Falling oil prices likely to affect Alaska's budget
Originally published Sunday, November 23, 2008 at 12:00 a.m.
Updated Monday, November 24, 2008 at 11:05 a.m.
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Stumble It!FAIRBANKS — As the price of crude oil continues to plummet, state officials are scrambling to figure out what that means for Alaska in the next year and a half.
The price for a barrel of North Slope crude oil was listed at $44.53 on the Alaska Department of Revenue’s Web site on Friday. That’s a drop of almost $7 since Monday and more than $100 a barrel from an all-time high of $147.27 on July 11.
As much as 90 percent of Alaska’s budget consists of money from taxes and fees on oil companies, and the plunging price of oil, which has dropped more than $100 a barrel in the last four months, means less money for things like roads, education, public safety and resource development in the next budget year.
“These are going to be grim times” if the price of oil continues to fall, Rep. Jay Ramras, R-Fairbanks said on Friday by cell phone from Anchorage, where he was attending a retail gasoline hearing.
“It’s crazy,” he said, summing up the state’s financial situation.
Gov. Sarah Palin is expected to release her budget for fiscal year 2010 in about three weeks, and her communications director, Bill McAllister, said it “will be as frugal as we can make it.”
Last year, Palin approved a budget worth roughly $11 billion, but that was based on an average oil price of $83 per barrel.
Legislators will have a much better idea how things are shaping up by spring, but “the knee-jerk reaction is going to be to pull back on capital projects,” Ramras said. Doing that, though, will only stall future development when money does come available, he said.
“This is the kind of thing that shelved the Sustina hydroelectric project in the ’80s,” Ramras said, referring to a plan to build a dam on the Susitna River that never gained steam after the price of oil dropped.
The governor spoke to the state resource developmental council this week and “she made it real clear she expects state government to live within its means and that there will be belt tightening of some sort,” McAllister said.
Rep. John Coghill, R-North Pole, a 10-year veteran in the Alaska Legislature, said the fluctuating price of oil represents the “feast and famine” nature of Alaska’s economy.
The lower price of oil means “we’re going to have to be more frugal, and that will put pressure on all kinds of things,” Coghill said.
The Legislature bankrolled about $5 billion in surplus revenue during the last session, and the state’s constitutional budget reserve, which serves as a savings account of sorts, now stands at about $8 billion.
“Thank heavens we put a lot of money away last year because we’re going to have use it,” Coghill said. “That’s one of the reasons we put money away; we knew those prices weren’t sustainable.”
The price of oil would need to average $65 per barrel from now until June 30 to avoid dipping into the state’s constitutional budget reserve, which now is more than $8 billion, according to McAllister.
State economists are in the process of working on an estimate of oil revenues for the rest of this fiscal year and the next. The state will release its fall forecast for oil prices in early December to coincide with the release of the budget, said Cherie Nienhuis, the state’s acting chief economist.
“It’s always tough to forecast oil prices and even more so with the volatility we’ve had,” she said. “We’ve tumbled now close to $100. That’s the most volatile price period we’ve seen in a long time.”
When the state used an average price of $83 per barrel in April to compose the budget for this fiscal year, “people were saying we were too conservative,” Nienhuis said.
The average price of oil for the first three months of this fiscal year was $117 per barrel, which will help offset the plunging price of oil now, Nienhuis said.
“Those three months are helping a great deal, but can it carry us if the price goes down to $25 a barrel?” she asked rhetorically. “No.”
Much depends on how long the price of oil remains low, Nienhuis said.
“We’re still OK right now,” she said. “If this drags on for a year or two or longer, then we might have to take more action.”
Rep. Dave Guttenberg, D-Fairbanks, said he has always been a proponent of “lean and mean” government, even in times of surplus revenue. The state budget “ballooned up” in the past six years under former Gov. Frank Murkowski and Palin, Guttenberg said.
“There’s been a lot of spending on a lot of things that are questionable from my perspective,” the Democratic legislator said. “Even if we average out above what number the state needs to maintain itself, we need to be tightening our belt.”
At the same time, legislators and state officials say money needs to be spent to build a natural gas pipeline and develop the state’s resources.
As Coghill put, “We don’t want the oil companies to pack up the bags.”
Much of the money in the budget — about two-thirds, Coghill said — is spoken for in the form of school funding and public assistance.
“The places we can cut from are not that great,” he said, citing public safety and transportation funding as two examples. “That means no new programs.”
At the same time, there’s no reason to panic with a constitutional budget reserve of $8 billion, said McAllister, the governor’s communications director.
“The decline has been more rapid than anyone expected, but at the same time there wass an awareness all along that this was possible,” McAllister said, adding that was one of the reasons the Legislature called for a long-term fiscal plan. “We have lived with this for years and years with the general fund tied volatility.”
State officials will do the same thing they’ve been doing for years, he said.
“We’ll cross our fingers and hope it comes back up,” McAllister said.
Community Discussion
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now that ted stevens is gone we're probably going to have to adopt an income tax, sales tax or something along those lines. it's going to get rough on lower income folks in this state.
Agreed Mark.
The most expensive state government in all the 50 states. Gee, what would it be like if every citizen had to pay their share of the cost of this expensive government with its super expensive welfare system?
For those of you who would like to know, make your 2008 check payable to the State of Alaska, Department of Revenue, for $15,000 dollars.
And yes, those dividend checks will be going away too. That is the path your Legislators and governor have put you on.
Re: the headline, take a deep breath and say "Duh".
Feel better now?
She cut the state budget and we're building a gas line to take care of "America's energy needs". Hmm, yawn, barf.
Once again, the opportunity to take advantage of our wealth has been squandered by small minds. A crash course in infrastructure development had its moment in the sun and was ignored, in particular by our highly esteemed (by some) governor's office.
Let me rephrase that, patently ignored by the current Governor,
Nothing like showing up to lead and direct a state when things are good!
Gives "One" time to pursue "Outside" interests, no?
