Parnell praises state's economy

Governor, legislators dispute how to keep state moving forward

Posted: Thursday, January 20, 2011

Gov. Sean Parnell Wednesday took a hard-line stance on the federal government in Alaska, but a soft and friendly stance to the oil industry in his first State of the State address to Alaskans since being elected to his own term as governor last fall.

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Klas Stolpe / Juneau Empire
Klas Stolpe / Juneau Empire

Speaking to a joint session of the Alaska Legislature, Parnell spoke of how Alaska’s economy was going strong while other states are struggling.

“While other states faltered, Alaska grew stronger,” he said.

Alaska gained jobs, while almost every other state lost jobs, and the state’s unemployment rate was a full point and a half better than the U.S. average, he said.

Now, Alaska needs to lower its taxes to keep the economy going, he said.

“Lower taxes lead to more resource development, and that leads to more jobs for Alaskans,” he said.

It was Alaska’s oil revenues that allowed its economy to stay strong, legislators said after Parnell’s speech.

The Legislature last year pumped up the state’s capital budget, paying for new projects throughout Alaska as a way to keep the economy humming, even while a recession was hammering the rest of the nation.

Senate Finance Committee co-chair Bert Stedman, R-Sitka, was among those disputing Parnell’s economic analysis, and said senators pushed through large capital budgets despite a reluctant governor.

“That policy now looks like it was successful,” he said.

House Democratic Leader Beth Kerttula, D-Juneau, told the press afterwards Parnell was right about the state’s economic strength, but was wrong about what it needs to do to keep strong.

“We are really lucky to be in a good place financially,” she said.

Alaska needs to continue to save dollars and invest them in infrastructure, she said.

Alaska’s oil will eventually run out, and the state will need to be able to fund its operations after it does so.

“We have to turn that non-renewable resource into a renewable resource,” she said.

The best way to boost the industry, she said, was not subsidies, but competition, she said.

Parnell’s speech got numerous rounds of applause from the legislators, particularly when he talked about less controversial issues such as challenging federal control or public safety.

The federal government controls two-thirds of Alaska, he said, and is unfairly blocking the state’s development.

“We demand to be treated as a state, not a colony,” Parnell said.

The state will litigate when its sovereignty is threatened, and has repeatedly sued the federal government over such infractions, he said.

Rep. Cathy Mużoz, R-Juneau, said Parnell’s stand was appreciated by legislators.

“We appreciated the governor’s aggressive ‘pro-state’ response to the federal government,” she said.

When Alaska became a state, it was thought its resources would enable it to support itself, but that can’t happen if the federal government blocks development, as it did with offshore oil drilling, Parnell said.

“Congress did not want Alaska to become a ward of the federal government, and neither do we,” he said.

Parnell also talked of his administration’s efforts to boost public safety in rural Alaska, including new village public safety officers, troopers and prosecutors to protect victims of sexual assault and domestic violence.

Mużoz also praised Parnell’s scholarship plans, which Parnell said would make 9,000 high school seniors eligible to earn scholarships this year.

“I very much support his scholarship plan and want to see that funded,” Mużoz said.

• Contact reporter Pat Forgey at 523-2250 or patrick.forgey@juneauempire.com.



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