Sarah Palin – ACES Incentivizes Oil Production and Development

Demonstrating the widespread nature of the bipartisan support for ACES, former Republican Governor Sarah Palin has weighed in on the battle over oil taxes now raging in the Alaska legislature. Defending one of the key pieces of legislation that was passed during her administration, Palin calls out the New York Times, Big Oil, and hypocritical legislators in a recent posting on Facebook.

The New York Times just can’t seem to get much of anything right lately. No wonder they’re facing economic and reputation woes. Their article today falsely reporting on my record as governor is full of spin, and I shall call them out on it.

Regardless of the recent political posturing, ACES (Alaska’s Clear and Equitable Share) is a success for all stakeholders who want more domestic energy supplies for our great country. The Alaskan people (who collectively own the natural resources, via our state constitution), the resource producers who bid on the right to develop our oil and gas, and consumers all benefit under ACES. It incentivizes production and development. It works.

Amazingly, to the uninformed (or to those who really don’t want to incentivize oil exploration in America) ACES is spun to sound like an oil windfall profits tax and its progressivity is made to sound excessive. In reality, it was born of a need to have a tax structure that did three things:

1. It could not be created under a cloud of political corruption and self-dealing like the former Alaska administration and legislature’s PPT oil valuation structure. That’s a critical fact that is now frequently overlooked years later. Remember the legislators and oil industry players who went to jail because of bribes leading to votes in favor of the former administration’s PPT, which was unfairly tilted in favor of the resource producers against the resource owners (i.e., the people of Alaska)? Have we conveniently forgotten the fact that a corrupt process brought forth PPT, and I and others set out to change it by cleaning up the corruption?

2. It had to align the interests of Alaskans and the oil producers through exploration and production credits in partnership so that they benefit proportionally from commercialization of Alaska’s sovereign resources. This is very different from a government overtaxing personal or corporate income in which the government has no ownership stake in whatever it is that is being taxed.

3. It had to use a progressivity system that protects the producers from commercial strain when oil prices are low; otherwise the producers would seek development opportunities elsewhere. ACES does incentivize industry, but beware that Big Oil will always do what it does best for its shareholders: it will look out for its bottom line and always claim that it needs even more tax breaks. More power to them for trying, but resource owners deserve A CLEAR and EQUITABLE SHARE (ACES) of the value of their commonly-owned oil and gas.

ACES accomplished all three. The current criticism of this fair valuation makes no real sense. As an article at Big Government notes:

“The number of oil companies filing with the Alaska Department of Revenue has doubled indicating that competition has indeed increased. Alaska has the second most business friendly tax set-up — up two spots since the passage of ACES. Additionally, a report from Governor Parnell’s Department of Revenue indicated that 2009 yielded a record high in oil jobs. Even more recently, the newest employment numbers from Alaska show that oil job numbers were higher in January 2011 than in January 2010, indicating that jobs are growing at the seasonal level. Parnell argues that state revenues are in jeopardy, but it is estimated that his proposal would reduce revenues by $100-200 million.

Most importantly, Alaska enjoys a $12 billion surplus thanks to ACES and the sound fiscal policies of my administration.

Support for ACES with supporting links can also be found at the blog Conservatives4Palin.

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Alaskans are On the Hook

 

According to analysis, Gov. Sean Parnell’s plan to give oil companies a tax cut bailout will cost the state $10 billion over the next five years.

There are 710,231 Alaskans. Simply put, giving this tax cut to outside oil corporations like BP, Exxon and ConocoPhillips will cost the Alaskan family of four more than $56,000 over the next five years (or $14,079 for every man, woman and child living in this state.)

The Governor’s plan would give the oil companies Alaska’s money with no strings attached. Under this oil tax bailout, oil companies are not required to create a single Alaskan job or spend a single dollar on Alaskan exploration and development in exchange for the cash. And while $56,000 may be a big deal to your family, for the oil companies, it’s a drop in the bucket; Exxon Mobil, for example, reported $30.46 billion in pure profits this past year and recently reported earning $9.25 billion in just the last three months of 2010, its most profitable quarter since 2008.

SPEAK OUT
Think “no strings attached” is the way to go? Please e-mail Gov. Parnell and give him your permission to give your share of the bailout – $14,079 – to the oil companies on your behalf.

Don’t think it’s fair to hand our money over to the oil companies, no strings attached? Send an email to Governor Parnell and your representatives in the Alaska legislature to let them know.

State:
Governor Sean Parnell
Anchorage: 907-269-7450
Juneau: 907-465-3500
sean.parnell@alaska.gov

Local:
Plug your address into the “Who Represents Me?” box here to get the contact information for your Senator and Representative in Juneau. http://w3.legis.state.ak.us/index.php