Alaska, like Hawaii, is too dependent on one industry

Posted: Monday, January 25, 2010

Hawaii and Alaska are often considered siblings since they were the last two states to join the Union. If we're twins, we're certainly of the fraternal and not identical variety. But despite our vast differences, the Last Frontier and the Aloha State share many similarities: isolation from the rest of the nation; strong, vibrant indigenous populations, both historically and in the modern era; and dependence on the U.S. military as a crucial part of our economic infrastructure.

I had the pleasure of attending the opening of the Hawaii Senate in Honolulu on Wednesday. While I am sad to have been out of town for the opening of the Alaska Legislature and the annual Juneau Community Reception, I made these travel plans months ago - and I'm happy I stuck to them.

Most years, Hawaiians throw a party in the open-air rotunda of the Capitol, shaped like a volcano with the House and Senate chambers occupying half of the conical structure. This year the party was canceled because Hawaii faces a $1.2 billion budget deficit. That's a lot of money, and while canceling the opening day festivities won't save much toward closing the budget gap, it does send a message of frugality.

The Hawaii Legislature is dominated by Democrats, who enjoy a 23-2 majority in the Senate. The Senate session was convened by Senate President Colleen Hanabusa, a seasoned politician who's currently seeking to move up to one of Hawaii's two seats in Congress. Hanabusa was circumspect but upbeat, and explained the decision to cancel the opening party by saying that, given the financial situation, now was not the time to party. She pledged to bring back the celebration when the Legislature had made some progress.

If you're wondering how tough times are in the islands, Gov. Linda Lingle - who was a few rows behind me in the Senate Gallery - instituted last year "Furlough Fridays" for the majority of government offices and services, including schools. That means children are being instructed one fewer day each month, leaving Hawaii with the shortest school year in the country. This still hasn't closed the state's monumental deficit nearly enough.

We in Alaska have in recent decades, and particularly since the current recession began, been largely insulated from unpleasant economic circumstances elsewhere in the country. Our earnings from oil have paid generously for public services, and Alaskans pay few taxes except at the municipal level.

A huge part of the deficit facing the Hawaii Legislature results from the massive drop-off in the numbers of visitors from the mainland and Asia, among other places. A dependence on tourism is something our economies share. In Juneau and other Southeast towns, declining visitor numbers have led to some big holes in municipal budgets, and while we haven't heard talk of "Furlough Fridays" here in Juneau, our city is facing a serious shortfall in years ahead.

In Alaska, there are many who resent the visitor industry, without accounting for what we could possibly do to replace the dollars it provides to our local and state economies. The other day on the north shore of Oahu, I drove past a sign that read, "Nuff Hotels Already." I understand how Hawaiians don't want to see any more of their scarce land allocated to a use that is momentarily faltering, with existing hotels not full to capacity. Personally, I'm not eager to see more T-shirt or tanzanite shops where I live in downtown Juneau. But neither sentiment makes the visitor industry any less important to financial health and well-being, and we all must be willing to compromise to create a sustainable future.

While Hawaii obviously faces much greater constraints on land use than we do in Alaska, in the long run all resources are finite, except perhaps or capacity as a species to find ever more innovative ways to allocate scarce resources efficiently and effectively when we really try. As much as we can breath easily because this year's oil prices are likely to generate a sizable surplus, that doesn't answer the tough questions about where we'll be in five, 10 or 20 years from now. Just as Hawaii became too reliant on the golden goose of tourist dollars, we too are dependent on a single industry. Our future likely will come to rely more and more on tourism money, and that gives all the more reason to cultivate sustainable growth in this industry.

Alaska and Hawaii will continue to be places that people from around the world are eager to experience, if only as visitors. I'm grateful to call the one my home, and to spend quality time in the other.

• Ben Brown is an attorney living in Juneau.

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