America’s Last Frontier is in trouble. The 40-year oil boom that turned Alaska from a frigid backwater into one of the nation’s richest states is over. Not only have petroleum prices crashed, but Alaska’s supply of crude is running out. Thirty years ago the state was pumping 2 million barrels a day, a quarter of all U.S. output. But over the past decade, the Prudhoe Bay oil field, once the largest in North America, has started to reach the end of its life. Alaska’s output has fallen to 500,000 barrels a day, enough to fill only one-quarter of the capacity of the state’s main economic artery, the 800-mile Trans-Alaska Pipeline System.
With 90 percent of the general fund revenue tied to oil, the collapse has been devastating. Alaska, facing a $4 billion budget deficit, is one of four energy states that have slid into recession over the past year because of cheap oil. The state’s rainy day fund is burning through $11 million a day. If that keeps up, it will be out of emergency funds within two years.
The article goes on to point out that Governor Bill Walker is stuck with the unenviable tasks of trying to fix a problem that the last two governors Parnell and Palin pretended did not exist.
To do it Walker will undoubtedly have to tap into the Permanent Fund account, the recognized third rail of Alaska politics. And possibly reintroduce state income taxes, which might lead to an open revolt within the state.
Whatever Walker does it will no doubt signal the end of his political career in Alaska. And that is really a shame because he is now making the hard choices that his predecessors should have made years ago, and simply refused.
Oh dear. So the people of Alaska will finally have to enter the real world and pay taxes for services like the rest of us? I do wish I could generate some compassion, but frankly, Alaskans have had a free ride for decades-pump the oil, ruin the environment, tax the oil companies, and write every Alaskan a nice check every year, AND no one has to pay for schools or roads or anything. Nice. And the RW thought they could get away with this forever, and Palin encouraged ever more drillling because "God" wanted Alaskans to just take and never give back. Welcome to reality.
ReplyDeleteI do feel for the people who will really be hurt by this, and the people who will have to change their lifestyles. But geez, what were they thinking?
"Take and never give back" is the Palin creed! What have they ever done for anyone?
DeleteWe do pay property taxes in Anchorage and a lot of cities have local sales taxes. Alaska isn't as tax free as it seems. It had been nice not having a state income tax but we can all chip in now.
DeleteAbout time to cut Alaska off of the federal teat too.
DeleteOh you poor thing,I bet the good people in NJ,NY,and California are so sad to hear you actually pay a pittance in real estate tax.
Delete4:12 it is not that simplistic. Statistics can get quite skewed when the ratios are imbalanced (i.e. rate of federal spending per (low) Population. Here in Anchorage, we have some of the highest property tax rates in the US. We pay for our schools, our roads, our other services and then some. Other smaller cities have sales taxes to support services
DeleteStatewide, off the road system, out in the Bush, it is a much different story. The transition from a subsistence way of life to a cash economy has been traumatic. This isn't about changing lifestyles. Many of the people out there won't be paying any taxes because they can't. No jobs = no money. This is also quite a simplistic explanation. There's so much more complexity to this.
I am a yuuuuuugggggeeeee fan of Governor Walker. He is an adult in the room and I respect what he is trying to do. While many people are whining about 'excessive' spending in our state government, what we have here is an income problem. We need a much more diversified economy and yes, fellow Alaskans, we also need to dig deeper into our own pockets and pay more for state services.
I, too, support Governor Walker! He's doing one hell of a job!
DeleteAlso, like Mayor Berkowitz of Anchorage!
The state is changing (as to current elections) and for the better.
Get Republicans out of their offices throughout the state, Alaskans!
Weren't you in surplus not too long ago? Though most facets could probably use more funding. I think the fact that Alaska only relies on oil is definitely the problem. I don't know enough to know if Parnell's tax breaks for oil helped, but I wager it likely didn't matter. How wrong though. Tax break to rape the land. No wonder democrats and Palin turned on him (ok, never really accepted him. shill)
ReplyDeleteI think just drastically reducing the PFD would maybe suffice. Because the few states without income tax are coveted for that reason by residents. Last year I moved my family to a state WITH income tax after living 7 years without and it kind of sucks. I think there are ways to circumvent that for all 50.
