Fritz Pettyjohn: What are we going to do with all that money?

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By FRITZ PETTYJOHN

In 1969, when Alaskans realized how much oil was in Prudhoe Bay, people quickly understood the implications. A formerly cash starved state was going to get rich. The questions were how quickly, how rich, and what should be done with all that money?

When Alaska Natives demanded a settlement of their land claims, it was apparent this issue needed to be resolved before any pipeline could be built. The landmark legislation that resulted, the Alaska Native Land Claims Settlement Act of 1971, cleared the way.

Then the oil crisis of 1973 made the enormous cost of a pipeline economically feasible. Construction began in 1974, and by the summer of 1977 the oil began to flow. By 1978 1.2 million barrels a day were arriving in Valdez, gradually reaching a peak in 1988 of 2 million barrels a day. The State of Alaska was poor no more.

The still unanswered question was: What to do with all the money? As a result, the most important election in Alaska’s history was the 1978 Republican gubernatorial primary. Whoever won would become governor, with the power to control the expenditure of the windfall.

The candidates were incumbent Gov. Jay Hammond, the man most responsible for creation of the Alaska Permanent Fund; former Gov. and Secretary of the Interior Wally Hickel; and conservative stalwart Tom Fink, Speaker of the House.

Neither Hickel or Fink had much use for the Permanent Fund. They both believed that Permanent Fund money should be spent on major infrastructure improvements, like the Rampart Dam. So this election determined the fate of the Fund. It would either thrive, under Hammond, or be discarded in favor of huge mega-projects. Bridges across the Turnagain Arm and the Knik Arm of Cook Inlet were seriously considered. Moving the state capital from Juneau to Wasilla was financially feasible. Money was no object.

Hickel was one of the richest men in the state, while Hammond and Fink had modest means, and relied on small-dollar donations. All the business interests in the state, along with organized labor, were behind Hickel, but they were unable to overwhelm Hammond with money. In 1978 Alaska had a very strict campaign finance laws, and Hickel’s wealthy supporters were of limited use to him. This proved critical, since Hammond only beat him by 98 votes.

That law was later ruled unconstitutional, and recent Supreme Court decisions have made effective campaign finance laws unobtainable. Big money from outside, dark money, from people like George Soros, will be pouring into next year’s Alaska Senate election. Dark money groups get a bigger bang for their buck in small states like Alaska. Here, a few million dollars can make a difference. In large states, they have to spend a lot more to have an effect. And the votes of senators from Alaska count just much as the ones from California.

Alaska voters have repeatedly voted for campaign finance reform, most recently in 2020, for Prop. 2. We’d vote for it again, if we could, but court decisions like Thompson v. Hebdon prevent any such reform from taking place. Congress will never clean up this mess. It’s dysfunctional, mired in extreme partisanship, and thoroughly corrupted by big money donors.

One group of American patriots, Wolf-PAC, is trying to do something about this corruption, and the Alaska Legislature in 2022 will have the opportunity to participate in the solution they propose. It can pass a resolution calling for an Amendment Convention limited solely to the subject of campaign finance for the purpose of proposing an amendment to the United States Constitution.

Under the terms of Article V of the Constitution, if 34 state legislatures pass such resolutions, Congress is required to call the convention for this limited purpose. When it meets, Republican and Democrat delegates will work to forge a compromise solution acceptable to both parties. A partisan proposal would be pointless, since it could never be ratified by the required 38 states.

Campaign finance reform can work, as shown by its effect in Alaska in 1978. We wouldn’t have a Permanent Fund without it. The United States Congress is dysfunctional, paralyzed by the money of special interests. The Alaska legislature can be part of the solution.

In 1983, as a freshman State Senator, Fritz Pettyjohn voted for an Article V resolution calling for a fiscal reform Amendment Convention. 

12 COMMENTS

  1. Fritz, you are rolling a rock uphill. There is no “bipartisan” solution in today’s world. At this moment, Democrats are trying to pass a “fundamental transformation” of our country into a socialist state with a tie-breaker of a 50-50 vote. Scorched earth politics at its worst.
    By its title, I thought your column was going to be about what Alaska chooses to do with the now “surplus” income due to higher oil prices and Permanent Fund income. Pay our debts? Nahh. Plan for the future? Nahh.
    To paraphrase the Grass Roots: “Nah Nah Nah Nah Live for today. And don’t worry about tomorrow anymore.”

  2. Hm?

    Fairly certain the founder of Wolf-PAC is The Young Turks progressive media icon Cenk Uygur.

    Though a broken clock is right twice a day I tend to tread carefully when wanting to jump into those alliances.

    Also, ballot measure 2 was itself financed by dark money and does little to nothing to stop the large IE expenditures which go to the heart of your argument on campaign finance law.

    I don’t disagree with the notion of campaign finance reform I would simply caution that given the partisan nature of wolf-pac especially as it pertains to its founder some caution is probably advised

  3. Wow! Click-bait at it’s best! I thought I was going to read a PFD story, instead Fritz pushed a Art. V convention narrative. Fritz- I do not trust a Art. V convention. One Art. V representative has already come out and said they would support revoking 2A rights. If one representative out there is spouting this, how many more are sharpening their knives to revoke other rights? This is on-par with “trust the science” that Americans are being spoon fed right now. Sorry. No trust in a convention and my trust in you to be a American is falling fast.

