AK Gov. (r) Mike “Drink-Your-Milkshake” Dunleavy
Tanker Teacher Oil Guy
My month-long stint on the Last Frontier winds down. Nightfall casts its dim mantle over daylight hours with heightened resolve. It engulfs faraway volcanic silhouettes with relish before gobbling up the chicken coup outside.
Around mid-November, the state’s North Pole will undergo complete darkness for two consecutive months.
But not in Homer. The daylight swings here aren’t as pronounced. So much for romantic geographic extremities. Still, the floodlight outside the guesthouse died and walking to the bathhouse for a midnight piss is a chilling journey even Virgil would deem hellishly dark.
Speaking of Satan, lazy segues, and exhausted metaphors, the Republican Governor of Alaska and former school teacher, Mike Dunleavy, still beats his bat-like wings of austerity, pushing to cut budgets for public programs and freeze up the state’s legislature and courts. Think “Ron Swanson” from Parks and Recreation, but replace “libertarian of charming banter” with “opportunist of deleterious incompetence.”
Yes, just like its pristine wilderness, Alaska’s markets ought to be free, unencumbered by pesky government rules and regulations.
Who cares that a fifth of its budget comes from federal grants? FREEDOM! Who cares that the state still has an inkling of wilderness because that very government owns 60% of its land via national parks, wildlife refuges, national forests, military bases, and the North Slope National Petroleum Reserve? Screw those first three! MARKETS! And who gives a damn that heat waves and wildfires burned 2.5 million acres in Alaska this year, with fire seasons dragging out to historically unprecedented lengths? FREEDOM MARKETS!
Dunleavy ran his 2018 gubernatorial campaign in an all-too familiar form, tying its slogan, “Make Alaska Safe Again,” directly to the president. Stable Genius himself sums up the unfolding buddy-buddy bond with Dunleavy:
Let’s take this tweet as structural fodder to get into some issues.
“Mike is for Energy and Jobs”
The first part—and the focus of this article—isn’t too far off the mark. In fact, Mike is certainly for energy. On top of public spending cuts, which include $130 million to the University of Alaska and $335,000 to the Alaska Supreme Court, Dunleavy vows to balance the state’s budget by making “Alaska open for business.” In other words, drill, baby, drill!
Like hyenas to a rotting carcass, the Koch Brothers’ political advocacy group, Americans for Prosperity, materialized to guide the newly elected governor through budget meetings. If the above picture isn’t evidence enough of Dunleavy’s affiliation with the group, then his effective $1.2 billion in tax credits to oil companies operating in Alaska during FY ‘19 ought to speak for itself.
That’s $1.2 billion stolen directly out of the hands of people with medical needs, educators, and students, including many Alaska Natives, expecting state scholarships. That’s $1.2 billion funneled directly into the pockets of wealthy oil tycoons.
Granted, Alaska’s historical relationship with the oil industry is… complicated.
On March 12, 1968, Arco executive Robert Anderson popped the cap off a 12-billion barrel oil field at Prudhoe Bay on the North Slope. In seconds, natural gas plumes rocketed 30 feet into the air. It remains the biggest oil strike in U.S. history, vitalizing a newborn state and paving the way for development over the next half of a century.
It put Alaska on the proverbial map, opening its land to domestic and foreign companies for hydrocarbon exploration.
Today, oil revenue from production taxes, petroleum property taxes, corporate income taxes, and royalties derived from state-owned land harboring giant oil fields accounts for 56% of Alaska’s state budget (with most of the remainder, again, federally sourced).
There is no personal income tax;
there is no state sales tax;
and as of January 2016 Alaskans paid the lowest tax rate for gasoline and diesel fuel in the U.S., a convenient break to citizens who often need to travel long distances.
Alaskans are ranked fourth highest of U.S. consumers of fossil fuels per capita—it’s a “way of life” here.
Things get particularly weird when it comes to Alaska’s Permanent Fund Dividend (PFD), an amendment to the state’s constitution in 1976 that requires a percentage of oil revenues be divvied out to Alaskan citizens each year. The fund functions as a state savings account ($55 billion in 2016), and its dividend payout to Alaskans remains the closest state mechanism to a universal basic income that exists in the U.S.
The better the Alaskan oil industry performs, the more sweet state cheddar in citizens’ pockets.
But oil production in Alaska reached its peak in 1988. Like all nonrenewable resources, oil and gas proved exceptionally finite, as production dropped nearly 75% over the course of 30 years. Companies like Hilcorp continue to push their exploration and extraction efforts further and further up Oil Mountain with Sisyphean absurdity. Their attempts inevitably, perpetually, tumble down the other side.
The years preceding the 2018 gubernatorial elections saw both relatively low PFD payouts and low global oil prices. State revenue in any given year is unconventionally volatile given Alaska’s marriage to the oil industry, and voters weren’t psyched that their $2,100 PFD fell to $1,100 over the course of several years.
Capitalizing on the state’s “oil crisis,” Dunleavy launched an oil-friendly campaign, successfully convincing voters that he (rather, BP-Hilcorp and the Koch Brothers) would lift Alaska out of its slump. He’d also be “tough on crime,” snuffing out increasing property theft and opioid addiction. Yet, the systemic criminal activity of ransacking protected land and marginalized communities for diminishing profits—most of which Alaskans would never see, despite the tax revenue structures mentioned above—would be ramped up.
So yes, Mike is for energy. The source of that energy merely happens to be disappearing, destroying sensitive ecological systems, and contributing to a rapidly warming global climate.
In February, the governor issued an administrative order to effectively kill the state’s Climate Action for Alaska Leadership Team and its policy initiatives to adapt to climate change. As of 2013, the Arctic was warming at twice the rate of the rest of the world. Seeing this, the state’s previous governor, Bill Walker, began a process in 2017 (better late than never) to develop renewables, implement a carbon-tax system, and branch out into new industries to adapt to the indisputable changes. Infuriatingly predictable events ensued.
Here’s a distilled version with direct quotes:
Dunleavy and his administration:
For various reasons these AO’s are no longer needed: they are no longer relevant, have fulfilled their intended purpose, are not aligned with the Governor’s policy direction, and/or appear to have been made primarily for political or public relations purposes.
Chris Rose, founder of Renewable Alaska Energy Project:
Without such planning, Alaska will be more vulnerable to negative climate change impacts and less attractive to outside investors who are coming to expect that states and municipalities will diligently work to adapt to climate change, and lower GHG emissions. Without those types of proactive efforts by the state government, many investors who could help diversify the Alaskan economy and create good paying jobs will go elsewhere.
This brings me to the president’s second twittoral claim, “Mike is for… jobs,” which I’ll dive into next time for the final installment on Dunleavy. [Spoiler: he’s afraid of unions—and he should be].