Opinion: Ballot Measure 1 would be deleterious to Alaska’s future

Opinion: Ballot Measure 1 would be deleterious to Alaska’s future

A yes vote on Ballot Measure 1 would be like driving a ship into the eye of a storm.

  • By Barbara Haney
  • Tuesday, July 21, 2020 12:44pm
  • Opinion

Like many sectors of the economy, the oil industry has been hit hard by the pandemic. Stay at home orders that greatly reduced demand for fuel, production wars between Saudi Arabia and Russia that greatly increased the global supply of oil drove the price down to historically low levels. The industry has struggled nationally, and Alaska’s industry has been no exception. Alaska’s oil industry has one of the highest cost structures in the world, and some firms are struggling to make royalty payments.

Oil revenue is the lifeblood of Alaska’s economy. Nearly one-third of all employment in Alaska is directly tied to the oil industry. The majority of Alaska’s state revenue is derived from the oil industry, and public employment is also a large component of the Alaska economy.

Raising taxes on Alaska’s oil industry at the present time would be deleterious to Alaska’s economy- it would be like kicking a person when they are down. An increase in the tax would lead to declines in production, employment, and investment. Not only would this hurt current oil production and state revenue, and it would have an adverse impact on future revenue through disinvestment and future production cuts.

To put it in terms that a Coast Guard engineer like Rich Moniak (of a previous editorial) might understand, a yes vote on Ballot Measure 1 would be like driving a ship into the eye of a storm. At first it would seem peaceful;, but the back side of the storm soon hits with a new set of dangers that are often worse than the beginning of the storm. Voting no on Ballot Measure 1 would be more like staying at the edge of the storm; the ride will be rough but navigable.

Whether Ballot Measure 1 passes taxes, there will be decreases in public services — so the question becomes do we want to destroy Alaska’s future economy by stifling its lifeblood through raising taxes or sit tight, be fiscally conservative, and weather the storm. If we sit tight, be fiscally conservative and vote no on Ballot Measure 1, we can at least preserve the private sector and have some hope of a future economic recovery. A yes vote will have an adverse impact on oil production, industry investment, state revenue, creating damaging impacts on employment in multiple economic sectors and state revenue now and in the future. Please, vote no on Ballot measure 1.

Barbara Haney, Ph.D., is a North Pole resident. Haney received her Ph.D. in public finance from the University of Notre Dame and previously taught economics at several institutions including the University of Alaska Fairbanks. She is currently a legislative aide to Rep. Mike Prax. Columns, My Turns and Letters to the Editor represent the view of the author, not the view of the Juneau Empire. Have something to say? Here’s how to submit a My Turn or letter.

More in Opinion

Web
Have something to say?

Here’s how to add your voice to the conversation.

This image shows the site plan of the proposed Capital Civic Center. Thursday evening the city was given an update on the project’s concept design which is expected to cost up to $75 million and would include amenities like a theater, community hall, gallery, ballroom and business center. (City and Borough of Juneau)
Opinion: Keep an eye on the proposed civic center project

FTF will continue to monitor this issue and urge Juneau residents to do likewise.

Mist from Nugget Falls has a prism-like effect in September 2020. (Ben Hohenstatt / Juneau Empire File)
Multiple vehicles line up at the entrance of Waste Management’s Capitol Disposal Landfill in Lemon Creek Monday morning. (Clarise Larson / Juneau Empire)
The absence of economic incentives to reduce waste

This week, Waste Management, the Texas based company that owns and operates… Continue reading

Over 200 people attended LunaFest (Courtesy Photo)
Opinion: JPCC owes a huge debt of gratitude to two LunaFest guest speakers

LunaFest 2023 was JPCC’s most successful fundraising event ever.

(Clarise Larson / Juneau Empire File)
Opinion: Education funding is complicated and political

At a recent Alaska State Senate Education Committee hearing at the Capitol,… Continue reading

At Wednesday evening’s special Assembly meeting, the Assembly appropriated nearly $4 million toward funding a 5.5% wage increase for all CBJ employees along with a 5% increase to the employer health contribution. According to City Manager Rorie Watt, it doesn't necessarily fix a nearly two decade-long issue of employee retention concerns for the city. (Clarise Larson / Juneau Empire)
Opinion: Assessment needs additional oversight

A win in dealing with City and Borough of Juneau is when… Continue reading

This photo shows the Mendenhall Glacier Visitor Center. (Ben Hohenstatt / Juneau Empire File)
Opinion: Deja vu for the Mendenhall Glacier Recreation Area

Three new alternatives don’t go far enough.

In this Nov. 29, 2018 photo, clouds swirl over Douglas Island. (Michael Penn / Juneau Empire File)
Opinion: The Roadless Rule is a misnomer for what’s really happening in the Tongass

The Roadless Rule, as currently comprised with an exception provision, works.

Most Read