By ART CHANCE
Unless President Joe Biden adds crashing the stock markets to his astounding list of failures, sometime in the next months the Alaska Permanent Fund will surpass the $100 billion mark, a holy grail for Alaska’s trust fund babies and wannabe trust fund babies.
The popular notion has been that with a Permanent Fund corpus greater than $100 billion, the State could maintain current services off the fund’s revenue alone, so long as it could limit or eliminate the Permanent Fund dividend and devote most or all of the earnings to governmental operations.
This warms the cockles of lefty hearts as it harks to the sainted Gov. Jay Hammond’s notion that we should use oil development to turn oil wells into money wells. The lefties think they can abandon natural resource development and productive enterprise generally and just live off the Permanent Fund.
What they really want is the Juneau economy all over Alaska. Most of our readers are not from Southeast and have never been closer to Juneau than 30,000 feet or so as they flew by. It isn’t really the land of beer pong and leg wrestling, but it has a social and economic system that the lefties and self-styled elites find attractive. Juneau has almost no true private sector economy. It has a few big boxes and some retail and service businesses to serve immediate needs. Those businesses understand that their market is government employees who are mostly left of center; so they’re not going to advocate any conservative positions or give any money to conservative candidates.
Here’s where somebody from Juneau chimes in about the mines in Juneau. Those high-paid miners they like to tout mostly hot bunk in apartments, do their shift, and go home to momma in the Lower 48 on their off-week(s); they’re not a part of the Juneau economy or res publica. Yes, there are administrative and other support employees in mining, but they’re really indistinguishable from the people who trudge into State and Federal office buildings every morning.
And finally, the two mines are in Juneau over the vehement opposition of the Juneau leftist elite, and mine owners and management are simply not a part of Juneau politics.
The dream of the trust fund babies is to turn the whole State into Juneau. Post-scamdemic, we’re close here in Anchorage to achieving that, and it is probably just as close in Fairbanks, Juneau, and Kenai.
Other than a minimally necessary service sector and transportation sector, urban Alaska has only such trade as is necessary for the people who live off the government to provide for themselves. If you are among Alaska’s ruling elite, government, healthcare, education, and social services providers, you can pretty much get anything you need to make yourself happy in Anchorage, other than fashionable entertainment, anyway. The rockers and country musicians are being defiant and having some events, but the fashionable types aren’t ready to leave the house yet.
The computer on my Mercedes Benz is demanding a scheduled service; the dealer can’t offer me an appointment for two months. To make it worse, my trusted independent backup can’t give me an appointment for five weeks. In 2019, I would have had to wait at most five days, and they’d have given me a ride home and come and picked me up when it was done. Either a whole bunch of mechanics/technicians have packed up and left Alaska or they’re sitting home drawing welfare and unemployment benefits having discovered that in Slo Jo’s world, working isn’t worth it. Well, in the Trust Fund Babies’ world, working really isn’t worth it either.
I worked in two Democrat administrations — Gov. Steve Cowper and Gov. Tony Knowles. Cowper was dealing with an economic crisis and had to act responsibly; the Democrats/leftists hated him for it. Things were a little more stable economically by Knowles’ time, thanks to the efforts of Cowper, Gov. Wally Hickel, and people like me, so his administration could act like the typical Democrat Trust Fund Baby. If you were a State employee with ministerial or regulatory authority during the Knowles Administration, the very worst thing you could do for your personal well-being was to actually do your job.
As I look back on 1994-96, what I should have done is just stay home; they wouldn’t have had either the skill or the guts to fire me, and I’d have three more years of PERS earnings. Instead, I told them where to put it and went to work for the Legislature as a contractor; that cost me about $300K in PERS earnings. I’ve never bothered to figure out what that costs me every month, but my wife probably has.
What today’s Trust Fund Babies want is for the whole population of Alaska to essentially work for the State or for local governments that live off the State. You can be a public employee in either State or local government or in education, you can be a healthcare employee, you can be on welfare, or you can be a part of a small service and retail sector that lives off the foregoing group; welcome to Juneau.
With oil at nearly $90 a barrel. there is probably enough money around to have some bread and circuses to keep the plebes happy next year. The problem is the same one we struggled with back in the Seventies; oil is a finite resource. We understood back then, that one day it would run out, and we wouldn’t have all that beautiful money anymore, so we started stashing some of it away.
Now that we’ve turned oil wells into money wells, we have to confront the same issue with that money; it is all good when the the stock market is at record highs every day. What happens when it isn’t? All that money is really just speculative, fiat money; what happens when its value collapses? Do you want to be a trust fund baby with the State managing your life, or do you have more faith in yourself?
Art Chance is a retired Director of Labor Relations for the State of Alaska, formerly of Juneau and now living in Anchorage. He is the author of the book, “Red on Blue, Establishing a Republican Governance,” available at Amazon.