Let's not forget the other Governors who didn't help the state infrastructure for the past 30 years. Now I believe we will see how smart Sarah Palin is, to make a silk purse out of a sows ear. And the companies that can make it happen don't screw off.
If the State wants to avoid legislating an income tax...
...here's an alternative revenue source, $250k/day
6" type-3408 SDR-7 poly-gasline weighs 7.336 lbs. per foot.
it's 2,200,000 feet from Prudhoe to the rail siding in Goldstream/Fairbanks
16,139,200 pounds of polypipe
type 3408 poly pellet is currently $2/lb
$32,278,400 polypellet cost
I can get you the extrusion machines airfreighted to FBX for $5mil
I can get a shipload of polypellet shipped to Seward.
..add $5mil for the condensate pumpstations [modularized in TEU's]
Now we're looking at roughly $45million for a basic gasline-kit to FBX..
A few small teams of workers can deploy this gasline during winter at a rate of 100,000feet per day..
it's as simple as dropping a gardenhose onto your lawn [almost]
An NFPA-58 fire-insurance waiver can be managed to allow the first test shipments of condensate to occur in winter until the gasline can be buried next summer.
Total installed cost can be slightly less than $100million.
This gasline is easily capable of delivering 200gallons per minute of LPG or ethane-condensate to Fairbanks.
200gpm = 288,000 gallons of condensate or propane per day
NetBack wholesale rate roughly $1/gallon
$100million at amortization rate of $288k/day = full amort in 348days
http://s281.photobucket.com/albums/kk209...
..I can pack all of this in one shipment of 10,000dwt
This will take care of half of Fairbanks heat-&-fuel needs..
and it will bring feedstock for a small polyolefin-plant in Tyonek..
creating 100 fulltime jobs.
Backing off a couple of posts,Polarmark, Yukon John and Tonto12,
the end result will be those not capable of putting up with our way of life minus the currently granted subsidies will, in a word, leave.
Sad? Not me.
Oh Yur God,
I did not see McAllisters' plaintive assertion at the bottom of this article regarding our Governor's new economic policy, i.e. "we'll cross our fingers and HOPE the price comes up.
Now we're talking social security, folks.
Bottom line: Who and what are these people, and just what is it they think they deserve to know?
By the way, hasn't Bill McAllister turned into someone's pet, perhaps one more victim of the Palin thing?
Poor kid is looking like FDR in March of 1945.
Goldstreamer 1,
In the winter of 2006, post inauguration, my brother and I, both 50+ year residents of our fair Territory and State, were summarily ignored by the Administration after bringing up rural power and heat issues. A number of other things very important to average Alaskans were brought to Her attention and on a formal, state sanctioned basis.
These issues were politely yet adamantly pushed to Her attention and just as peremptorily ignored by Her filters in place.
Dude, (sorry about that) I worked for her campaign and gave thousands of $, my own hard earned money, nobody elses, and believed. You, like so many others, have been snookered by one of the best, I'm not going back to that place.
Sarah Palin loves Herself like I love Alaska, my home.
I'm thinking Alaska and its people will be here much longer than SP's flash in the pan political career, a lot more people would be well served to not find out as did I, She is nobody's friend or advocate but for Her own ambition.
Why people can't accept that simple truth is the difference between night and day and also explains why Alaska is always shrouded in twilight.
After all, it takes the FBI and DOJ to clean up our local messes because we're always so busy making excuses for our societal and criminal misfits as they are part and parcel of what we proudly proclaim to be, i.e., ultimately different than Outsiders,
Simply more romantic trash from the recently moved here and I rest my case for the moment.
I sometimes wish there was an antidote to the stupid pill a lot of people apparently took at the border.
According to Rep. Coghill, two-thirds of the state budget goes towards education and public assistance. Lately, all I’ve read about the education system in Alaska is that it’s subpar; a higher than average drop out rate and graduates that aren’t prepared for a college education or the work force.
And public assistance?...most of the folks I know on public assistance spend more time at the bar with their buddies than I do, and I work and go to school.
So basically, two-thirds of the state budget is wasted.
When they say public assistance the big ticket item is Medicaid. Most of which is Denali kidcare health insurance. How soon all of you have forgotten it was only ten years ago oil was $10 a barrel and four years ago Gov. Muskowski was dealing with a budget in the red. This State has had a very short lived time of high priced oil and budget surpluses.
No, now we will see if Governor Palin is a real Republican conservative and has no fear of using the red pen on the legislators spending. It is about time that Alaska returns to the idea that less government is best.The people who want the government to pay for it all will most likely decide to leave this State and those remaining will soon learn that their life styles will change dramatically. For many who never lost sight of living a frugal Alaskan lifestyle, they will continue life as they know it. Just maybe some will learn a lesson regarding windfalls.
Alaska will probably be flooded with new residents looking to be supported by oil royalties. Sarah Palin brought the spotlight to Alaska and the good life of the welfare state looks good to those in the lower 48. Let's get the price of oil up right away!
Falling oil, higher cost, Ted is gone, and the current Governor said the new president was "pallin around with terrorists". Probably not the best situation to be in a ressesion. Oh an they will probably close Eielson now.
Tundra Trekker ~ I'm not sure what kind of lifestyle you have but I can tell you as an Alaskan living outside, I don't know of many who's lifestyle can be "supported by oil royalties". I doubt you are in any real danger of having AK flooded with lower 48ers! lol
Our state officials have been treating Alaska's money like they had the winning ticket and won the lottery! Like most lottery winners, the outcome has been the same. Spend, spend, spend = lose, lose, lose. Alaska has had stock piles of money flowing in for years. There is absolutely no reason for state officials to be scrambling. They are scrambling because they have been wiping their butts with $100 bills and now they are going to have to use toilet paper like the rest of us.
Wake up Sarah! Before it's too late for AK
We need fire dept,Police,road maint,Fish & game
Everything else should be closed down.
CUT CUT CUT
should have put some in savings and why the heck would you want the price to go back up? Maybe this year we will be able to afford to run our snogo's and heat our house.
"where he was attending a retail gasoline hearing."