  4. Funny how I remember those times differently. I was VP of Laborers’ Local 71 and had some position with the AFL-CIO’s Committee on Political Education, the AFL-CIO PAC. That qualified me to be Business Manager Al Baffone’s brief case toter at a lot of meetings with people in high places. I remember an incident about the time of the ’78 fraud -fest, excuse me, election down at the old Traveller’s Hotel on Third, then a Hickel property still, so a fairly nice place. It was some sort of meeting of Union leaders chaired by the head of the State Federation of Labor, the AFL-CIO’s umbrella organization, Duane Carlson. A group of us including Duane were on the elevator when the door opened and Gov. Hammond and his party were at the door; we all got off and gave him the elevator rather than ride with him. There was no love lost between organized labor and Jay Hammond and his administration. That said, the AFL-CIO was still strongly Democrat rather than communist back then and our candidate for Governor was Democrat Chancey Croft. The Teamsters, still exiled from the AFL-CIO back then supported Hickel, and Jesse Carr had even less love for Jay Hammond than we did.

    While Hammond was a nominal Republican of the sort we had back then, the far left of the Democrats, the Ad Hoc Democratic Coalition, had bolted the Party’s nomination of Bill Egan in ’74 and endorsed Hammond. The Ad Hoc bunch also got a good number of their group and its friends elected to the Legislature and appointed to political slots in the Hammond Administration. I knew several of the Ad Hoc leadership; they ranged from your standard issue Sixties college socialist to Little Red Book communists, and not a few crazies. Anywhere they gathered you could be sure the air would be filled with sweet perfume.

    The writer makes much of the notion that because of the campaign finance limitations he’s so fond of, that Hickel’s “wealthy supporters” couldn’t help him. I’ll remind him that in ’90 Gov. Hickel financed a successful campaign for governor almost exclusively with personal funds. While campaign finance laws may have limited Hickel’s economic support, that didn’t hurt Hickel nearly as much as the unlimited “member education” expenses of the interest groups that supported Hammond, almost all of them from the left. Hammond characterized Hickel and his supporters as “the rape, ruin, and run bunch,” and the greenies and lefties, of which there were many in Alaska and the Left Coast playing in Alaska politics, flocked to support Hammond.

    These times were also the heyday of “The Bush Caucus” and rural Alaska, as well as Southeast Alaska had much more power than today. Hammond enjoyed strong support in rural Alaska. Alaska had an open Primary and five time zones back then. When the polls closed in Anchorage and Fairbanks, you still had two more hours in Western Alaska and the bidding began. Bags and bundles of ballots kept showing up for a month after Primary election day.

    Of course it went to court and the AK Supreme Court goes through an astounding litany of mistakes, slovenliness, misconduct, malconduct, and demonstrable voter fraud and ultimately concludes that the whole litany didn’t establish enough of a taint to set aside an election decided by 98 votes. Talk about counting them until you get it right! Read Hickel v. Hammond if you think the 2020 election set a new low.

  5. Art,great brushstrokes, and personal backstory.But its always the same thing, whine ,snivel, blame it on commies,socialists and antifa.
    Surely there were some highpoints,maybe even some victories, for well….. the state

    • I can recall lots of high points and, yes, victories for the State, but I suspect you wouldn’t appreciate them as victories because they usually involved beating people like you.

  6. While the mantra that money buys elections sounds good and plays well with those who aren’t paying attention, that myth gets shattered every election. Look no further than the recent upset in New Jersey where truck driver Edward Durr unseated the long time state senate president while spending very little money and doing very little campaigning.

    • I disagree; there are occasional exceptions every election. Message and organization will beat money, but only if the money doesn’t have as good a message.

      • There are hundreds if not thousands of examples across the nation every election cycle. Primaries are a great example of this, but general elections show the same. There are studies showing a winning candidate can cut their spending by half and only receive 1% fewer votes while a losing candidate can double their spending and receive only 1% more votes. This has been shown to be true in races where the same candidates run against each other multiple times. Typically money goes to good candidates. Now the power of incumbency is hard to overcome with or without money.

      • According to ‘https://www.opensecrets.org/elections-overview/winning-vs-spending?chamber=H&cycle=2010’ since the 2000 election cycle 11.76%-28.57% of candidates for US Senate spent less than candidate they defeated in the US House of Representatives it was 2.46%-14.39%. State and local election most likely show a larger discrepancy in spending and election results.

  7. I don’t think people in Alaska and elsewhere in America believe in or know the US Constitution. People think refuting the US Constitution is like taking a survey and if their social group is “woke” the Constitution should be dismissed. People in Alaska do not understand the US Constitution is the law of the US nation creation. We are not creating a new nation just because of the left leg of a partisan political inclination. The Constitution is the settled laid down law of this nation a guaranteed republic with 50 states with equal footing. Alaska is a mess but for different reasons than the state of Washington. Alaska has refused the US Constitution. They teach the courts lay down the law, the state legislature, the city assembly, the school board, CDC lay down the law equally. That is NOT our form of republic. We need to apply the US Constitution in all instances of conflict and the winner is the US Constitution in all instances.

  8. An Article V call for a convention of the States has already been called and is well on its way to fruition. In fact, our own State of Alaska has passed a resolution for just this purpose. No need to get Cenk Uygur involved. For some reason, his name doesn’t come to mind when talking about patriots.
    Conventionofstates(dot)com for more info and to find more patriots.

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