Every once in a while, the elite media remembers that they are journalists and when they think they can get away with it they tell the truth or at least get much closer to it. Of course they had to destroy Sarah Palin first with all of their lies, editing chop jobs and other malfeasance, but at least now they can say “hey we reported what a good job she did”.
Sarah Palin did not just “raise taxes” as MSNBC tried to spin this piece, Sarah Palin pushed through an entirely new royalty structure for the oil companies buying oil from the people of Alaska. The old royalty system was not just a good deal for the oil companies, it resulted in a royalty so low that the people of Alaska were being ripped off (details HERE). The Murkowski machine was corrupt and on the take, they were also corrupt in the contract bidding process which Palin also fixed.
As far as I know, this is the first elite media publication to tell the truth that Dick Morris told us way back in mid 2008 (and what we have told you in dozens of articles ever since):
So why do so many of the American people not know this Sarah Palin? Why did the elite media, who knew all of this, not bother to tell you?
As governor, Palin demonstrated many of the qualities we expect in our best leaders. She set aside private concerns for the greater good, forgoing a focus on social issues to confront the great problem plaguing Alaska, its corrupt oil-and-gas politics. She did this in a way that seems wildly out of character today—by cooperating with Democrats and moderate Republicans to raise taxes on Big Business. And she succeeded to a remarkable extent in settling, at least for a time, what had seemed insoluble problems, in the process putting Alaska on a trajectory to financial well-being. Since 2008, Sarah Palin has influenced her party, and the tenor of its politics, perhaps more than any other Republican, but in a way that is almost the antithesis of what she did in Alaska. Had she stayed true to her record, she might have pointed her party in a very different direction.
Inside the Alaska capitol hangs a framed copy of the front page of the Anchorage Daily News for September 11, 1969, its headline—“Alaska’s Richest Day: $900 Million!”—stretching above a picture of purposeful-looking men in suits carrying large briefcases and about to duck into a car. The briefcases contain a fortune that is being rushed to the airport and on to a bank in San Francisco, so Alaskans will not forgo a single day’s interest. This is the proceeds of the state’s first oil-lease auction since the discovery, a year earlier, of the massive oil deposit at Prudhoe Bay on Alaska’s North Slope, to this day the largest in North America. The headline captures the euphoria over the massive payout by the world’s leading oil companies—a windfall that transformed the state’s politics, economy, and self-image almost overnight.
Throughout most of its history as a territory and, after 1959, as a state, Alaska was a tenuous proposition, a barren outpost rich in resources yet congenitally poor because the outside interests that extracted them didn’t leave much behind. The main obstacle to statehood was convincing Congress that Alaska wouldn’t immediately go bust. It still relies heavily on aid from Washington, and that, combined with the federal government’s holding title to 60 percent of its land base (the state itself holds 28 percent more), generates a robust resentment of federal power. The colonial mind-set is reinforced by the intensity of the state’s politics, a common attribute of remote settlements like Alaska, as the historian Ken Coates has noted—think Lord of the Flies.
To suddenly strike it rich opens up all sorts of possibilities, but there can be problems too. The legislature exhausted its fortune without meeting Alaskans’ outsize expectations. And although oil brought jobs and revenue, it also ensured that a state long accustomed to economic subservience would be beholden to a powerful new interest. Oil is more important to Alaska than the movie business is to Los Angeles or the auto industry is to Michigan. Stephen Haycox, a professor at the University of Alaska at Anchorage, writes in Frigid Embrace, his history of the state’s political economy, “The oil industry is, for all practical purposes, Alaska’s only private economy.”
This binds the state’s fortunes not just to the price of oil but also to the fate of the three giants that dominate Alaska: BP, ExxonMobil, and ConocoPhillips. Oil taxes supply almost 90 percent of the general revenue, so oil is the central arena of state politics. The industry is forever trying to coax lower taxes, lighter regulation, and greater public investment by promising jobs and riches—or, on occasion, threatening to withdraw them.
