Palin and the Politics of Big Oil

Like a Dickens novel, these are, “the best of times and the worst of times” for Alaska and Alaskans. It is no coincidence that just when Alaska was taking control of its oil field destiny, acting like an owner state, the political game was changed by forces beyond its control and the opportunity lost. Thanks to an ingenious political maneuver, orchestrated by Big Oil, Sarah Palin has been transformed from oil’s political antagonist to a potential ally at the national level. Whatever the election’s outcome, Big Oil wins in Alaska and Alaskans are, forever, the losers.

“The best of times”- Consider $3269 checks for every Alaska man, woman and child , equal to more than the annual income of folks in Vietnam, Nicaragua, Pakistan, Zambia, Uzbekistan, the Marshall Islands, and dozens of other client nations of America in places where trickle-down corporate resource income fails to trickle into every outstretched hand. As Alaskans will soon see, not only folks from Yemen or Cambodia are paying attention to Alaska’s big oil money distribution. Alaska is the single state of fifty where the gap between the top twenty percent richest and the poorest twenty percent has narrowed in the past twenty years, a factoid left out by the New York Times blog when it cited stats, blaming the two year Governor, Sarah Palin, for every state failure, rural or urban.

“The best of times?” Governor Sarah heeded the warning of future Congressman Bob Bartlett at the Alaska Constitutional Convention not to let big resource extractors sit on our resources and develop them when they felt like it. She took on Exxon for its corporate decision to inventory the massive Cape Thompson leasehold indefinitely with no commitment to drill. “The best?” Because she worked with Democratic legislators while her fellow Republicans stood transfixed with fear over Federal prosecutions, to raise the tax on oil profits (although not production), and –in the most unconservative fashion imaginable- used $500 million as table bet to force the oil companies to move forward on a natural gas pipeline.

In an obscure, but invaluable, web offering, consultant Joe Rothstein describes part of her oil policy this way:

“On becoming governor, Palin launched a process that resulted a few weeks ago in a contract with a credible Canadian company to build a gas pipeline from the north slope to the U.S. Midwest through Canada. The big oil companies who own the gas didn’t bid on the gas line project and have given no guarantees that they will fill the line with gas if and when the project is completed.

“Palin has suggested that if the oil companies don’t cooperate the state just might go into the gas business itself, from its own unleased lands. If Alaska were a country, that might be called “nationalization.” You can be sure that if Obama or any Democrat suggested it, the Republicans would call it “socialism.””

So there you have it. The good news was Sarah Palin really had taken on the oil companies, with a windfall profits tax, cancellation of unused leases, and by moving ahead with a major gas pipeline that the oil companies would rather not see built.

Palin had become a bad Republican, an out of control governor, out Chavezing Hugo Chavez. With bonus checks for Alaskan fuel bills, Sarah Palin had the moxie to capitalize on the universal Alaska hatred for Exxon, festering since the spill in 1989. Her predecessors –both Democratic and Republican- could have done the same, but were either on the take or wanted to be: The best example- Tony Knowles who used state resources to fight for an even bigger oil monopoly before the Federal Trade Commission, a merger of BP and ARCO. (He lost).
Palin’s independence from Big Oil’s control was catching. The

Presidential outcome was in doubt for the first time since 1964. Alaska was on the verge of drifting Democratic with solidly popular candidates for Senate and Congress. Obama even had the chutzpah (Yupik for gall) to run TV commercials in Alaska, sending 65 staffers North to open offices in places long abandoned by the state consumer protection and Alaska legal services offices. A Democratic Presidential campaign spending money in Alaska!! What a concept.
How Exxon fixed its Alaska Problem

If you were the most powerful multinational corporation on the planet,
what would you do? How would you get rid of Sarah Palin and the fledgling independence movement against Big Oil she had sparked? If Alaska were another Uzbekistan, you would fund a coup or an assassination. But this is America and, luckily, here you have a national political party that does your bidding. Ask Dick Cheney. In the oil business, you know how to deal with your colonies. Simply put, you pit Alaskan against Alaskan with a Palin nomination to higher office.
Even easier than working with floundering national Republicans was working with a desperate John McCain, whose survival instincts are those of a sewer rat, honed as they were in the worst of places, John McCain, whose attacks on Alaskan benefits are legendary (Disclosure: I took on McCain on Reindeer herding at a DC consumer meeting). Apparently John McCain, is the only one in America who knows he will outlive his critics because he has his mother’s genes. (Americans who wait for their enemies to die, usually die waiting. Ask Fidel Castro.) Easy, if you know Palin is a typically ambitious Alaskan political animal who will grab a brass ring when handed her. Don Young did it when Nick Begich disappeared in 1972. So did Frank the Bank and so did his daughter.So did former U.S. Solicitor, Ted Stevens.

