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After oil … what?

Posted: January 30, 2013 - 1:03am

I read in the Jan. 15 Empire that “ways to get more oil flowing through the trans-Alaska pipeline” will likely be the dominant legislative issue this year. This is understandable in the short term, given the nature of our economy and tax base. But what is our strategy for a longer-term future? The evidence is very strong that the more hydrocarbons we put into circulation, the more we are voting for a climate that will radically alter life, especially here in the north. These alterations are almost certain to work against the interests of our kids and grandkids. When oil and the future don’t mix, I hope we will vote for the future.

We are a rich state right now, in part because of a wise decision to save some of the boom money. We need to access that wisdom again to look beyond the immediate lure of oil and work out a new direction for our state. This will be difficult and potentially divisive; it will require us all to think out of the box. So where is the political energy for this? I ask you, Representative Kerttula, Senator Egan, Governor Parnell, and Senators Murkowski and Begich: are any of you willing to lead a conversation on what our future should look like beyond the oil days? I, and I think many others, would join you.

Greg Streveler

Gustavus

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Latitude58
14447
Points
Latitude58 01/30/13 - 09:14 am
4
1

Thanks Greg

An entirely reasonable request. Wanna bet that you'll get zero response? Our elected officials want nothing to do with that scenario.

glacierdogs
1331
Points
glacierdogs 01/30/13 - 11:37 am
0
2

Comment

It's a reasonable but entirely naive request. While I do not agree with the global warming aspect I think the fiscal cliff is a likely scenario. When in the history of mankind have elected leaders done what Mr. Streveler asks?

Only elected officials who will not run again could possibly tackle this problem and identify real solutions. That is how our political system works, and it's the same throughout the world. Those in the Minority can come up with rhetoric of course because those elected officials have no responsibility to make decisions. The impunity of the Minority very much prevents the Majority from discussing real solutions.

I cannot imagine an Alaska economy without oil yet that is probably what will happen. The magnitude of the imbalance between the economy we have now and the economy we would have then is possibly ten times greater than the imbalance at the federal level, and the federal government has tools that states do not have. Hopefully mitigating that somewhat is that we have better leadership in Alaska than we have in Washington, DC. The $43 billion PF corpus and the $16 billion in operating liquidity the state has at the moment is ample evidence of superior Alaska leadership.

The first decision should be to discontinue the PFD right now. Handing out from $500 million to $1 billion each year makes no sense given the outlook, especially when 25% of the PFD goes to the IRS. The Minority would have to demand it to give cover to the people who have responsibility to make decisions, and obviously that is not going to happen. Many dogmatic liberals might defend the PFD even as the state cuts core services.

We need to allow agencies and officials to give importing LNG to the Railbelt an honest look. Otherwise the competing Alaska gasline proposals are going to suck up a few billion dollars with no possible chance of a pipeline being built. Anchorage Mayor Sullivan is the only elected official willing to have this discussion right now; not even the Minority is willing to talk about it.

Every state manager needs to be free to look at the most cost-effective way to manage their organization without regard to politics. For instance, shutting down state prisons and shipping almost all prisoners to the Lower 48 (because the courts would not allow shipping them to China) would save money - big money - immediately.

The state likely cannot afford a university if there is no state oil revenue. State debt and liabilities need to be paid down while the state still can afford it. Municipalities that have an arcane, direct claim on state petroleum revenues before the state can take its claim need to be dealt with in order to stop unprecedented waste; that's why the North Slope Borough department of wildlife has its own helicopters but the state department does not.

On the other hand, perhaps changes in petroleum taxes can quickly return production to 1 million barrels per day as the Department of Revenue quietly claims. If so then these stark decisions will at least be postponed.

Latitude58
14447
Points
Latitude58 01/30/13 - 08:32 pm
0
1

geedog

Not that I disagree with your position, but I'm 100% certain that Cathy Munoz will not be the one to propose eliminating the PFD anytime soon. A shame, really, since that's what needs to happen.

As far a getting 1 million bbls/day - the only way we'll get that is with a massive slash in taxes, which won't help our economic situation any. It'll just accelerate us toward the day that the oil dries up. And give that new BP-Alaska manager a fat, fat bonus.

Let's reduce spending, keep taxes high, meter out the oil extraction slowly, and try to extend the revenue stream as far into the future as possible. Oh, and increase state taxes on mineral extraction.

I'm not holding my breath for any of this. You claim that we have better leadership here than Washington - I'll play my CBC BS card on that. And who can forget Frank and Ms Quitty-Pants and Governor Giveaway? Washington's terrible with our congress, but comparing them to the likes of Chenault - they look like Rhodes scholars.

Spoorprint
227
Points
Spoorprint 01/31/13 - 11:38 am
0
0

Nice try, Greg...

Of course you are more or less correct. However, our leadership in Alaska is totally incapable of considering your point of view. The goal of a vast majority of Alaskans is to consume as much of everything until something - either the end of oil, the bitter end of the fiscal cliff, global warming, environmental degradation - or all these things in any combination - causes a final collapse.

From that point of view, it's all about retirement, a huge over built home somewhere, big SUV's, unlimited money and credit. Steaks every night when they are not eating crab legs. It will be difficult to explain to them they are on the wrong track. Besides, when Alaska goes broke, they will just move on, or retire elsewhere prior to the fact.

I got a kick out of 'glacierdogs' comment:
'Every state manager needs to be free to look at the most cost-effective way to manage their organization without regard to politics.'

Good luck with that one. The very reason for being a 'state manager' is the money and the politics in most cases. Juneau in particular is all about money. The reason these people went to college in the first place was not science or the philosophy to build a better world, it was to have the minimum requirement so they could 'play the game.' Their idea of a better world is simply more money. They are in. You bet they don't want to see it coming because they know deep down in the bottom of their black little hearts, when things do finally grind to a halt, Alaska will be toast. They are hoping too, that they will have enough stuff to bail out, but frankly, they would rather not even think about it.

Sorry to seem so negative, but Alaska has always been a 'come and get it and leave' kind of place. As long as these people are funded, they will continue. Of course they will try real hard to keep the funding coming.

hellojuneau1
196
Points
hellojuneau1 02/01/13 - 02:30 am
0
0

After oil, what?

hmmm no one really answered the question did they?...what WILL we do in Alaska after oil?

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