When Legislators Cared about Alaskans

HUGH MALONE’S
PERMANENT FUND LEGACY

(2020©donnliston.com)

Hugh Malone was Speaker of the Alaska House of Representatives when the Alaska Permanent Fund Dividend was designed to protect Alaska resource wealth from being pissed away by politicians. The dividend gives all Alaskans a stake in the fund’s future by spending levels set  by averaging 5-year earnings.

 Every
year around St Patrick’s Day my memory returns to one of the best friends I have
ever had, who died too soon, and who might be outraged at what appears to be
happening today to his most enduring legacy, the
Alaska Permanent Fund
PFD
payout. He didn’t cause it to happen alone, but the Permanent Fund  corporate board
room at the Juneau headquarters was named after
Hugh Malone on April 30,
2001, and his presence must be felt during every meeting there since.

Our
mutual friend Clark Gruening signed that proclamation naming the conference room as chair of the Permanent
Fund Board of Directors
.

Hugh
and I became friends in Juneau because we both had dogs we liked to walk on the
many trails, docks and beaches around the area. We had been casual friends for
a long time but became close as we shared our Alaska life experiences and varied
perspectives on politics during frequent outings.

A
professor of Anthropology at Kenai Peninsula College, Alan Boraas in
January of 2004 reflected in a column he wrote in the Anchorage Daily
News
about the Kenai representative he had encountered in 1978, who was:
the brains behind the Permanent Fund, and was part of a cadre of young,
liberal Democrats and moderate Republicans like Jay Hammond, who forged
one of the most innovative and fiscally conservative financial institutions in
Alaska’s history
. Boraas also credited Malone as among the smartest and
most thoughtful legislators Alaska has ever elected
.1

Hugh Malone, 1977

This
appears to be a quality sorely lacking in legislators today who say anything to
get elected and go to Juneau to accommodate the bidding of special interests.
As the largest employer in Alaska, the State of Alaska is a special
interest demanding ever more while oil revenues decrease.

Juneau
is also the pinch-point for all state employee unions.

In his
column, Boraas continues, …at 10 o’clock on a clear, crisp, fall night we
found ourselves in the parking lot of the old Kenai Library after everyone else
had gone home. Hugh, leaning against the old beater car he drove, smoked a
cigarette and talked about the dividend while I turned my collar up against the
cold and listened.

What
has become the dividend was not a foregone conclusion and was not part of the
earliest discussion of the fund,
reported Boraas. Growing
up in Kenai, Malone had seen the powerful influence the oil industry could
exert in a community…This strategy of influencer was no doubt forged at company
headquarters back in Houston or London where they knew it’s hard to demand
environmental accountability, question labor practices or resist efforts to
lower oil taxes when the public face of the company is sitting next to you at
the Rotary Club or donating uniforms to your kid’s Little League team
.

It was almost always difficult to get a good picture
of Hugh Malone but we had good times on my boat!

Some
might argue that as our partners in Alaska oil resource development the oil
companies didn’t need to be our corporate nanny. Their success is automatically
our success if the state gets a percentage of all oil produced. But the genius of the
Permanent Fund is that it protected our part of the earnings by distributing a
statutory amount in addition to providing for an equal amount to fund
reasonable State government.

By
(the oil industry) applying this (self-serving) strategy statewide and intensively
lobbying the legislature
, Malone reasoned, the oil industry
would successfully lower its oil taxes, the major contributor to the principal
of the fund in the early years, and the Permanent Fund would dissolve,
explained Boraas.

Which
never happened!

And
here is the clincher: However, a significant yearly dividend paid directly
to Alaskans from invested interest would create public  ownership of the Permanent Fund concept and
vigilance over oil tax contributions to the principal upon which the dividend was
ultimately based because their (Alaskan) pocketbooks would be directly
affected.

In his
2004 reflection, Boraas begrudgingly further admits: In this sense, the dividend
program has worked. Last year the Legislature lowered North Slope oil taxes for
perhaps the first time since the inception of the permanent fund. But now,
ironically, the public’s diligence over the fund that Malone envisioned is not
directed at the industry’s attempt to reduce its taxes but at state government’s
need to use the fund to pay for services.

Click to read about the best thing about Los Anchorage

Imagine
that, a state UA employee bemoaning in print that the need to adjust taxes on declining
oil fields could be detrimental to state employee’s incomes.

The
genius of the Permanent Fund Dividend, is Alaskans have a stake in the future
of the fund by virtue of the fact they receive a payout based on the value of
the fund. Shouldn’t they have the right to decide if that fund should be used
to buy more government or to reduce expenditure on state government? Should
elected officials be allowed to simply change the terms of PFD payouts while hiding out in Juneau without
a vote of the people?

I don’t
think so, and I don’t think Hugh would have thought so either. If we currently
had elected officials in the legislative majority of the caliber of Hugh Malone they wouldn’t think so either.

Hugh and I pulled our share of dungeness and king crab in the waters around Juneau.

Hugh Malone
died while on vacation in Italy March 8, 2001 at age 57. It came as a great
shock to me at a time when I was working as a substitute teacher while earning
my teaching certificate in Juneau schools. He had encouraged me in this pursuit.

Hugh
was a couple of years older than I but we had both participated in the takeover
of the Alaska Democrat Party by the Ad Hoc Young Democrats during
the early 1970s. He had gone on to become a member of the Alaska House of
Representatives
from Kenai. A surveyor by trade, Hugh had never
finished high school, but the had such a common sense approach to life that he
attracted smart people to his brilliant way of thinking.

Prior
to the Celebration of Life for Hugh, held on St. Patrick’s Day, the following tribute
was published in the Juneau Empire .