Newsminer, where is the report on the hearing? Does Flint Hills not want you to cover the story?
As the US average drops below $2 a gallon we are left with more questions than answers. If you want to put a price tag on our economy it is costing us about $285 million extra for gasoline alone. That equals out to roughly $415 per resident. One lawmaker asked what effect the 8 cent gas tax that Palin suspended had on prices. The answer, "It's gone, we don't know where it went but we are still paying high prices." With competence like that no wonder we are getting taken advantage of.
So here's an idea that will make lots of people scream. For every mom, dad or relative that gets any kind of public assistance, before and during the time that they are on the dole, make them take a urine test to prove they're clean. I have seen many, many people trade thier foodstamps for drugs. Why should my hard-earned money, or the states for that fact, go to support some druggie? His/her kids can get the free school breakfast/lunch (more of my money/state money at use) and they can get high. If they come up clean, fine, the state eats the cost of the test, if they are not, they lose benefits for 30 - 60 days so they can get clean and before they are allowed any more assistance, they have to pee clean and continue to pee clean. 2 dirty test, denied services for 6 months, 3 dirty tests, the ride is over. Period, end of story. I think we would see a lot less drug use and/or a lot more state money in the coffers from those parents that refuse to give up their drugs. I realize this is a pipe dream and DT's "pipe" dream is a lot more realistic but just food for thought.
Does Coghill really think the oil companies will simply pack up their bags and leave? I don't believe that they will for a couple of reasons. For one they made a ton (scratch that, RECORD PROFITS) of money in the past several years and can quite easily afford to ride out this downturn. Of course most normal companies would use some of those profits to reinvest in more recoverable fields for the future, but the oil industry is not very hungry these days and so they will do only the minimum to keep output slow but steady and work on reversing the latest tax structure instead. Another reason I would doubt that they will want to shut down is that they made agreements back at the start that the equipment, when no longer in use must be removed and the area returned to a natural state. This is called the Dismantling, Removal and Restoration (DR&R)
http://www.finebergresearch.com/pdf/DR&a...
http://www.gao.gov/new.items/d02357.pdf
and includes the Valdez terminal and pump stations as well as the above ground pipe. Other agreements include removal and restoration of the North Slope. It will be expensive to say the least and if and when they do pull out, that will take huge effort and will likely be another boom in the economy. They will keep the line going, even at extended periods of losses for a good long while to put off the inevitable. Even in the late 90's when oil was under 10 a barrel they never came out and said they were considering pulling out in certain words (the legislators said otherwise), only used fear of that possibility in order to get taxes slashed. Their cash cow was then and is now simply taking a temporary vacation.
It is precisely this short sighted fear mongering thinking by Coghill and others, both corrupt and not that has gotten the state the short end of the stick on its due of ALASKA'S OIL. I predict a revisit soon to the oil tax structure pressured by full page ads and a lot of fear talk from certain legislators that they will "pack their bags and leave".
Made in alaska:
since every citizen in Alaska is on the dole that is a lot off pez ya is talking about. gonna need a pipeline for that for sure.
Well might be the only way they would build one...
DON'T YOU PEOPLE GET IT.... SARAH PALIN DOES NOT HAVE THE KNOW HOW TO GET YOU OUT OF THE PROBLEM YOU NOW FACE WITH THE DECLINE OF OIL PRICES... AND THE POSSIBLE FUTURE OF OIL BEING IN LESSER DEMAND....
ALSO THE 500 MILLION SHE GAVE AWAY TO A COMPANY TO DO RESEARCH ON THE GAS LINE WAS A VERY VERY BAD DECISION AND IS 500 MILLION THE STATE OF ALASKA DOES NOT HAVE ANYMORE.... AND IN THE LONG RUN YOU GOOD CITIZENS UP THERE WILL BE PAYING THE BILL....
HOW COULD ALASKA HAVE ELECTED SUCH A BIZAR PERSON.... LIKE ONE OF YOUR POSTERS SAID SHE ONLY CARES ABOUT HER OWN POLITICAL CAREER.... WHICH IS NOT GOING TO GO VERY FAR FROM YOUR BORDERS.....
Chewtoy - when I say on the dole, I don't mean the PFD money or that sort of thing, let me clarify - foodstamps, and public assistance grant money, money given to a person on a month to month basis so that they are able to meet their monthly household expenses. I work hard for my money, I pay my bills, I try to set a little bit aside every month, I scrimp and save for 11 months so that my daughter has a good Christmas and birthday in the 12th month.
I've lived in Alaska since my very first day, having been born in what is now a bank and I'm tired of seeing my money, and your money for that matter, go to assist some mom or dad who has been here for 8-10 months who continue to say, I can't get a job. McDonald's is hiring.
I'm not talking about those who are working and doing the best that they can and still find themselves in a hard spot. I'm talking about the ones that aren't even trying. There are many, many hardworking Alaskan's that had to pee in the bottle before they were hired, why can't we make those that take some of that hard earned money that we had to pee for do the same thing?
Gotta love the Obamabots' persistence in excoriating Sarah Louise Palin.
They are so predictable.
The State coffers will suffer with the drop in oil prices but Sarah's refusal to permit the State legislature to GROW GOVERNMENT when the price spiked up will now prove that Sarah was acting responsibly back then, and more importantly did keep her eye on the ball at a time when so many legislators were being ignorant and irresponsible. There will be a "bump" in the road, however, no catastrophe as the Obamabots would have one believe.
Everyone go look at the State online checkbook and find your favorite fluff to cut. I will take travel expense. It was over $13million for fy08. With a total population of around 600k, that's a lot of travel for very few people. Only necessary travel should be granted. Until the economy turns around, we need to tighten the belts and eliminate the great trips to fluffy meetings around the globe. Spending over 100k a year for the gov to belong to SEVERAL governor's associations is another stupid expenditure. Grants to Spendard Builders of half a mil each year is suspect in my book. Wait for it....here it comes....ACCOUNTABILITY!!!!!
