By Steve White
Big Oil is barraging us with ads that attack the Fair Share Act. But why are some of our friends and neighbors also singing their song? Here are some of their verses that need to be rewritten:
Would Ballot Measure 1 “…deter investment which will cost jobs and income in future years?”
This is the old “they will pull up their tents and leave” story. Big Oil has never guaranteed it will stay and invest more under a favorable tax scheme. Nor has it ever guaranteed that it will reduce investments if we increase their taxes. Predicting what they will do is pure speculation.
No one really knows what motivates those multinationals. I suspect that the CEO’s in Houston are pondering things other than whether Alaska may raise its production tax from the current 4% to 10%. An additional $250 million — the amount that the proposition would generate at current petroleum prices — is pocket change for companies that make tens of billions selling Alaska oil. A good reason to vote yes.
Would Ballot Measure 1 “cost jobs” and “shrink future PFDs?”
Poppycock! Paying $250 million more to Alaska so that it can be distributed through the operating and capital budgets will fund Alaskan jobs. And our PFDs are threatened more — way more — by the current lack of state revenues than by the possibility of reduced oil field investments. Vote yes.
Should “Oil tax legislation should be enacted by the Legislature?” Is it ”best suited to decide complex oil and tax…law?”
Sounds nice. It might work if all legislators take an unbiased approach to deficit reduction. But I suspect that some of the more powerful ones may be compromised because they count on Big Oil and its political action committees for campaign contributions. They may be following the old saying ”don’t bite the hand that feeds you.”
That’s why the Legislature — rather than seeking new revenues — has been depleting reserve accounts, cutting spending, and reducing PFDs. That’s why it wanted us to pay $1 billion to buy out production tax credits now held by Big Oil. That foolishness was based on the faulty premise that the credits — credits which could only be used to offset any future production taxes — were actual, present debts owed to the oil companies. Thankfully, the Alaska Supreme Court saw through this ruse and prevented that windfall.
So this is the Legislature that some people trust for enacting oil tax legislation?
Is Ballot Measure 1 “supported by outside interests?”
The sponsors of the ads against the ballot measure ads are the three major North Slope oil companies headquartered in Texas. They have spent about $15 million to defeat the proposition. On other side, 39,000 Alaskans signed petitions to put the issue on the ballot, and 683 individual Alaskans have contributed nearly $1.4 million to the “Vote Yes” campaign. Looks like a Goliath-vs.-David battle. And which side has the “outsiders?”
Is “increased oil production is the best solution” to the problem? Opponents of the ballot measure agree that “oil demand and prices have shrunk to historic lows.” The pandemic has reduced demand, and oil, seeking buyers, is piling up in dozens of offshore tankers. The producers will probably not increase production while the world is awash with oil. So, for the near future, that will not solve our problem. Vote yes.
Finally, in these difficult times, is it “right to increase anyone’s taxes?”
Well, despite the challenges now facing individual Alaskans, we will soon have our taxes increased or essential services reduced. We will continue to see reduced PFDs, increased property taxes, perhaps higher sales taxes, and maybe even a state income tax. Elected leaders will probably cut more from education, the university, ferry service, police and fire and other essential services. Those are hardships that will be borne by individual Alaskans, not Big Oil. We will be making sacrifices to respond to the fiscal crisis. So, why shouldn’t they?
It makes no sense to continue to give our resources to Big Oil at bargain prices and then tax ourselves to raise the revenues we just gave away. That’s why I am voting yes on Proposition 1.
• Steve White resides in Juneau. He is a charter boat captain, a Navy veteran and 40-year resident of Alaska. 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.