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Palin's Alaska Reaps the Windfall Profits McCain Decries

by: Robert Scheer  |  Visit article original @ Truthdig

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Sarah Palin and John McCain. (Photo: AFP / Getty Images)

    Welcome to the People's Republic of Alaska, where every resident this year will get a $3,200 payout, thanks in no small measure to the efforts of Sarah Palin, the state's Republican governor. That's $22,400 for a family of seven, like Palin's. Since 1982, the Alaska Permanent Fund, which invests oil revenues from state lands, has paid out a dividend on invested oil loot to everyone who has been in the state for a year. But Palin upped the ante by joining with Democrats and some recalcitrant Republican state legislators to share in oil company windfall profits, further fattening state tax revenue and permitting an additional payout in tax funds to residents.

    No wonder she is popular with voters in a state whose residents pay no income or sales taxes but are blessed with state coffers rolling in cash at a time when all other states are suffering. Indeed, when the oil companies pay more taxes to the state of Alaska, they get to write that off against their federal tax obligation, leaving the rest of us to make up the shortfall.

    The state of Alaska owns most of the oil-producing land and was getting upward of 85 percent of its budget from the oil companies that lease the fields, even before Palin helped increase the state's cut. While other states fire schoolteachers because of the economic downturn, Alaska has, as Palin indicated in accepting John McCain's offer to join him on the GOP ticket, more money than it knows what to do with. In a display of plucky arrogance at her coming-out press conference, Palin boasted deceptively that if Alaskans wanted that infamous bridge to nowhere, "we'd build it ourselves."

    She originally had supported having U.S. taxpayers finance that boondoggle, before McCain and others in Congress blasted it.

    Not that I blame Palin for wrangling for her state a bigger cut of oil company windfall profits; it's just not an option that will work wonders for states without oil. Of course we can remedy that by having a federal windfall profits tax of the sort that Barack Obama dared propose, and which McCain and his fellow congressional Republicans have managed to quash. Their argument, rejected quite pointedly by Palin for Alaska, is that it would discourage oil companies from investing in boosting oil field yields.

    McCain derided Obama's call for the windfall profits tax, saying it would "increase our dependence on foreign oil and hinder exactly the same kind of domestic exploration and production we need." I am far more interested in how McCain handles the contradiction between his and Palin's position on windfall oil profits than whether he properly vetted her on her family-values commitment to the abstinence-only teenage sex education program.

    Why is it a good thing for the folks up in Alaska to get a cut of exorbitant oil company profits, but not the rest of us, if we are all part of one nation? Didn't taxpayers from across the U.S. buy the place from the Russians? Isn't it our federally collected tax dollars that have been subsidizing Alaska more lavishly than any other state, both before and after the bonanza of oil?

    Just witness the success of Palin, who, as mayor of the hamlet of Wasilla, hired a big-time lobbying firm intimately connected with the state's now-indicted Republican Sen. Ted Stevens and thus obtained $27 million in federal earmarks during her tenure. As The Washington Post calculated in a devastating report on Mayor Palin's assault on the federal treasury, her home town of Wasilla (with about 6,000 inhabitants in 2002 when she was mayor) received $6.1 million, or $1,000 per resident in earmarks, almost as much as Boise, Idaho, got this year with a population that is 30 times larger.

    It obviously helped to have Alaska's now-indicted senator as chair of the Senate Appropriations Committee. And despite McCain's claims that Palin distinguished herself by breaking with Alaska's discredited Republican establishment in February, the governor sent Stevens a request for $200 million to support various state projects. With representatives like that, it's no wonder that Alaska, despite its oil boom, is still at the top of states subsidized by federal dollars, receiving $1.84 back from Washington for every $1 that Alaskans pay in federal taxes. (California receives 78 cents for every $1.)

    Unfortunately, looking to Palin for advice on helping the rest of us during the oil crunch, as McCain has promised, is a bit like asking a Saudi oil minister or Russia's Vladimir Putin to provide a model for our nation's economic woes. They hardly feel our pain at the pump.

