Quick, somebody turn the telescope around for politicians and bankers looking at Alaska's economy. They cite CNBC's survey ranking Alaska's economy 41st out of 50 states. But, the Rockefeller Institute just reported that Alaska leads the nation with the highest job growth of any state. Alaska is one of only two states nationally who had positive annual job growth.
Primary opponents and commercial power players, those who profit based upon dictating Alaska tax policy, decry Gov. Sean Parnell's support for ACES and AGIA as the cause of economic malaise in Alaska. They describe Alaska's investment climate as dour, stagnant and cold.
Republican challengers Ralph Samuels and Bill Walker cite the economy as proof of the need to unseat Parnell. They want ACES done away with and taxes reduced on the oil sector by $1 billion plus. According to Reuters, BP's 2010 profits are up 135 percent based upon higher oil prices.
Samuels and an even more strident Walker have chosen the economy as their platform. They both oppose ACES and AGIA; the law enacted to build an Alaska gasline. The facts cutting against their argument is that the oil industry has had some of its most profitable years in history since ACES passed in 2007. And, we have two FERC applications in for gasline construction.
We all want a strong, profitable, expanding oil sector in Alaska. But, lower taxes before the 2007 ACES enactment didn't create additional jobs or investment. If taxes were again lowered, would increased jobs and investment result?
The best friends the oil patch in Alaska may have are folks with bad memories. We were promised expanding jobs and contracts if we held the line on oil taxes. We held the line but jobs declined, sacrificed to the cost cutting gods at BP and others. BP adopted a disastrous "work to failure" philosophy for equipment and pipelines. Feeder pipelines, without corrective maintenance, ruptured, burst and bled.
Today, without guilt or disagreement, the job of the oil companies is to make money for their shareholders. That is capitalism.
Also, today, without guilt or disagreement, Alaskans charge our public servants with their responsibility under the Alaska Constitution's Article 8.2.
"General Authority: The legislature shall provide for the utilization, development, and conservation of all natural resources belonging to the State, including land and waters, for the maximum benefit of its people."
ACES implemented Article 8 of the Constitution, as does AGIA with regard to the gasline. Parnell understands the vital distinction in oil company vs. state responsibilities and proved he is tough enough to take the heat.
Is Alaska in economic malaise? The numbers refute the political spit and blather. In June, Alaska had 342,400 people employed, up 4,200 from a year ago. That data is even understated. Not included are thousands of self-employed, commercial fishermen, agricultural workers and others. In 2009, after 21 years of back-to-back employment growth and avoiding two national recessions, Alaska's economy slowed. That slowdown was not due to errant Alaska oil policies but to the national recession that slowed our tourism and trade. Alaska's economy is growing in 2010.
Alaska's foreclosure rate is the second lowest nationally. In June, the feds calculated Alaska's unemployment at 7.9 percent, below the national average of 9.5 percent. Alaska bucks the trend in the majority of states (27) who are still bleeding jobs. Freight landings in Alaska's largest port, Anchorage, are up substantially in 2010. And, did I mention that Alaska leads the nation in job growth?
Neil Fried, labor economist, stated in the Juneau Empire, "It's not surprising that Alaska is doing better than the average in the country, or better than most states." And, "From a fiscal situation, we've got to be one of the envies of the nation."
In fact, we are in good fiscal shape and getting better. Just track the real numbers. Let's count our blessings, not butcher the leaders who brought us this positive economic platform.
Jim Crawford is an Anchorage real estate broker.
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