Fighting big oil is something Democrats always seem to want more of. I usually do not. But reading about the corruption in Alaska, it's pretty bad. Sarah Palin has cleaned up the corrupt system while increasing the freedom and vitality of the free market system, and her constituants love her for it. After reading this article, I think you will too.
Every state has its share of crony capitalism, but Big Oil and the GOP political machine have taken that term to new heights in Alaska. The oil industry, which provides 85% of state revenues, has strived to own the government. Alaska's politicians—in particular ruling Republicans—roll in oil campaign money, lavish oil revenue on pet projects, then retire to lucrative oil jobs where they lobby for sweetheart oil deals. You can love the free market and not love this...
And so it came as no surprise in 2004 when former Republican Gov. Frank Murkowski made clear he'd be working exclusively with three North Slope producers—ExxonMobil, ConocoPhillips and BP—to build a $25 billion pipeline to move natural gas to the lower 48. The trio had informed their political vassals that they alone would build this project (they weren't selling their gas to outsiders) and that they expected the state to reward them. Mr. Murkowski disappeared into smoky backrooms to work out the details. He refused to release information on the negotiations. When Natural Resources Commissioner Tom Irwin suggested terms of the contract were illegal, he was fired.
In steps Sarah Palin. Unfortunately for Mr. Murkowski, he himself had appointed her to state oil and gas regulatory agency. She challenged his seat on the issue.
Mrs. Palin ran against the secret deal, and vowed to put the pipeline back out for competitive, transparent, bidding. She railed against cozy politics. Mr. Murkowski ran on his unpopular pipeline deal. The oil industry warned the state would never get its project without his leadership. Mrs. Palin walloped him in the primary and won office in late 2006. Around this time, news broke of a federal probe that would show oil executives had bribed lawmakers to support the Murkowski tax changes.
Among Mrs. Palin's first acts was to reinstate Mr. Irwin. By February 2007 she'd released her requirements for pipeline bidding. They were stricter, and included only a $500 million state incentive. By May a cowed state house—reeling from scandal—passed her legislation.
The producers warned they would not bid, nor would anyone else.
But they were wrong. Guess how this turns out.
Five groups submitted proposals. A few months before the legislature awarded its license to TransCanada this July, Conoco and BP suddenly announced they'd be building their own pipeline with no state inducements whatsoever. They'd suddenly found the money.
Mrs. Palin has meanwhile passed an ethics law. She's tightened up oil oversight. She forced the legislature to rewrite the oil tax law. That new law raised taxes on the industry, for which Mrs. Palin is now taking some knocks, but the political background here is crucial.
The GOP machine has crumbled. Attorney General Renkes resigned. Mr. Ruedrich was fined $12,000. Jim Clark—Mr. Murkowski's lead pipeline negotiator—pleaded guilty to conspiring with an oil firm. At least three legislators have been convicted. Sen. Ted Stevens is under indictment for oil entanglements, while Rep. Don Young is under investigation.
Throughout it all, Mrs. Palin has stood for reform, though not populism. She thanks oil companies and says executives who "seek maximum revenue" are "simply doing their job." She says her own job is to be a "savvy" negotiator on behalf of Alaska's citizens and to provide credible oversight. It is this combination that lets her aggressively promote new energy while retaining public trust.
That's corruption fighting. That's recognizing the nature of both free enterprise and government bureaucracy, and fighting to achieve a true free market at the benefit of the people.
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