Sorry, fingers upset..that should be $3 mil for travel in 08
What about energy assitance? Free weatherization? All seem like dole programs to me. Need a cup?
I completely agree with Made in Alaska! I too know people receiving assistance that don't need it. These are also people that earn $4000 to $5000 a month under the table, plus they got $700 a month in food stamps + Energy assistance + Denali kidcare + medicaid + Santa's clearing house + state funded cell phone + unemployment + state is paying to repair their vehicle + money for work clothes + a few hundred dollars to help towards rent because they were behind for some strange reason. Yes, their money went for drugs, alcohol, online games, cellphone bills in the hundreds (she already had 2 cellphones, the one from the state she gave to her teenage son) Rent a center (them and their dogs destroy couches within 6 months so they buy new stuff all the time) Do the math. They are not the only ones, I'd say this accounts for at least 50% of public assistance recipients. Oh yes, and lets not forget about the $400 a month her anti-depressants cost the state. And at PFD time, they get 6 PFD's and keep their benefits! I better stop talking about this, it's making me angrier than I already was.
Should not have so much coffee before posting...the $13 mil for travel number is correct for fy08, the $3 mill number is for the first 4 months of fy09.
"They are not the only ones, I'd say this accounts for at least 50% of public assistance recipients. "
what are saying this on? Is there some stats book on crack heads who are the dole that i don't know about?
Denali kid care is a great program. Or do you think kids who have poor parents (for what ever reason) should pay the price for being born to said parents?
The energy rebate on the other hand...Let us just give everyone money when there is budget surplus for a month, and then figure out what we will do when the price of oil stablizes later? Kind of funny if ya think about it, how so few of the dollars were spent on fuel and those that were spent on fuel were spent when the price was the heighest. Great planning my our elected officals.
Chewtoy - I'm getting assistance w/regard to the weatherization, I'll happily pee in a cup for it. Not only that but for some of the weatherization assistance, the homeowner pays up front and is basically reimbursed, if they had the money to fork it over in the first place, I don't give a flying rip if they light up on a daily basis, it's the ones that flagrantly abuse the system and expect for me and you to pay for it. As for DKC, check my posts, I never mentioned it. I know it was mentioned but if the circumstances are as Angry posted, than that should be looked at as well. Chewtoy, I think you get what we're saying but you're arguing for arguments sake, what you smoking crack and waiting for the foodstamps to hit your card? (Chew - I'm joking on that comment) but don't argue just to stir the pot, it's not nice.
chewtoy- All these programs that are in place to help people are great programs. They need to get rid of some that are on these programs that don't need it. Another example, Alaska Natives have 100% medical coverage. You would be surprised at how many are also given Denali kid care. I know native kids who have 3 x coverage plus Denali kidcare. I know 2 children who are without insurance and don't qualify for Denali kidcare. The parent don't make enough to make it, and too much to get help.
These are good programs, they are supposed to help when help is needed. Lot's of people abuse these programs. I don't think these programs should cease, I think they need to send people out to investigate.
It sure hurts to hear people begrudging the poor help because of someone who milks the system for all it's worth.
Most who must take assistance feel bad enough about it.
Lots of folks esp. single parents can't hope to get by with out working two jobs, using daycare assistance and everything their wits and faith in GOD will provide!
Poverty is a black hole...folks just get sucked in and can't get out unless someone will throw them the line. Don't begrudge the poor. Please quit begrudging the poor...GOD saw that era and is punishing US for it too. Rightly so!
Report abusers, but don't assume everyone who must accept help abuses that help. That's so far from the truth you'd be ashamed to realize fully.
All the poor in the whole nation (abusers included) don't cost as much as WALL STREET and the Financiers w/their company bonuses are costing US, supporting the rich has been an ongoing thing.
Perpetuating WAR has cost US more than the poor!!!!
The Drug WAR has cost US more than the poor.
Take care of your neighbor and they'll take care of you...and GOD will see and bless us all!
Remember that we conservatives profess faith...we need to live up to that...READ your bibles! WWJS? WWJHYD?
With all due respect want2ski, butt out. I'm sure there's something local in YOUR own home turf that needs your attention. We Alaskans have got a much better grip on what's going on here than you can ever conceive. Not to mention it's the epitome of bad taste and ignorance to not MYOB. When you're a resident of this state, by all means speak up till then go save some owl in your backyard. Or at least call a cop to help someone down the block. Get off of your HIGH horse...what ever you're smoking, it's no good for ya! BUTT OUT!
Don't you just love this.. 30 years of the oil industry screwing Alaska out of its rightful money from ITS oil wealth with the help of mostly Republican coalitions with their loyalties towards big business and big oil. Now we sound like starving kids fighting over the crumbs of whose program should be slashed in order to survive. Where is the outrage towards those politicians who sold us out for a song, and some favors? I am talking about politicians who maintained close friendships with SCUM OF THE EARTH like BILL ALLEN and others! Everyone who was brought down by Allen who had anything to do with him had it coming, fair trial or not. It is guilt by association as far as I am concerned. When Veco was flying in the replacements for the Alaskan petroleum related workforce from Louisiana and Oklahoma in 86 it started a vicious downturn in the local economy, with huge job loses, home foreclosures, and bankruptcies not likely to be topped anytime soon. So soon how everyone forgets everything, the wool has been pulled over our eyes for so long the truth is just too ugly to bare. Now we are reduced to a sorry welfare state, a state with once the richest oil reserves in the US, mostly gone, given to the oil industry. It makes me sick. Like made in Alaska and lots of others, I was also born in Fairbanks and I will call AK my home no matter how bad it gets, but I just hate this feeling of being screwed by the oil companies.. Come on, where is the outrage? When Norway has 400 billion in their petroleum fund doesn't anybody care why we got raped while Exxon and the others made record quarterly profits, as in the most money any company made ever while we got the crumbs. Each quarter, hundreds of billions of dollars made by big oil while we get just enough to get by on. We should be sitting fat with saved up wealth. Now we will be firing teachers and closing schools. God Damn!
