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My Turn: Maximum benefit to people or favored corporations?

Posted: August 15, 2014 - 12:06am

This season’s high water has undermined roads, bridges and homes, threatening to erode the foundations of commerce and domestic tranquility. When property and livelihoods are swept away, independent citizens are reduced to charity.

The political analog to raging floodwaters and a diminished future is the passage of Senate Bill 21, also known as the More Alaska Production Act. Over the long term, MAPA will divert billions of dollars into Big Oil’s global accounts instead of the state’s treasury. Its effects will cripple the state’s obligation to fund government.

The implications to Alaska’s public-serving nonprofit economy are dire. The sector that includes soup kitchens, food banks, legal aid, mental health services, medical assistance, museums, education (vocational training, hunter safety, wildlife refuge outreach, community colleges and the University of Alaska) is already reeling from loss of revenue.

Despite years of low overhead and high profits, the oil giants cannot let this moment slip away. The industry’s leverage in Juneau has never been greater. Two Republican legislators who are oil industry executives ignored ethical boundaries, voting for the tax package that gives away the farm. Gov. Sean Parnell runs the playbook via instructions from skyboxes above the stadium.

Parnell’s spin ignores oil price trends. The resource is thinning after decades of production, yet the smart money knows it’s only going to become more valuable. MAPA is written to prevent Alaska from benefiting from high oil prices. Big Oil is greedy; it doesn’t want to share the wealth. Exxon, BP and ConocoPhillips prefer to deal with a weak state, one that cannot adequately fund accountants and lawyers.

The Alaska Constitution holds that natural resource extraction shall provide maximum benefit to the people. MAPA undermines the law of the land, casting it into bondage. One can assume that Republicans who voted for MAPA were either active conspirators or sleepwalkers. To their credit, two Republican leaders, Sen. Gary Stevens and Sen. Bert Stedman, voted with the minority in opposition to MAPA.

Like chief executives of more than a few states, Parnell was elected to work for the people but runs errands for his former employers. A denizen of revolving doors between industry and government, Parnell tries to cover his tracks with law and order rhetoric and dash of religiosity. Pioneered in Washington, D.C., the revolving door is so effective that entire agencies are captured by the industries they were chartered to regulate.

Alaskans who oppose insider influence and its destructive outcomes have a powerful ally. The referendum is a tool to reverse legislative folly. However, it relies on informed voters to prevail. On a level playing field, the industry would lose in a heartbeat; it cannot compete with common sense and history that documents Big Oil’s duplicitous and illegal activities.

The last time Big Oil came this close to running the show in Juneau, the Feds stepped in to expose the Corrupt Bastards Club. A few dirty Republican legislators were sent to jail, some slipped charges and others remain on the state payroll. Unfortunately, the Feds’ attention was focused on the prostitutes and their johns, bagmen who distributed cash and favors. Big Oil escaped the FBI but not the taint.

And now the pattern is being repeated. Sporting oil company decals on their blazers, legislators take orders from Houston and New York City, speaking to Alaskans with a feigned authority that resembles forked tongues. Political scientists call it strategic misrepresentation.

Big Oil’s favorite political weapon is television. With more money than God, the industry spreads its propaganda like Typhoid Mary. Shedding its virus through electronic media, Big Oil intends to infect everyone with its wife-beating message: “Give me what I want or I’ll leave.”

Such arrogance is a habit bred from unimaginable wealth and psychopathic imperatives that seek to control every feature of Alaska’s oil patch.

The industry acts like a bully, never satisfied, always demanding more. Its pride and overbearing self-importance is offensive; it deserves to be rebuked by citizens and the press. Fifty thousand Alaskans, men and women from every part of the state, said, “Enough!,” signing the petition that launched the repeal.

Prudhoe’s legacy fields are in harvest mode. Maintenance costs are climbing; end-of-life infrastructure, corrosion and the ever-present threat of spills and cleanups dog daily operations. Meanwhile, automation technology is moving ahead, cutting rig workers and pump station staff. Increased production is a good thing, however, it’s not necessarily linked to a boost of high paying jobs.

It’s wishful thinking (Stockholm Syndrome, perhaps) to credit oil company executives with concern about Alaska’s future. It’s our responsibility to anticipate and meet challenges as they unfold. Selling the state’s resources at deeply discounted rates undermines our patrimony and threatens the ability to act as an independent, self-governing state.

If Alaska aims to become head of its household, captain of its destiny, MAPA cannot stand. We have no obligation to cushion the downside of an aging oil field, certainly not when it ignores the Alaska Constitution.

• Douglas A. Yates is a former legislative aide, a photographer and writer. He lives in Ester.

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Art Petersen
Art Petersen 08/15/14 - 11:21 am
All the anger

and dark characterizing in this piece show the level of resentment that SB21 has created across Alaska. It's understandable because what's at stake is Alaska's financial well being. Mr. Yates provides excellent specificity in just one economic sector, and it's important enough to look at again:

"The implications to Alaska’s public-serving nonprofit economy are dire. The sector that includes soup kitchens, food banks, legal aid, mental health services, medical assistance, museums, education (vocational training, hunter safety, wildlife refuge outreach, community colleges and the University of Alaska) is already reeling from loss of revenue."

This is just a part of the picture, though. The whole picture would be changed, including the general fund, constitutional reserve, and the Permanent Fund and its valuable PFD program. Public safety, infrastructure, capital investment, "catch up" on deferred maintenance, employment opportunities and advancement, employee benefits, retiree benefits, all general services ... everything would be reduced if SB21 is retained. Advocates of SB21 want to give the oil companies more in the hope of securing more productivity and steady revenue to support fewer and fewer comprehensive state services and less state investment. SB21 will shrink Alaska government and its service and support of everything in Alaska.

This failed economic approach is "supply side" economics in action--where government forces a cheap supply of resource to big business in the hope of receiving a steady supply of trickle down revenue and ancillary jobs. It hasn't worked to the benefit of the people anywhere. It holds down wages, reduces state credit ratings, reduces and eliminates state services, and dampens development of small economic sectors and small businesses. Who, after all, are the job creators but the people who aspire to the American dream. Frustrate them, keep optional cash to spend from their pockets, and hold them back from the middle and higher classes, and an economy goes into decline. Look at Kansas presently as an example of a fast-paced decline that's coming as a result of government-enacted "supply side" economics.

Regarding the vitriol against the oil companies, it's surely true that they have been and are looking after themselves first and taking advantage of matters large and small where they can. Court action and other measures have had to be taken to force them to develop leases they already own. That's their business model, to put their interests first. But it seems doubtful that the oil companies go out of their way to pervert and corrupt public servants. Services companies might, and misguided public servants might misguide themselves into hurting Alaska and the people they serve in order to serve powerful interests, but why would the oil companies recruit such people? It produces anger in "the people," who in Alaska are their partners because the people own the oil.

Voting Yes on Ballot Measure 1 gives Alaska another bite of the apple. It gives their representatives another chance to get it right with the people at large by returning to ACES and adjusting it reasonably and equitably. Alaska will be very well served by taking that bite and retaking ownership and a fair share of its resources.

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