Proposition 1| My closing argument …

A friend this morning asked for closing arguments from a few of his on Proposition 1.  This was mine:

My closing argument is simple. It’s our future. We need investment to turn our oil into cash, under ACES Alaska has lagged behind at a time when investment in oil development globally has rocketed and, along with excessive spending has put Alaska in a place where the University of Alaska – Anchorage’s Institute of Social and Economic Research has warned (using ACES revenue projections) that “[r]ight now, the state is on a path it can’t sustain. … Reasonable assumptions … suggest we do not have enough cash in reserves to avoid a severe fiscal crunch soon after 2023, and with that fiscal crisis will come an economic crash.”

SB 21 was built to attract increased investment in a way which, if it reduces the decline curve by as little as 1%, will produce greater long term revenue for Alaskans than under a continuation of ACES. Based on my 35+ years having been and working with oil and gas investors I firmly believe it will achieve that objective and will give Alaska a stronger future than where we were headed under ACES.

I am voting NO to give Alaska that future.

Things I feel strongly about …

Keithley Press Release (8.6.2014)Sometimes when you believe in what you say you need to back it up.  This is one of those times for me.

The following is the text of a press release that was distributed earlier today.  A copy of the release is available here or by clicking on the picture to the left.


Alaska budget hawk announces effort to hold State Legislative candidates accountable

Anchorage, AK, August 6, 2014– Today, Brad Keithley, an Anchorage based oil, gas and fiscal policy consultant, announced plans to spend up to $200,000 of his own money to target 3-5 legislative races this fall.

Mr. Keithley is a well-known expert on Alaska state budget and other fiscal issues and has regularly appeared as a guest on local talk shows, in local policy debates, and was an appointee last year to the state House of Representative’s Sustainable Education Task Force.   He has spoken repeatedly about what the non-partisan Institute for Social and Economic Research (ISER) terms the coming “fiscal crisis” Alaska faces as a result of continued overspending.

“In January 2013 ISER said ‘the state is on a path it can’t sustain. … Reasonable assumptions … suggest we do not have enough cash in reserves to avoid a severe fiscal crunch soon after 2023, and with that fiscal crisis will come an economic crash,’” said Keithley.   “Instead of heeding these warnings, the legislature has gone backwards in the last two years by running up the two largest budget deficits in Alaska’s history and draining over a third of the state’s cash reserves.”

“The state’s legislators acted responsibly when it came to oil taxes and I’m confident voters will reward their work by voting no on Prop 1,” Keithley said.  “When it comes to spending, however, our leaders have lost their way.  Many go to Juneau claiming to be ‘fiscal conservatives,’ but stop paying attention to fiscal reality when they get there.  Sadly, they are spending the state directly into the ‘fiscal crisis’ that ISER has predicted, and they know it.”

“I was raised in a culture that taught one generation is responsible for passing on a bright future to the next.  I’m unwilling to see tomorrow’s kids go without a decent education, tomorrow’s Alaskans bear massive broad based taxes, and tomorrow’s Permanent Fund depleted, just because elected leaders today won’t do in Juneau what they claim they’ll do when on the campaign trail.”

“I’ve been successful in my life and it’s time to pay some of that success forward.  The best way I can do that is to hold legislators accountable for what they are doing to Alaska’s future generations,” Keithley said.  “I’ve accepted it’s time to put my money where my mouth is.”

Mr. Keithley said, “In the end, every voter has to ask themselves whether voting for a candidate just because they use the right sound bite every second or fourth year is good enough.  I will encourage voters to demand more.  As a people, it’s time we hold our legislators accountable. “

# # # #

I will be talking about my decision on various radio shows during the day, and I anticipate it will make the news along the way as well.   I will try to collect links to those as the day goes on so that readers will have the benefit of  those further discussions.

As always is the case, we will see how this goes.

Feel free to copy …

I have been playing with a new logo for this page and elsewhere and am beginning really to like this one.  Feel free to copy … or comment if you have other ideas.

Its Our Future (1)



Guest Column: J.R. Myers, The Alaska Constitution Party Candidate for Governor

Publisher’s Note:  From time to time as we approach the coming election I intend to offer various candidates who are focusing on the issues relevant to this blog — Alaska oil, gas and fiscal policy — the opportunity to post guest columns on these pages.

The first of those is below, from J.R. Myers, The Alaska Constitution Party candidate for Governor.  Surprisingly given the importance of each to Alaska’s future, Myers is one of only two candidates for Governor that is currently supporting both the retention of SB 21 and the adoption of sustainable budgets (the other is Libertarian Party candidate Carolyn “Care” Clift).