AKb - I couldn't agree w/you more if I had said it myself - all but that last two words and that would be gosh darn based on my seven year old listening. We are going to continue to fund the public trough while cutting jobs to those who have never had to use it becasue they were responsible for themselves and their actions. As for the outrage, believe me I vent on a regular basis, just no one there to hear me. I'm not sure in which direction I need to vent to get some action, I am only too well acquainted with the POM's and my rep's know me on a first name basis. Unfortunately, my one voice doesn't add up to much when you're dealing with the likes of big oil that just throw money at the situation to keep my one voice quiet. You're so right - Gosh Darn!
I just hope there is wisdom in Juneau (or Anchorage or Wasilla) when it comes to this budget. Too many times, the politicians get "even" with the poor slobs who didn't vote their way and cut the most necessary areas to make us repent and come around to their ways. Government spending has to be responsible. We have to fund life/safety first and then start down the ladder by importance. A third grader can figure that one out. We don't need programs that benefit only a small portion of our citizens, those are best served by those that want them. Until the crisis is managed, we just have to do without some things.
I agree that assitance programs are abused at times. But how does peeing in a cup fix that? In Alaska it is legal to smoke marijunana and legal Alcohol is the main substance abuse issue. A breath test might be a better test. But then what. So person X fails a breath test, we stop feeding their kids? We take their kids from them? Who wants their kids? What do you suggest we do with folks on assitance who fail a breath test?
I also agree most arguments are purely for argumental sake. Ever see the monty python skit about the argument store? A classic.
Andrew Briseno, you never did answer my question as to why your vituperative hatred is focused on Obama alone, as evidenced by your invariably derogatory comments whenever you bring up his name. You say you're not a racist. Fine. So what gives, then? There are so many other liberals and democrats you can take shots at, but it's only ever Obama who's in your crosshairs. It's only he that gets you so bent out of shape and unbalanced. Why?
*******
Some people definitely abuse public assistance. I really like the idea of drug testing recipients in order to deter abuse. But as chewtoy brought up, what do we do if they fail their tests? Letting their kids starve is not an option. Taking the kids away just puts a whole new level of burden on government and social programs that are already strained to the max. Unfortunately drug testing as a solution would only create far more problems than it attempts to solve. Still, it would be nice to have a way to know that the state's resources and people's tax dollars aren't being abused to support some people's drug and alcohol habit.
Maybe another way the state can trim the fat off its budget is to put a cap on the amount of non-emergency medical treatment it provides to those on assistance.
Too many people who work don't have health insurance, and too many who are insured still can't afford to get medical treatment. I only know one person on public assistance. Yep, she does drugs. And yep, she won't hesitate to bring her kids to the doctor - all expenses paid for by the state - even if they are only slightly ill. Okay, better safe than sorry when her kids' health is concerned. But what gets me is that she's gone to see a doctor when her skin breaks out really badly. She had very many tests done - all on the state's dime, all of which came back negative - and for nothing more serious than a temporary dermatological condition. The state has always paid for her and her kids health care, and as a result, she's turned into somewhat of a hypochondriac - any little thing, and she'll rush off to the doctor's office. And why not? She doesn't have to pay for any of it, and never has.
It just makes me wonder how many doctor's appointments she would really make if she weren't given carte blanche in terms of health care, if she, in fact, had to pay for a good part of it out of pocket.
It'd be good if the state could trim its budget by addressing the abuses of its programs.
But at any rate, I agree, we Alaskans are in for some tough times ahead. The sooner we individually can accept that, and prepare ahead, the better off we'll be.
Our PFD that is distributed is based on a 5 year avg of the earnings.
Why couldn't the State budget be fixed on some type of average as well?
Maybe a 10 year avg.
Thoughts?
The sky is not falling.. Oil prices will go back up... OPEC is already scrambling to cut production again in order to drive the price back up.. The State of Alaska will survive, and for the rest of the lower 48, we'll just wait and see. Remember Obama, he's going to fix it all......lol
As a college instructor (I know, I know scary) I am around a lot of young folks. Many of them were on Denali kid care as kids. Almost across the board they are great people and society has benefited and will benefit greatly from providing them health-care when their folks could not. The glaring exceptions will always stand out over the thousands and thousands of folks that don't abuse the system. This is an age old issue. Does one rotten apple make the whole barrel bad? One dirty politician? One cop like Wooten? How do you separate the great parents, who occasionally light a jay from the compulsive abusers? What will benefit society more-giving all kids health care, no kids, kids who’s folks do not smoke or drink and what ever else we decide is best (no internet for instance because internet is the gateway to all sorts of bad things), poor kids, only really poor kids. Ah if there was a simple answer there would be a simple solution, but alas there is not. I’m personally for free-public health care for all kids regardless of economic means, but the next thing ya know you’ll be giving energy assistance to everyone without regard to economic needs (oh wait we already did that this winter). On an interesting aside there is no correlation between being on Denali kid care (from my continuing student survey) and being for or against socialist leaning programs. That is lots of folks that get/got Denali Kid care think it should not be available (though they are thankful for it). Very confusing indeed. For all.
Anyone here hear of Lindsey Williams? He was a minister who worked on the slope in the late 70's. He became friends with oil execs who have continued to give him inside info over the years. Several months ago he stated that oil was going to $50/barrel. He also stated that new fields would be opened in Indonesia and Russia. The oil companies will NOT open fields in Alaska. Oil is suppose to stay at around $50/barrel for a while. We will have 2.50/gal gas for a while, but noone will be able to afford that.
The purpose of manipulating the price down is to bankrupt the Arabs and Iranians, which will now dump their dollar reserves, crashing what's left of the dollar. We (the US) are to be a post-industrial feudal state. His exact words, coming from his sources were "a financial crisis that the US will not recover from for many years".
I suspect the crashing oil price will have the same effect on Alaska as it will on the Arabs. This is what Williams has recently said and he's been correct with all the info he's given in the past.
???
We were doing fine when oil was $25/barrel and so were the "arabs."
