Politics

Call of The Wild

Alaska's Frank Murkowski left the U.S. Senate to take over a state that's going broke. Why would he do that?
by | February 2003
 

Frank Murkowski does not act with reckless speed. After his election last November as Alaska's new governor, the veteran Republican politician let the better part of two months go by--missing several scheduled announcements in the process--before revealing that he'd chosen his daughter to replace him in the U.S. Senate. Nor could you consider his move to leave the Senate and run for governor hasty. The idea first surfaced before the 1990 election; four years later, after Murkowski had let months of sitting on the fence drag by, one of his potential primary opponents called a news conference to plead with him to "play ball or get out of the game."

As things have turned out, Murkowski might have had more fun had he decided to pick up a glove back then. Alaska is hardly the only state facing dire fiscal conditions, but the state faces some particularly hard choices during Murkowski's upcoming term. Its projected budget deficit of about $900 million is in line with the shortfalls some other states are facing, but with that figure comprising nearly half of the 2003 budget, Alaska is deeper in the hole than any state in the country, including California.

Of course, Alaska has often had budget problems in the past, and it has made a habit of drawing from its Constitutional Budget Reserve--a savings account filled by taxes and royalties on oil and natural gas extraction in the state--to balance the budget. But that fund has been drawn on all but two of the past 12 years, and the state's Revenue Department expects that it will be emptied within the next two or three years; the timing depends on oil prices, whose recent rise has bought the state a few extra months. Murkowski, who was a staunch supporter of the oil industry in the Senate, has pledged to increase oil and gas development; even so, it would be 2005 before the state starts seeing any new revenues, and at a projected $30 million a year, they won't do much to plug the roughly $1 billion-a-year deficit the state is expected to run.

In the meantime, Murkowski will have to figure out how to pay for all the things he has said he wants--new elementary and secondary education spending, new funding for vocational and higher education, new highways, new prisons. He pledged during the campaign to do all this without new taxes or using money from the state's $21 billion Permanent Fund--also funded by resource taxes and royalties--without a vote of the people. But no one is sure how the state can afford the new spending and clear up its structural deficit otherwise. "It's clear that within two years he'll have to produce a revenue package that balances the budget," says Gerald McBeath, a political scientist at the University of Alaska in Fairbanks. "That means turning to the Permanent Fund and some combination of taxes."

It's not entirely clear just why Murkowski would sign up for these challenges at the age of 69, with a long political career behind him. But it may well be that, having waited so long, he could wait no longer. Before he ran for the Senate, he was a bank president. "He prefers to be a boss rather than one of the pack," says McBeath, who spent some time in Murkowski's Senate office during the 1980s. "From my observation, he was always uncomfortable being one of a hundred. He liked to give orders and have people follow them up. So being an executive is a more congenial role for him in life."

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Rob Gurwitt  |  Former Correspondent
robg@valley.net

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