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Tuesday, May 21, 2019
HomeColumnsAre we investing in solutions, or just spending more?

Are we investing in solutions, or just spending more?

By WIN GRUENING
SENIOR CONTRIBUTOR

As deliberations on Alaska’s budget approach the Legislature’s constitutionally mandated deadline — the session’s 121st day — the struggle to maintain full funding for existing programs is ramping up.

In many cases, this struggle comes in the form of emotional pleas to not cut Medicaid, education or fill-in the blank because to do so means we are failing to fulfill government’s “obligation” to be all things to all people.

We are told these expenditures are an “investment” in our future and that, absent such investments, our quality of life and even life itself, is at risk.

Couched in these terms, it is difficult to argue against these claims. After all, we believe, and our state constitution requires, that our students must be educated. And health care is critical to everyone.

But these are not binary decisions. It’s not education or health care (regardless of cost) versus zero education or health care. Decisions about the level of service should fall somewhere in-between.

All investments require expenditures. Could we possibly admit that not every expenditure is an investment?

Win Gruening

In the real world (outside the confines of political la-la land), an investment is an expenditure of funds that promotes a profitable return or an appreciation in value, or both. As wise stewards of our state’s resources, using this definition, if we judged every government program against the amount of money “invested” in it, how many programs would actually qualify as a prudent “investment?”

Most people understand the basic concept of investing and the importance of making good investments.

For instance, according to CNBC calculations, if you had invested $1,000 in Microsoft in 2009, that investment made on April 25, 2009, would be worth nearly $8,000 as of April 25, 2019, for a total return of almost 700 percent.

That’s a measurable outcome.

Admittedly, measuring outcomes of government programs can be difficult — especially in monetary terms. But, are we even trying?

Increasingly, we are asked to “invest” handsomely in pre-K, K-12 education, our university, solving homelessness, reducing crime, drug addiction, ferry systems, etc.

Many of these programs and services produce statistics each year about how many Alaskans are served and how many interactions have transpired. But does this really tell us anything about their effectiveness or whether they are delivering measurable beneficial results?

How many programs and services actually have real performance measurements and, if they do, is anyone paying attention to them?

Let’s take education. Is our “investment” in education helping to grow the knowledge and skills of Alaska students and make them self-sufficient contributing members of our society?

In some schools, the answer is yes.

Yet, Alaska ranks consistently at the bottom in national and state testing. Recently released Alaska statewide math testing (Performance Evaluation for Alaska’s Schools) show 47.5 percent of students performing at grade level in fourth grade but only 29.7 percent are proficient in eighth grade and 22.5 percent in ninth grade.

Over time, educational reform has focused less on academics and more on social and cultural issues that teachers are not equipped to address.

If our sex education classes are any indication, these “non-academic” requirements aren’t very effective either. For almost 20 years, Alaska has ranked among the highest nationally in sexually transmitted diseases statistics. A recent state of Alaska Department of Health and Social Services bulletin indicates STD numbers are continuing to increase — especially in the 15-24-year-old group.

By these objective measurements, the dollars “invested” in education have not been well-spent.

Education advocates insist more money is needed. The latest costly proposal is a statewide pre-K program to prepare our kids for kindergarten.

Why would we expand an ineffective system that has failed to deliver?

We have great teachers who genuinely care for kids and work hard in our schools. But more and more of their time is spent on unnecessary paperwork. The current system doesn’t reward them or allow them to excel. Students are often promoted to the next grade regardless of proficiency level.

The solution to every problem isn’t always spending more money on another program. It’s imperative to establish metrics and priorities and hold the system, parents and students accountable. We need to recognize success, not failure.

Alaskans should expect government dollars to be treated like their personal investments — and, likewise, expect an increase in value.

Win Gruening retired as the senior vice president in charge of business banking for Key Bank in 2012. He was born and raised in Juneau and graduated from the U.S. Air Force Academy in 1970. He is active in community affairs as a 30-plus year member of Juneau Downtown Rotary Club and has been involved in various local and statewide organizations.

