into this great debate on Facebook, you know, claiming that Dunleavy had set some new low bar by you know using savings to plug in and say he had a balanced budget, and claiming that it was a balanced budget. People were saying, That's not balanced, you're using savings.
unknown:Crap.
SPEAKER_00:That's what the legislature's done continuously since 2013. Dunleavy isn't setting a low bar, he's following the low bar set by the Pardinell administration, then the Walker administration, and and now you know his prior seven years. It's just it's one continuous bar from that and from that entire period forward. No one's tried to balance the budget.
SPEAKER_01:Yeah. Continuing now, the weekly top three, number two. What the OMB's tenure forecast tells us about our fiscal options. They they seem to be few and far between at this point. Brad Keithly, Alaskans for sustainable budgets. Come on, Brad, leave me with some good news at the end of this year.
SPEAKER_00:What what it's like rolling the dice, right? Come on, come on, 7 or 11.
SPEAKER_01:Yeah, but the dice are loaded. That's the problem. They don't belong to me, they belong to the dealer, and they're totally loaded, and I'm gonna roll it. And I keep hoping. I keep hoping. What uh what does the OMB 10-year forecast tell us, Brad? Uh I brace yourself, Gertrude. Here it comes.
SPEAKER_00:Well, the 10-year forecast is is is a fantasy in a way. I mean, what the 10-year forecast is supposed to be is the uses use of funds over the 10 years, the the spending levels over the 10 years, and then the revenue levels over the over the 10 years. And those two numbers are actually supposed to be the same. They're actually supposed to lay on top of each other. Revenues are supposed to equal, are supposed to equal spending. The governor's 10 year, the latest 10-year forecast is slightly better, I guess, than last year's 10 10-year forecast in the sense that he just doesn't give up and say, I'm not going to try to get revenues. We're just going to show this red line, this deficit line, uh, all the way out. This year, he has a placeholder put in for what he calls new revenues, which shouldn't be new revenues, it should be replacement revenues, replacement of PFD cuts. But but he has this placeholder put in that that instead of showing deficits of a billion dollars plus throughout the 10-year period, he's showing these revenue, these uh additional new, yet to be defined replacement revenues of a billion dollars plus throughout the year. But I took a look at uh at the numbers and um and and see something in them that I think is good news, but then some would say I have a perverted sense of what is good uh uh in in these things. Uh, but I saw some some good news in here. All right, so this chart is the red line is the spending line that's included in the governor's tenure forecast. Now, that spending line X escalates at less than inflation. So the governor is already including some spending cuts. It escalates at about 1.9% compared to assumed inflation of about 2.5%. So the governor is including some spending cuts already in uh in the red line. Even though it's going up on a real basis, if I did this on a real basis, inflation adjusted basis, the line would be would be stabilized and going and going slightly down over the period. But on a nominal basis, it's going up. And then I've got I've got two blue lines. The the lower blue line is the governor's projection of revenues from traditional sources, but not including his phantom new revenues. It's the projection of revenues from traditional sources plus the portion of the POMB draw remaining after the statutory PFD. It is the revenues of the traditional revenues plus the remaining portion of the POMB draw uh at the at the statutory PFD. So it's what he's really including for revenues against that spending line. And the deficits are huge. I mean, these are the deficits that show up in the 10-year plan. And the deficits that show up from the lower blue line are are the numbers at the top of the bars at the bottom. So$1.5 billion in 2027, going up to$1.9 billion in FY30, coming back down a little bit and ending the period in FY26 at$1.578 or$1.6 billion. 2036, 2036, right? Right. I'm sorry. Those those are the are the deficit numbers that uh uh that the governor is showing uh at the statutory PFD. So I played with it a little bit and I said, okay, instead of a statutory PFD, let's assume POMB 5050, which I think is a fair assumption of a landing point for a for a comprehensive fiscal plan. It's the number included in the 2021 uh legislative fiscal policy working group uh comprehensive fiscal plan. So let's assume POMV5050. And that cuts the deficit surprisingly. Um uh and this will look this will show you a little bit how the statutory PFD is a little bit distorted. Um, but that cuts the deficit by about 500,$500 million on average uh over the period. Um the the resulting deficit uh is the is the solid red bar, the solid as opposed to the light colored red, the solid red bar uh at the bottom, and it shows instead of a deficit of$1.5 billion,$1.53 billion in FY27, it shows a deficit of$1.16 billion. That's the deficit if you assume uh the