On the upside, teen pregnancy in Alaska has been falling since 2006 like with the rest of the country. Note: the highest teen pregnancy has been was in the early 90s, as we know. I just read the article, that while birth control among minorities is more easily obtained, teens are just having less sex. I'll see if I can find the article.
Levi started his guide service and will survive, probably like many Alaskans already have.
DeleteUnemployed Todd and Track will never work for anything.
I think Sunny is trying to start a new business but then I've lost count of how many times she's done that so who knows?! Track and Todd definitely don't work. I think all these people do is breed nonstop.
DeleteThe Palins are very disliked in Alaska. You never see them anywhere in the state. They hide on their compound in Wasilla, don't work and have become a curse upon the state.
DeleteI can hardly wait to travel outside of Alaska and have someone needle me about the likes of one of the Palins. They think the family is a pure joke - especially Sarah and Bristol!
Sarah and Sean did the 'shuffle' with accounts and trusts and investments...
DeleteWhy do you think he is in Palmer now?
It sure isn't to be close to Sarah...
The Palin Curse strikes again
ReplyDeleteyea giving England cough I mean Canada 500 million that does not belong to you is just the beginning of the end for that crew...
DeleteThis is exactly what rethugs do - they sh*t the bed and then leave Dems to make the hard choices during the cleanup. People don't like the cleanup so they blame the Dems. How many times have we seen that SAME scenario?
ReplyDeleteIt's not the first time I've wondered whether Walker winning was no accident.
ReplyDelete"Here's a GOP scapegoat we prepared earlier..."
I don't care what the Drill Baby Drill-billy says, fossil fuels ARE expendable.
ReplyDeleteWhat tha hell? Sarah Palin's family is having all those bastard grandchildren in order to collect their Permanent Fund checks and you're saying that gravy train is over? Poor bastards.
ReplyDeleteIt means they have to get a J O B...
DeleteGryphen do you hear that? whining of the winds!
Alaska baffled me the five years we lived there. They have tens of billions of dollars in the bank, but the Anchorage teachers were always threatening to strike. Most of the state still drinks snowmelt. What the hell is that money for? Just to sit there and produce a dividend so people can by flat screen TVs every year?
ReplyDeleteThere wasn't even sales tax for most municipalities.
Hey baffled Lisa - were you a homeowner paying property taxes? We pay through the nose and butt!
DeleteEven if you were a renter, you really didn't feel the full impact of those MOA taxes. Rents are already high here because property costs are high - not because landlords are greedy. Factoring in the full cost of property tax into rent would make those rental rates prohibitive.
"Drink Snowmelt"
DeleteGood lord, where do you think most of our fresh water comes from? The Water Cycle is Kindergarten science.
http://water.usgs.gov/edu/watercycle.html
As a highly taxed Californian, a donor state, I don't think any state that doesn't pay state income tax or sales tax should be eligible for federal dollars.
ReplyDeleteAlaska is one of the biggest welfare states and Alaskans still get a cut of the oil money.
California produces oil and just about everything else, we pay some of the highest taxes, have a very high cost of living and all we get from the red, welfare states is the middle finger.
Sorry, Gryphon, but fair is fair.
@5:54 - As a fellow Californian I agree with you 100%. If we Californians did not have to support so many red welfare states, we too would have lower taxes. In addition, the money that would be kept in the state would pay for a vastly improved infrastructure, better schools, and perhaps universal health care.
DeleteI shed no tears for Alaska.
I agree as well.
DeleteAs a Texan I actually agree with you.
DeleteI don't think ANY state should receive more than 85% of what they pay into federal taxes back. The other 15% could be used to run the federal government. Texas, Alaska, and the other red states should not be allowed to be welfare queens. Now, having said that, I do think it's up to the state to see how they want to raise those other funds..whether it be income tax, higher property taxes, high sales taxes etc.
Heard that alaska was losing population more than any other state. Am not so unhappy about that. Keep it wild!