While some might question the efficiency of focusing on third party candidates, I am continually reminded this election cycle of the role played by Ross Perot during his 1992 Presidential run against then-President George H.W. Bush (R) and then-Arkansas Governor Bill Clinton (D).  As analyzed over a decade later in a piece on the PBS Newshour:

The most successful of the third parties in any one election was the Reform Party, which in 1992 nominated Texas billionaire Ross Perot as its candidate for president. Perot ran on a platform that advocated reducing the federal budget deficit, an issue previously ignored in elections but one that would become a major part of almost every presidential campaign since. …

“[H]e was the first candidate really in a big way to float the idea that the deficit was a bad thing,” said historian Michael Beschloss. “By the time Bill Clinton was elected that fall, if he had not done something about the deficit he would have been in big trouble and that was largely Ross Perot’s doing.”

The parallels to the current campaign for Alaska Governor are intriguing.  As with the two national parties in the run up to the 1992 election, Alaska’s two major political parties largely are either in denial (the R’s) or ignoring (the D’s) Alaska’s current fiscal situation. It will be interesting to see if third party challengers this fall, as well as other efforts, can put the issue in the public’s mind in a way such that the ultimate winner, even if not one of the challengers, will be in “big trouble” if something is not done about it when they take office.

Myers is going first in this series because, while not being challenged on the August ballot, he and his running mate for Lt. Governor, Maria Rensel, are in the midst of a petition drive to gather enough signatures to qualify to appear as a party on the November ballot.  (By virtue of its performance in past elections the Libertarian Party candidate is guaranteed to appear on the November ballot.)  Running this piece now will enable voters to evaluate whether they want to sign the petition.  As I reminded myself when I signed their petition last week outside my local Carr’s, doing so does not commit the voter to voting for the party in November; it merely is a way of supporting the effort to ensure that the candidate — and their issues — have a voice in the coming campaign.  (If you haven’t run into a petition gatherer yourself, you can nonetheless participate by going here.)


A Statement on Alaska’s Future

by J.R. Myers

Alaska Constitution Party Candidate for Governor

J.R. MyersAlaska needs new leadership as soon as possible. We are in a crisis of our own making. Our current leaders are rapidly leading us to economic ruin with deficit spending to the tune of $7,000,000 million dollars every single day! We cannot afford them and their failed economic policies anymore. Our progress since statehood could all be undone in short order if we don’t make a real economic course correction now. We must not allow this to happen! Alaskans have a real opportunity to replace our failed leaders and their disastrous policies this November 4.

My family ties precede Alaska statehood. My grandparents homesteaded near North Pole. My father ran a dog sled miles into town to get supplies during the long dark interior winters. Their refrigerator was a hand dug hole in the permafrost. Life was challenging and rewarding. They believed in hard work, taking care of the family and neighbors helping neighbors. They and their generation have left us a precious legacy. Continue reading

Why I am contributing to DeLena Johnson …

DeLena Johnson for State SenateSometimes I think I am in a unique position. I don’t have a state job or contract and don’t want one. I have never asked the Alaska state government to fund a pet project or cause because I believe those are private (not state) responsibilities, and so, contribute my own funds and if it is bigger than me, invest my time to raise the remaining funds privately from others.

I don’t really care if I am “banned” from a given set of offices or hearing rooms in Juneau, or even from the Capitol itself, because I don’t go there often and can live without ever going there again. And I don’t work — anymore — for clients that don’t want to “make waves,” or as happened a few years ago when I started this blog, clients who, when they make their annual visit to Juneau to meet with legislative leadership have to contend with leadership putting me on the list of “troublesome” things that leadership wants to talk about (now that was an interesting discussion at the time).

Instead, all I want out of Juneau and the legislators and other government officials that go there is smart government, a real (i.e., not fake) sense of long-term fiscal responsibility and an eye for what their actions today are doing to Alaskans of future generations.  

Continue reading

The best interview I have done on #SB 21 and Alaska’s fiscal future …


Click on icon above for podcast (starting at 10:05)

Over the past few years I have done a number of radio — and even television — interviews  on Alaska oil policy, and as it was being formulated and after it passed, SB 21, Alaska’s current approach to oil taxes.

In all that time, however, I don’t recall doing a better, more focused and succinct  interview on the topics than this past Tuesday with Chris Story on 700 AM KBYR, News and Talk of Alaska.  A podcast of the interview is available here (starting at 10:05, running to 30:40).