PFDs at POMB 5050. And then it goes up um uh to$1.2 billion in FY30, but then by FY36 comes down to a billion dollars,$1.007 um uh billion dollars. So so POMB 5050, some people don't think of it as a big step, but it's a it's actually a huge step in terms of helping to solve the deficit. It's helping to resolve the state's fiscal situation. And as I say, it's a step that was included in the in the legislative fiscal, the 2021 legislative fiscal policy working groups uh recommendations. If you look at FY36 just at the far end of the bar, just to sort of see how this projected plays out at the end, what you've got is some spending cuts in in real terms, in terms of holding the the growth of government at less than inflation, some spending cuts in real terms by FY36. And then you've got and then show and then and then reducing the the deficit by by going to POMB 50-50 reduces that remaining deficit by a third. It remu re reduces it from$1.578 billion to a billion dollars. So you got$500 million, you got you need roughly$1.5 billion by FY36 uh to get the budget in truly in balance. You got a third out, a third of it by going from statutory PFD to POMB 5050. As we've talked on the show, another 500 million of that, half of the remaining, would be from oil tax reform, could be from oil tax reform. Getting the state back where SB21 originally put it in terms of share of gross revenues, uh, which really ought to be the standard that we're looking to in terms of in terms of how we're judging uh the success of uh of an oil tax uh oil tax uh structure. And so another$500 million from oil tax reform, maybe a little bit more. If you if you close the subchapter S corporate loophole, the corporate uh uh corporate S loophole, uh maybe maybe a little bit more than$500 million, but about$500 million, let's say, from oil tax reform. So now you've got just a third. You've got$500 million remaining. And if you close close that through broad-based taxes, that's about a percent and a quarter of adjusted gross income, projected adjusted gross income over the over the period. Not huge. I mean, it's it's it's not nothing, but it's not it's not these huge tax numbers that some people bandy about. The huge tax numbers that some people bandy about are to close the entire deficit through personal taxes. But if you close a third of it, if you close 500 million of it through POMB 5050, and you close 500 million of it through oil tax reform, you've only got about a percent left, percent of adjusted gross income. Alaska, Alaska adjusted gross income, including non-residents. You've only got about a percent left uh uh to close the to close the remaining loophole. So I think the good news out of out of the year is this is within our grasp. Oh the the fiscal, don't groan. This is good news.
SPEAKER_01:No, no, no, go ahead. I'm sorry. I I didn't mean to go ahead.
SPEAKER_00:I'm gonna I'll have my say at the end because the good news is that that the resolution of our fiscal situation is within our grasp. It it it's only about a third, a third, a third. It's a third going from the from the statutory PFD to POMB 5050, not from from looking at the intent of Governor Hammond, the original intent of Governor Hammond, not a big step going from the statutory PFD to POMB 5050. The about a third of it from from restructuring oil taxes or or redirecting oil taxes back to the original intent of SB21 in terms of in terms of the share or the gross of the revenue share that the state would get out of out of production, sort of following the production up and getting the state's share out of that about$500 million. And then$500 million remaining uh to be closed through through other means. And people can come up with, you know, maybe we can tariff things, but but people could come up with with other ways to with with other ways to close that remaining$500 million, but plus or minus, uh, it's about a it's gonna have an impact of about a percent and a quarter uh on Alaska adjusted gross income. And I think that's a good thing. The reason I think it's a good thing to put that at the margin as the marginal source of revenue is it gives all Alaskans a reason to put the brakes on spending. Right now, when we use PFD cuts as a as a as the as a marginal source of revenue, non-residents, the oil companies, the top 20% don't have any reason to push back on spending because they don't pay any share of it. Right. But if but if you spread the burden, and a percent and a quarter is is is a good way to do it. If you spread the burden evenly across all Alaska families, they see that if they don't put the brakes on spending, that percent and a quarter could go to a percent and a half, could go to two percent, and keep on going up. And so that creates an incentive to go back to the beginning of the show. That creates an incentive for them to put the brakes to put the brakes on spending, an incentive we don't have now. Right. Uh incentives we don't have now to put the brakes on spending. So I think at the at the end of the year, I think this is good news in terms of we can see a path to get to uh uh to get to a resolution of the fiscal of the fiscal situation. I love your optimism.
