Skip to comments.How Sarah Palin Got a AAA Credit Rating for Alaska (Attacking her for raising oil company fees)
Posted on 08/08/2011 8:34:04 AM PDT by 2ndDivisionVet
In light of Friday's decision by Standard and Poor's to downgrade the United States' credit rating to AA+, it's worth mentioning again -- as I first did in this Atlantic piece -- that Alaska recently had its bond rating raised to AAA for the first time in the state's history, largely due to fiscal improvements brought about by Sarah Palin while she was governor. The state currently enjoys a $12 billion budget surplus. I was reminded of this fact over the weekend by Ian Lazaren, the indefatigable supporter-cultist behind Conservatives4Palin.com.
This is unquestionably a good thing for the people of Alaska, just as the country's downgrade is a bad thing. The state enjoys lower borrowing costs as a result. But especially in light of the current dysfunction in Washington, it's important to understand why Alaska's fiscal situation improved: It was largely because Palin raised taxes. Specifically, the state oil tax. Her central achievement as governor was signing a law, Alaska's Clear and Equitable Share (ACES), that dramatically increased the state's share of oil profits just as oil prices began to take off. There's a direct line between increased revenue and improved fiscal health. (Alas, the good folks at Conservatives4Palin have posted a gloating item about Alaska's credit-rating that both attacks Obama for raising taxes and neglects to mention that Palin's own tax increase was the basis for the improvement.)
(Excerpt) Read more at theatlantic.com ...
Im supposed to be upset about this? Obama is fighting oil, coal and gas at every turn. Sarah wanted more of it because it was paying the bills. The A-hole in chief might not have noticed,,, but around the country, the only conomies that are booming are based solidly on oil and gas.
It’s time to impeach Obama, even if it denies us the pleasure of seeing him lose the election. He is deliberately destroying the economy..
Exactly. Alinsky-ite tactic.
And I seem to recall the last number I saw, showed Alaska in the black to the tune of $40 Billion. The rest of the US should be so lucky.
Pick the states with the lowest unemployment. They all have oil and gas in common as the engine of their economy. The communist in chief is trying to kill it.
Sarah’s approach sounds fine to me.
If a democrat did what she did people here would be screaming that the rats went after ‘big oil’ and ‘stole’ their profits to ‘redistribute’ their wealth. But since Palin did it it’s AOK. What hypocrisy!
How terrible! The evil oil companies were sitting on their oil, waiting for higher prices. She persuaded them to drill, produce, and build pipelines, increasing domestic production and enriching the state.
Obama, of course, does the opposite. Which the Atlantic loves. Don’t drill, don’t produce, and only build pipelines to China.
Capital B Capital S. And you know it!
Every state imposes some kind of tax or fee on mining and extraction activity. The fees or taxes thus raised, if used properly, take care of public costs associated with these activities-- wear and tear on the roads or necessary upgrades being the most common. These are normal and, all but your most extreme libertarians, would agree that they are necessary as well.
The problem comes when big government demonizes these industries and wants to shut them down without a logical assessment of costs versus benefits. Exhibit A is the ObaMao Administration's attitude toward coal fired power plants. Burning coal to generate power is evil, not because actual data shows it, but because petty political experts so decree.
Exhibit B is even more common-- punitive taxes imposed to benefit one set of political allies at the expense of political opponents. This was the Rendell Administrations position on natural gas drilling in western Pennsylvania. They weren't opposed to it per se, they just wanted it to generate taxes to be redistributed to Fat Eddie's friends in Philadelphia and Scranton rather than the regions of the state actually impacted by the gas drilling. This is why little happened until Fat Eddie was shown the door.
Sara did raise oil taxes, a lot. (If you live in Cali and are paying $5+ a gallon for gas - thank you.)
And now unemployment is up, a lot.
Only a single drill rig was working this summer. Which means a whole lot of people were not working.
At least one major oil comapny (so far) has sold all of thier assests and has left the state.
In my small neighborhood, 6 familys have put their homes up for sale and left the state.
And for the record, Alaska is #2 in bonded indebtness of all the States and some local communities (Most notable Barrow AK) are so in debt, there is no real hope they will ever pay all of their bonds off.
So I guess ther is a cost for that AAA rating - at least here.
In case you want to know more
ACES oil tax structure went into effect years before Moody raised Alaska’s rating.
The bond rating was actually raised after Sarah Palin quit the office.
ACES passed back in 2007.
The bond rating was raised in Nov 2010.
Sarah Palin quits as Governor, July 2009.
If you are living in California and paying $5+ for gas, it’s because the state assembly wants you to and demands that the oil companies refine California gasoline to a different standard.
That is nothing but the facts! The only BS is being spouted by those trying to defend that policy!
Go read Alaska’s constitution and then get back to us.