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Suzanne Downing had careers in business and journalism before serving as the Director of Faith and Community-based Initiatives for Florida Gov. Jeb Bush and returning to Alaska to serve as speechwriter for Gov. Sean Parnell. Born on the Oregon coast, she moved to Alaska in 1969.

Latest comments

  • Bravo!

    Sadly, this message will be ignored in whole by the leftists in all local government and the state levels. If it’s acknowledged at all, it will be in the form of “SEE! Conservitaves want our kids stupid and to kill grandma!” Which is a lie.

    Who’s the better friend? The one who keeps giving the addict money for their addiction? Or the one who says “STOP! We will not allow this behavior and we’re going to end it now!”

    Our sense of public entitlement must end. Or our State will forever be a magnet for takers and not builders.

  • Fiduciary responsibility seems to be non-existent in the dim world. Education is the most prime example in Alaska. When a person, politician, representative or any shepherd of “other peoples’ money”, assumes a position of agent for constituents, they are required, by law, to exercise fiduciary responsibility. That means, the “representatives”, supposedly using their position to make wise decisions and safeguard “other peoples’ money”, are required by federal law to do their utmost to safeguard that “money”. Failure to do so generates personal and group “fiduciary liability”, if the “representative” of other peoples’ money fails to properly safeguard those funds. The leftists, now controlling the state house of Alaska, have no more “fiduciary responsibility” than the average seagull. Fiduciary liability, personal and group, must be focused on the failure to safeguard public funds with greater conscience and culpability than their own personal funds. Do this, hold the “public” representatives liable for all non required squandering of public funds. That should rein in their reckless spending.

  • It is an ethical violation at the least to take (with the threat of force) someone’s money and promise results then ignore outcomes or say that more money is needed. It’s right up there with Bernie Madoff. Why would we sink more money into Medicaid when we know it is rife with waste and abuse. Why would we sink more money into education when it can’t produce results with an already high budget. Why should we pay admistrators lavish six figure salaries when they can’t maintain accreditation? If they tell you “the children” you tell them we’re not helping the children by making them debt slaves.

  • Excellent article, Win. The big question: What will make legislators/elected officials be accountable for wasteful spending? Not sure anything can do that. Those that benefit from the exorbitant spending outnumber and are more active than the rest of Alaskans.
    Check out the very recent Vanderbilt University study on PreK and you will notice that those kids in the control group were better off than those in the PreK group. Unbelievable! The K12 Education Industry needs PreK to keep the student numbers up so the bureaucracy can still thrive.

  • First, in government outcomes are de-linked from decisions so that those responsible for bad decisions are usually long gone.

    Second, the outcomes Democrats want is different than for Republicans. Democrats want to control the economy, so they are only trying to grow government so the public sector hires more, who typically vote for Democrats who support programs to hire more Democrats.

  • For every dollar spent in the ferry from the general fund, there is $2.30 of economic activity from tourist dollars, spending by the ferry in each community it serves, local spending by ferry passengers, payroll, etc. By cutting the cargo transportation ability of fishermen, businesses and residents, they will now be paying higher rates, therefore pulling money from the communities and people and sending it down to Seattle transportation companies. There are studies out there, you are just ignoring them to push your narrative.

    • John a bit off subject, once again a Whataboutism commentor at work!

      • Let’s see- an article about value of investment in public services. A response that points out legitimate economic impact studies that shows the economic benefit of said services. Then you respond that it’s whataboutism!
        It seems like you have either no idea of what any of those things mean, or are gaslighting just to screw the narrative. Well done.

        • Does that $2.30 hold true if the ferry is running at less than half capacity annually? Or is it meaningless extrapolation designed to get people to believe in the wonderful benefits of government spending. Cite your studies or you are the gas.

        • Does the $2.30 hold true if the ferry runs at half capacity annually? Or is it just meaningless extrapolation to try and convince people how wonderful State spending is for the economy? No citations? Talk about gas!

  • Great Narrative. Yes indeed, let’s completely understand the performance of State expenditures and investments by means of measurable ‘metrics’ so as to determine the proper level of allocation of resources. The private industry does this successfully, why can’t Government do the same and why wouldn’t citizens expect such transparency?

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