AROUND THE BLOCK
News with a Twist
Alaska Oil Money Melts
Mulls First Income Tax in Years
In a remarkable development, the New York Times reported today that the state of Alaska is considering the imposition of a personal income tax the first time in 35 years. The tax is being proposed, along with other austerity measures, as Alaska faces a massive revenue shortfall due to falling oil production and prices.
In a clever turn of a phrase, the Times called it an "Alaska-size shortfall", reporting that two-thirds of the revenue needed to cover this year's $5.2 billion state budget cannot be collected.
This is a stunning turn-around for Alaska which has historically been the nation's least-taxed state, where, the Times reported, energy taxes and royalties once paid for 90% of state functions and where oil money was so plentiful that residents received annual dividend checks from a state savings fund that could total more than $8,000 for a family of four. In another clever turn of a phrase, the Times reported that the check would arrive every autumn, "as predictable as the first snowfall".
The state is looking at various options to increase revenues, including a personal income tax and a proposal to collect $100 million in new taxes on oil and gas companies, while reducing the tax credits they can claim by $400 million, the Times reported.
In response, Knute Kneejerker, the spokesman for the energy industry's main lobbying group, said the industry has vowed to fight the proposal. Kneejerker went on to say that additional taxes and a reduction in credits is "just not fair", continuing, "the oil industry has been making billions in Alaska due to low taxes, huge state subsidies and tax credits. Now that things have 'gone south' it's just not American to have us pay our fair share." (Note: Given his clever turn of a phrase, we do not know if Kneejerker's statements are written by a Times reporter).
Undaunted, the people of Alaska vow to carry-on, finding ways to mitigate some of the effects of increased personal income taxes. Long out of print, Guluarija Guraam's classic Alaskan cookbook, "1,000 Ways to Prepare Blubber" is due to hit the bookstores before the "snow melts" (Note: It's contagious). And the famous chain of Alaskan variety stores, Qagaasakung's with outlets in 12 Alaskan cities, is stocking it's shelves with a variety of whale oil products including soaps, cosmetics, candles and lamps. According to owner Taanil Taglas, "these things were sitting in the basement for 20 years. With all the fossil fuel money coming in, we didn't think we'd ever sell another whale blubber product. Little did we know".
For her part, former Alaska governor Sarah Palin said the budget crisis "couldn't have happened at a better time", going on to say, "with Obama's terrible foreign policy leadership, particularly towards Russia and it's heroic leader, Vladimir Putin, being able to see Russia has never been so important". In that regard, Palin has plans to open up the "You Can See Russia From My House" theme park at her house in Anchorage.
And in a stunning announcement, 77-year old California governor Jerry Brown, who is being termed out of his current position, has vowed to move to Anchorage and run for governor of Alaska saying, "no one has more experience fixing a state budget than I have", going on to say, he would repeat to Alaskans his famous call to Californians, "Bark if you don't like deficits."
(Editor's note: this is a revised version of "Alaska Oil Melts". The original version erroneously contained an image of Dr. Ben Carson, rather than the image of the map of Alaska, which clearly shows how close Russia really is to Alaska. While the original version was posted in error, we have subsequently heard from Dr. Carson who said, "It is my opinion that however this tax and revenue debate ends, when I'm president I will seriously consider making Alaska a state". We apologize for any confusion.)
In a clever turn of a phrase, the Times called it an "Alaska-size shortfall", reporting that two-thirds of the revenue needed to cover this year's $5.2 billion state budget cannot be collected.
This is a stunning turn-around for Alaska which has historically been the nation's least-taxed state, where, the Times reported, energy taxes and royalties once paid for 90% of state functions and where oil money was so plentiful that residents received annual dividend checks from a state savings fund that could total more than $8,000 for a family of four. In another clever turn of a phrase, the Times reported that the check would arrive every autumn, "as predictable as the first snowfall".
The state is looking at various options to increase revenues, including a personal income tax and a proposal to collect $100 million in new taxes on oil and gas companies, while reducing the tax credits they can claim by $400 million, the Times reported.
In response, Knute Kneejerker, the spokesman for the energy industry's main lobbying group, said the industry has vowed to fight the proposal. Kneejerker went on to say that additional taxes and a reduction in credits is "just not fair", continuing, "the oil industry has been making billions in Alaska due to low taxes, huge state subsidies and tax credits. Now that things have 'gone south' it's just not American to have us pay our fair share." (Note: Given his clever turn of a phrase, we do not know if Kneejerker's statements are written by a Times reporter).
Undaunted, the people of Alaska vow to carry-on, finding ways to mitigate some of the effects of increased personal income taxes. Long out of print, Guluarija Guraam's classic Alaskan cookbook, "1,000 Ways to Prepare Blubber" is due to hit the bookstores before the "snow melts" (Note: It's contagious). And the famous chain of Alaskan variety stores, Qagaasakung's with outlets in 12 Alaskan cities, is stocking it's shelves with a variety of whale oil products including soaps, cosmetics, candles and lamps. According to owner Taanil Taglas, "these things were sitting in the basement for 20 years. With all the fossil fuel money coming in, we didn't think we'd ever sell another whale blubber product. Little did we know".
For her part, former Alaska governor Sarah Palin said the budget crisis "couldn't have happened at a better time", going on to say, "with Obama's terrible foreign policy leadership, particularly towards Russia and it's heroic leader, Vladimir Putin, being able to see Russia has never been so important". In that regard, Palin has plans to open up the "You Can See Russia From My House" theme park at her house in Anchorage.
And in a stunning announcement, 77-year old California governor Jerry Brown, who is being termed out of his current position, has vowed to move to Anchorage and run for governor of Alaska saying, "no one has more experience fixing a state budget than I have", going on to say, he would repeat to Alaskans his famous call to Californians, "Bark if you don't like deficits."
(Editor's note: this is a revised version of "Alaska Oil Melts". The original version erroneously contained an image of Dr. Ben Carson, rather than the image of the map of Alaska, which clearly shows how close Russia really is to Alaska. While the original version was posted in error, we have subsequently heard from Dr. Carson who said, "It is my opinion that however this tax and revenue debate ends, when I'm president I will seriously consider making Alaska a state". We apologize for any confusion.)
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