How will $50/barrel bankrupt Alaska or the "arabs?" Who is manipulating the price down? The elders of zion? The liberal media? The illumnati? The price of things is based on supply and demand. This is so very confusing.
???
See? this is the problem with the current system.
I don't like thinking that our state is hoping the price of oil stays high and we are getting raped at the pumps.
It's like a taxation without really calling it a tax.
Its back to basics my friends. No more instant gratification for things material. I grew up getting only what I could afford to have at the time. No credit cards, heck..computers weren't even around for private use. We worked for every morsal of food and each piece of clothing. The next generation wanted more...so credit cards came into play. Spend, spend, spend, who cares if it takes 20 years to pay off last Christmas' gifts. Our government has grown with the same attitude. The population of Alaska is small and spread out. We only have a few cities with measurable population. Why do we need BILLIONS of dollars to run basic services? It's time to pare down and become efficient in spending. Write your Senators and Representatives and tell them to start being accountable.
Chewtoy: one word-Inflation. Saudi has said that they need to maintain $80/barrel and it's socialist system.
Between 2002 and 2007, the dollar lost about half its value, now take a nice look at this graph http://research.stlouisfed.org/publicati...
Chewtoy: What you are missing in your liberal argument for a welfare state is the dishonorable way the state removes the concept of taking responsibility for ones actions.
Here's an idea: We tell folks that if you have more kids than you can afford to care for, YOU ARE A BAD PARENT. Do not have kids that you can not care for. What a concept.
Liberals like you are dishonest in your attempt to re-brand 'welfare' with terms like "Denali Kid Care". What nonsense. It's still welfare even if disguised by cheery words.
Welfare is a redistribution of wealth scheme. It takes money from responsible companies or individuals and gives it to mostly irresponsible/lazy people. This, in turn, creates a morally impoverished and bankrupt society.
Alaska will be making serious budget cuts in the near future, and cutting welfare spending will be a key reform. If the welfare class doesn't like it, too bad. Let 'em move to California.
Or get a job.
oops, Saudi needs to maintain $80/barrel to maintain it's socialist system.
Yes we should sterilize all poor people. So is it the Saudi's that want to turn america into a fedual something?
What would happen if we got rid of all welfare? Do you think society would be better off? Do you think you would be safer? Why has getting rid of all welfare not been a republican platform? Seems if welfare is corrupting our society then we should get rid of it, get rid of medicare, get rid of denali kid care, get rid of food stamps. Do you think that is best? That old folks and kids who can't afford food should hit the streets like they did before F.D.R.? Why hasn't there been a big push do get rid of all the new deal programs like social security and food stamps? Maybe because if we feed the poor then we can save money on ammunition. Just a thought. That maybe feeding the worthless lazy kids who can't afford food will stop them from busting into your house and trying to take your food. I know, shoot them all...oy vey. Food stamps are bad, Denali Kid care is bad. Call Lisa, Call Don, Call Mark, Call Sarah tell them to end food stamps. Ask them why they are not trying to end food stamps. Opps forgot what I was talking about. The illumati control food stamps and thus by controling the price of oil they will maintain a certian level of discourse amongst those that shoot high but aim low.
What would happen if we got rid of all welfare? Do you think society would be better off? Do you think you would be safer? Why has getting rid of all welfare not been a republican platform? Seems if welfare is corrupting our society then we should get rid of it, get rid of Medicare, get rid of Denali kid care, get rid of food stamps. Do you think that is best? That old folks and kids who can't afford food should hit the streets like they did before F.D.R.? Why hasn't there been a big push to get rid of all the new deal programs like social security and food stamps? Maybe because if we feed the poor then we can save money on ammunition. Just a thought. That maybe feeding the worthless lazy kids who can't afford food will stop them from busting into your house and trying to take your food. I know, shoot them all...oy vey. Food stamps are bad, Denali Kid care is bad. Call Lisa, Call Don, Call Mark, Call Sarah tell them to end food stamps. Ask them why they are not trying to end food stamps. Opps forgot what I was talking about. The illumati control food stamps and thus by controlling the price of oil they will maintain a certain level of discourse amongst those that shoot high but aim low.
Sorry for the rant. But am confused. Do you really think you would be better off, safer, richer, if there were no welfare programs in the U.S.? Do you remember the great depression? Oh well. Sure end all socialist programs. End social security. End medicade, Medicare, Denali kid care, energy assistance, energy weatherization, energy rebates. Better yet take a look at countries that don't offer programs like this. What country best fits your ideal of a perfect society? Somalia? Seems to me keep a slightly fed work force has done wonders for our economy and growth. Did the G.N.P. of America go up or down since we became a welfare country?
The idea that all poor people are poor just because they're lazy is ignorant and incorrect. As we all know, a lot of economic factors outside our direct control can affect our jobs and well-being. Now, I happen to believe that the best way to fix those problems is through free-market capitalism and not socialism. But that doesn't mean the government shouldn't provide temporary assistance to those who need it during hard times.
tonto12, I'd say that some people on welfare are definitely irresponsible and lazy, but I just can't make the leap and state that "most" of them are.
I'm glad welfare programs exist, because there is a real need for them among the most vulnerable of our population - the poor, children, and the elderly. But I cannot stand fraud, the abuse of these programs.
I totally agree with you, people shouldn't have kids that they can't take care of. And they certainly shouldn't have *more* kids when they can't take care of the ones they already have.
It might be draconian, but it would certainly help prevent abuse of welfare programs if women or parents on welfare were given a STRONG incentive not to have more children while they're on welfare. The worst welfare abusers equate having another child with getting yet another PFD, and more monthly benefits. This is the built-in, monetary incentive for the laziest and most irresponsible among them to keep having more babies, and keep abusing the system.
It's draconian, but would be very effective if families on public assistance were limited in the benefits they receive for the size of their families when they first started getting welfare. No additional benefits for any future children. That would take the "more children = more money" incentive out of the equation. It would make welfare recipients far more accountable in their behavior, procreation-wise, especially.
It's also draconian, but would prove very effective, if people were required to give up their PFDs in return for accepting public assistance.