SPEAKER_01:Uh let me this is why I was groaning. Okay, so here's the first thing. This all this whole tenure forecast, they're all based on uh super rosy assumptions, right? They're based on basically flat spending. And as you said, the governor even you know put in some cuts in there, which uh, you know, I just I think that's that's optimistic to say the least. The second thing is you've put in this 50-50 POMV, which I think is great, and it shows that we could, you know, we could meet them in the middle, so to speak. The problem is they don't want to meet us in the middle, they want to take all of the PFD, and they're not interested in giving us back any of our money. That's the problem. I mean, I agree this plan could work. The thing is, do you think final thoughts in this segment, do you think there is the there is the political will for them to give us back a 50-50 POMV and not just take all the money because it's the easiest route? Yes.
SPEAKER_00:I do I do because it's Christmas, first of all. And secondly, I do because it it assumes one thing. It assumes people begin to understand that PFD cuts are just a tax on middle and lower income Alaska families, and we want to limit the tax on middle and lower income Alaska families. We want to even out the tax burden in a way that impacts the top 20% non-residents and the old companies as well. Um, we want we want a broad-based solution to this. We just don't want a solution that goes deeper and deeper and deeper and deeper into the pockets of middle and lower income Alaska families. I think I think there are some legislators who realize that. I think there are some legislators that would that would pursue that. We don't have a governor, I think, that even understands it. But but assuming 2026, we have a we have an election cycle that that that has that understanding and deepens that understanding, and we have a governor at the end of it that does have that understanding. Yeah, I think it's doable. So it takes it takes some assumptions, takes some rosiness. But yeah, I I think it's achievable.
SPEAKER_01:It's a Christmas miracle, Brad Keithley. He's more positive than I am on this one. How did I get to be the Grinch in this whole deal? I mean, I just I just look at these numbers, and I mean, you're right. We might be coming to the point in the end of the road where they're just like, okay, we have to do something, and maybe that's a viable option. But the more and more they talk about combining these funds and doing some other things, I I just see all I see is avoidance. That's what I see, Brad. I just see avoidance from you know, from one side to the other, right?
SPEAKER_00:I mean, that's just kind of the reaction at this point. You see, you see avoidance driven by the top 20 non-residents, non-resident industries and the old industry. The the the the avoidance works in their benefit. I mean, the more and more you can take out of PFD cuts, the more and more you can open yet another door uh into additional free funds, which is what the consolidation of the two accounts would do by opening a back door uh into the permanent fund. You the the more the more you can do that, the more they benefit because they don't have to pay anything for the costs of government. And and frankly, the result of that is gonna be government's gonna continue to grow and grow and grow because the donor class, the the non-resident industries, and the oil companies, which are major in the state, and the and the oil companies, which are even more major in the state, will all continue to be ambivalent about additional spending because they don't have to pay for it. Um and so and so we're gonna continue going in the wrong direction. Increased spending because people aren't pushing back, because the people who can affect it aren't pushing back, uh, and decreased uh decreased revenue for middle and lower income Alaska families. Um, and that's I mean, and so and so non-action works in their favor and they encourage it. They come up with rationalizations for it. Uh oh my God, the the earnings reserve is in danger. I mean, they they come up, they come up with these dark, you know, conspiracy theories about about why it's important to continue to open these doors. But frankly, at the end of the day, all they're doing is trying to keep the door open so they don't have to pay, they don't have to pay any share of the cost of government. They can continue to shove it off on somebody else. Right. Uh, in the case of PFD cuts. So yeah, I mean, maybe that, maybe that continues. But, you know, I I think there are legislators out there, maybe they're not strong in number, but I think there are legislators out legislators out there that understand that, that understand this is all an effort to keep to keep Alaska going at the benefit of the top 20% non-residents in the oil companies. It's not to keep Alaska going at the benefit of Alaskans, the 80% of Alaska families that are in the middle and lower income brackets. It's to keep the the the free ride going for those in the top 20% in the non-resident industries and the all and the oil companies. And I think I think there are legislators that see that. And I think during the 26 campaign, I hope we see people raising that issue, and I hope we see people people pursuing that issue, and I hope we elect people that when we get to the next legislature want to do something about that issue.