A society that stops producing ceases to exist.
So our local leftists are trying to turn the entire Alaskan economy into a giant self-licking ice cream cone, and they appear to be working in concert with the leftists in the federal government in preventing Alaska from developing a modern, diversified economy. One wonders where we would be now as a state without these worthless, rent-seeking grifters running things.
Government spending cannot create an economy, it can only feed off an economy.
Government is a parasite, not a producer.
You can try Meineke. You can also try Professional Automotive at the Potter rd location off C street.
Good insight. I do not want to live in that world! We need to get more like minded people to vote!
This scheme is bound to fail unless there is some semblance of self control over spending. No matter HOW big the fund gets, it can be eliminated if the state becomes everyone’s Santa Claus.
The problem is, one leftist will have to tell another leftist to quit whining for more, and I don’t see that happening. Ever.
The Permanent Fund should put at least 50% in precious metals and mining stocks to preserve its value. Rare Earth mining stocks are especially attractive. Gravity will soon deflate the stock market with or without Brandon.
The Permanent Fund, 401Ks, IRAs, Roth IRAs, and various pension funds are doomed. Even with the stock market at nosebleed heights, many pension funds have already lowered monthly checks sent to current retirees and lowered future benefits for employees still working…..
Art makes the point that Permanent Fund income (realized and unrealized) due to the stock market boom combined with higher oil prices changes the entire dynamic of our fiscal dysfunction. Instead of deficits we are looking at a surplus of income to feed the pig trough of government, including the Dividend. So now the debate over government services versus bigger Dividends will rage on. On steroids!
I appreciate the free government services from the “trust fund” (Permanent Fund). Unfortunately, I have not been able to nurse off of the “trust fund” free cash (PFDs) since 2015, because I’ve sent back my last 6 PFD checks (uncashed) due to the big deficits. I have received my 2021 PFD paper check ($1,114). I have not cashed it, and I have not sent it back to the state yet. The crude oil prices have gone up. Do we now have a deficit or a surplus? Would it be ethical for me to keep the money? How much have we reinbursed the CBR, which is supposed to be paid back?
You have been patting yourself on the back for years. I can respect someone who does a good deed anonymously for its own reward….
Perhaps a better use would be to donate your checks to a charitable
organization whose works you approve. The monies will actually be a help, rather than just tilting at windmills…
Trying to make sense of spending all the time and effort to fill out an application and submit it for a dividend just to return it. It would obviously be more efficient to just not bother.
The $64,000 question: how long before sane people bolt Alaska for Texas, Idaho, or Florida?
Answer: yesterday if they have sense.
The mines sit out the politics of Juneau out of safety. Juneau’s politburo is always one step from regulating them out of existence. The miners are in and out because Juneau has done nothing to make them feel Juneau is a safe place to put down roots.
In all my years in Juneau I’ve watched as the politburo and the Juneau elites work damn hard to making sure growth can’t happen. I was frankly surprised to see Juneau fight off the idiots who wanted to cripple tourism.
Juneau is a cautionary tale for the rest of Alaska. It slides further and further left daily. The difference between Juneau and Anchorage is patience. Juneau chose to slowly boil the frog (the economy and personal freedoms). Anchorage chose to to toss it wiggling into a pyre.
The left is everything conservatives aren’t. Patient, persistent, in it for the long term. And mostly willing to do the work necessary to rape society. Conservatives still think going to a political rally or flying a flag is sufficient.
If you’re sane and under 50, get the hell out of Alaska while you can. If older, buckle up.
You ain’t seen nothing yet.
Ouch Art! As a miner here in Juneau that was a bit critical of natural resource workers. Sort of undermines the thesis of your article. Maybe spoon a little sugar on next time.
You are correct we have a very leftist assembly and city administration in Juneau, which takes every opportunity to tax and spend. Such policies quite effectively chase working residents out of town – which I believe is more or less your point.
And you are correct that the stock market depends entirely on businesses somewhere making money (future profits). No intrinsic value, just trust that someone else will work. I have great trust that miners will work.
I didn’t mean to be critical of the miners or the industry, but rather of the Juneauites with whom I’ve had some spirited discussions in these pages, who contend that the existence of the mines and a few contractors and support businesses gives Juneau a private sector economy. Sorry, but if you’re a union contractor whose business is publicly funded construction and maintenance under union project labor agreements, you’re not really in the private sector.
I kept my boat at Fisherman’s Bend and my Auke Bay office was Squire’s Rest. Of course Squire’s was a convenient stop for miners getting off shift so I rubbed elbows with quite a few of them. I also knew some technical and managerial people from the mines and worked with some who had a background there who had come to work for the State. So, I’m not unfamiliar with the industry.
