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Be Safe

Why I am voting no on Ballot Measure 1

“Drainage!”

– Daniel Plainview, “There Will Be Blood”

You can’t talk Alaska without talking oil. It’s one of those ever-present inextricable truths. Wisconsin has cheese. California has Hollywood. And we have swaths of land with black gold churning underneath.

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Ever since we sunk our first oil well in Katalla there’s been debate over how to manage and tax this rich natural resource. Alaskans know this, and we vote accordingly. Politicians in this state, like their constituents, live and die on oil. This has forced them (and us) to become, in effect, armchair resource managers.

There’s a cottage industry in the 49th State of oil and gas analysis – and even further removed, debate over how best to extract and process oil. It’s a subject of intense debate and scrutiny come election season. The number of public forums and policy arguments skyrocket around this time as people try to figure out which ballot measure will screw us the least.

Recently the UAA debate program hosted a public debate centered around a particularly controversial ballot initiative – Ballot Measure 1 (BM1). Without entering into the legalese, it’s an initiative to increase oil taxes for legacy fields on the North Slope.

Representing the Vote Yes team were Robin Brena, the main sponsor of the initiative, and Senator Bill Wielechowski. Arguing against BM1 were Roger Marks, a former petroleum economist, and Tom Walsh of Petrotechnical Resources of Alaska.

To be clear. I’m not an economics major. Nor am I by any means an expert in the field of oil exploration or drilling. I have a working knowledge of how Alaska’s oil situation makes us unique among the 50 states, and I know that our budget deficit is problem number one at the moment.

As such, most of this debate for me was spent cross-checking and Googling issues and figures the two sides brought up. It’s an intensely technical topic and it’s hard to talk about oil taxes without sounding at best, dry, and at worst, boring.

Given that, the focus of this column isn’t going to be as laser-focused as the four debaters were – I don’t have their years of experience or their insight from working in government and industry. Rather, I’d like to highlight why I believe a given side won, and then explain my personal reasoning. Draw your own conclusions. I anticipate you’ll learn more about my political leanings from this column.

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I believe the negation, or No on 1, won the debate for a few reasons – personal ideology and economic rationalization.

As someone who’s predisposed to the idea of no taxes and minimal government intervention, I like to think those principles hold true regardless of administration or subjects – all taxation, simply put, is theft. Given that, I can’t in good conscience support a ballot measure that imposes more taxes, even if the tax doesn’t directly affect me.

More directly, and with more relevancy to Alaskans, is the question of economic rationalization. Essentially, how can we look at this initiaitve and not see the warning signs written all over it?

Ten years ago when the price of crude was on the rise, some may have considered it good economic form to impose higher taxes on oil. I’d still be opposed personally, but it might have made economic sense in the short term. An oil company making money is less likely to leave because of higher tax rates than a company making significantly less money, especially in the middle of a pandemic/recession.

At the end of the day it’s important to keep our state’s economic well-being as the priority. But BM 1 is not the way to do that. It’s a thrown-together fix that tries to deal with a more complicated issue – how do we keep our state functioning in the face of economic turmoil?

The answer isn’t with more taxes. The answer isn’t to alienate the economic producers that have kept the state above water for decades. The answer isn’t Ballot Measure 1.

“This is bad policy, created in backrooms, created in a vacuum, by a handful of people without any public debate,” said Tom Walsh in the debate, referring to the measure. I agree with his summary.

I’ve mailed my ballot already and the rest of its contents are a topic for another day. But after watching the UAA debate I’m confident in casting my vote against Ballot Measure 1. I hope most Alaskans will agree with me.

Jacob Hersh is a sophomore political science major from Anchorage, Alaska. He’s been described as neurotic, emotionally distant, and unhealthily obsessed with national politics – all by the same person. In his free time, he scrolls obscure Internet forums for Jeffrey Epstein conspiracy theories, and writes election coverage for his college newspaper.

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Taz
22 days ago

Please Vote Yes on Ballot Measure 1 to save our jobs and economy. Since SB21 (2015-2019), Texas-based producers took $57 billion of our oil and didn’t paying anything (nada) in net production taxes! [They count the $2.0 billion in production taxes the producers paid the State in 2015-2019 below, but didn’t subtract the $2.1 billion in cashable credits the State paid or still owes the producers!] For the five years before SB21 (2009-2013), Texas-based producers paid $19 billion or $3.8 billion per year in net production taxes! Let me be clear on the five-year average: Before SB21, $3.8 billion per… Read more »

Anonymoose
21 days ago
Reply to  Taz

I have some major issues with your comment, Taz. WHAT SPECIFIC Texas-based oil producers? Where did your statistic of $57 billion come from? Where did ANY of your statistics come from? What would the economic effect of this ballot measure coming into effect do to oil companies producing oil? Would they leave? Would they cut Alaskan jobs? The majority of what I would like to see an answer to is the first 3 questions I ask of you. You make out this issue to be an issue of money being stolen without proven statistics to prove it. A general rule… Read more »

Taz
22 days ago

“This is bad policy, created in backrooms, created in a vacuum, by a handful of people without any public debate,” said Tom Walsh in the debate, referring to the measure. I agree with his summary. The $8 per revenue barrel credit ($1 billion per year of credits) is the largest single dollar issue. It was added to SB21 an hour before the vote with no hearings, expert modeling, or debate and only passed because of votes and Chairmanships by employees of ConocoPhillips. Now compare Ballot Measure 1 process. Took 15 people and months of modeling to develop the simplest solution.… Read more »

JL Thomson
22 days ago

I voted YES on. SB21 was a bad bill made worse by a legislature that worked directly for the oil companies. Fixing the tax structure is essential to have a state worth living in, worth investing in, worth raising a family in, worth retiring in. Big Oil will do none of those things.