Dunleavy lauded for fiscal discipline at conservative DC think tank

Gov. Mike Dunleavy unveils his budget Dec. 11, 2019, at the Capitol in Juneau. (Photo by Rashah McChesney/KTOO)

Gov. Mike Dunleavy gave a speech to the Heritage Foundation in Washington D.C. on Monday. The conservative think tank billed Dunleavy as a fiscal hawk with lessons for Washington on how to balance the federal budget.

Dunleavy said he inherited a large deficit and set out to cut spending.

“And when some of our state’s big spending politicians decided to ignore these warnings, I utilized my veto power to cut spending by $650 million. This was the largest budget reduction in our state’s history,” he said, (though there are other contenders for that title).

The governor also talked about the spending plan announced last week, which he told Heritage will keep Alaska on “fiscally solid ground.”

“Most government services will be flat-funded and there will be no net spending increase with the budget I’ve rolled out,” he said.

Dunleavy’s first budget proposal was controversial in Alaska, and many of his suggested cuts didn’t go through. It also spurred a recall campaign.

The new budget doesn’t impose deep cuts. It takes a different tack by relying on deficit spending. Without new revenues or additional cuts, his plan would spend $1.5 billion more than the state brings in. Covering the shortfall would drain most of the Constitutional Budget Reserve, a state savings account. 

Recall Dunleavy Campaign Manager Claire Pywell got up early to catch the 7 a.m.  livestream of the governor’s speech at the Heritage Foundation. Pywell says the way he was portraying himself in Washington didn’t match what she saw in his much shorter budget press conference in Juneau last week.

“Sadly, another display of a lack of leadership, right?” Pywell said, describing Dunleavy’s budget speech in Juneau. “A lack of a plan, that we’re eliminating our savings with no plan in place.”

Dunleavy is proposing a Permanent Fund dividend next year of about $3,000 per Alaskan. No one at the Heritage Foundation event questioned whether government payments to all residents fits with a conservative fiscal model.