Pete Kelly Plays Fast and Loose

Senator Kelly does "Who, me?"

Senator Kelly does “Who, me?”

Earlier this month, Alaska State Senate Pete Kelly (R, Big Oil) wrote an opinion piece claiming that there was no need to have a state income tax because oil was returning to the Trans-Alaska Pipeline and everything was going to be just fine.

Let’s parse a few of Senator Kelly’s claims, just for fun.

“The Walker administration told us to expect a 12 percent decline in oil production this year that would result in a catastrophic loss of revenue. As it turns out, we have a 2 percent increase.”

WC is uncertain why you are crowing about a 2% increase. Oil Revenue is projected to be about $1.8 billion next year with a projected budget of $4.2 billion and Alaska still owes oil producers $700 million. Assuming the 2% is collected, that would be $36 million. So we’d have money to pay about 20% of what Alaska owes because of SB 21.1 Leaving nothing available for that walloping deficit.

Calculated another way, in just 25 years at a 2% improvement a year, we’d balance the budget. Of course, we’ll have burned through all of the budget reserves long before then, but you choose not to talk about that.

“The Senate has repeatedly found that our reserves, if prudently managed, will earn enough investment income to fund government and ultimately close the fiscal gap without taxing Alaska’s wage earners. Our plan does not rely on draconian cuts, nor does it wipe out our budget reserves.”

At the start of the Walker Administration, when the governor first proposed an income tax, the Constitutional Budget Reserve had a balance of about $10 billion. Today, it’s about $3.9 billion. To avoid paying a very modest income tax, you’ve burned through 60% of your children’s and grandchildren’s inheritance. If that’s “prudently managed,” Bog help us all if you were “imprudent.”

As for “no draconian cuts,” you’ve cut the University budget by more than 16% across the last four years, reduced public school spending, cut state veterans’ programs by over $10 million (40 percent) in the past four years, piled up hundreds of millions in deferred maintenance, short-sheeted public safety and killed state offices like the Division of Tourism that might generate jobs and revenue. You did find the money to give your self a Tajmahawker of an Anchorage office and attendant lawsuits afterwards, so WC is forced to admit you didn’t cut everything. 

As for the poor Constitutional Budget Reserve, you’ve decimated it. You haven’t wiped it out but you’ve reduced if by 60% and you are on a stright path to wiping it out entirely.

“Here’s the deal: In the last two years, senators have spent more than a year living in Juneau hotels and sleeping in rented beds, but we will not be more easily leveraged just because we are tired. We won’t be leveraged because we’re unpopular with the bureaucracy, either.”

Poor baby. It must be dreadful surviving on per diem. Alaska’s increasing numbers of homeless and bankrupts would feel pity for you if they could afford it. Of course, if you’d do your freaking job instead of clinging to the illusion that Alaska can pump enough oil to make it all okay, you wouldn’t have anything to complain about. But if it really is all that tough getting paid to not do your job, you can always quit and find honest work.

“Because Alaska gets the bulk of its revenue from oil, increased production means the state has a lot more money in its future than the Gov. Bill Walker has been telling us.”

WC can’t help but notice you don’t mention damage to infrastructure caused by climate change. Or that the additional crude oil you want to produce translates into more CO2 will will worsen the rate of warming and the catastrophic damage to Alaska. Producing oil to gain Alaska prosperity will only increase the bill for climate change damages. Alaska should be the poster child reducing production of fossil fuels. Instead, you’re all about “Drill baby, drill” like there are no consequences.

Senator Kelly, WC knows its hard to listen to the voters when your ear are stuffed with oil industry money. And you’ve never been troubled by economics of science, even when they smack you in the face.

Which is really saying you’ve spouted more of the same nonsense. And that Alaska will continue to suffer for it.


  1. It’s remarkable you tout SB 21 in your opinion piece when its impact has been so disastrous that Alaska can’t even afford to pay the tax credits that accrue under the shoddily-written law. Earth to Senator Kelly: you need to be very quiet about the rolling disaster that is SB 21.