Very different policies led to a reduction in state government in Kansas than what is driving a reduction in state government in Alaska, according to ISER Director Ralph Townsend in an interview for Alaska Public Media. But that doesn’t mean Alaska will be spared the economic impacts.
In Kansas, large tax cuts led to reduced state government, a downturn in the economy, and schools closing. In Alaska, a battle over the size of the Permanent Fund Dividend is being coupled with cuts to state government.
“As we’ve seen in ISER studies of the state budget and PFD, cuts to state government cause more harm to the economy than the socio-economic benefits of the Permanent Fund Dividend,” Townsend said.