Art, your disdain for Juneau may have over ridden your usually good sense, at least in one part of your papal bull above. Let’s remember that there are only two economic engines, Mining and Agriculture, meaning you either grow it or mine it. Fishing is considered Agriculture too. Given the above Art, lowly Juneau is an economic powerhouse by Alaska Standards. I mean in measure of “product” that the world beats a path to your door seeking. I further would point out that many of the Mine Workers in Juneau are young men in their 30’s and 40’s who were born and raised in Juneau. The mines have kept these folks in well paid six figures payrolls and active in the community of their birth.
Sure J-Town Fascist are reprehensible, but it appears that they are smart enough to not kill the Golden Goose that are the two mines. More then can be said of Los Anchorages , Alaska’s biggest village in terms of economic out put.
I look forward to reading your reply! Oh, BTW Buy a Subaru next time…
I wouldn’t be caught dead in a Subaru. I like M-Bs and I know how to buy them and take care of them. Only drug dealers, professional athletes, and trust fund babies buy a new M-B. You buy one with no more than one owner once it went off lease and a history of good maintenance. You can buy a superb vehicle with every amenity for less than the price of a KIA.
Remember, I lived there for almost thirty years, most of it as either a political appointee or a direct report. I’ve had my name taken in vain on a lot of posters and handbills by the crowd of malcontents and ne’erdowells that call themselves the Juneau elite. The People’s Republic of Juneau well earned my distain.
Art, even as a blind squirrel finds an acorn on occasion, so have the lefties discovered Subaru’s. That said I get why you are down with J-Town, you worked for the State in labor relations, it’s no wonder your north office was the Squirrels Nest, who wouldn’t want to get pasted after a day of that whine. I lived in Juneau longer then you and fondly recall the good and loving folks there. As for the Elite you mention they were the Basketball Players, Winter King Catchers or Buck Slayers or Blue Grouse Hunters in our peer groups. Few of us cared a hoot for the politicos. I do however recall putting up an Art Chance for School Board sign in my yard.
Lots of Pimps and Pretenders drive Mercedes cars, (in fact Mike Porcaro reportedly owns one) but does that make Art Chance a Pimp? No, he just loves his Mercedes similar to the thousands of productive people that love their home in Juneau.
Thank you for putting up that sign. I didn’t have the money to buy a seat from the JEA. Dave Reaume and I kinda’ coordinated our campaigns, but he spent nearly ten times what I did to get a seat that was largely irrelevant because he wasn’t a part of the union-owned majority on the Board. I went to enough boring meetings with my State job, adding another one on Monday nights was not my life’s ambition; I just had a point I wanted to prove. That was when I first met Suzanne; she was the Editor of the Empire and let me have my letter-writing war with JEA on her editorial pages.
I did accomplish what I wanted by forcing the JEA and the Board to make their bargaining public. Closed bargaining is blatantly illegal and they were simply hiding from the taxpayers, something that is very common here; the taxpayer is NEVER at the bargaining table in the MOA or ASD.
When I was in JNU, there were only a handful of M-Bs and the only late-model I recall was an ML that belonged to a prominent lobbyist. Chrysler in those days was partnered with Daimler-Benz and I had the next best thing, a Chrysler 300M; everybody needs a 150mph car (with an aftermarket chip) in a town with 37 miles of road.
The 300M died on the first day of my wife’s new job in Anchorage when she actually believed that guy was going to slow and turn just because he had his turn signal on.
I had been more than a little unhappy with Chrysler for not protecting the value of the 300M, but the insurance payoff for the M bought a M-B ML 430 of the same year that had retailed for almost $20K more than the Chrysler.
I came to learn that M-B doesn’t seem to much care about selling new cars in the US market; it leases them and dumps them on the wholesale market when they come off lease. I still have that ’99 ML, which has over 205K miles on it now and runs like new, though it has some squeaks and rattles and is getting a little ratty cosmetically. I took it to a couple of body shops to see about some rust repair and paint touch-up and they just laughed and told me to buy another one.
The one wanting service is a ’13 CLS 550, one lessee and one owner before me. Low mileage, immaculate interior, and looks new from ten feet. It was an $80K car and you couldn’t buy a new mid-level KIA for what I bought it for; 400 hp, 150 mph, and all the bells and whistles except some of the “self-driving” features, which I don’t much like anyway. Even the rudimentary traction and stability controls on the ML sometimes make me want to scream; “let me drive.”
Love the article Art, but I must ask – if our (and world’s for that matter) economy is based on blue sky and speculation, what has actual value? Even the gold bugs know they keep prices high by stirring up demand – the industrial (actual) value of gold is far less than the market price. There is no hedge against an economic collapse.
Buy dirt.
Integrity is (still) a thing.
