Change the tax policy if you want a green industry

Once again, the U.S. Congress is where it was during the 1970s with the politically driven and politically correct desire to reduce the environmental impact of U.S. industry. Instead of providing tax incentives to allow our industry to reduce atmospheric emissions, and to eliminate the impact upon our water ways and soils, Congress at that time chose to leave the tax code intact, and so began the great exodus of heavy industry to elsewhere in the world.

In his 1980 run for president against Ronald Regan and George H. Bush, John Connolly, former governor of Texas, proposed a sweeping change to the tax code. Connolly proposed to allow business to add pollution control equipment and to modernize plants when doing so with the ability to immediately write off the entire amount of the needed changes to meet EPA’s new regulations. Unfortunately, this idea failed with his candidacy.

Ronald Regan fought for tax cuts, but not the specific changes needed to allow a business to write off millions in new pollution control equipment in one fell swoop, rather than amortizing the expense out over 20 years, the life of the building under IRS code.

What happened to our heavy industry? Over the next 20 years it went to Japan, China, India, Argentina, Chile, and Thailand to name a few places benefiting from our stupidity. Our industry went to places without controls. And, our Congress watched it go bye bye in the name of “free trade”.

Instead of making it feasible for U.S. industry, including the car makers, to reduce their environmental impact, and to upgrade and to modernize production facilities that in many cases were unchanged since the end of WWII, Congress elected to leave that portion of the tax code unchanged.

Business, being profit driven was driven to looking offshore to compete with the burgeoning Japanese heavy industry.

Our steel, and other heavy industry went elsewhere along with hundreds of thousands of U.S. jobs. This exodus is continuing today in the service sector. All because Congress cannot figure out that a simple change in the tax code was necessary to allow our industry to meet pollution control laws.

Yet, by contrast, in response to the 1973 oil embargo, Congress authorized the Trans Alaska Pipeline System construction by passing the most the liberal construction tax package in the history of Congress. The oil companies comprising what became Alyeska Pipeline Company enjoyed tax breaks off of the construction cost for years beyond the pay off date for the pipeline. Which pipeline, by the way, was paid for within 3 months of the first barrel of oil flowing south to Valdez.

A good start is a rational tax policy designed to achieve the national goals of environmental protection and to achieve the strategic national defense goal of maintaining our industrial and labor base by keeping industry here.

Our industry has always had to compete with countries—not businesses, countries—who subsidize their industry. Try to compete with Mitsubishi when Mitsubishi can get a 2% forever loan from the Japanese government to improve production technology, whereas CAT must acquire financing at the going rate and terms in the U.S. financial market, as well as deal with unchanged tax code that punishes innovation. Hence, Mitsubishi owns part of CAT, Chrysler, on and on in order for our companies to get some degree of competitiveness.

On a micro economic scale, even this peon had that lesson brought home the hard way. In the 1980s when the price of gold was high, IHC Holland came to Alaska. Ever tried to sell a “home grown” mineral processing plant when the local banks would not support the local miner, but the foreign firm could offer national financing through the Dutch national bank for their project?

What would be the impact upon the U.S. steel industry, for example, of being allowed the full write off at the time of expenditure of the cost of meeting EPA regulations by reducing green house gas emissions and meeting environmental regulations, which tax write off also allowed renovating a steel mill to include robotics and other improvements to increase production efficiency?

The impact would be immediate and beneficial.

What business wants to depend upon the third world for manufactured goods?

My experience with Chinese fittings, hoses, and other materials handling equipment is not good. These items fail before they should. The accelerated replacement of that junk was a major factor in my job cost this summer.

I further believe, that such a tax policy would have the impact of attracting foreign industry to the U.S. That would not hurt the labor force.

The U.S. provides a stable, educated workforce. A workforce that would grow and provide generations of Americans opportunity. These workers would have a standard to meet and would need to educate themselves to meet the needs of industry.

I believe that such a need would have a positive impact upon education, as where would be a need for education in the workplace.

Even the common laborer has to be literate and able to read and write English.

However, Congress will not be able to figure this out. There are too many ways to split the dollar, and business is evil in the dem mind. As bad is the globalist Republican mindset that is too focused on a "one world" economy that the rest of us has to pay for with our jobs and the country's industry in order to raise the standard of living in every rat hold in the world. This in the face of the reality that the best way to nation build is for a nation to develop its business infrastructure to serve a domestic market rather than be used as a cheap labor pool for the U.S.

