Jackie Stewart took Gov. Sean Parnell to task for his efforts to revise Alaska’s petroleum tax regime in her My Turn in Friday’s Empire. I could forgive her for simply being wrong on the subject and I would have let it pass but for the contemptuous tone and apparent purpose of her missive.
Parnell is trying to steer Alaska away from a looming iceberg. This issue is not that employment and state revenues are down now. The issue is that both will decline — and fast — if new oil development is not encouraged in time to reverse the current decline. The current tax regime, ACES, was based on lower prices than we now experience and removes all incentive for new production at these prices. Oil companies can do better in other parts of the world and they are.
Stewart says Parnell is concerned that oil production is decreasing and I am sure that this is true. We all are. Then, amazingly, she says “Well, lowering taxes won’t change that…” Here is where she is resoundingly and unequivocally wrong. Alaska has plenty of oil that is relatively easy to extract and deliver thanks to previous development and we can be sure that the industry will rebound if we compete effectively on the tax issue.
You can’t get milk if you strangle the cow and that is what we have been doing to the oil industry. It can be fixed and I think it probably will be in the 2012 legislative session. Commentary like Stewart’s will not help.
I think the real purpose in Stewart’s column is revealed in her eighth paragraph where she says “Well, methinks he has aspirations about his future…” to answer her own question about why Parnell is seeking tax changes. What the hell? Does she think he wants to go on to cap off an illustrious career as an oil company lobbyist? Stewart’s purpose is obviously to besmirch the character of a governor who has earned genuine respect and affection across the state and here in Juneau. She apparently cannot stand the possibility that he is earnest and capable in confronting the oil tax issue. We shall see if more of this contempt-based-on-ignorance messaging emerges in the media.
Murray R. Walsh