ReplyDeleteActually it is the government (federal, state, and miliary) that has traditionally supported Alaska. North slope employment is much different than people realize. For example, see Prudhoe bay in the winter. Native corporations play a part in the economy as well.
Alaska history is quite interesting. I love my home there.
It is a yearly ritual at all Alaskan Boroughs for the school districts to threaten to cut important programs etc in order to leverage more $$ out of tax payer coffers although they are guaranteed a large percentage of tax dollars as well as federal funding. Look at an actual school district budget.
ReplyDeleteExcuse, me, but isn't it also a yearly ritual for big oil to claim hardship and get even more subsidies form everyone BUT Alaskans? And what do they do for us? At least school systems produce the next generation of thinkers and innovators. I fully support every dollar my school system needs.
Deleteyep. But oil companies are also on Native land and state owned land.
DeleteAlaska is different than any other state.
ReplyDeleteWe like 40 below.
Alaska has changed considerably as to our climate. We no longer see 40 below temps (say in the Anchorage area) that we once did. It can be cold in the interior of the state or the very northern part. But, Fairbanks is even now warmer during the winters than it use to be.
DeleteAnd, 6:22 am - most Alaskans don't enjoy -40 temps! Or, -20 temps! We learned to live in it and dress for it. Brrrrrrr!
Do you really think it doesn't get -40 in other states? Minnesota has had -60 without the windchill factor.
DeleteWell, at least when they decommission the pipeline they won't need to spend any money taking it apart. Just send the meth heads out to chop it up for scrap metal and they'll get the job done for free.
ReplyDeleteAm not sure if the meth heads want to leave Alaska's meth head capitol, Wasilla, courtesy of palin.
DeleteOT:
ReplyDeletehttp://www.rawstory.com/2016/05/americans-are-delusional-prudish-religious-nuts-especially-when-compared-to-the-rest-of-world-study/
"How to reconcile a country that fetishizes violence and is squeamish about sex; conflates Christianity and consumerism; says it loves liberty yet made human rights violations a founding principle?"
DeleteAmerica created donald dRumpf from nazi German ancestry heritage.
A lot of Alaska-bashing from those whose only knowledge of Alaskan life comes from what they read in this blog. When I moved to Alaska in the early sixties, the state had an income tax. Alaska had been a state for only five or six years. That went away when the Permanent Fund was established. With a far-flung population in isolated communities, there was a dearth of infrastructure and a lot of catching up to do. If you live Outside, you likely have no idea how badly the State needed that oil money, but many Alaskans felt that putting all our trust in the oil companies was a mistake. Banking our future on a non-renewable resource at the expense of the renewable resources--fishing, forestry, tourism, agriculture--was a dead-end road, but the oil companies 1) drew a lot of outside workers to Alaska who owed their livelihood to the petroleum industry and had no long-tern ties or loyalty to Alaska and 2) spent a lot of money telling Alaskans how they were here to invest in our future and spread their corporate wealth around. No kidding--we have been inundated with high-gloss commercials about how Exxon and BP were so good for Alaska. And of course, the oil companies bought a ton of legislators (the Corrupt Bastards Club) to make sure they got the best deal while they were raping our resources. But the trouble with non-renewable resources is that they run out, and I always knew that when the oil was gone, our good friends in the oil industry would be out of here before the door could hit their asses. I won't cry to see them go, and I hope many of the people that followed the oil up here will follow it back out and take their red-state politics and land-raping mentality with them. We will have a smaller, tougher Alaska but we will be closer to our roots and we will survive. Sure, we may face a smaller PFD, but it's not like it was ever more than a little extra help--no one was living large off their PFD--it has been just a little something to counter-balance the expense of living here. Sure, there were some who would fritter their PFD away on toys or TVs--those are many of the same people who will be chasing those oil jobs--but for many in the bush, the money was a welcomed boon to help with high food and fuel prices that are the norm if you don't live in Anchorage or Fairbanks. I think Bill Walker has done a great job in a difficult situation and he has been fair-minded and non-partisan. I would gladly vote for him again.
