On Feb. 7, 2020 Elwood Brehmer of the Alaska Journal of Commerce reported on continuing job loss in Anchorage “leading to a fifth year of recession…” In January of 2019 The Washington Post reported Alaska was in its fourth year of recession with the “nation’s highest unemployment rate” and “since 2015, the fastest rate of job losses.”
Because the coronavirus is continuing to sweep the nation, Alaska is sinking deeper into recession. Citizens across our state see and feel the virus’ grip.
Further, the Russia/Saudi oil market share war crushed oil prices everywhere. There is no doubt: These are dangerous and uncertain times.
But there is another invisible threat that Alaskans may not think about. This threat damages Alaska worse at times like this: low oil prices. Senate Bill 21 imposes its greatest risk when Alaska has little to no ability to protect its own citizens or to protect Alaskans’ way of life.
Under SB21, the years have not been kind to Alaska. Holding on to a diminishing permanent fund dividend has been a struggle. SB21’s manifest failings are clear by watching our university, ferry system, and our savings crumble.
SB21’s promises were of a return to 1 million barrels per day. Citizens believed Alaska’s treasury would soon be awash in money and that each citizen would be comfortable with a stable PFD program. Oil’s promise was not kept. Alaska’s treasury is emptying, and the PFD program is unstable.
The heady promises and high expectations of SB21 filled the minds of many with thoughts of a rich Alaska. Just give it a “try” was heard by all. Reality bites so hard in 2020 with those promises and expectations now showing themselves as superficial and baseless. Oil industry ads in 2020 use words of “projections” as compared to actual pipeline throughput to hide the truth that industry doesn’t want you to know. Oil throughput is actually lower in 2020 than in 2012. Just look at Alyeska Pipeline Service Co.’s pipeline throughput numbers for 2012 and 2019 and make up your own mind. To save you the time of looking, throughput is down about 57,000 barrels per day. But, please look.
The silence of the oil industry on its 1 million barrels per day failure might mean more to you than any or all oil industry ads.
Each Alaska voter shall make a choice as to the Alaska of tomorrow. The choice shall be between the way it has been or the way it might be.
What options are before you? There is a choice to do nothing. The choice to do nothing means Alaska’s savings not yet spent will soon be spent. You know your wallet is slimmer now because of many cuts to the PFD. You also know that harm to Alaska’s university, ferry system and other vital organs will continue.
There is another option. I call it the “solid floor option” as a 10% floor would be created. As with your home, you want a solid floor. Our state should have a solid floor. A solid floor would be fair to both sides. If the oil industry gets $10 billion in revenue after royalties are paid, Alaska gets 10%, which would be $1 billion. If the oil industry gets $6 billion in revenue after royalties are paid, then Alaska gets 10%, or $600 million. Alaska gets its solid floor. That’s the the solid floor option.
I looked for another alternative for you to choose between, but there is no alternative that does not invade your income potential or your purchase decisions or take away the PFDs.
The solid floor option may be the best choice for you. It is up to you and your friends and neighbors to decide, even in these most-troubling times, which option is best for you. The solid floor option allows Alaskans to take back control of our state. Alaska will not be Shangri-La even with $1 billion in production revenue. It does allow, however, for stable PFDs, stable and small capital improvements and deferred maintenance budgets and stable and efficient operating budgets. Alaska will be in control of its own future.
In dangerous and uncertain times, and when Alaska is least able to protect its citizens and its way of life, change is needed.
Alaskans should not, because SB21 is hurting Alaska, have their pockets emptied by taxation upon their income and purchases. That will happen if the way it has been continues to control Alaska. SB21 should be changed.
The solid floor option, you may have guessed, is part of Alaska’s Fair Share citizens’ initiative. For me, I choose a solid floor. You will have the opportunity to take back control of Alaska’s future in 2020.
For any questions, look to voteYesforAlaskasFairShare.com.
Joe Paskvan is retired after almost 40 years as an attorney in private practice. He is a former state senator who served as chairman of the Senate Resources Committee. He lives in Fairbanks.