A look at what Palin did while in office in Alaska—Not Ethical, Not Conservative, Not Good

Palin gets Atlantic makeover, but did the magazine get it right?

By Craig Medred

Finally a major publication comes along with a lengthy analysis on the Good Sarah. It’s about time. There were reasons Alaskans adored their Gov. Palin for those few, brief, halcyon months after the VECO-Alaska Legislature corruption investigation and before the Troopergate scandal, and it’s rare to hear anything in the national press about those reasons.

“As governor, Palin demonstrated many of the qualities we expect in our best leaders,” Joshua Green writes in an lengthy profile in June’s The Atlantic magazine.” “She set aside private concerns for the greater good, forgoing a focus on social issues to confront the great problem plaguing Alaska, it’s corrupt oil-and-gas politics. She did this in a way that seems wildly out of character today — by cooperating with Democrats and moderate Republicans to raise taxes on Big Business.”

Yes, yes, she did. But why did she do it and was it ultimately good for Alaska?

Fighting over oil taxes for decades

She picked the biggest, choicest, richest target in Alaska — the oil industry — and went after it. This is not something new for Alaska politicians. Many of them recognize Alaskans live in a love-hate relationship with the oil industry. Forget Green’s nonsense about “corrupt oil-and-gas politics.” Corruption in Alaska politics has been more about public funding — Lew Dischner and North Slope Borough construction; Sen. George Hohman of Bethel and Canadian firefighting planes — than about oil and gas. This state is like the 49 others in that regard. The main role oil-and-gas has played is in providing the wealth to finance the predictable sort of government corruption.

 An oil-and-gas scandal really only arose in the end because Bill Allen, the head of the major oil-field services company known as VECO, went way overboard in trying to keep the big, bad, Alaska tax man of the backs of his cronies in the “oil bidness.” The oilmen and the state of Alaska have been in a long-running tax fight that traces its roots all the way back to statehood in 1959. Alaska’s founding fathers wrote a constitution granting all Alaskans a share in the state’s resource wealth.The late Gov. Jay Hammond, the late Democratic Rep. Hugh Malone and some other lawmakers leveraged that into a universal Alaska belief that any oil found beneath the ground and permafrost in the 49th state belonged not to the businesses that worked hard to find it, but to the people of Alaska, by God.
Oil eventually took on the status of the lifeblood of the Alaska people. It was not something to be given up easily. The oil companies shouldn’t be expected to pay taxes merely to support government services required to oversee oil development and the people who came with it. Oh no, the oil companies should be expected to pay for almost all government services in Alaska and more. The state created Alaska Permanent Fund Dividend to start salting oil money away in the bank, and then came the Permanent Fund dividend payment, an annual handout to Alaskans. The PFD is every Alaskan’s annual compensation for allowing his or her oil to be pumped out of the ground and shipped to America. Paying the proletariat a chunk of the income associated with the sale of this resource isn’t so much socialist as it is Marxist

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Alaska Dispatch


5 Comments (+add yours?)

  1. nswfm
    May 12, 2011 @ 22:18:01

    “Just ask the oil companies how they feel “Her oil tax is a different story,” Green writes. And indeed it is. The tax scheme Palin and state Democrats cooked up has earned the state billions. “It’s no exaggeration to say that ACES has made the state one of the fiscally strongest in the union,” Green writes. “While other states reel under staggering deficits, budget cuts and protests, Alaska has built up a $12 billion surplus, most of it attributable to Palin’s tax…it has raised $8 billion more than Murkowski’s tax would have.” So let’s see here. Under Murkowski’s oil-tax scheme, the state would have taken in only $4 billion more than it needed; and instead it has taken in $12 billion more than it needs. “Alaska’s Clear and Equitable Share” is $12 billion more in tax revenue than the government needs?Everyone is supposed to rejoice about this because…? How would residents of income-tax-funded states feel if they woke up tomorrow to learn their governments were using their income-tax dollars to run up surpluses of billions of dollars? Probably about like oil industry executives feel in Alaska.”

    Or Lower 48 net tax donor states when we hear of pork projects like “I said thanks, but no thanks for the money for the bridge to nowhere….” Blah, blah, blah, LIAR!


    • Syrin
      May 13, 2011 @ 09:44:33

      Remember also what was done in the name of ‘OUR FAIR SHARE’- A large amount of that tax that was leveied for NO real reason was redistributed to every man, woman and child as an energy REBATE? Ha! And, required to PAY taxes on once again!


  2. Sally in MI
    May 13, 2011 @ 01:44:55

    So if oil taxes are so bad, why haven’t the over taxed oil companies LEFT Alaska for cheaper areas? That’s what Palin preaches about subsidies…if we stop subsidizing these behemoths, they will take their business elsewhere. Except they don’t. They are making so much profit despite the Alaska taxes and despite anything the US Government takes, that they will not leave. I agree that the whole setup in Alaska is not what Palin pretends it is. And that if Alaska has managed to set aside this much money, they no longer need to be held up by the rest of us when we are in such trouble, but she needs to stop blasting the lower 48, whose economic trouble she does not understand, and just go away.


    • LisaB
      May 13, 2011 @ 04:38:17

      Actually, the oil companies are moving onto federal land in Alaska where it’s cheaper to drill. I think ONE new well has been drilled onto Alaska’s land, and that one was on the books before ACES. Most of those job increases the ACES proponents tout are maintenance, not new drilling projects.

      The state of Alaska takes no risk on these investments really. A well doesn’t produce, they don’t lose money as the oil company does. Oil is the third biggest employer in Alaska, paying very well. It finances 90% of the state government. There’s no state sales tax, many cities–including Anchorage when I was there–have no sales tax. There’s no state income tax. There’s hardly an arts function in Anchorage that doesn’t get some underwriting from Oil. Every year, the PFD checks come out, making flat screen TVs, new cars and snowmobiles available to all.

      But to hear the Alaskans, Big Oil does nothing for Alaska.

      What I find gobsmacking is that this journalist appears unaware that Alaska already was the richest state in the Union. Palin’s tax didn’t change that.


    • Syrin
      May 13, 2011 @ 10:10:53

      Sadly, they are leaving. There is no real exploration of new areas of development going on. Whatever projects had been appropriated previous are either being implimented at a much lesser degree or have been completely abandoned as being too much of a risk, a non viable project. Alaska is a state .. one of 50.. NOT a country! This state should not have billions and billions of tax dollars- there’s NOTHING HERE! Soon to be NO ONE HERE if there are no jobs or economy! This state government didn’t even create appropriate infrastructure for industry, it was the oil industry themselves who did that back in the 60s and 70s! Alaska’s resources are the most difficult to develop and bring to market because of the costs, the opposition by enviormentalists and of course the distance for shipping. Oil companies have a business model that has worked for decades. Go where you can develop more easily (ocs, at tide water) use less capital to produce more resources..


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