ReplyDeleteGreat read. Thank you!
DeleteThanks for the history lesson. It really annoys me that the RW cannot see the forest for the trees. We NEED government. We need revenue to support the infrastructure (ask Flint) and we need people in government who are not afraid to raise revenue to help all of us. I saw that creep Norquist on MSNBC (yes, they are SO liberal) and he is still going on about lowering taxes..for the rich of course. Lower taxes got us int he mess we are all in now. Fewer foremen, police, teachers, librarians, city workers to collect trash and snow, and on and on. Taxes are the dues we pay for living in a civilized society (no, NRA, it's not guns that make us civilized.) It is pretty pathetic that we have allowed businesses and the GOP to delude the populace into thinking all taxes are evil, that government is evil, and that we the people can run this nation all by ourselves, with the help of the corps of course.
DeleteYou are very rational and learned in this - many of your statemates .....not so much.
DeleteThe disparity in the states is annoying. My family pays $12,000 - yes 12k in township taxes alone. That is why we keep our kids in the school district - who can afford private high schools with these types of taxes?
When the kids are out of HS and in college (we have two years saved for each of them, hoping for scholarship help and then loans plus the extra we save on taxes) we plan to move to DE and pay $1200 at most in local taxes and no sales tax. We didn't move earlier in life as the kids were entrenched here.
A beete school district ner us have txes 14-17k a year.. amd again this is just LOCAL taxes. We also have state income, sales tax, federal tax and because i work in phila but live in burbs I pay city local wage tax too!!
Oh - an we owed both state and federal taxes. At our income level, it almost behooves me NOT to work. I carry our benefits as mine are better than my husband, so that is essentially why i work.
Crazy.
A smaller PFD? Don't you mean no PFD? I live in an oil producing state,we are having budget issues,but not like Alaska.We don't expect the state to send us a check every year,no matter how small.Imagine if that PFD money had gone into infrastructure,schools,and real businesses. In all of the other oil producing states,state land that has oil provides state income.Private land that has oil provides individual income.Amazing I know. Somebody sitting an apartment with 4 kids doesn't get a check for 6 people every year just because they breath air.
DeleteYes, 7:05! I've been grateful for the pfd all these years. Saved all for our kids' college education.
DeletePeople like the Palins buy toys and teevees with their 'free' money. Bristol is up to $10 K a year now just in pfd income. Add to that, the child support and the payoff from Sarah and you've got one momma who can keep up with the blogs all damn day while drinking 310 in her loubootonzzzz.
Excellent.
DeleteIt was very difficult to get Alaska to statehood.
I still like "getting water" in my pickup. Alaskans know what I am talking about.
7:05 AM-
DeleteAs a fellow Alaskan all I can say is Bravo, you nailed it.
We all had one big partay. Alaskans, and non alaskans that benefited from the oil boom. There were those that were saying all along we would have the great hangover. Sorry that Walker had to walk into that. Disillusioned in Parnell and Palin that they made us look prosperous. Remember that big check she gave us on her way out? We all took it. No questions asked. Now we have to stop, think and think hard. What did we do? It's hard to wake up and smell the roses.
ReplyDeleteDon't forget Republican Lisa Murkowski sitting back there in D.C. as a member of the despised United States "Do Nothing" (and, obstructionist) Congress.
DeleteShe needs to be voted out of office when up for reelection again. She damned near lost last go around!
She's already raising huge amounts of money (not from Alaskans) for her run, knowing full well that she's not liked by the regular folks throughout Alaska!
She has not helped Alaska!!! Be educated about her - check how she voted on various things in Congress and review what she had to say about particular subjects coming before Congress!
She talks one position publically and votes exactly the opposite as to the subject!
The lower 48 west coast crab fishing was decimated this yr. Even the Alaskan crab were out way farther than usual. When the oceans warm up another degree or so Alaskans can kick the crab fishing goodbye also.
ReplyDeleteHope Levi doesn't get laid off from his job on the slope. He has worked so hard to finally get a reasonable child support ruling and buy a home for his family.
