Juneau, Alaska (KINY) - The executive director of the Juneau Economic Development Council, Brian Holst, talked about the economic impact of Governor Dunleavy's budget cuts while a guest on Action Line.
He said the impacts will be hard and negative and will result in increased taxes at the local level; turn away millions of dollars in federal support; and generally damage the economy.
Holst said there are three areas that must work for an economy to thrive. One is institutions which said is at many levels. "People want less government. There are certain people out there who propose less government, but it's not no government. You need a certain level of government to deliver services that individual's need, but also that your economy relies on. Those institutions need to be able to work well."
Another area is investment. "We need to make investments. We need to have roads that work. We need to invest in our schools. We need to be able to create the conditions for investment, but investment not just for the public sector."
Private sector investment has to take place, according to Holst. "The private sector really looks to what's happening in your economy. So you can't have inadequate services. You can't have untrained employees. You can't have a poor quality of life. You can't have shoddy health care or it won't be attractive for the private sector to work."
Holst added that there's a lot in the vetoes that need to be reversed so that we don't deteriorate the interest in the private sector to invest in Alaska.
And the last area is innovation which he ties to education. He said the cuts eliminate any support for early education and impose unprecedented cuts of the university system. He said the immediate impact on the economy will be a loss of an estimated 4,000 jobs.
Holst said the budget cuts all work against those three elements which he calls critical.
In addition, Holst said a larger dividend as proposed by the Governor. Holst said the dividend from an economic development and economic impact point of view does not offset the budget reductions.