Elton Engstrom attacked Gregg Erickson's logic on May 18. In the 40 years or so that I have known Gregg, I have found his logic to be solid. If anything, he's a bit too conservative. If Gregg sticks his neck out to say there is problem, you had better listen.
Our Alaska Constitution provides for three separate branches of government, and Gov. Sarah Palin has joined the oil companies in saying the legislative branch cannot be trusted by contracting away future Legislatures' ability to tax oil and gas. (What does this say? Who cannot be trusted? Alaskans cannot be trusted, but the oil companies can?)
Palin wants a 10-year freeze on oil and gas taxes. But the clock does not run out until 10 years after the gas starts to flow, and most likely there will not be a gas line for 20 years, if then. So it is at least a 30-year freeze.
Palin has conceded that her first gas line open season will fail and likely so will the second open season. The reasons for failure:
1. There is less than half enough gas for the Alcan Gasline.
2. Palin's estimated cost is less than the cost of the oil line 30 years ago, on a per mile bases; since then costs have doubled and will be twice her estimate.
Yet, Palin is willing to give away $500 million of Alaska's money to bribe some company into selling the state on a gas line proposal. She takes solace by saying that if there isn't a gas line, at least there will be a Federal Energy Regulatory Commission license - somebody else's FERC license, not Alaska's. Nevertheless, Trans Canada not only already has a de facto FERC license from the last gas line try in the 1980s, but it also has the Canadian National Energy Board license and Provencal approvals. Palin's gas line plan results in less than what already exists. Trans Canada considers Palin's plan "crap," my word not theirs. You doubt it? Read transcripts of Trans Canada's testimony.
When Palin's plan fails, and a future governor tries to dump it, we'll find that Palin's contract requires the state to pay triple damages and triple damages on our $500 million, too. Just wait and see.
Confusion and an innocent, pretty face will get Palin past the next election.
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