Here’s Brad Keithley on Facebook, who sometimes gets things right, about Gov. Bill Walker’s edict to members of his cabinet not to sign confidentiality agreements on the Alaska natural gas pipeline. Let’s be clear: nearly every single business decision includes a confidentiality agreement. Journalists often sign them. I even have one with the person who helped build this blog. As Keithley points out, the AKLNG line is a business decision, and a mammoth one at that:
Wrong direction. Alaska is part owner of a commercial enterprise competing in a very challenging environment. You and I wouldn’t disclose our commercial strategy in our businesses; neither should the state. And you and I would want all hands important to the success of our business in the information loop; we wouldn’t want to blind key players by keeping them in the dark about our strategy. Neither should the state. Taking this position on confidentiality is two significant steps backward in the success of this venture. Treat it like the Permanent Fund (which regularly enters into confidentiality agreements) and give the LNG project the tools necessary to be successful…Competitive market rules are not suspended merely because one of the actors is a government. In a tightly competitive market — as is the market for grassroots LNG projects — information about what a competitor and potential supplier is doing provides a significant advantage to other projects and potential purchasers. Frankly, the primary beneficiaries of this decision, if it holds, are competing projects in Australia, East Africa, Canada and the US Gulf Coast, and potential buyers in Korea, China, Japan, India and elsewhere within the Pacific Rim market who will use the information to both to undermine Alaska’s competitive position and beat down the price that Alaska can extract from the market (and as a result, return to the state). And for what? Just because you or I can offer a vague suggestion here and there about how we would do things differently? Not worth it. It puts the project in jeopardy, and even if it survives, lowers the return the project is likely able to achieve. (And by the way, in the corporate world shareholders aren’t given this information, either, for the very same reasons.)
GF – the one issues that Parnell and Walker agreed on is that the LNG project is real and has a chance of success. They both understand that the world needs LnG, coal is not sustainable, and Alaska has a lot of competitive advantages over the competition. I am NOT saying that this project will happen. I do think that those who are convinced that they know the answer – that we will absolutely have a project or that we won’t have one – deluding themselves. Companies like Exxon don’t spend billions of dollars of their shareholders money on a project that is a fantasy.
You are spot on. The governor should disclose the details, including money received, on the sale of his law firm. Shine the light and let all Alaskans see.
Port Authority 2.0. How did the first one end?
But of course, those Union negotiations are different……
And of course as soon as Walker became Governor while remaining entangled in a Law Suit against the State, the details of his negotiations to sell his Law Firm should have become public as well. I wonder if he will publish them?
Transparency like the Port Authority NEVER having a public meeting and covering everything in an executive session? Odd that this is a core value now when the port authority was not run this way at all.
Forecast may know something about that.
There is no way to represent one side in a negotiation if one must do it in public when the other side need not, will not and cannot do its deliberations in public. The other side sees and hears everything the state considers so in fact no negotiation takes place.
In this instance it’s all moot because there is no climate for an Alaska gas line. If this climate had existed 45 years ago there would not have been an oil pipeline. There is no market, no investors, no lenders. We only have confidence men and promoters, and we have those who would use the promise of a gas line in seeking to spend what little income there is.
Supposedly Governor Walker did this in the name of transparency. Then I would also hope that the governor would shine the light of transparency on public employee union negotiations by opening them up to the general public. He should also disclose all records of previous negotiations to the public, The public has a vested interest. Public employees work for us, they are paid by us. Open all the records and negotiations, Governor Walker. Be true to your transparency value.
I often don’t agree with Mr. Keithley’s view of things. In this case, he’s spot on.
As to the concept of the state being involved in business endeavors: One could reasonably argue that our state constitution leads us in this direction by virtue of the fact that it declares the state government to be owners and managers of natural resources on behalf of us as Alaskans. That sets up a de facto parallel with how corporations run.
Makes perfect sense what Walker has done. It’s transparency. Maybe government shouldn’t be in business endeavors. Isn’t it a Republican creedo that govenment can’t do anything right?
There is nothing preventing any of you from purchasing stock in any corporation with the understanding you are exposing your investment to risk. The Alaska Permanent Fund is not tasked to generate income for a private concern or a exclusive private business endeavor involving the State of Alaska nor is the Alaska Railroad, AHFC or other similar agency. In the case of the Railroad ,why not form an exclusive state partnership with the Union Pacific Railroad, to the exclusion of all the other railroads, and then be liable for all losses by the partnership?
What you do in your private life and with your private investments is not my business; however, what my government does with public funds is my business. Mr. Keithley makes a rational ,solid and valid argument for why our State Government should not be an equity partner in this or any business endeavor.
Amazing what Walker does. Doesn’t make sense to me. I agree with Amanda and Keithley.