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March 5: Voice of The (Anchorage) Times on privatization study:

Posted: Monday, March 06, 2000

There was something familiar about this past week's trashing of the Legislature's privatization study. It was a virtual repeat of the trashing a few years ago of a study of state employees' pay. It's more than a coincidence.

For years, Alaskans have heard much about the state's budget gap and the crisis ahead once the state's savings account is depleted.

Former Gov. Walter J. Hickel hosted a number of public forums on the subject, inviting recommendations from individual Alaskans on how the state might bridge the financial gap. Gov. Tony Knowles and the Legislature continued the process with a series of town meetings on developing a long-range budget plan.

The goal was to find a consensus. Were Alaskans ready to start using part of the Permanent Fund's earnings to pay for state government? How about a state income tax or another tax?

The consensus the politicians heard, however, was neither of these. The people said: Don't use the Permanent Fund and don't raise taxes. Cut state spending instead.

Two specific recommendations heard most often were to bring state salaries and benefits in line with the private sector and to privatize some of the functions of state government.

How did the politicians respond? On the pay issue, the Legislature a few years ago funded a special study that was overseen by the Department of Administration. Salaries and benefits of certain state positions were compared to average salaries and benefits of similar positions outside state government.

When the results came in and showed that indeed state workers in a number of instances are paid well above others and enjoy top benefits, representatives of state employees attacked the credibility and integrity of those involved in the study.

The same thing is happening on the privatization issue. Last year, the Legislature formed a special panel and involved about 300 citizen volunteers. They came up with a long list of recommendations about which functions of government might be turned over to the private sector.

But those who embrace large government don't care much for ideas to privatize state functions. So it was no surprise to see the latest effort to discredit that study. Their goal all along was to shelve both studies and maintain the status quo.

Unfortunately, they appear to be winning. Gov. Tony Knowles in recent months signed off on new contracts with state employee bargaining units that increase pay and benefits. He also has called on the Legislature to increase budgets of a number of state agencies.

And rather than moving forward with privatization recommendations, lawmakers are talking about using part of the Permanent Fund or instituting new taxes to pay for it all.

And they wonder why the public is so cynical.



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