9-4-08 by dugan
In her first speech Wednesday as a VP candidate, Sarah Palin got whooping cheers for her accomplishments as governor of Alaska, including a big state budget surplus. But Palin didn’t mention how she did it: with a big windfall profits tax on oil production. I wonder how Palin will respond when the evil news media ask her where
most of Alaska’s surplus came from, and whether she’s still
proud of her hard-fought new tax.
She’s completely out of step on that point with Sen. McCain, President Bush, and Washington’s many other friends of oil.
From the Seattle Times:
Over the opposition of oil companies, Republican Gov. Sarah Palin
and Alaska’s Legislature last year [in 2007] approved a major increase in taxes
on the oil industry — a step that has generated stunning new wealth for
the state as oil prices soared.At a time when Americans are feeling the pinch at the gasoline pump
and oil companies are racking up record profits, Alaska’s choice
foreshadows one of the sharpest debates in the upcoming presidential
election.Democrat Barack Obama supports a national windfall-profits tax, while Republican John McCain opposes it.
Alaska collected an estimated $6 billion from the new tax during the
fiscal year that ended June 30, according to the Alaska Oil and Gas
Association. That helped push the state’s total oil revenue — from new
and existing taxes, as well as royalties — to more than $10 billion,
double the amount received last year.
The Alaska tax is breathtaking, with steady tax increases for any oil valued at above $55 a barrel. That’s a price last seen, briefly, in Jan. 2007. The tax goes far beyond the small "oil extraction fee" proposed in California in 2006 as Proposition 87, but defeated by $100 million in negative campaigning by Chevron and other oil majors. It’s proportionately far bigger than proposed but stalled legislation in Congress to reap fair federal royalties on oil and gas from U.S. waters.
Oddly enough, the Alaska governor’s big tax hasn’t stopped exploration there, with Chevron committed to new North Slope drilling that its top Alaskan executive says has "really upped the ante in investment in Alaska." Exxon, BP and Conoco Philips are grumpy about the tax, but certainly not leaving the state.
Yet the friends of oil in Washington won’t even close egregious loopholes and cut subsidies that go straight from U.S. taxpayers’ pockets to Big Oil. They use the Chicken Little argument that it would bring exploration and drilling to a halt, never mentioning Alaska’s much different result.
Gov. Palin, please give us your plan to treat Big Oil in the Lower 48 like you did in Alaska.