Art, you can take that broad brush of yours and put it where the sun doesn’t shine. Yes Juneau often has a socialist agenda being pushed by some folks but there are a lot of hard working moderate and conservative folks here in Juneau and some of them even work for the government. Shock!!! Oh yea, you were one of them. While I am a private sector manufacturer ( heavy industry) I don’t presume that you have to be private sector to be a level headed person. The recent vote that turned down the cruise ship initiative by a staggering margin speaks to that. Just remember that of all the legislators , only 3 of them are ours. Most of them come from your neighborhood. Send us some that will be a better influence on us :- )
Art’s analysis is pretty good. I would add to it in a couple of ways. The presence of lots and lots of high-potency marijuana will ensure that a large chunk of the population is lazy, docile and stupid. The Left is all for that result. Most on the Left are also thrilled that there will not be much local initiative or skill to pursue resource development. Environmentalists have always wanted to turn Alaska into some kind of theme park for the privileged. Now they can count on the locals supporting that result. Having lived in both, I can say that Anchorage is already looking and feeling much more like Juneau. The spineless are everywhere. My kids were raised to be curious and take initiative. All have left Alaska and will likely not return.
Back during the beginning of the War in Iraq, I travelled to Anchorage a lot. I’d take Minnesota in to get to the Cook. From Westchester Lagoon in there were more of those blue “War is Not the Answer” signs here than on Tenth St. or Chicken Ridge in Juneau.
The reality in Juneau is that most of what passes for a private economy is tourism. Nobody spends their life savings on a cruise to Alaska to see our mines and mills. As Green’s Creek and the Kensington demonstrate, the only way you can do natural resource development in Southeast is if the Greenies and tourists can’t see it. Look at how the “conservative” Mat-Su reacted to an attempt to do some natural gas development out there; NIMBY!.
Three of my four have left Alaska, never to return. I didn’t do anything to encourage them to stay, and the one that remains I’d help pack if she and hers had a plan. There’s very little work here that the Alaska educational system prepares you for that pays much above the minimum wage. If you’re one of the few that can actually endure UA to graduation and check the right block on the AA form there are some government, NGO, and NP jobs that pay you far above your actual value; then all you have to do is weave your way through the politics and keep the job. If you can get into the apprenticeship programs, that is a path, but to a large degree apprenticeship slots depend on how much union work there is, and there isn’t much. And even if you get in, the whacky-baccy will get you right out. I’ve had some terse “but it is legal” conversations with my youngest, and the shithole schools here did a good job of teaching him what lefties think is “fair.” So, he screeches that it isn’t fair that an employer’s WC carrier doesn’t care if marijuana is legal in Alaska, they’re simply not going to insure you if you don’t drug test.
I like my house and my life, but my wife and I flip flop about every other day about whether we put up the “For Sale” sign and just drag it up. The conversation always breaks down at, “to where.”
My eldest earned a STEM degree at UAF. His excellent job offers came from outside Alaska. He left and will never be back. Another great victory for Gov. Jay Hammond, who, IMO, created the whole toxic culture.
UA does offer some worthwhile STEM majors, but mostly they just do “studies” degrees for people on welfare.
JMark, you bring up an excellent point for discussion, High Potency Pot. Not long ago, (before the Chi-Com / Fauci Bio-Weapon sucked the oxygen out of every news report) there was a major study released from multiple countries that concluded prolonged use of High Potency Pot was causing a 5 fold increase of mental illness. Meanwhile Xi “Big Daddy” Jinping is pumping out the Fentanyl and seeing that this cheap, powerful and highly addictive drug gets over the porous Biden Border. Some might say that we are doomed, but I remain hopeful, everyday I happen upon bright, critical thinking young people who are “Hip” to what the man is doing. Hang in there, this is a John Paul Jones moment!
Bob – Our fathers worked together back in the day. We need to have a beer together some time.
Count me in – sd
J-Mark, I would love to do that! I see Suzanne is down with it also. Anchorage? Invite Art?!
I’m in!
Bob. Please email Suzanne…
If you work for government it is better for the private sector to be in the toilet, because are relatively better off. You money goes further. For example, if housing demand from the private sector is weak you can afford a better house.
For sheer beauty nothing compares to the state of Washington. Even Hawaii is ugly by comparison. It would take a lifetime to learn the botany. The legal system is so corrupt in WA state it makes Alaska look like angels. Of course there are people of faith in WA but buy and large everyone is wallowing in corruption. Idaho is great if you like onions. Oregon smells of cow farts which is why the left doesn”t think cattle herds are ok for the planet.
Washington is nice if you want to live enveloped in a rain cloud 24/7/365. Environmental beauty is mostly a state of mind. Real Northerners will make it here one way or another. Always have.
No. Washington is much prettier. Real northerners keel over too and even their own kids walk by and laugh at ’em.
Thank you for the insightful and witty takedown of the leftist fear mongers. Sadly, we who have been accused of Covid (and other) misinformation, have almost always been correct.|
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