Waiting at the gate for Hugh’s calls2

By
Donn Liston

Hugh
Malone became a part of our family after my chocolate Labrador retriever,
Kowee, became his friend. Hardly a day went by when Hugh was in Juneau that he didn’t
drive to our home to pick up Kowee and take her with his own dog, Gussey, to
have an adventure.

Initially
it was startling when Kowee would disappear from our fenced yard without notice.
After a time or two of frantically calling Hugh’s number and leaving a message
inquiring about Kowee, he made it a practice to call before picking her up. He
would leave a message on our answering machine telling Kowee he was on his way
over to take her for a walk. We might find out Hugh had liberated Kowee hours
after she was already back home. Now, anytime Kowee hears the telephone ring
she runs to the gate to wait for Hugh’s arrival.

Whenever
he took Kowee, they would be gone for hours. But Hugh once told me Kowee would
become anxious if he kept her too late. He said Kowee knew Cathy and I were “her
people.”

Hugh
always referred to Kowee as his friend, and I joked that we had joint custody
of Kowee. It was a good deal for everybody. On occasion I would join Hugh,
Gussey, Kowee, and sometimes Hugh’s wife, Debra, on an outing to Sandy Beach or some local
trail. Inevitably we met other dogs walking, and their people would often know
Hugh, who would introduce me as “Kowee’s people” and his good friend. It had
become somewhat of a ritual on Saturday mornings and afterward we would buy
snacks and stop by the Friends of the Juneau Library store for cheap books.

Hugh
was the best friend my wife and I have ever known. Moments spent with him are
magical memories.

Sometimes
I could get Hugh to talk about his efforts as a legislator, and later as an administration
official (commissioner of revenue) under Gov. Steve Cowper. He would take no
credit for anything he had accomplished in his quest to make government
accountable to the people of Alaska. On the other hand, he was often critical
of the way things have happened in this state since his days of public service,
and freely offered his opinions about how things should be.

Some
might be surprised to know that despite his critical role in establishing the
Alaska Permanent Fund, Hugh was not satisfied with what had developed out of
the initial idea of a means to use North Slope oil funds to make Alaska a
better place for future Alaskans.  Additionally,
after his many years in public office, Hugh was a man of intense integrity who
hated corruption in any form.

When
Cathy and I approached Hugh and Debora early this year about our upcoming
vacation to Mexico in mid-February, it was revealed that they, too, had planned
an upcoming trip to Europe. Once again, as in the past, we would need to work
out arrangements for care of the dogs. We were scheduled to return to Juneau
only a few days after they left.

Mere
words cannot describe the loss we now feel at the news of Hugh’s untimely
death March 8 in Italy. We are listless and sorrowful, although we know he
would not want us to feel morose. So, Saturday morning I took the dogs to Sandy
Beach for a walk like they were used to taking.

Kowee
has been spending a lot of time at the gate waiting for Hugh following rings of
our telephone. Taking the dogs out was one of Hugh’s favorite things to do and
now, in his memory, it is going to be mine.

Commissioner of Revenue, Hugh Malone, 1994

The
Eulogy

Plenty
of people showed up for Hugh’s Irish Wake on St. Patrick’s Day and I was
honored to be one who gave a eulogy. I described this giant of an Alaskan as possibly being some kind of magical Irish being who chose this time to leave
rather than allow those of us who savored his many pots of gold to find out the
truth.

Most
primary records concerning the Leprechaun go back to the 19th
century, and they describe a fellow with an occasionally elfish grin, with high
spirits, and an inclination to suddenly move quickly or change the subject of a
discussion in mid-sentence, when what was being said was irrelevant. They often
appear to be mirthful, or animated, with serious overtones only when the situation
calls for such. And while a leprechaun might, on occasion be inclined to imbibe
in fine Irish beer or spirits, they never become so drunk that they are
unsteady or their sharp minds become affected.

In the
spirit of Hugh Malone I also offered: Leprechauns have also become
self-appointed guardians of ancient treasure, which they have hidden in crocks
or pots. This may be one reason why leprechauns tend to avoid contact with
humans whom they regard as foolish, flighty, inconsistent and greedy creatures.
However, if caught by a mortal, a leprechaun will promise great wealth if
allowed to go free. And, according to the legends, you must never take your eye
off a leprechaun or he can vanish in an instant.

Hugh
Malone has vanished from his legacy continues. Gov. Dunleavy has proposed
three constitutional amendments to protect our Permanent Fund pot of gold
before the Dwarfs and Gnomes now in the Alaska Legislature majority caucus steal
it all. In coming months every one of the candidates for legislative office
must be asked where they stand on 1) Constitutional Amendment – Affirmative Vote
of the People for Taxes (SJR 4/HJR 5);

2)
Constitutional Amendment – Vote of the People to Change the Dividend Program
(SJR 5/HJR 6);

3) Effective
Constitutional Spending Limit; Savings Plan (SJR 6/HJR 7).

Alaskans must never let politicians steal the Permanent Fund.

References:

1Alan
Boraas, “May spirit of Malone guide fund talks,” Anchorage Daily News, January
24, 2004

2Donn Liston, Juneau Empire, Waiting at the Gate for Hugh’s calls, March 12, 2001

Hugh Malone

LEGISLATIVE SERVICE:

1973-1976 Representative District  
1977-1978 Representative District  Speaker of the House
1979-1984 Representative District  

OCCUPATION:

Registered Land Surveyor from Kenai

COMMUNITY SERVICE:

Member, American Congress of Surveying and Mapping

EMPLOYMENT:

Member, Kenai City Council;
Member, Kenai Borough Assembly;
Vice Chairman, Cook Inlet Air Resources Commission;
Chairman, Alaska Local Boundary Commission

OTHER:

Kenai Chamber of Commerce Award for Governmental Service, 1971

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