I think welfare, generally, is a good thing. Until we have built-in safety nets in our society to totally prevent people from falling on hard times, we should continue to offer public assistance to people who really need it. But this assistance should definitely come with major strings attached in order to curtail its abuse.
ummm So if someone on welfare has more kids who would suffer under your program? The parents or the new kids? Thus lays the dilemma. Accountability. Take child support for instance. There is no accountability in the system at all. Should we get rid of the child support system?
Seems were all on the same page, just tiffing over specifics. Welfare abuse is bad. Now what? Or are do folks really think we should go back to pre-F.D.R.? When banks failed because there was no socialist government to back them up?
My understanding is folks that get the PFD get less assitance. It is counted as part of their income, thus the energy rebate welfare program benefited the ones that needed it the least.
For all of you who are so in love with welfare, here's an idea for you. YOU donate as much of YOUR own money to the welfare recipients of your choice.
Just do not ask my government to use force to redistribute the funds of hardworking people to the lazy dolts.
And AK_WWB, you win a special prize. The grand prize for intellectual dishonesty. You built a straw man argument, then knocked it down.
Okay, since this subject has changed from falling oil prices affecting AK's budget and onto worthless welfare queens then I think this needs to be said. ANYBODY who participated in the state welfare system known as the Permanent Fund Dividend program has no excuse bitching about anybody on welfare because they themselves have partaken in free money from the government. Sorry, but nobody has explained to me satisfactorily the difference between "welfare" and a dividend check paid by the state of Alaska, other then frequency of payments. Don't think welfare is right? Then don't file for the P-fund.
Shoot me for saying this, chewtoy, but if it gets that bad, then let the parents put the new child up for adoption. There are many many American couples who are so desperate to adopt kids, they're willing to travel to distant, foreign countries to do so.
Maybe we are just haggling over specifics.
All I'm saying is, let's just figure out how to take the incentive away from those irresponsible parents on welfare to having even more kids.
Our state budget is going to have to be trimmed something fierce. I would rather see money saved by addressing, and eliminating abuse of state programs, than to have to cut public education funding, or cut back on infrastructure maintenance, for example.
All of us are going to have to make do with less, in these economic times. The first people I'd like to see make do with less are those who are milking, exploiting, abusing social programs and public assistance.
Lady not-so-nice.
clap clap clap
akbearable you are the winner.
Alaska Constitution 101 for Akbearable. The resource wealth beneath your feet is not owned by you, even if you hold title to your property. The mineral resources of Alaska are held in common. When those resources are sold, part of the value of those resources are returned to the people.
Your dividend check is your equal share of the sale of those resources plus investment interest, if any.
Of course the welfare queens get dividends too. Except the rest of us have to subsidize their welfare payments through hold harmless provisions. In layman's terms, our dividends are smaller to ensure the welfare queens continue to get their welfare payments without interruption.
alaska is the most socialist state in the union. we are champion are spreading the wealth.
The adoption thing has always made me wonder. If as you say there are more folks that want to adopt than kids available then why does the foster kid system exist?
There are so many bad parents out there. Where do we start. Do we take kids away from the poor, the ones that spank their kids? The ones that leave their kids in their cars when they go to the grocery store? Oh this is gonna be fun. Some folks think giving young kids soda is terrible, should we take those folks kids away? Since we all are on welfare seems if we open the box we might as well open the box wide. I'm not the perfect parent, but I do my best, thing is am sure there is someone out there who would say I'm a bad parent because I don't take my child to church or this or that. I get the pdf. So are they gonna come knocking for my kid? Got to go. But its been fun.
Chewtoy, if you do a little study, you will find that every depression in our history was engineered by the dominant banking power at the time to consolidate power and assets.
The saudi's are not making us a feudal state, the banking powers that engineered this depression and who own "our" govt are. The saudi's are victims in this.
FDR's socialist policies did not save us, they centralized power and gave the private federal reserve greater power over us. Did you know that the Federal Reserve is a private bank that profits off the interest on the debt? It's largest shareholder last time I looked was the Bank of America. Anyway, as we became socialized, people forgot how to take care of themselves. We live in a baby-state. If this gets as bad as many anticipate, many will suffer, not because the govt didn't help them, but because the govt taught them to be lazy, self centered and weak. My wife is from a socialist nation. She knows the damage it does and she is disgusted with what she sees here.
But when it all hits the fan, who will be prepared, the ones who laughed at those giving the warnings, or the ones who listened and prepared. Do you really think that in a depression people like me are going to keep working to support people like you? I don't think so. I will not go to the govt for "help" either, I'm prepared. If the govt (the private banks that control it) keep squeezing us for more as our fake paper money continues to loose value, you WILL see armed revolution. Only a fool would put their faith in govt. I will have no sympathy for those who don't bother to heed a warning.
As far as your love for FDR goes, he was one of the worst violators of the Constitution, along with Bush.
I'm getting tired of saying this, but "spreading the wealth" isn't socialism. Socialism is defined as government control of the means of production.
http://pesn.com/2008/11/18/9501500_Pirat...
Wanna jackup the oil prices? Play with Pirates
Maybe if you go to Somalia and go hang out with Blackwater and the "pirates" you'll get rewarded with a briefcase full of cash??
http://news.google.com/news?hl=en&ne...
...crude oil is black in many different ways, and attracts crude behavior too.
Oilgae is much more honest and fun..
http://www.valcent.net/s/Ecotech.asp?Rep...
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http://www.oilgae.com/
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"Alaska Constitution 101 for Akbearable. The resource wealth beneath your feet is not owned by you, even if you hold title to your property. The mineral resources of Alaska are held in common. When those resources are sold, part of the value of those resources are returned to the people."