The first part of the interview focuses on the issues surrounding SB 21.  Right before the break the discussion appropriately transitioned to a conversation about current state spending levels and where Alaska is heading as a result.  I couldn’t have scripted a better discussion on both topics if I had tried.  If you have 20 minutes and are interested, listening to the podcast is probably as good a use of time on the topics as reading some of the other posts on these pages.

“There you go again …”: The Real Parnell Fiscal Record, Part II

There you go againAfter listening to Jimmy Carter ramble on inaccurately again about some issue during the single Presidential debate of 1980, Ronald Reagan turned to him, smiled, shook his head a little in the way that only Reagan could and said simply to Carter, “there you go again.”

That moment came to me the other day as I was reading yet another press release from Governor Parnell’s office claiming success in keeping “Alaska’s fiscal future strong.”

Clearly, Sean Parnell has become the Jimmy Carter of our time.  When it comes to the state’s fiscal position, Parnell, like the Carter of old, seems capable only of repeating over and over again the same old, tired — and completely inaccurate — mantra.  As President Reagan would have said to Parnell when reading his most recent press release, “there you go again.” Continue reading

The Real Parnell Fiscal Record (FY 2011-2015) …

Click on graphic to enlarge.

As mentioned in Amanda Coyne’s column Friday, Governor Parnell has been sending out campaign material and otherwise taking credit for exercising sound fiscal policy during the last legislative session. As I was doing some calculations this morning, I thought a look at the Governor’s real fiscal record might be helpful when evaluating his claims.

The above chart plots unrestricted general fund revenues (in blue) against spending (in orange) over the five budgets for which Parnell has been responsible since assuming office in 2009 (the FY 2010 budget had already been set at the time he assumed office). As is clear, in his first budget (for FY 2011) Parnell was indeed a fiscal conservative, limiting spending to $5.47 billion, well within the “sustainable spending” limits applicable at the time. It may be useful to recall that the FY 2011 budget was set in 2010, an election year in which the Governor was being challenged in both the primary and general elections by opponents sounding fiscally conservative themes.

Beginning the following year — the year following the election — however, spending started to grow, first to $7.01 billion (a leap of nearly 30% over the previous year’s level), then to $7.78 billion (a year-on-year leap of an additional 10%, and fully 40+% over FY 2011 levels). While Parnell subsequently has attempted at times to lay blame (podcast beginning at 5:35) for those budgets on the Senate Bi-Partisan Majority, the fact of the matter is that under the Alaska Constitution the Governor has the authority to line-item veto all or any portion of the spending levels proposed by the legislature, as long as he is supported in the event of an attempted override by 20% +1 (i.e., 13) members of the legislature.

Even in the “darkest of times” under the Senate Bi-Partisan Majority, the Governor easily would have been able to muster 13 members of the legislature to support lower spending levels.  He didn’t even try. Continue reading

My criteria for making political contributions this coming year …

Dollar signFor the past several years I have contributed a lot of money to a lot of candidates (often at the maximum level).  With the beginning of the current election season, the inevitable invitations to various legislative, gubernatorial and party fundraisers have started to appear again (by mail, email, Facebook, calls and in some cases even txt).

Given the profound level of  my disappointment with the budget decisions taken by the Governor and legislature these last two years (see, e.g., #AKbudget| Round 3 of “The FY 2015 end game (and its not looking good …), Apr. 14, 2014), I have decided to adopt some new criteria for supporting candidates this election cycle.  

To be honest, I have grown tired of supporting candidates who say with earnest face “I am a fiscal conservative and will do whatever it takes to make certain the budget stays at sustainable levels,” and then, when it comes time to match those words with action, vote with everyone else, in the case of the last two years, for the two biggest budget deficits in Alaska’s history.
Continue reading

#AKoil & #AKLNG| Understanding Global Best Practice …

Best PracticeAs is the right thing to do, Alaskans insist that the oil and other industries adopt global best practices when operating in the state.

But is Alaska itself,  particularly now that it has decided to become a co-investor in the Alaska LNG project, following global best practices in its dealings with the industry.  The answer may be no.

One of the most successful governments in the world in terms of maximizing benefit to its citizens from the development of its resources is Norway.   By partnering with industry, Norway has both successfully slowed the decline curve in oil and gas production and successfully developed a global gas and LNG industry.   In addition, Norway is maintaining a strong  exploration program at a time that, even under SB 21, Alaska’s continues to struggle. Continue reading