In 1978, the Democratic legislature tried to secure the state’s share of oil profits by establishing a corporate income tax over the bitter opposition of the oil companies, which sued to overturn it. They lost in every venue, including, finally, the U.S. Supreme Court. But the real battle was fought in the statehouse.
The oil industry contributed mainly to Republicans through the 1960s and ’70s, but came to realize that it needed broader alliances, and in the late ’70s began courting Democrats too. The strategy paid off. In 1981, the oil companies, through their allies in the legislature, launched a coup, ousting the speaker of the house and key committee chairmen. Then they revoked the corporate income tax. For the next 25 years, oil interests ruled the state almost uninterruptedly.
Palin’s rise began in 2002, when, term-limited as mayor of Wasilla, she ran for lieutenant governor. Little known and heavily outspent, she beat expectations, losing only narrowly and showing an exceptional ability to win fervent support. Afterward, she campaigned for Frank Murkowski, the four-term Alaska senator come home to run for governor. Palin traveled the state speaking about Murkowski, and making herself better known. When he won, she was short-listed to serve the remainder of his Senate term, and even interviewed for the job. But it went to his daughter Lisa instead. (Palin acidly recounts the patronizing interview with the new governor in her memoir, Going Rogue.) Palin got the low-profile chairmanship of the Alaska Oil and Gas Conservation Commission, a regulatory body charged with ensuring that these resources are developed in the public interest.
By the time she arrived, the notion that Alaska’s oil-and-gas policy operated in the public interest was getting hard to maintain. The industry controlled the state, and especially the Republican Party. Other than a modest adjustment to oil taxes that squeezed through in 1989 after the Exxon Valdez oil spill, the hammerlock held. Alaskans were coming to regard this situation with suspicion and anxiety. The problem wasn’t just that the state was starved of revenue from its most valuable resource. It was also the failure to develop another resource to which the oil companies held title: Alaska’s bountiful supply of natural gas. It’s always been understood that North Slope oil would one day run dry. Someday, perhaps as soon as 2019, there won’t be enough oil left to push through the trans-Alaska pipeline—a catastrophe, unless the state somehow replaces the revenue. For this reason, building a gas pipeline has long been a political priority, and one the oil companies have balked at.
From her spot on the oil-and-gas commission, Palin touched off a storm over these anxieties. One glaring example of the unhealthy commingling of oil interests and Republican politics was her fellow commissioner and Murkowski appointee, Randy Ruedrich, who was also chairman of the state Republican Party. Less than a year into the job, Ruedrich got crosswise with Palin for conducting party business from his office (and, it was later revealed, giving information to a company that the commission oversaw). When he ignored her admonitions to stop, she complained to Murkowski’s staff, but still nothing happened. So Palin laid out her concerns in a letter to the governor and the story leaked to the media. In the ensuing uproar, Palin became a hero and Murkowski was left no choice but to fire Ruedrich from the commission.
Palin got strong support from an unlikely quarter: Democrats. “She had the appearance of someone who was willing to go in a different direction,” Hollis French, a Democratic state senator, told me. “We subsequently learned that she’ll throw anyone under a bus, but that wasn’t apparent at the time. It looked like real moral courage.”
Even so, Palin’s actions were presumed to have ruined her prospects. Murkowski and Ruedrich still ran the party. Breaking with them made her no longer viable as an ordinary Republican or a recipient of oil-company largesse. To continue her rise, she needed to find another path. Palin alone imagined that she could. In this and other ways, she displayed all the traits that would become famous: the intense personalization of politics, the hyper-aggressive score-settling—and the dramatic public gesture, which came next.
Palin was clearly the victor (Ruedrich paid the largest civil fine in state history), but she quit the commission anyway. In Going Rogue, she says only that as a commissioner, she was subject to a gag order that Murkowski refused to lift. But quitting didn’t void the gag order. What it did was thrust her back into the spotlight and reinforce her public image. It also gave her a rationale to challenge Murkowski.