SPEAKER_01:Terry says, Brad is trying to give us a cheerful report. Go, Brad. That's right. Go, Brad. I'm I had to be in the grudge. Um I hope you're right, Brad. I really do. Um, I just, you know, I'm a student of history, and from what I'm seeing right now, politicians, you know, they just they never learn until the wheels come off the bus. And then they're shocked. Shocked, I tell you, that this is where we ended up at. I mean, that was Lyman Hoffman, that which was just hysterical. Somebody sent me a seniority report the other day, uh, seniority report in the legislature. Lyman Hoffman has been there longer than my marriage, right? 38 years. He's been there longer than some people that I know have been alive. And all of a sudden he's shocked, shocked, I tell you, that there's a deficit. Where did this come from? I mean, it's just, you know, it's um uh I I can only hope. I can I can hope at this point, Brad. I'm trying to believe that it's a Christmas miracle.
SPEAKER_00:I guess we'll see. Michael, the thing, the thing that encourages me is it's simple. A third, a third, a third. I mean, the numbers, the numbers, assuming that you would have Dunleavy's spending curve, assuming that he holds that that that he and subsequent legislator or he and subsequent governors actually hold the deficit or spending it at inflation. Uh assuming that, um, it's a third, a third, a third. It's a third POMV, uh 50-50. It's a third getting all taxes back to where they were back to where we were told in 2013. And it's a third uh a little bit of a share, a percent and a half, percent and a quarter, percent and a half of uh of adjusted gross income uh from Alaskans themselves to pay for their own government. Shocking, shocking, I tell you. But but a little bit from Alaskan's Alaskans to pay for it itself, turning that into the pushback that people would then push back on spending. I it's doable, and it's it's a third, a third, a third. I I think it's it's that simple. When you look at the 10-year forecast and you look at the numbers and you take it out, it's that simple. And I and and hopefully that simplicity will will resonate with some people.
SPEAKER_01:I mean, I don't know if anybody's watching you. I mean, because a third, a third, a third sounds pretty good. Uh, but again, that's assuming that they want to not just consume all the revenue in the room and they actually want to give us back a portion of the PFD that is ours to begin with. But we'll we'll see. We'll we'll we'll keep we'll keep we'll keep her, we'll keep, we'll keep the positivity rolling here. The final weekly top three for the year concludes, and Brad's put on his Santa hat because he's trying to get in the spirit. I think every time I ask him to do this, he just gets terrified. He's like, Whoa, wow. Talking about numbers and and uh and and all the politics and that stuff, that's easy for Brad. Talking about Christmas, man. So Brad, the weekly top three, your number three for the weekly top three is Christmas memories and Christmas stuff. And yeah, and I'll admit it, you are the you are the Christmassy guy today. I've been more of a Grinch than you have. Um, so ho ho ho. What's uh what's what's on your what's number three of the weekly top three here?