IZEMBEK OUTRAGE!!!!!

There are few things that will torque me as much as the BS about "pristine wilderness". There is nothing "pristine" about Alaska's wilderness. It has been walked over, hunted upon, mined and developed at one time or another for over 10,000 years. Yet, a few, who have appointed themselves as the unofficial protectors of this great land--read exploiters who shamelessly use Alaska to raise funds to promote their insanity--blocked for many years something that should have been a no brainer.

Alaska, unlike the lower 48, is a state without surface transportation infrastructure, excepting a limited road and rail infrastructure within south central Alaska. There are few roads linking Alaska's western, southern and northern villages.

Many of Alaska's outlying villages comprise the United State's third world. No sewer, water, or roads. The village of Hoonah in southeastern Alaska managed to get its first generator for electric power (50KW unit) back in the late 1970s.

One of the most egregious and outrageous situations for many years has been the plight of the villagers of Kings Cove on the Alaska Penninsula. King Cove suffers from such lousy weather that the USCG will not fly their aircraft into King Cove. The nearest IFR airport is at Cold Bay, some 20 miles away.

Gee, that's not far. . . .

Except, that 20 miles is through the Izembek National Wildlife Refuge, a refuge that did not exist at the time of Alaska's becoming a State in the Union of States.

There is an ATV trail that links the two communities that is illegal to use, because of the INWR.

This no trespass of Uncle Sam's wildlife refuge meant that any villager in King Cove who has a medical emergency was in very dire straits.

For many years, Senator Ted Stevens tried to get a road built. In 1996, the feds invested in a $30 MILLION dollar clinic in Kings Cove to avoid upgrading the existing trail across the edge of the INWR. In 1998, to give the villagers better access, Congress authorized an appropriation for a hovercraft.

The bottom line is that 10s of millions of dollars have been spent to avoid bringing up an existing trail to a pioneer gravel road standard, such as is common throughout the Midwest. This money has been spent to circumvent the logical, rational, and necessary solution, which, all along, was the road.

What was the cost to the State of Alaska for the Senate of the United States accepting the road?

61,000 acres.

The sovereign State of Alaska had to bribe the Congress of the United States with land.

Why?

The Congress of the United States is so sensitive to the environmental lobby, that Congress seeks the satisfaction of those greedy, self-centered, arrogant twits over the needs of someone fighting for their life whose salvation is a few miles away through the INWR.

What is the impact of the road in terms of the number of acres actually impacted in the INWR? About 200 acres.

The necessity of this land swap was an egregious affront to the sovereignty of the State of Alaska.

Why is there no outcry from our Legislature, our Governor, or our Congressional delegation?

Cowardice, and the fact that most of these folks have grown up with placating the feds and their elitist environmental lobby.

Alaska's Statehood Compact was a compromise with Congress made with the recognition by Congress in the late 50's that the federal government did not have enough money in the treasury to provide Alaska with roads, airports, and harbours to the standards enjoyed by the rest of the states in the union. In lieu of the government spending money that it did not have, the Congress, in its infinite wisdom, gave the State of Alaska 90% of any non-renewable resource development in the state on both State and Federal lands. Since 1959, the federal government has continually reneged on this promise.

One of the implied promises was that the federal government would not impose stricter land classifications, nor classify additional lands more restrictively as to use. Then came ANILCA under Carter.

The Alaska National Interest Lands Conservation Act was one of the most egregious acts against the intent in the Statehood Compact.

The land swap shows that Alaska is a State in name only. That Alaska must buy its citizens' needs from the environmental lobby.

Welcome to the colonies!

Why are Alaskans paying the highest prices at the pump?

In May of 1973, at the start of the OPEC oil embargo, the price for regular gas at the pumps in Palmer, Alaska was about 47¢ per gallon.

The major suppliers in the Alaska market at the time were Standard Oil, Tesoro, and Texaco.

In Palmer, the Texaco station was about 200 yards from the Tesoro station, in the building where the Alaska Fireplace, Co. is now located.

Tesoro was fairly new to Alaska having recently built a refinery at Nikkiski to process Cook Inlet crude into fuels for Alaska.

Texaco and Standard Oil moved refined fuels into Alaska by tanker.

