With Obama 3.0, radicals back in charge will devastate Alaska’s resource economy

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The thought of Gina McCarthy as “climate change czar” for the incoming Biden Administration should send chills throughout the Northwest. It certainly does through Alaska, which has an economy already reeling from a loss of tourism and oil patch jobs this year due to one of China’s more notorious exports.

McCarthy was in charge of the Environmental Protection Agency when, in violation of federal law, the agency preemptively told Northern Dynasty to not bother applying for federal permits for the Pebble Mine project in Western Alaska.

Pebble was never going to happen, the EPA said. With the preemptive veto, McCarthy’s EPA stopped Pebble in its tracks because the U.S. Army Corps of Engineers could not take action on any permit application.

The Trump Administration with Scott Pruitt at the EPA, unwinded that ill-conceived ruling, and allowed Pebble the right to try to propose mitigation efforts that would be enough to get the copper and gold mine running on a limited basis. Last month, the U.S. Army Corps of Engineers dealt the final blow, but at least the environmental process had been followed, as laid out in law.

Trump reset a number of job-killing environmental policies when he took office in 2017, rolling back burdens on the energy, mining, and other resource sectors that were crushed by excessive regulation, among them the land grab known as the “Waters of the United States Rule,” which expanded federal control of waterways, and the Paris Accord climate pact. McCarthy took the credit for many of those job-killing policies.

In 2020, McCarthy was named CEO of the radical National Resources Defense Council. Now, with a whole host of Obama alumni returning to power, she’ll recycle into the highest levels of government, where she will be part of undoing Trump policies that opened the Coastal Plain of the Arctic National Wildlife Refuge for drilling.

How can Alaskans be so certain she has their state’s economic foundation in the crosshairs?

In August, the NRDC, along with the National Audubon Society, Center for Biological Diversity, Friends of the Earth, and Earthjustice, launched a lawsuit against the oil and gas drilling plan in ANWR.

But it goes back further than that. Under the Obama Administration, McCarthy visited Alaska, where she was gifted a jar of moose meat that she said “could gag a maggot,” and a tiny lapel pin from someone in North Pole, Alaska, that she said she tossed away. She hates everything Alaska stands for, and, for many Alaskans, the feelings are mutual.

Biden has also said he will nominate Tom Vilsack as his Secretary of Agriculture, another blow to the Northwest resource economy.

Vilsack, as the former Secretary of Agriculture, was instrumental in the destruction of the non-oil-based economy of Southeast Alaska, when he pushed through federal regulations that made timber harvest uneconomical in the 17-million-acre national forest.

“Today, I am outlining a series of actions by USDA and the Forest Service that will protect the old-growth forests of the Tongass while preserving forest jobs in Southeast Alaska,” said Secretary Vilsack said in 2013.

Today, there are effectively no logging jobs left in Southeast Alaska — none. In 30 years Southeast went from 4,200 jobs to zero, ever since the Tongass Timber Reform Act of 1990 allowed lawsuit after lawsuit to block responsible timber harvest.

On the other hand, the state of Rhode Island, which isn’t even as big as the Tongass National Forest, has 3,877 logging jobs.

President Trump had just begun to reverse the lockdown of the Tongass. This fall he announced a final Alaska Roadless Rule that exempts the Tongass National Forest from the 2001 provision that prohibited road construction and reconstruction, and select timber harvests.

It must be noted here that while timber jobs disappeared in Alaska over the past two decades, U.S. Forest Service jobs grew. There are hundreds of them in Southeast Alaska, including more than 75 alone in the Petersburg office, and more than 50 in the Sitka office. The only cutting of trees in the Tongass at this time are the personal-use Christmas trees around the shrinking settlements that dot the Alexander Archipelago.

Private sector timber jobs will never return to Alaska, even if the exemption to the Roadless Rule miraculously survives Biden’s environmental policies. No company will again make the investment in the Tongass because no company board of directors is reckless enough to count on the Forest Service to give them 25 years of timber, which would be needed to capitalize an operation.

That’s not the end of the troubles for Alaska under Biden. From John Kerry as Special Presidential Envoy for Climate we will hear speeches about the need to wean America from our resource economy, which in resource-rich states, is code language for “We’ll be keeping it all in the ground, so you may as well get used to it.”

29 COMMENTS

  1. Are we then suppose to get used to Canadian timber, which is poorly milled to begin with, because we can’t even get our own forest products to market? What happened to the “green sustainability” of timber products? Are we not supposed to have direction and control of our own resources? And moreover, let’s start looking at the monetary interests of those suppressing Alaska’s resources and how closely tied they’re to China. I say a thorough investigative look into ALL of China’s business holdings with Alaska are deeply needed!

