Former U.S. senator urges investment despite Alaska’s fiscal challenges

Wednesday, February 15, 2017 - 14:59
  • Former U.S. Sen. Mark Begich speaks to the Chugiak-Eagle River Chamber of Commerce on Wednesday, Feb. 8, 2017. Begich — who now works for Northern Compass Group consulting — said he thinks Alaska needs to invest in the future desptie the state’s fiscal problems. (Star photo by Matt Tunseth)

By matt tunseth

Chugiak-Eagle River Star

Mark Begich began his speech to the Chugiak-Eagle River Chamber of Commerce last week with a history lesson.

“I want to take you back in time…” said the former U.S. Senator, who now works as a consultant for Northern Compass Group in Anchorage.

Begich told the chamber that the financial crisis currently facing Alaska is in some ways similar to what the nation faced during the latter part of the previous decade.

“It was just all bad news,” he said.

As a U.S. senator in 2009, Begich voted for a sequestration bill that was popular with almost nobody, he said.

“As painful as that was, what it did was forced some discipline,” said Begich, who lost his reelection bid in 2014 to current Sen. Dan Sullivan.

However, Begich also voted for the federal stimulus package, and said the State of Alaska won’t be able to simply cut its way out of a budget deficit that’s currently running at more than $3 billion per year.

“If you want to cut your way out of this you’re never going to prosper,” he said.

Instead, Begich suggested the state needs to both cut its budget where possible as well as prioritize spending projects that will have future economic benefits.

“As you cut the budget, you also have to push out…and invest in core infrastructure,” he said.

It’s a plan he said worked well at the federal level and helped pull the nation out of an economic tailspin, he said, pointing to 55 consecutive months of economic growth he believes were the direct result of congressional action.

As for Alaska’s financial situation, Begich suggested legislators in Juneau will undoubtably have to make some tough choices to get the state back on solid ground.

“Anything they do will not be popular,” he said.

However, Begich also believes investment in several areas will be critical to a sustainable financial future, and he laid those areas out at the chamber. The former Anchorage mayor said he thinks tourism, fisheries, the military and air cargo will continue to be growth areas for the state. Tourism, especially, has a bright future both this summer and beyond, he said.

“It’s the one industry we know without question is going to grow,” he said.

Begich thinks the state can get a lot of value from marketing itself as a tourist destination. He also thinks marketing money can help benefit the state’s seafood industry, the nation’s largest. Because Alaska’s fisheries — which employ more than 60,000 people annually — are clean and sustainable, Begich thinks there’s still room for growth.

“Our product is the best,” he said.

Begich also believes the University of Alaska shouldn’t be forgotten when it comes to state funding. Having a thriving university system, he said, will help the state over the long haul.

“Every great state, great city, has a great university,” he said.

The bottom line, he said, is that the state can’t cut its way to prosperity.

“We may cut ourselves to a balanced budget but we will not grow ourselves to the future,” he said.

Begich, who said he’s been a businessman since he was 14-years-old, said he thinks Alaska’s financial future remains bright — despite the looming fiscal problems faced by declining oil and gas revenues.

“I’m an optimist,” he said.

As for his own future, Begich answered a question about any potential run for political office with a decidedly politically correct answer.

“I don’t know what the future holds.”

Contact Star editor Matt Tunseth at editor@alaskastar.com