All of this turned out to be shrewd politics, because Murkowski’s governorship proceeded to fall apart, thanks to his brazen sense of entitlement. After failing to persuade the Homeland Security Department to buy him a personal jet (to help “defend, deter or defeat opposition forces”), he ignored the legislature’s objections and bought one with state funds. But it was his handling of matters vital to the state’s future that finally threw open the door for Palin.
Murkowski made up his mind to strike a deal with the major oil producers to finally build a gas pipeline from the North Slope. He cut out the legislature and insisted on negotiating through his own team of experts, out of public sight. This rankled all sorts of people because, beyond his arrogance, Murkowski had distinct views about oil and gas that many others didn’t share.
Alaska’s parties align differently from parties elsewhere—they’re further to the right and principally concerned with resource extraction. The major philosophical divide, especially on oil and gas, is between those who view the state as beholden to the oil companies for its livelihood, and will grant them almost anything to ensure that livelihood, and those who view its position as being like the owner of a public corporation for whom the oil companies’ interests are separate from and subordinate to those of its citizen-shareholders. “Oil and gas cuts a swath right through ordinary partisan politics,” Patrick Galvin, Palin’s revenue commissioner, told me.
Murkowski’s willingness to cater to the oil producers, and his secrecy, caused tensions in his administration that burst into view when he announced his deal, in October 2005. It was a breathtaking giveaway that ceded control of the pipeline to the oil companies and retained only a small stake for Alaskans; established a 30-year regime of low taxes impossible to revoke; indemnified companies against any damages from accidents; and exempted everything from open-records laws. In exchange, the state got an increase in the oil-production tax. (Palin later released a private memo in which Murkowski’s top economic adviser complains that he has “gone completely overboard” and is treating “Alaska as a banana republic in order to secure the gas line.”) The deal conceded so much that Murkowski’s natural-resources commissioner, Tom Irwin, publicly questioned its legality—and was summarily fired. Six of Irwin’s aides quit in protest, and the “Magnificent Seven” became a cause célèbre. In the end, the legislature rejected the gas-line deal. But, in a twist, it agreed to the oil tax—which had been intended as an inducement to pass the rest of the package.
Palin came out hard on the other side of the philosophical divide from Murkowski—and made it personal. She announced she would challenge him for governor. She assailed the “secret gas line deal” and the “multinational oil companies that make mind-boggling profits off resources owned by all Alaskans.” She put an “all-Alaska” pipeline at the center of her campaign. And she declared her intention to hire Tom Irwin to negotiate the deal. “She’s what I call ‘alley-cat smart,’” Tony Knowles, the former Democratic governor, told me. “It’s not about ideology. She knows how to pick her way down the political route that she feels will be the most beneficial to what she wants to do.”
Murkowski’s tax was discredited almost immediately. Just after he signed the new Petroleum Profits Tax, the FBI raided the offices of six legislators, in what became the biggest corruption scandal in state history. During the legislative session, the FBI had hidden a video camera at the Baranof Hotel, in Juneau, in a suite that belonged to Bill Allen, a major power broker and the chief executive of Veco Corporation, an oil-services firm. The tapes showed him discussing bribes with important politicians, and revealed the existence of a group of Republican legislators who called themselves the “Corrupt Bastards Club” and took bribes from Allen and others. (Several were later sent to prison.)
In the Republican primary, Palin crushed Murkowski, delivering one of the worst defeats ever suffered by an incumbent governor anywhere. She went on to have little trouble dispatching Knowles, an oil-friendly Democrat. “A lot of people on the East Coast, when they think of Sarah Palin now,” Cliff Groh, a former state tax lobbyist, told me, “some five-letter words come to mind: Scary. Crazy. Angry. Maybe some others. But the five-letter word that people in Alaska associated with her name was clean.”
You betcha.
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