A Citizen’s Guide

I wonder if Gov. Murkowski saw the movie “Back to the Future?”

I ask because it would help if lawmakers and he could ride with Marty McFly and Doc Brown in their fictional DeLorean time machine back to the days of the 20th century robber barons that sparked Alaska’s drive for statehood.

In the early 1900s, the Guggenheims syndicated with J. Pierpont Morgan to monopolize Alaska’s extensive mineral resources by building a railroad to the Beluga coal fields and planning to extend the railroad into the Interior. They even bought the Alaska Steamship Company to control the link to southern markets. James Wickersham, Alaska’s lone delegate to Congress, earned his place in territorial history by fighting the Guggenheim syndicate.

Then there was the Outside-based Alaska Packers Association that monopolized the salmon canning business and wielded enough power in Congress to exempt them from territorial taxation and basic fishery conservation measures—putting the short-term health of their business ahead of that of the territory and the very fisheries on which their industry depended.

The arrogance of the Guggenheim syndicate, the salmon cartel and other would-be resource monopolists was deeply resented by Alaskans and fueled a movement for economic self-determination that culminated with statehood in 1959.

But now many of the economic controls won with statehood may be given back to the oil companies to simply encourage—but not guarantee—our dream of marketing Alaska’s natural gas.

Consider the contract negotiated by the governor with Exxon Mobil, ConocoPhillips and BP. The contract cedes the following:

• Our taxing authority over their commercial oil and gas interests (Article 11);

• Our ability to collect taxes or royalty in cash (Articles 12, 13);

• Our judicial sovereign immunity protections (Article 26);

• The deference ordinarily granted a sovereign in the interpretation of its regulations (Article 19);

• Our regulatory authority over their commercial pipeline interests (Article ;

• Our ability to set a timeline for construction (Article 5); and,

• Any real control over the qualified project plan that governs development of that gas (Article 5).

This means we can’t raise taxes for a long period of time; we can’t collect some of our taxes and royalties in cash but have to take in-kind quantities of gas instead; we can’t say when construction begins; we can’t regulate some intrastate activities; and we can’t even stop the multinationals from fundamentally changing or postponing the project plan.

These are not insignificant concessions since there is nothing, nowhere, in the contract that requires the oil companies to start building a pipeline. All they have to do is act in a manner “prudent under the circumstances” when making construction decisions.

And should the state try to argue before an arbitrator (we can’t go to court) that the multinationals weren’t being “prudent,” the contract forbids the arbitrators finding for the state if the companies simply plead to “errors in judgment.”

Given such terms, the question before Alaskans is this: Does it make sense to give up the taxing authorities, regulatory controls and sovereign immunity we gained with statehood for a contract that may or may not lead to a gas pipeline?

Is it necessary to cede powers we won 47 years ago to control the exploitation of our resources for the benefit of huge and faraway corporations? Is it necessary to lock into practices of the past to perhaps secure a gas line? Must we go back to the future?

Perhaps, instead of a jet, the governor should have bought the McFly/Doc Brown DeLorean time machine to help answer these questions.

Sen. Kim Elton is a Democrat from Juneau.