Your *facts* are twisted by your personal outrage. HERE is the *facts*.
Former state Representatives Pete Kott and Vic Kohring have been convicted taking bribes from oil company executives in Alaska. Using the oil profits tax passed in 2006, these politicians literally used their offices to steal money from the citizens of Alaska. Governor Sarah Palin would have none of it, and set to work to correct the problem and return that money to Alaskan residents...
Governor Palin did what any conservative worth their own soul would have done. She gave tax dollars that were literally stolen from Alaskan taxpayers right back to them and appropriately reversed corrupt tax policy. Not only did she bring ethics back to the tax policy in regards to the oil industry in Alaska, she improved the policy itself in her proposal.
The tax raises when oil prices are high, and falls when oil prices are low. This give amazing incentive for the oil companies to produce more oil, which increases supply, and lowers prices for everyone including the taxes they themselves pay the state. When oil prices are low the tax moves to a 10 percent tax on the gross, instead of the net tax of 25% when prices are high. Instead of, not in addition to. The oil companies in Alaska with the Palin proposal pay the state minus their operating expenses along with pipeline and tanker charges. In this way, the oil companies are not taxed for the cost of doing business.
So if someone snowed you and put you out of a job and blamed Sarah Palin, they were lying through their teeth. And if YOU didn’t bother to find out the truth, then shame on you because you wasted a lot of time blaming the wrong person. DEAL with it.
It was the CROOKS before Palin that screwed you.
I was one of those. But I needed to stay employed so I returned to Texas from Alaska.
Sorry, I forgot this link above.
We knew that Governor Palin created serious enemies among the corrupt of the republican party and the oil industry love nest.
What hurts us in California is the 70 cents in taxes per gallon of gas, I think you guys pay 26 cents per gallon in taxes in Alaska.
Alinsky, you magnificent bastard ... I read your book!
Alaska's State Constitution makes two things (among many others) very clear.
1) The Governor is the State's CEO and COO. It falls to this one individual to be the final say on all matters of applying the State's Laws.
2) The natural resources of the State are the property of its citizens, and it is they who by Law should be the beneficiaries of its lucre if sold or used for profit.
Had Palin just "taxed" the oil companies so that she or the State (government) could thus benefit, there might be some teeth in your whine. However, that's not what she did. She made sure that The Law was followed, and diverted a percentage of the profit from Alaska's Energy Resources directly to The People.
The only "hypocrisy" in your blatt is your own, Caniac.
And for the record, no Democrat ever born would even consider returning massive amounts of State-controlled cash to "The People." So your example is a pile of "Unicorns skating down Rainbows" nonsense.
Next time, put your pants on over your underwear. You won't look nearly so silly. Trust me.
I see no hypocrisy at all. Anyone who claims not to see a difference between a tax on oil produced on private lands and a fee for drilling on public (state) lands is being intentionally obtuse, at best. Since the oil lands belong to the State of Alaska (meaning the people), charging a fee for a private company to drill for that state resource is entirely appropriate and has nothing to do with raising taxes. Perhaps some would debate the reasonable level for that fee, but I would argue that the marketplace determines that level.
Note: I own enough shares of Exxon stock (XOM, currently about $72.65 a share) that I keep its price constantly displayed on my screen, so my personal interest is on the other side of this question, but honesty is an absolute, and Palin was on the right side in this decision. Also, I own land on which two private companies drill for oil, and I change them for the use of my land, just as Alaska does - and what I charge is not a "tax" either.
The hypocrisy is strictly yours, as usual.
This is far more than royalties or land use fees. ACES sets the profit tax rate as high as 75% when prices are high in addition to royalties paid. Alaska also charges property tax for the oil and gas industry but no other business has to pay property taxes.
>> “(If you live in Cali and are paying $5+ a gallon for gas...” <<
Did you mean $3.60?
I’m sure that the rest of your screed is equally accurate.
Facts are nice things unless you’re a Journolist...
Sure...right. You guys just keep telling yourselves that.
Interesting how the head of a Palin-backing organization is labeled an “supporter-cultist” by this clown. Those in Benito Obama’s Cult of Personality are never called “cultists”.
She did not raise taxes on the oil companies. She re-negotiated the price the oil companies pay the owners of the oil, the people of Alaska. Unlike the other states, the mineral resources of Alaska were not sold as "mineral rights," but are retained by the citizens of Alaska, who have the right through the AOGC to sell or not sell the minerals.
Wrong. ACES raised the profit tax paid after the royalty payments are made.
ACES is a separate issue than the royalties paid for the State Oil & Gas resources.
Actually, the Alaska state Constitution provides for the oil profits to be distributed to state residents. That was drafted l;ong before Sarah palin came along.
What Sarah did was tell the oil companies to quit sitting on there reserves and start drilling or she would give there leases to somebody who would drill.
