Safe Landing: Charting a Flight Path Through the Clouds

Abstract

Everybody’s got an idea about where to find the roughly $1 billion we’ll need to balance the state budget every year from now on. It’s hard to evaluate these proposals, because the budget is complicated—and it’s hard to imagine how much $1 billion really is. This paper looks first at why some popular ideas can’t raise $1 billion a year, although they can certainly help. Then, in the foldout, we try to help Alaskans see through the clouds obscuring the “Safe Landing” strategy, which we first talked about in 1992. This strategy says that dealing with such a big deficit requires using a combination (and there are a number of possible combinations) of budget cuts, windfalls, Permanent Fund earnings, new taxes, and economic development.