SPEAKER_00:Well, uh this year I decided to do a top three of the of the of of Christmas, um, uh Christmas memories or Christmas future or Christmas, just Christmassy stuff that I've learned over over my period of time here uh around on the earth. Um, and so I thought that would be my my top three this year. Or that would be my Christmas segment this year. Nice. Ho ho ho. All right. So so number one is family. Uh what I've learned over the course of my years, um, and I didn't didn't learn it until later in life, I gotta admit, um, is is family is important. You know that. Uh others certainly know that on the show. It's been something that has sort of caught up with me um over the years. There have been Christmases that I didn't come back to Illinois to see my family, see my mother, um, or when he was alive. My father, there were years when, you know, I was working on something that was way too important to spend the time to uh to come back to come back to see them. Um and I've learned over the years that that that's the wrong way to look at it. Family always ought to come first, certainly at the holiday season. Uh, and uh, and and visiting and talking and living out or living out, reliving the good memories um and talking about things that are that are family-oriented are is probably the most important thing that that I can do, certainly for me at Christmas, and something that uh that I've learned uh over the course of the years. And it's it's been it's been something that that as I say has been hard to hard to learn. Um because when you're going through your career, uh there's always some some other deal to work on or some other project or some other trial or some other some other advice to to be given. Um and yeah, yeah, it's December 25th. So what about that? I mean, right. Um but uh or as I've gotten older, the more I've realized that it really should, it really should be all about family, the holiday season. There should be a season that's all about family, and that this is the best one to do it in.
SPEAKER_01:I remember the whatever the the story or the axiom that went on that said, you know, when you're laying in your deathbed, are you gonna think about that X? You know, you're gonna think about that deal you closed, or that skyscraper you built, or that one or thing, or you're gonna think about the moments with your your your kids, your mom, your dad, your, you know, and that and that's that's it. Family is everything. And that's uh and that's a a great thing. And that is the cornerstone to me of the holidays is being around my family and doing all that kind of stuff. So I'm with you on that.
SPEAKER_00:Yeah, the federal government used to get in the way. I mean, we used to have we used to have these tax codes, particularly in the oil industry, that uh that would change at the end of the year. And so you'd have to get a deal closed by the end of the year. I remember one deal in particular. You'd have to get closed by the end of the year in order to qualify for the favorable tax treatment. And I remember, you know, being in an being in an office on December 25th, working away on getting this deal closed, doing the documentation, doing the negotiation uh around the purchase agreement to get the deal closed. And so the federal government got in the way. I'll blame the federal government for a lot of years on that because it was it was end of year driven. Um, and I was an oil and gas guy, and by gosh, you know, we were gonna get this deal done. So uh, but you know, the older I've gotten, uh, the more I would have, the more I should have realized back then that, you know, there's somebody else that'll do this deal. I can I get home and be with family. Life's life's too short for that. So that's number one. What's number two of your Christmas top three? Best presents. Uh, I was thinking back through the best presents I've given or the best present presents I've received uh over the years. And it's the gift of travel. Um, yeah, I remember one Christmas in particular. I'd never been, uh I was living in Dallas. I'd never been a big Santa Fe guy. I'd never gone to Santa Fe much. Um, but the present was a trip to Santa Fe in January, uh, for New Year's, actually. Um, and that was like the best present ever. I mean, just opened my eyes to so many things. Santa Fe is great in terms of art, um, uh uh Southwestern art, in terms of various performances, in terms of food and all sorts of different things. And that trip opened my eyes to new areas. I mean, I was a really green eye shade guy, or green, you know, eye shades, bent down over my desk guy, and sort of looking up and saying, oh wow, there's other stuff to do in the world. And since, you know, I've tried to do a major trip uh a year to Ireland or to Scotland or to Canada or to, you know, some years, all of those places. Um, but uh it was the gift of travel. It was the gift of looking up and getting out of yourself and going someplace else. And that could be as little, I mean, in in in Alaska, I used or in Anchorage, I I have done it uh over the years by going up to Denali or going to Fairbanks or going down to Homer um uh to spend a substantial period of time and see life in a different way from a different place. Um, and so it's the it's uh I I I've come to value um and in terms of gifts, I've come to value giving travel as a as a gift. It doesn't have to be long travel, doesn't have to be, you know, extensive, expensive travel, just the gift of travel and getting yourself out of yourself and seeing things from a different perspective, uh, I think has been the best Christmas give, best Christmas gifts I've given and received uh uh over the as I look back over the last year.