    ---------

    Robert Scheer is author of a new book, "The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America."

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Comments

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Wouldn't it be patriotic if

Wouldn't it be patriotic if big oil gave something back to the country that made it so rich?

Yes, you're right that other

Yes, you're right that other states should have access to the petro-windfall. But, don't diss us because we're progressive enough to consider ourselves an 'owner state' where we tax extractive industries. If other states had programs like this they could cut the taxes that burden their constituents so heavily. Remember, these corporations pay little in the way of Fed. taxes and leave that to the consumers. If you take the time to do better fact-checking you will see that many Alaskans felt that bridge money should have gone to New Orleans after Katrina. And while we are a wealthy state, we get screwed at the gas pump on a daily basis. ...$4.35/gal. in urban areas and up to $8/gal. in bush Alaska. The closer the drilling rig, the higher the price per gallon. Energy costs are killing us and winter is looking pretty bleak. I figure that extra $2400 will cover the additional gas and utilities increases over last year's cost for about 6 months. Our Permanent Fund check will cover half the $4600/yr. in property taxes. We pay 3% sales tax locally on everything. Every phone call beyond 40 miles is an expensive toll call. I enjoy your essays, but, you need to do some research on our state before cleaning our clocks. In the vast bush regions of Alaska there is little running water, no flush toilets (honey buckets are dumped in 'shit lagoons'), emergency medical care requires a long flight to the nearest hospital- often by military crews flying in horrific conditions, English is spoken as a second language, and hunting and gathering is a necessity for survival with little cash economy available. Slam us on facts, please. But, don't diss the PFD program. Get one of your own! That way you won't have to wait for FEMA to show up and fix things after the next disaster strikes! Heck, you might even be able to afford to pay your kid's college tuition. alt. clinton delegate, palmer, AK

"If other states had

"If other states had programs like this they could cut the taxes that burden their constituents so heavily." --says 'alaskadiva' Well, if other states were owned as totally by the corporations as Alaska we'd be in a much bigger pile of dog-do, now wouldn't we ? Alaskans are paid 'hush money' it seems to me by the big oil interests that foots the bills. No one had dare say a disturbing word. "Get one of your own" she says condecendingly. Yes, we'll try but Congress is already owned lockstockandbarrel of oil by BIG OIL. You're lucky you got your little pittance of hush cash every year.

Of course, the PDF is taxed

Of course, the PDF is taxed by the federal government, and the individual income from it goes on to the top of other income. So, the US taxpayers (IRS) receive a sizable portion. For a state that lack so much of the infrastructure, roads, etc., that other states take for granted, it is a stupid distribution. But the Chamber of Commerce and retailers who receive the bounty from the buying frenzies the distributions create are certainly supportive of it. In the days following these distributions it is difficult to park near major retailers as people fight over the newest video displays and other toys. Why is nobody talking about the BP Petroleum job that Palin's husband was given shortly after her election as governor? These jobs pay about $120,000 per year plus benefits and are few and far between. For all the talk about her "independence" this was a clear favor to her intended to buy her allegiance and support. It does not pass the smell test and stinks as does much of current political practices.

To 'anonymous', the PFD is

To 'anonymous', the PFD is not 'hush money' from big oil. It's dividends from money that was invested by and for the Alaskan people from the original sale of north slope oil leases decades ago. Extremely great foresight on their part I'd say. Former and hopefully future Alaskan resident.

Sarah Palin will not enjoy

Sarah Palin will not enjoy her homecoming once the Presidential contest is over (assuming the Democrats win). She's abandoned her claim to a high ethical standard (Troopergate and the stonewalling that accompanied the investigation). She's INCREASED state spending 30% over the past two years (thanks to high oil prices) to the point where oil must exceed $84 per barrel to balance the books, but now with oil dropping below $70 there will literally be hell to pay. So much for the conservatives golden child. At least they got the "child" part of it right.

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