(What?!!! That was done here? Ohhhhh. Uh . . . wait a minute, why then, has crude been moved from Valdez to the lower 48 and not refined fuels all of these years? Just think of all those jobs and infrastructure that could have benefited Alaska! Oh, it has to be refined Outside, because it’s . . . what? Too expensive to move it from Alaska refined? But, fuel was shipped to Alaska refined. Oh. Don’t ask. Oookaaay. Uh, I was just in Iowa where refined fuels come to the state by pipeline and then distributed. Gas there was $1.64 for unleaded without ethanol at the pump. What do you mean that’s there and not here?—The foregoing for all you Rick Rydell and Dan Fagan listeners out there who believe “big oil can do no wrong”.)

When the embargo was officially announced, and oil production cut by OPEC, Texaco and Standard Oil raised their prices immediately to about 92¢ a gallon at the pump citing decreasing supply issues and market forces.

Then “little” Tesoro stated publicly that Tesoro had no intention of raising its prices at the pump.

What do you think happened?

The other two oil companies sued Tesoro for unfair trade practices.

Tesoro claimed that there was no reason for it to raise its prices.

After the press on the issue had quieted down, Tesoro quietly raised its prices to match those of its out of state competitors and the suits by Tesoro’s competitors were dropped.

Two things came of that situation which had little or no notice from the press.

Tesoro began refining fuel for Texaco and Standard oil for the Alaska market.

Tesoro has matched its competitors’ prices ever since.

How do I remember this?

I was working for MTA at the time making $3.25 an hour as an apprentice central office switchman who was married with a kid on the way. The price of gas mattered even then.

Upon my return from Iowa on the 23d of December, the local price of gas at the pump was about $2.35. This morning (31 Dec.) the price was $2.45 per gallon for unleaded at the big Palmer Tesoro on the hill.

All because the Israelis bombed the Palestinians who have no oil, as the pundits would have us believe?

Our Legislature recently completed an investigation of pricing at the pump and pronounced no price fixing or other factor which would cause artificial inflation of our fuels in Alaska. That the prices are just what we have to pay.

Uh, huh.

I believe that the Palin Administration should fund a comprehensive study to be performed by the University of Alaska Fairbanks and Anchorage to determine whether or not we are paying a reasonable price for gas at the pump. The scope of the study should begin back in the last year Alaska was completely reliant upon refined fuels being shipped in by tanker through the present.

As in, “How much for how long have we been overpaying . . . or not”?

Why the U of A?

U of A would use business grad and undergrad students not beholding to the oil companies or any group whose re-election is dependent upon funding from oil companies.

I do not believe the State could hire a consultant to do the job, as the result would be clouded by politics.

The Legislature is certainly the last entity that I would trust to provide an unbiased finding.

It is time Alaskans had the truth about the cost of producing fuel and why we pay the highest prices in the U.S. for fuels at the pump versus what the real price at the pump should be.

How about it, Sarah?

Concoco-Phillips Denali Project

The decision by BP and Conoco Phillips to build a pipeline to take North Slope NG to Canada is a definite change of heart for two out of the three Producers on the North Slope.

I believe the reason for this change is not because all of a sudden BP and Conoco want to get NG off the North Slope, but rather because the alternatives are lacking for another high priority project.

Between unstable tundra along the proposed route due to permafrost melting to legal challenges by Deh Cho and other Native groups, and as yet unsettled right of way regulatory issues, the NG from the MacKenzie River Delta that was intended to fuel the separation of oil from the Alberta Tar Sands is not going to be available within the time frames originally envisioned for the MacKenzie River Delta pipeline project. An alternative had to be found, and Alaska’s North Slope gas reserves is that alternative.

The increasing price of oil is driving the recovery of oil from Alberta Tar Sands at an ever increasing pace. A supply of cheap NG is necessary to the economic viability of the separation process.

The only long term viable source of NG without rights of way issues at least to the Canadian border is found on Alaska’s North Slope. The rights of way and other issues would still have to be worked out to get the NG to Alberta, but, undoubtedly, BP will wield considerable influence in dealing with the Canadian side, given the Crown’s interest in BP along with the imperative to get the Tar Sands oil to market.

It is unlikely that Exxon will seek its own means to transport NG off the North Slope, especially with the promises made regarding development of the Pt. Thompson NG reserves made in order to retain those leases. Exxon is in a market it or else situation with the Pt. Thompson NG reserves. Therefore, it is reasonable to assume, that although unannounced, Exxon will eventually join with BP and Conoco Phillips.

Exxon was a player in the MacKenzie River Delta pipeline project, and a major advocate of taking Alaska’s NG over the top and plugging into the anticipated MacKenzie River Delta pipeline system.

Through a subsidiary, Exxon is also a major player in the Alberta Tar Sands project.