SPEAKER_01:We live live we love to live vicariously through your trips to music festivals and distilleries and wineries and all the different places around the world. And that's kind of cool. Uh travel is a big thing for many people. Most people don't move beyond their, you know, 60 or 70 miles beyond their hometown where they were born. So a little bit of travel is eye-opening. Definitely uh a good one. That leaves us down to number three of the Christmas top three. What's your third thing that you've learned on Christmas?
SPEAKER_00:Go into the new year with a sense of optimism. Go into the new year, not un don't be unrealistic uh about what you go into the new year with, but go in, sort of re-sit down and recast everything in a sense of positive, in a sense of if we do this, we can accomplish this and we'll achieve this. Um uh and and go and and recast everything in your mind at the beginning of the year uh in a sense of optimism and a sense of things to accomplish as opposed to things to defend against. I mean, I I get beat down uh more than anybody else. I get beat down during the course of the year into, you know, just sort of hunkering down and trying to get all of the various uh all of the various things that are going on out there. But to me, over the years, the thing I've learned is to sort of use this period to recharge and come back with a sense of optimism um at the beginning of the year, at the beginning of going into the new year and hold that as long as you can. I remember I used to, when I was younger, I used to come back from vacations and go into my office and shut the door. I just, yes, I was back from vacation. Yes, I was working, but I just didn't want to allow the outside world in yet. I wanted to hold that, right? Hold that from uh hold that experience from uh uh from from being on vacation. Same thing's true of coming out of the first of the year with a sense of optimism. I want to hold on to that for as long as I can. I may not hold it, you know, much past the first top three of the of next year, but I want to hold on and remind me of this occasionally when I when I when I slip off the deep end, but I want to hold on to that sense of optimism as long as I can. But in any event, come out of the come out of the holidays uh with a sense of optimism going forward.
SPEAKER_01:I, you know, that's why I take off the end of the year because again, I'm kind of that beat down, you know, mangy cur at the end of the year kind of thing, and I need that. Uh, and that's a good thing. That's where we gotta be. Like I said, you're you were definitely a little bit more positive than I was, uh as well. Um, you know, I I just I guess I'm just getting a little cynical in my old age. And uh, and by the end of the year, I'm like, I'm just totally be. And that's why I don't quite quite honestly, I know there's all this kind of stuff that went on and the shootings and the the Australia and all, and I'm just like, you know, I just I what can we do about it? Nothing. Let's talk about something fun, you know. Let's let's let's rem let's remember. And that's where we live is in that nostalgic, remember the good times, like you were saying with the family, talking about the good times and doing that kind of thing and reliving those. And that's what makes that what that's what makes life worth living, I think, in the long run. And uh being able to tend to spend time with your family, to go travel, to do those things, and then to try and create that sense of optimism and positivity at the end of the year is I think is is uh I think that's all audible. I think it's all good stuff.
SPEAKER_00:Yeah, I mean, I used to treat the holidays as just you know another workday. Um, and that was that was wrong. That was seriously wrong. Um I mean, it may have helped my career, but but it was seriously wrong to do that. So um one of the things as you as you sit there and you look back on it, and you know, my son doesn't listen to me anymore, any more than I listen to my parents at this point in time. Um, but it's uh as you look back on it, you go, yeah, I yeah, I should have handled it this way. But now, you know, you have a chance to handle it this way when you as you as you get as you get older and you learn about these things, you have a chance to handle it that way. So I decided to to handle them that way.
SPEAKER_01:Yeah, because again, as you're laying on your deathbed, nobody's gonna think back at that final deal you closed at Christmas. They'll remember the, you know, the the the uncle that spilled his drink at the Christmas table and everybody laughed, or you know, the the great things that happened, or the the great trips that you took, or you know, just just that, just those gifts. That's that's the important part because those are the memories, are all the gifts or the best Christmas gifts that you can get and give is the memories uh and the good times and everything else uh as well. Somebody just said, put your hat on too, MD. I don't have a hat. I should, I need a hat. I used to have one, except mine was velvety green, which is my favorite Christmas color, is the green. I I'm not a red guy so much as the green guy, but uh yeah, I don't have a hat, unfortunately, anymore. I don't know where it went. But uh, Brad, final thoughts for the year, uh, for the coming year. Give us that positivity that we were talking about, uh, that optimism. You know, is this the year that they is this the year that they that they figured out that there is a problem? Is this the year that they address it and actually come up with a plan? What do you think?