Sarah would most likely do the same for the USA as a whole (increase production) and we could actually stop sending precious money to Muzzies and dictators.
Just so you know...it’s expensive up here. Oil check last year was running about $140 a month per person...you can’t really live on it.
Gee. Yesterday I defended Perry. This morning I defended Bachmann. A little while ago I posted the FACTS about the so-called windfall tax...which isn’t. So if you don’t like the truth, you should just LOVE obama and stick right with the left’s ralking points. mmmkay?
No. Not the profits.
The constitution amendment to create the Permanent Fund is for 25% of the Royalties. The profit tax is in addition to those royalties. The ACES legislation that Sarah Palin campaigned on and got enacted dealt with profit taxes over and above the royalty payments.
The ACES profit tax is not shared with the residents but only goes to the state government.
The profit tax that was increased in ACES is not redistributed. That tax is kept as for the state and is not part of the Permanent Fund that is shared with the residents.
The permanent fund is from royalty payments. Royalty payments are taken out first before the profit tax is added on.
"ACES represented a major philosophical shift in the role of government. As resource owners, Alaskans literally had a "working interest" in energy exploration and development. Traditionally, the sovereign's role is to passively collect resource royalties, but under this value structure, we would shift towards an active role in incentivizing resource development. Our state and nation needed it. Ours ACES proposal would provide more value to Alaskans when the price of oil was high but would provide substantial relief to the oil companies when prices fell.
In the special legislative session held in October and November 2007, legislators on both sides of the aisle agreed with our approach. The measure passed with overwhelming public support. Of course, I took political hits as the oil companies launched a smear campaign that we were raising taxes on the industry. But we persevered, and I'm glad we did. A year later, vindication came when industry officials admitted that the legislation was working and had even significantly increased their profits while spurring them to invest more in exploration and new development in Alaska. We had struck that sweet spot where industry and the public interest were mutually served."
This wasn't a change with ACES. It existed that way before ACES.
Yes, based in their constitution, I believe.
No Conservative should have the slightest problem with royalties being paid to drill for oil. That is another good reason to drill. Better our coffers than the Saudis.
Pray for America
ACES isn’t about royalties. It is about the profit tax paid after royalties are paid.
Yes, Alaska amended their constitution to include this after the discovery of Prudhoe Bay oil field. Jay Hammond, governor was the primary driver of getting the constitution changed.
Why “think" about things in Alaska - check the net for facts, it helps you both ways.
To save you time in checking on google
As for the love nest - 90+% of all state revenue comes from oil. Hard not to worry about the (almost) sole source of income.
Nope I meant 5 bucs
4.89 in Burbank.
4.79 at the Mobil @ 201 S Azusa Ave & Garvey Ave S
And you have it easy -
In Orlando, Fla., one gas station that is closest to the airport is selling gas at $5.39 today, 10 cents more than last week’s price of $5.29
As far as screed -
taxes are up, employment is way down, oil comapnies are leaving - I see see this as I live here in Alaska.
You go ahead and love Sara, just like a lot of folks in Alaska did once upen a time.
Maybe she will love you back, just like she did the whole state. Before she quit.
Nope - just LMAO over what they pay for gas there - oil is taxed in Alaska at an astounding rate of 88% (all levels) before it gets out of the state on the way to the refinery.
Total taxes for a gallon of gas is closer to 26 cents in Alaska I think.
"What hurts us in California is the 70 cents in taxes per gallon of gas, I think you guys pay 26 cents per gallon in taxes in Alaska."
I know that it is hard when someone comes in and busts up a corrupt relationship between a major industry and a corrupt state party, we could sure use a reformer in California.
Sarah has done great!
I just paid 352.9 for gas and its continuing on down.
Sarah put your people in the hoosegow where they belong, and that is the sole reason for your gripes.
She accomplished more in 2 1/2 years as gov than any other governor has ever accomplished in two terms.
Aren’t you glad she quit; you’d probably have been the next to go to jail.
Your are entitled to your own opinion, but NOT your own facts.
Sara did jack to clean out the stables.
That was the FedGov, and of the cases they tried, over half have been tossed for misconduct on the part of the FedGov. OOps. Feds can’t even trap a rat.
You really need to get your head out of the up and locked position and do a little reseach. To have facts.
As far as “my people”, please, stop acting like a 3rd grader.
I will grant you that she did get more done in 2.5 years
more state employees
Higher unemployment / less drilling
Zero support for abortion related bills
More folks on welfare and far more in welfare payments - not to mention the ‘free’ money she gave away...
Then beat feet before the chickens came home to roost.
You are welcome to vote for her, or anyone that you feel should get your vote. Please, be certain you have the facts at hand before you make that choice - becuuae it’s one we will all to have live with.
Enjoy your day.