ReplyDeleteNobody gives a fuck.
DeleteThen why did you reply 10:41?
DeleteThe chances are pretty good that Levi will be losing his job in the next 3 months. He's a short timer and there are many people with a lot more time and experience on the Slope that have lost their jobs.
DeleteIt's getting dire up there, my friend was a chef in a man camp and the entire camp shut down and he lost his job. It's happening and Levi will most likely be looking for a job soon.
It's kind of sad as that kid can't seem to catch a break.
Levi does not work on the Slope full time. His job rarely takes him there.
DeleteHe will be just fine.
Nice try though.
I give a fuck, Sarah. And so should Bristol. You see, if Levi loses his job, he can file for a further reduction in the usurious amount of child support that Bristol still demands.
DeleteOf course, unlike Bristol who has no rill employment, Levi would seek out another steady job. Guiding will serve him well since he is one of the best and rich assholes from Outside will continue to come to Alaska regardless of the 'local' economic turmoil.
Tawd should've kept his share in the Rainbow Lodge. Oh wait - that was just a money laundering scheme. Never mind.
Thanks Gryphen.
DeleteNot the other poster but your post was off topic, SPHASH. Post that crap on your own blog. This thread is about the Alaskaan economy, Palin threads are elsewhere.
Delete1249 they crucify those they cannot forget
DeleteMany people will soon be underwater with their mortgages and will begin walking away from their debt, just like in the 80's there will be empty homes all over the place.
ReplyDeleteAt the end of the 80's recession we picked up a home for $110,000 that had previously been valued at 450,000. If you ride this out it will be worth it, but unless you are sitting on a home that is nearly paid for it will be painful.
My two cents regarding the PFD, take the whole thing. What of mine doesn't go to taxes I give to public radio and television to offset my remaining taxes. It brings a bunch of freeloaders up here anyway, freeloaders who have extra kids for extra PFDs if you can believe anyone would be dumb enough to have a kid for an extra thousand or two per year.
No doubt, some people will lose their homes, but Anchorage is not overbuilt like it was in the early 80s. You'll also real that overheated housing market was fueled by a lot of loose loans and scams by banks and credit unions that went bust or were busted for fraud.
DeleteI'm willing to let go of the pfd as well. The program has attracted quite a few folks who viewed it as a big payday. What a surprise when they got up here and discovered they have to work double-shifts at the 7-11 just to pay a portion of the rent while their kids have gone all gangster and are shooting themselves up.
Fuck the Republicans in Alaska that have literally screwed Alaskans. They have been the majority for WAY too long!
ReplyDeleteVote any of them that are up for reelection in the Alaska Legislature - out of office - throughout the state!
Alaska is slowly turning blue again and it's a pleasure to see. Keep it up Alaskans!
READ THIS>
ReplyDeletehttp://www.amazon.com/Who-Owns-America-Walter-Hickel/dp/013958322X
Published: 1971
Russia?
DeleteThis may be a blessing in disguise G. The Republicans who have huge majorities in the Legislature cannot seem to come up with a plan. They won't institute an income or sales tax, they don't want to discuss cutting the permanent fund dividend, let alone allowing the State to fund itself on the Permanent Fund earnings.
ReplyDeleteI read comments in the Alaska news where residents are talking either/or. The deficit is so huge that it is not an either/or situation. It will take income taxes, sales taxes, use of the permanent fund earnings and cutting the Permanent Fund Dividend. All of the above. I don't see how this particular Legislature gets there.
And if they cannot get there, perhaps the good folks of Alaska will vote Blue again, as they did before Big Oil came to town.
Glad the article didn't blame it all on Walker. It's the combined asshole of palin and parnell that Alaskans are now smelling.
ReplyDeleteThanks for clearing that up Gryphen
ReplyDeleteSo when will the big profits from Sarah "The Energy Expert Governor" Palin's natural gas pipeline start rolling in? Will it be in time to make a difference?
ReplyDeleteWill it be yooge?
Or was it a pipe lie?