Former Senate President, Rick Halford, part of the Governor’s transition team, ironically, disagrees with the Governor about restructuring the Permanent Fund. Together with economist Brad Keithley, also represented on the Governor’s transition team, on a radio interview yesterday, they discussed the issue of using the Permanent Fund to resolve our state’s budget situation.
Halford said, “The Permanent Fund is not the first place we should go.” It would be “the most regressive way… It’s just the wrong place to start.” Instead, he suggests looking first to the credits we are giving away to oil companies. “The Permanent Fund should be the last thing to be put in the breach.”
Keithley agreed that the oil tax credits have ballooned. He said, “We have roughly $13B in savings… If we reduce those credits, and then supplement with the savings we have, then we don’t need to cut the Permanent Fund Dividend.” He said that then we can continue to sustain ourselves until oil prices recover.
They rattle some good ideas around in regards to using, or rather, preserving the PFD, arguing that reducing it now would have the most regressive impact on Alaska’s economy. Keithley advocated a spending cap, a constitutional spending cap on the budget.