SPEAKER_00:Well, I was reminded as I was traveling this weekend and and dealing with my third snowstorm that's that was preventing me from getting me where I wanted to go. That one of my favorite musicals was Annie is Annie, and one of the favorite songs is The Sun Will Come Out Tomorrow. So um, you know, I'm I'm now trying to start every day remembering, remembering that musical and remembering those songs. And, you know, life's not going to change that much between the two. If I was if I'm dour and downcast, life's not gonna be any different uh than if I'm if I'm upcast and optimistic. So as I come into the holiday season, I'm building up that optimism and and I hope it lasts me, that lasts me uh through the entire year uh until we're talking about it again uh this time next year.
SPEAKER_01:All right. Well, everybody is wishing uh Brad a Merry Christmas in the chat room and uh have a good Illinois Christmas. I don't know how an Illinois Christmas uh you know makes the difference, but uh it should be fun. And I hope I hope you and your mom have a great uh have a great Christmas night. She's how she's 90. What? She's 90.
SPEAKER_00:Today's her birthday. Today is today is her birthday, and she's uh she she's turned 93 today.
SPEAKER_01:93. Well, tell her that we here on the show wish her a very happy birthday. She watches the she watches the show, Michael, so she's listening to you right now. Mother Keith Lee, thank you for and thank you for bringing Brad into the world and allowing him to uh come over here and share his wisdom and with us. And uh uh, you know, not always joy, but it's not, you know, not all news is good news, and so sometimes we just have to deal with it. And we give Brad a hard time about the doom and gloom Tuesdays, but by golly, this is the kind of realness that we need um on the show. It's why we've done it for 10 years, uh, quite honestly. Um, and I uh, you know, I it's I just wish more people who were in power, more people who are making decisions were listening to what Brad and I have been talking about for 10 years, because we have predicted uh Brad and I have predicted everything that has happened uh over that mean right, Brad. I mean, the first thing we talked about in 2014, 2013 was was hey, if we don't get the spending on, and if we don't if we if we spend more than three point, what was it, 3.9 billion at that point, we're gonna be in in trouble. And that's where we started. And it's just uh it's just continually gone from there. We've been harping about this, and maybe one day people will actually listen to us, Brad. I don't know.
SPEAKER_00:Oh, I think they're listening. I think they're listening. I mean, I get I get feedback that people are listening. They don't want to believe us, A. And B, it goes against their interests, so they just say they don't believe us, but but I uh people are listening.
SPEAKER_01:Well, I hope they are, and maybe all we have to do is get enough regular people who are out there, you know, in the who are out there just in the in the everyday people, get them motivated and listening, and maybe we'll uh we'll get through it. All right, one minute, Brad. Final Christmas wishes for everybody. What what you got here before we go?
SPEAKER_00:Oh, I wish everybody a great Christmas. I hope you're with family. Uh, and I hope that you've traveled safe to be with family if you're if you don't live with them. Uh, and I hope that you have a sense of optimism when we come out of the come out of the end of the year. I hope that uh that we hit next year on the ground on the ground running. Uh we got a lot of stuff to do, a lot of stuff ahead of us, but I hope we're optimistic that we can handle it. A third, a third, a third will will get us there in terms of the it's the rule of three.
SPEAKER_01:We use that on Firearms Friday all the time, but it's the new rule of three for the fiscal situation in Alaska. All right, Brad. Thanks for being such a good sport. Thank you for coming on board. I wish you a Merry Christmas. Tell your mom I wish her a Merry Christmas as well and happy birthday. So thank you, Brad. Michael, happy or Merry Christmas to you as well.
SPEAKER_00:All right, thank you so much. It's always good to talk with you. Well, that's a wrap for another week's and indeed another year'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 Keithly, Managing Director of Alaskans for Sustainable Budgets. One reminder this is our last podcast for calendar year 2025. We look forward to you joining us again when we return on January 6th for the first of our 2026 weekly top threes.
