Skip to comments.Whitney Pitcher: Will ACES Be Discarded?
Posted on 03/23/2013 8:28:42 PM PDT by Bratch
Great piece by Whitney Pitcher today, outlining the current debate in Alaska to overturn one of Governor Palins greatest achievements in office, ACES (Alaskas Clear and Equitable Share):
During her CPAC speech last Saturday, Governor Palin included some Alaskan constitutional populism (emphasis added):
If Mrs. Thatcher were with us here today, she would remind us that there is a big difference between being pro-business and being pro-free market. On this there can be no mistake where conservatives stand. Its time for We the People to break up the cronyism and put a stake through the heart of too big to fail once and for all.
That includes these resource-rich states like Alaska, my home state. Read your constitution, Alaskans. Realize that the natural resources that God has created for mans use theyre not owned by the big multinational conglomerates and the monopolies. Theyre owned by the people. They dont own them, so dont let them own you. You have a right to those resources to be developed for our use.
Governor Palin rightfully notes two important issues in particular1) the Alaskan constitutions charge that development of resources for the good of the people 2) the warning that the people (and politicians) of Alaska not allow themselves to be owned by the oil companies.
The Alaskan constitution notes that the states natural resources belong to the people and are to developed for their maximum benefit :
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.
Governor Palins point is especially salient and timely when it comes to Alaskas natural resources. On Wednesday night, the Alaska state senate passed a bill that if passed in the House and signed by Governor Parnell would overhaul the oil tax reform plan, ACES, that Governor Palin signed into law in 2007. Unlike Governor Palins ACES, however, this bill was not discussed in a transparent and comprehensive manner:
The newest version of the oil tax bill was introduced Thursday. In the hours before it passed there no public testimony. There was no testimony from Alaskas independent oil explorers. The only industry testimony came from Alaskas Big Three oil producers, which had been invited to testify.
It was sort of striking that the oil industry gets a chance for public comment and the rest of Alaskans dont, Wielechowski said.
Many of the smaller independent players in Alaskas oil patch are the beneficiaries of tax incentives aimed at new production from new fields, rather than the strategy pushed by Parnell and championed by legislative leaders of pumping oil, faster, from known fields.
Testimony from the Big Three acknowledged that the oil-tax changes proposed under SB 21 would make Alaska a more competitive tax environment. But they would not promise new production.
One of the positives of ACES is that smaller, independent oil companies have been able to develop in Alaska. In fact, the number of oil tax returns filed with Alaska has increased 383% since ACES was passed. Annual capital expenditures have nearly doubled since FY2007, meaning that producers are engaging in increased infrastructure development (i.e. more rigs) and the like. These expenditures are helping to lead to increased profits for even the major oil companies. For example, in 2012, 13% of Conoco Phillipss oil and gas development occurred in Alaska, but Alaska contributed to 34% of their income. Additionally, according to Alaskas own labor statistics, oil and gas jobs increased more than 15% between 2007 and 2012.
So, why is there a push for reforming ACES? Because of the very thing that Governor Palin warned against in her CPAC speechbeing owned by the oil companies. In theory, the Senate bill is better for the oil companies because it flattens ACESs tax rate and provides incentives for new oil. This sounds pro-business, right? Thats what Governor Palin warned about in her CPAC speech as well. Theres a difference between the invisible hand of the free market and the hand-in-hand pro business relationship between business and government. This hand-in-hand relationship is the very type of relationship that was the impetus for ACES being passed in the first place, as the Murkowski administration prior to Palins administration was shrouded in corruption due to the pay-to-play deals between the oil companies and lawmakers. Governor Parnell has not had that kind of relationship in his dealings, but he has had a revolving door relationship between the oil industry and politics. As I wrote nearly two years ago:
In the early and mid 1990s, Parnell served in the Alaska House of Representatives and Senate. Following his time in the Senate, Parnell became director of government relations for ConoccoPhillips. He then went to work for Governor Murkowski as the director state division of oil and gas from 2003 to 2005. During part of this period time, Governor Palin had served as an oil and gas commissioner until she encountered unethical behavior from another commissioner and Alaska GOP chair,Randy Ruedrich, and she resigned and lodged a complaint against Ruedrich. Prior to running for Lt. Governor in 2006, Parnell worked at Patton Boggs, a law firm that represented ConocoPhillips and ExxonMobil in the Exxon Valdex oil spill case.
Although the bill was passed in the Senate, it was proposed at the request of Governor Parnell. He found 11 allies in the Senate, and the bill passed 11-9. One Senator, Peter Micciche, who is also employed as a ConocoPhillips natural gas plant supervisor, paid lip service support to ACES, indicating he would reject Governor Parnells proposal. However, Micciche ended up voting for the modified Senate bill that Governor Parnell applauded.
Palin’s an honest politician in a nest of crooks. Wonder if this will hurt Murkowski’s image?
Alaskan voters might want to take a new look at both women.
I hated what happened to Miller, but Lisa promised the Indians all the gold they could eat at Native convention and the Repub good ole boy network & judges refused to investigate all the voter corruption. So we now have a RINO who will vote for an AWB for the right price.
All politics in Alaska has been beholding to Big OIl for as long as I can remember. Every 2-3 years they always reform the oil tax policy to benefit the oil industry. Palin was the only political that wouldn't roll over for them, quite honorable; dang I respected her for standing up like she did.
So Parnell will give them back 1 billion/year that should go to the state. It won't make big oil invest any more or less and bottom line, the oil industry won't be happy until the residents of Alaska are paying them to get the dirty stuff out of the ground.
I like Parnell's anti fed stance, I just wish he wasn't so bought and payed for & corrupt; he ain't the only filthy Repub of my party.
At least we live in a great place, more freedom than anywhere I have ever been, and no taxes. Maybe the billion loss every year won't have the politicals calling for new taxes; maybe oil will go back up to $140, ya right. It could be worse. remember when Phony Tony Knowles wanted to take 10 billion outta the PFD to build a gas line for big oil then give it to them; and he was liberal dem too; at least he was the last one to ever get elected up here. You see that's the rub, our Repubs get so corrupt even all the Republican voters hold their noses and refuse to vote for them, split the vote with AIP candidate and another Phony Tony gets in. Maybe the billion loss every year is the lesser of any of the evils too?
And out of respect for my friends, fellow freepers employed by big oil; you're all good guys and I understand why you support the tax reduction. Understand that I have been watching the game for many years also and I'll call a spade a spade too; just like Palin has all her life.