Palin has mixed record as fiscal conservative

By: AP
By: AP

ANCHORAGE, Alaska (AP) -- Alaska Gov. Sarah Palin, the Republican nominee for vice president, bills herself as a fiscal conservative. But that can be a relative term when you're governor of a state gushing with oil money.

When Palin signed an operating budget this spring authorizing roughly $11 billion in spending - more than $16,000 for every man, woman and child in Alaska - she told state lawmakers she had three goals: "To slow the growth of government, live within our means and save for the future."

Palin vetoed more than $250 million in projects from the public works budget around the same time, the second consecutive year she angered legislators by cutting their pet capital projects.

Palin's record as a fiscal conservative has been mixed in the less than two years she's been in office.

-She authorized a $1,200 energy rebate for every Alaska resident on top of the $2,069 check they received this year from the state's annual oil royalty program.

-She raised oil production taxes on companies drilling in Alaska, but also offered $500 million in seed money to a company to start planning construction of a $30 billion natural gas pipeline from the North Slope.

-She has presided over lavish capital budgets but angered lawmakers with her veto pen.

-The operating budget she signed calls for a 28 percent spending increase, but it sets aside money to help pay for schools beyond next year and also socked away more than $1 billion for a rainy day.

Soon after taking office, Palin made a splash selling off the state jet. She's pointed to that step to demonstrate that she isn't beholden to the trappings of office. Still, it didn't save the state money. The state had bought the jet for $2.7 million - and when no one bid for it on eBay, the state eventually hired an aircraft broker to unload it for $2.1 million.

She also got rid of the governor's chef and personal driver.

And Palin makes a point of telling campaign crowds about her response to Washington - "Thanks, but no thanks" - over the $400 million for a bridge linking Ketchikan to an island with 50 residents and an airport. In fact, she turned against the bridge only after it became a national symbol of wasteful spending and Washington had backed off financing the project.

For the most part, the spending increases Palin has approved since taking office have been responsibly managed, coordinated by the Republican governor and the GOP-dominated Legislature, said economist Gregg Erickson of Juneau, a longtime Alaska budget watcher.

"In the context of the challenges she faced, she did do a good job," Erickson said. "Not perfect, but she and the Legislature cooperated to come up with a budget that made a lot of sense."

Compared to her predecessors, Palin has been more conservative when it comes to spending in flush times, Erickson said. But the latest capital budget, even after the vetoes, is worth $2,500 per person in Alaska. The national average was $317 per person in state government capital outlays in 2003, the most recent data available, Erickson said.

"She has presided over a very unconservative capital budget by any nationwide standard," Erickson said.

Palin's mixed fiscal record extends to her six years as mayor of Wasilla. She lowered residents' property taxes by more than half from 1997 to 2002. In her last Wasilla budget message, in 2002, Palin boasted that general government expenditures had increased just 18 percent over her tenure, with larger increases for public safety and public works, and that her final budget "is based on this same fiscally conservative philosophy."

But she also angered some residents by putting Wasilla in debt for the first time ever - $5.5 million in road construction bonds and then pushing for $14.7 million in bonds to build a sports complex. The complex would be paid by raising the local sales tax by one-half percent. Wasilla voters approved the sports complex bonds and sales tax increase.

Palin has done well in keeping discipline, especially since lawmakers like to overspend in flush times, Rep. Mike Hawker, a Republican member of the House Finance Committee.

"It's much more difficult to maintain discipline when there's plenty of money to spend," Hawker said. "She has certainly demonstrated a willingness to restrain the Legislature's desire for a (big) statewide capital budget."

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