With no evidence, Dunleavy claims cascading bad news just a 'momentary glitch'

Oil prices plummeted. The Permanent Fund lost billions as the stock market tanked. And the 2020 tourist season is at risk because of the coronavirus, which poses an uncertain health risk to Alaskans.

Gov. Mike Dunleavy says there is no need to worry. All of these troubles are temporary.

“So first of all, it’s not the end of the world,” Dunleavy told reporters Monday. “I see these things as a momentary glitch. I see this virus as a momentary glitch. I see oil prices, the drop in oil prices as a momentary issue.”

There is a chance that he is momentarily right. And at least he didn’t brag about his vast knowledge of the coronavirus or say, in Trump fashion, “Maybe I have a natural ability.”

What worries me is that Dunleavy doesn’t seem to appreciate the strong possibility that he is wrong, and that the damages will persist for many months or years. The only financial flexibility the state retains is in the Permanent Fund because other reserves are gone.

The economic and health consequences of these multiple problems could be severe and Dunleavy has no inside knowledge of Saudi-Russia oil politics, the biology of the pandemic, the future of the stock market or how many passengers will take cruises to Alaska this summer.

Dunleavy’s pat assurances that all things must pass seem to be borrowed from the Alaska self-improvement manual we’ve relied on for generations. Columnist Mike Doogan summarized the ingredients as “hope, pray and look the other way.”

In the short run, Alaska is set to run out of reserves under the Dunleavy plan while he looks the other way.

“So we don’t know how long this price war will last between the Russians and Saudi,” he said. It could be a month or two. “It’s all going to be averaged out in terms of our oil revenue. I see it as a momentary glitch. It’s something certainly to watch, but nothing there to panic about at this point.”

Dunleavy said he sees no need to change his proposed budget for the fiscal year that begins in July. Maybe it’s time he opened his eyes.

Even if oil prices and the stock market bounce back in a few months, the budget Dunleavy has proposed for the next fiscal year would consume all state financial reserves except for the Permanent Fund earnings reserve.

A year-and-a-half from now, under his plan, the state will have to either cut $1 billion or $2 billion from services or make an irresponsible withdrawal from the Permanent Fund. That was the Dunleavy budget even before the collapse in oil prices and stock market. Now the walls are closing in.

“We have to have a continued conversation about how big our government is going to be going forward, how much we can afford,” he said.

In Dunleavyspeak, that means Alaskans have to decide if they want taxes, not him. He wants no taxes, big dividends and the extreme budget cuts he proposed last year. The math doesn’t add up. It’s the fiscal fantasy of his campaign all over again.

The state needs bold leadership to deal with the crisis created by oil prices, the stock market, the coronavirus and the threat to the tourism industry and other businesses. What we have here is more than a momentary glitch. What we have here is a governor running from the recall.

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