Hey Tonto, been looking at info on the state constitution, a little 101 as you say trying to find anywhere where it says that resources sold are to be returned to the people as a cash payment. Don't get me wrong here, I file for the P- fund and have since 81 or whenever it was first laid on us "citizens", but I don't see anywhere that getting cash is a right guaranteed in the constitution. It does say that it is "for maximum use consistent with the public interest", further defined as "utilization, development, and conservation... for the maximum benefit of [the] people"; for common access to resources; and for development to be based on sustainable yield.". I suppose it could be read where that translates into free money, flat screens, trips to the 50th state for all but it is a bit of a stretch I think.
akbearable, the Permanent Fund earnings come from returns on the fund's investment, not from oil royalties. Your argument is irrelevant.
??? Since the orginal fund is from the oil royalties the argument is very relevant. Try telling the A.T.F. that they can't take your house because it was paid for with earnings from invested ill-gotten gains, not ill-gotten gains itself.
They could have reinvested those returns on investment without violating the constitution could they not? They could easily have put the money towards building and running good schools all over the state and that would also benefit all the citizens as well. Right now, probably an average of 20% goes to the benefit of the federal government via income tax. Instead of putting the money towards things the government can make happen it goes to the "welfare" of all Alaskans via a yearly check from the gov.
"akbearable, the Permanent Fund earnings come from returns on the fund's investment, not from oil royalties. Your argument is irrelevant."
How does one separate earnings on investment from royalties deposited continually in the fund?
Personally, I like and the majority likes low gasoline prices, which of course we don't get to enjoy living IN ALASKA. That said, it's rather greedy for state of Alaska to want the price of oil to go up, so as to receive a profit and can budget our state.
THINK ALASKA. With the cost of oil decreased, why not prepare for when it rises again and protect we Alaskans from oil inflation by continueing with Natural Gas plans.
Remember, if you live in Alaska you either work for the state or are a ward of the state or barely getting by.
"Remember, if you live in Alaska you either work for the state or are a ward of the state or barely getting by."
Really? I'm pretty sure I'm...none of those.
I have never worked for the State, have never been a ward of the State and am retired...I get by because I took responsibility for my future and planned for it. I had a good job because I gained the knowledge necessary to do so (and no I didn't go to college). I owe no one except for my home and live within my means. The only ones responsible for you is YOU. If we can't get our government to see the err of their ways, we won't have a gas line, the oil will dry up (or be too expensive) and we will be the fossel remains they dig up many years from now after wondering what happened to that great state called Alaska.
Akbearable, thanks for taking the time to read our Constitution. Few do. When considering the Permanent Fund, one must also look to the amendments in Article 9, Finance and Taxation, wherein we amended our Constitution to create the Permanent Fund. The Constitution makes for allowances of distribution of PF earnings.
And yes, under Article 8, resource development is to be for maximum benefit of Alaskans. Most of the crooks in the Legislature have prevented that from occurring as they sold their votes to VECO/Big Oil. (When we gave away our oil)
With the normal revenues Alaska had we have been able to pay our bills, including funding education. That, then, justifies the dividend program- we had a lot of money left over.
If our leaders had any brains, we would have been using our wealth to build the infrastructure so that Alaskans could have a secure future.
Tonto12 I later was reading about the p-fund in the constitutional amendment which was something I was unaware. I thought it was just legislation pushed through by Jay Hammond. I thought I read that the amendment created the fund but that it was still the legislature that decides how the fund is spent. . I Still think the difference between welfare and the dividend is semantics but will agree to disagree on this one.
Finally, someone got the Constitutionality of the PFD correct. That should be taught in all our schools so that people who were not here when that amendment was voted on will understand, it is NOT welfare money, but a distribution of state resource income, given that the state owns the resources (a weakness in our Constitution). The concept, as envisioned by the late Gov. Jay Hammond, was to make sure ordinary people got some of that money (from THEIR resources), in cash, to do as they pleased. Without that amendment, and the PFD program, the money we get as our annual dividend would long since have been spent by the legislature. So, the argument goes, it is fair that some of the oil revenues go to the people in the form of cash. It does appear to be welfare at some level but there was thought put into the program, including a residency requirement. And, thankfully, the amount has never been enough to encourage any THINKING person to move to Alaska "for the free money."
It's about taking responsibility. For instance, assuming, for the sake of discussion, that the PFD is $1000 (I know, the amount varies, but stick with me), and assume fuel (gasoline, home heating, whatever) is $3/gallon. IF one were to buy 1000 gallons of fuel, the simple math (The PFD is subject to Federal Income Tax) is that the cost per gallon is $2, IF one were to "use" the PFD to offset the cost of that fuel. The point is, people have to use the PFD responsibly; and THINK about what it is for. One could take the PFD, blow it on a big screen TV, or a vacation, or a new ATV, to name a few. But the choice is up to INDIVIDUALS who, it turns out, are not always any brighter than the legislature.
The price of crude in Alaska is based on a world price (supply and demand, OPEC, whatever). If you want real socialism, the state would use its royalty oil, own the refinery, make the fuel, and give it away cheap. They do this in Dubai and the UAE. When I was there exactly one year ago, gasoline was about 43 cents a gallon, US. Guess who was paying the balance?
Could someone please educate me as to why you people want to eliminate the PFD. If I do not get to spend this money someone will and I believe that they will choose to spend it on things that may not really benefit us. If the budget is going to be in the red then we need to cut services. When we discus cutting services we do not need bomb throwing and threats that the police department and fire department will be eliminated. I work in the government, not state, and know that a 20% cut of operating budgets could easly be accomplished. There is too much waste in the government and this is where we should start.
Oh and by the way, if we could get a gas pipeline this would boost our budget in a significant way. OUT!
AKWDB wrote: "Remember, if you live in Alaska you either work for the state or are a ward of the state or barely getting by."
Really? I'm pretty sure I'm...none of those.
I'm happy for you AKWDB, seriously, because many are just getting by. If you're not a state employee, not receiving assistance, and apparently doing well that personal profile represents the Alaska minority.
Most the folks I know (myself included) don't work for the state, nor do they receive assistance and although money is a little tight this year they are doing much better than "barely getting by". Exaggeration is never a good argument.
Dove - nice stereotype; off the mark here too. I'll remember that next time I help someone else out because I CAN.
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