A major concern of those who live in the Mat-Su Valley is whether or not there will there be a provision for a spur line from Big Delta down to the Palmer Enstar NG Hub to provide NG for south central?

It is already a fact from the last round of this game under Murkowski that Alberta was all too willing to provide a ready market for Alaska’s NG liquids, such as propane and butane.

Will the Governor and the Legislature allow these valuable NG liquids to be transferred to Canada without proper consideration given to the long term benefits of value added processing in Alaska?

Stripping them out and using these gas liquids here would provide the building blocks for a petrochemical industrial base. A benefit with economic benefits far beyond just resource extraction that the pipeline represents.

Obviously, value added development of our NG resources would allow Alaskans greater opportunity beyond just the construction of a pipeline. Once the last pipe is welded into place, the pipeline jobs go away. Value added industrial development would be a lingering base upon which to ensure that the benefits from our NG resources go beyond fueling bloated, growing, and ever greedy state and local governments.

If the money goes directly to government, we all lose. If there is value added development, then we the people will benefit along with the Producers and government through jobs and infrastructure upon which to build industry.

The challenges for the Palin Administration, the Legislature and the Producers will be to balance the interests of all parties against the imperatives of the looming south central NG crisis, the economics of the proposed pipeline, and the constitutional requirement of the State to gain maximum benefit from the exploitation of this nonrenewable resource versus the interests of the Producers with respect to their profit motive.

Until there is a NG pipeline from the North Slope generating revenue, our responsibility as citizens will be to see that our elected officials do not spend revenue that is not there. And, to see that maximum benefit is exactly what is bargained for across the board.

Another blog dealing with this subject is to be found at http://www.blogged.com/about/denali-pipeline/

Be Proud, and be thankful for our armed forces.

We should be proud and thankful for our forefather’s bravery, integrity, and fortitude in their act of declaring independence from the most powerful nation on earth at the time.

The Declaration of Independence was a bell weather event in history.

The pursuit of those who signed that declaration was without mercy, remorseless and done to set an example for those who might again challenge the authority of the Crown.

Thank God that the Brits failed and that our forefathers were successful and courageous enough to see through a war that gave us our independence from Britain, the Declaration of Independence and our Constitution.

There is no other document in any government by any people now or in the past so powerful and protecting of the individual against the despot as the Constitution of the United States. Nor one that is so continually assaulted by a well meaning, but deluded liberal mindset.

There are others today who sacrifice and whose courage and example should be touted across this land. The men and women of the United States military.

Recently, I was in Hawaii working a job at a USMC Marksmanship Range at Puuloa on Oahu. There, I had the privilege to meet some incredible young men and women.

The scars of Iraq were evident after duty hours when they would come out to the range in casual attire to ride their motorcycles or drive their 4X4s down to the beach. To see the extent of some of the physical effects of their encounters with IEDs was sobering. The extended recovery some of these Marines underwent constituted challenges in of themselves daunting and sobering to we mortals.

The mental scars also came out in riding motorcycles and ATVs drunk in the dark, without lights, hoping to quell the images, the dreams, the flashbacks, the detritus of war that never goes away. The memories of buddies so alive one minute and gone the next. The guilt of wondering why one survived and others did not.

These men and women were on the surface professional and alive, and on another locked into a reality that only they and those who had served there could understand. Like all vets of all wars.

Unlike previous wars, excepting the Revolutionary War, as that war was the only other war in U.S. history without a draft, these men and women, like their Revolutionary counterparts were volunteers. Not compelled by anything but their sense of patriotism, their sense of duty, their desire to preserve this country, no matter how much the libs have screwed it up.

Unsung heroes are their families who endure years of hardship, years of not knowing, years of uncertainty, and years of separation. I say years, as it is now years, as most of our troops have served multiple tours of duty in Iraq and Afghanistan amounting to years away from home.

The families have suffered. Like all too many, my youngest son and his wife divorced after his return from Iraq. His situation was not an exception. The damage to family is a terrible toll that goes unrealized by those who benefit from the sacrifice of soldiers and their families.

God bless those who serve, and their families who endure and sacrifice. And, thank you all for that service and that inconvenience, proving once again that the United States is worth the sacrifice.

For those of you who dishonor our troops, know that you can do so because of the sacrifice of the generation in service today, and those who have gone before. Especially, those guys way back in the beginning who heralded the call to freedom and gave you a Constitution that lets you have your opinion and the right to be a moron.