Several weeks ago, I wrote a column praising the Governor for his limited government approach to the budget. Since then, his administration has announced a whole array of new taxes which has dampened my enthusiasm.
The Governor's latest budget proposal is a mixed bag of spending cuts and new taxes. I approve of most of the cuts as a breath of fresh air and wish to go on record as saying that, if anything, we should slice even more out of our gigantic eight billion dollar budget (highest per capita of all states in the U.S.) without hurting productive Alaskans.
The proposed taxes: a 12 cents per gallon motor fuel tax, a $100.00 annual tax on all workers or a summer-only sales tax, a $10.00 dollar tax on every studded tire sold, and higher taxes on vehicle registrations and business licenses. All would cause more harm than good to my constituents.
If the goal is to simultaneously trim the deficit and build a strong private sector economy, then this is the wrong approach. First, because new taxes that will continue to fuel an inefficient bureaucracy will drain us, little by little, and in the end, make us poorer as a society. There is no evidence in the history of our state or country that we have taxed ourselves into prosperity. In fact taxes have the opposite effect.
Second, it makes no sense to give even more of our hard earned money to politicians in Juneau given their poor track record over the years. Does the Delta Barley Project or the Point MacKenzie Dairy Project ring a bell? How about the Seward Grain Terminal or the fish processing plant off Minnesota in Anchorage? There's a long list of such government wastes that literally flush billions of our dollars down the toilet. Just think how our economy could have grown if private individuals and businesses had spent this same money. I'm convinced we as individuals are better stewards of our own money than any politician.
Third, government tax increases generate more than economic waste. They often turn productive people into vassals of the State, constantly waiting "approval," "permission" or "authorization" to merely go to work! I recall someone who wanted to start a private fish hatchery in Southeast. He was a trained biologist with a college degree and years of experience fishing in Alaska. He was encouraged by the State to put in for a government loan to get his fish hatchery started and wasted over two years dangling at the end of a bureaucratic leash. At the end of two years, the State changed its policy and he was consequently denied a permit to even have a fish hatchery. Wasted dollars and a wasted career.
Fourth, and most important, new taxes are simply not a necessary ingredient for a healthy economy. Therefore, I respectfully, but firmly, disagree with the Governor. We can remove the debt hanging over our heads by insisting that Juneau stop spending more than it brings in and aggressively develop our resources (such as oil and gas) to create more revenues for the State's treasury.
Unlike other states, our financial problems stem from having vast oil dollars that have now shrunk. We must get fiscally sober again and learn to manage what we have instead of spending ourselves into oblivion. Fortunately we do not have to cause havoc to accomplish the goal of a lean and efficient government. There are many things we can do such as a hiring freeze, consolidating agencies and privatizing services.
Finally, our indebted and distended government is due to straight philosophic error. If we hold the notion that government's role is strictly to defend individual rights, maintain justice and public safety, educate children and pave roads (what our Founding Fathers envisioned), then we will recognize that we have ample money to perform these limited but crucial functions. But if we view government as a big brother, if we see it as a giant cash cow who's main purpose is to give away other people's money, then we are doomed to a constant cycle of tax, spend and control. Our freedom will erode away and gradually our wealth and prosperity too.
This choice is so obvious and fundamental that most of my constituents insist I support less government and less taxes, which I do. I pledge to continue fighting for you.
# # #
Vic Kohring is a fifth term Republican, representing Wasilla in the Alaska State Legislature and is Chairman of the Special Committee on Oil & Gas.