Tag Archives: vic fischer

Local economist calls ‘$2 billion giveaway’ a myth

The phrase, “$2 billion giveaway” that was coined by those who want to repeal oil tax reform, has been used so often, including by this writer, that for many it’s believed to be a fact. Often quoted, and much respected UAA economist Scott Goldsmith took a hard look at the number and came up with something very different in a report funded by Northrim Bank, which is against repeal but funds a wide variety of reports about all facets of the state’s economy.

The “$2 billion giveaway is a myth,” Goldsmith told a crowd of about 200 at the Resource Development Council meeting on Thursday morning

While it’s true that the state is running at about a $2 billion deficit, the oil tax break isn’t what’s driving most of it, he said.

For one, to the extent that there’s a “giveaway” at all, it’s closer to $90 million. Much of the rest of the money is a result of lower production, lower prices, and rapidly increasing costs to produce the oil, costs that the oil companies provide to the state, and which we need more information about, he said.

Secondly, in the long run, reform will stabilize the tax system. At some prices the amount of taxes the producers will pay will be more under the new tax regime than under ACES. At some price points, it will be less. Why do the companies like it so much that they are willing to spend tens of millions to make sure that it’s not repealed? Because they believe that it will increase production

“The producers are not in business to minimize taxes,” Goldsmith said, “They’re in the business to maximize profit.” And the best way to do that is to expand and to increase the size of their operations, he said. He likened it to his wife getting a job. The family’s tax bill will go up, but the household will have more income. “We’ll be better off. And the treasury will be better off as well.”

Read Goldsmith’s presentation here.

Vic Fischer, who is the head the effort to repeal SB 21, issued a press release following the presentation. He’s sticking to his guns. “Goldsmith misses the mark,” he said and pointed to the $2 billion deficit has his proof.

“What Alaska needs is a tax structure that increases exploration for new oil and gas, not just provide incentives to pump the oil they are contractually obligated to produce,” he wrote.

Contact Amanda Coyne at amandamcoyne@yahoo.com


Loose Lips: Gassy oily Wednesday in Juneau. Repeal gets a generous donor. Higgins is in.

15770860_mIt’s oily, gassy Wednesday in the state capitol building. Among the oilies, ConocoPhillips Alaska President Trond-Erik Johansen and his posse spent the day roaming the halls. The Alaska Oil and Gas Association hosted a lunch today for leggies. The keynote speaker was BP Alaska President Janet Weiss.

Speaking of gas, gubernatorial candidate Bill Walker is still speaking about it. Expect much more of him as gasline legislation moves along.

From a fundraising letter from Vic Fischer “And now, for a limited time, a donor has agreed to match any contribution to Vote Yes! – Repeal the Giveaway 100% up to $25,000.”

As of last Friday, Fischer’s group, which is trying to repeal the oil tax legislation passed last legislative session, had raised about $104,000. Those who are urging voters to vote against the repeal, mainly oil companies, have raised more than $1.6 million as of Jan. 22.

So far, most of the $81,000 the repeal group has spent has gone to signature gatherers.  On the other side, nearly all the money the group has raised has gone to Poccarro Communications.

Some Anchorage Dems gathered at Barbie’s Café in Anchorage to watch the State of the Union, where the loudest applause line of the night came while Obama was speaking about women’s issues. The event was organized by, among others, Patti Higgins, who announced that she was running for state House against Rep. Charisse Millett, who just the day before told the press that doctors had discovered a brain lesion that might indicate that she has MS.

A panel was convened at the same gathering to talk to us after the speech and tell us what to think about issues. It was moderated by Dr. Carl Shepro. The inimitable Ivan Moore was on the panel. So was spokesman for the Democratic Party Zack Fields. The President of the Young Democrats Joe Samaniego and Dennis Knebel with the IBEW were also on the panel.

I was told that Shannyn Moore was invited to attend but didn’t show. Perhaps she was spent her evening somewhere in the company of women, who weren’t sitting in front of her telling her what to think about issues.

Not all Dems in the country are talking at women. Anchorage’s Gloria O’Neill, President of Cook Inlet Tibal Council, has been invited to participate in a White House discussion on employment with the President and his cabinet secretaries from Commerce and Labor. They want to hear what she has to say. Besides her work at CITC which includes several employment and training related programs, she also is on the University of Alaska’s board of regents.

What else? House Minority Leader Chris Tuck has been busy moving into his new, relatively palatial office, with a sitting room even! Outgoing Minority Leader Beth Kerttula had it pretty cozy. I remember throw rugs and pillows and plants and books. Since he’s the state’s most eligible bachelor, I was curious about Tuck’s designing plans, so I called his office a few times, but no one answered.

Speaking of the state’s most eligible bachelor, I’m told that he and Bernadette Wilson aren’t seeing each other anymore. Perhaps she was sick of calling and not getting an answer.

Contact Amanda Coyne at amandamcoyne@yahoo.com