Big Oil’s solution? You Peter Principle Palin out of Juneau. “Peter Principle” is a tried and true strategy for getting talented people out of the way. University people know this is why talented teachers become incompetent administrators. If McCain wins, she is transformed from an oil company troublemaker into a likeable advocate for domestic petroleum production on a national stage. And if she loses, the state’s working relationship between Dems and the Guv is shattered. Who will benefit more than Big Oil? Exxon is nothing, if not smart.

But of course, it gets worse. The National Campaigns discover and define Alaska for America. Sarah Palin is transformed by the Dems and their allies into a monster by people who don’t know her. Attacks on Palin morph into attacks on Alaska, heightening local paranoia. Alaskans attack one another in the street and in the blogs. The National Republicans ignore her work as governor, good and bad, and turn her into something she wasn’t in Juneau, a small town ideologue. Sarah Palin gets with the national program and plays her part. Dems counterattack. Nobody wants to talk about the alliance against Big Oil.
Famous scribes fill the Captain Cook (our Palestine Hotel) to stand shivering in Anchorage streets, forced to come to Alaska in the off-season to pretend they can instantly read the place and the character of its people. Lyda Green , Tony Knowles, Andrew Halcro, Les Gara, John Harris –all with pure consciences no axes to grind and no dirty laundry- offer wise local, counsel to the Outside Experts.. Local experts get with the national media program and get famous in “Northern Exposure Two- the Sarah Palin Story.”

Alaskans like to say they don’t care how they do it on the outside. But once the spotlight shines, they quickly become extras in a movie produced by a truly Bipartisan Political Slime Machine, as managed from afar by the ace partisan team, James Carville for the Dems and his wife, Mary Matalin (who just published a scurrilous book on Obama). Alaskans play along and tear into each other to the private delight of Big Oil and the national media. Their checks already in the bank, they either attack or applaud Palin in the street, forgetting that a few months before Exxon was the one they attacked together. The fight over “values,” conceals entirely Exxon’s agenda.

But not to worry, the worst of times will only get worse. In fifty days, the movie will be over. With a deepening national depression and word spreading of free money and a moose in every freezer, thanks to the nomination, thousands of Alaskan wannabes will hit the Al-Can for Alaska, an RV Grapes of Wrath. Alaska’s population will double and then triple. Palin will either be in DC in a one-term Vice Presidency or back as a lame duck Guv, abandoned by her Party and despised by the Dems who worked with her. Democratic challengers to Congressman Young and Senator Stevens will be drowned under an Alaska tsunami in defense of Palin and attacks on Alaskans, as defined by the guests in the Captain Cook. An Obama vote in Alaska becomes a protest vote.
His campaign staff, the lost patrol. And independent Presidential candidate Ralph Nader whose focus on oil politics in Alaska has been unwavering, stands in the eye of Exxon’s perfect storm. Villified for eight years by the same bipartisan slimers, this longtime Alaskan observer can say when he visits the state, “Alaska, I warned you.”

A Post script:Alaska’s Senator Ted Stevens is the lucky one. Out of town and forgotten, ready to take his sacrifice fly for Ben Stevens and Treavor McCabe, his office or his lumps and get his Presidential pardon. Uncle Ted, who drew down a billion in Federal dollars for unmet Alaska needs that only Calista’s Mat Nicolai remembered, will not comment on John McCabe, while Alaska debates its “favorite daughter”. But that wiley old fox must marvel at Exxon’s master counter-strategy for Alaska. The same Exxon who convinced America that the oil spill had been cleaned up and everyone was paid off found a way to stop Sarah Palin, her mini-revolt and its ripple effect, by giving her exactly what she wanted.

Steve Conn is a retired professor of justice at the University of Alaska, and former director of Alaska Public Interest Research Group. He lived in Alaska from 1972 to 2007 and is now based in Point Roberts, Wash. He recently helped collect more than 5,900 signatures from Alaskan voters to put Ralph Nader on the 2008 Alaska Presidential ballot. He can be reached at:


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