    • The federal government subsidized (using our income tax) the cutting of our timber. Then it was sent to Japan for bowling alleys. It sounds like socialism to me.

      • No. Any reasonable accounting of the Tongass NF timber sale program showed that it made money for taxpayers, as it should have. Environmentalists, including the Knowles administration, badly forced the numbers in order to show otherwise as they tried and eventually did shut down the pulp and lumber mills. As for the bowling alleys, there was a time – 1968 to 1971 or thereabouts – when Brunswick Corp (may still own Mercury Marine) was building a number of multiple story bowling alleys in Japan, but no federal timber went into them as the federal government owns little to no sugar maple worth the telling. Only sugar maple is used for bowling alleys and basketball floors (unless the buyer is an Alaska school district that can’t tell the difference). I logged one sugar bush to sell into that heated market; paid 5 times what I would have paid 3 years earlier and still came out (despite the sap spouts). The pasture on one side had a 1,100 pound, 2 year-old Clyde-fella. He was as proud of himself as a Golden Gloves teenager, and would have been 1,700 pounds three years later. I shared my lunch with him often and liked him a lot. He was offered to me for not much more than the cost of a big saw but a commitment like that scared me. Had I bought him I never would have made it to Alaska. The only maple we have in Alaska is good for little else but springboards for fallers, and even for that the bark slips and I much preferred alder. Now you know. Back to the Tongass for one last comment; we no longer have the output but we still have the same amount of Forest Service. It’s much like we still have to feed the cows and shovel the manure, but we no longer get the milk.

        • A New Yorker article from 1989:
          “Under terms of their contracts, the mills are entitled to buy up to 15,000 acres of Tongass timber a year at $2.19 per 1,000 board feet, less than 1 percent of the market price, which is $100 to $400 per 1,000 board feet, depending on the grade of wood. Without the agreements, the mill owners say, they might close their operations and eliminate 1,800 jobs.

          ”’What they’re saying is that they need a monopoly, they need the very best timber and they need $40 million a year in taxpayer money to keep them going,’’ said Joe Mehrkens, a 17-year Forest Service employee who now works for the Wilderness Society in Alaska.”

          Is this what you want? To give away 500 year old trees so corporations can make money? We’re paying for it with the money we pay in federal income taxes. It’s absolutely crazy to subsidize profit-making corporations.

          • Yes! Very much so. Right now that timber that could again give high-paying (mostly union) jobs to 4,000 Alaskans is now rotting and dying! Again, the taxpayers had a net gain in dollars from the Tongass NF timber sale program. Citing a USFS employee who went to work for the Wilderness Society will not and should not convince anyone.

        • Isn’t it socialistic for government to create jobs that don’t pay for themselves? When we subsidize industries so they make money, it isn’t beneficial to the taxpayers. What does Alaska get out of these jobs? The loggers I knew lived in Port Angeles and other towns in the Lower 48. Just like oil workers – they take our jobs and pay any taxes to other states. It’s a lose-lose proposition, even without considering the damage to the environment.

        • Kayak, you’re forgetting one thing:

          taxpayer . net/article/road-woes-at-the-forest-service/.
          I’m all for private industry, but how about you pay your own way.

  2. Natural resources, mostly oil, have been the life’s blood of Alaska for decades. Unfortunately, or fortunately if you value the environment, they will not be in the future. The big oil companies have seen the future and are starting to move toward renewable energy. They will not be big players in Alaska in the future. They aren’t even the biggest source of income to the state anymore.
    Mining has been a significant source of money for foreign companies, mostly Canadian like Northern Dynasty, but they have not been for the state of Alaska. Their legacy to Alaskans will be toxic waste and holes in the ground. Plus a few deaths.
    Aside from a few, usually low level jobs (mining companies need skilled workers and end up importing most of them from outside. Those people are the ones we are hoping to tax when the piggy bank runs dry, but they mostly don’t live here.) there is little to celebrate about “resource development” in our fair state. Even the old growth timber mostly gets shipped to Asia to be “value added.”
    It’s time to move on to the 21st Century and start finding ways to utilize our most valuable resource, our people. At the present time, we seem to be leaning toward exporting them to those parts of the US that value their work ethic and their outside acquired college educations. With our failing educational systems, I don’t know how we are going to fix that situation, but those people truly are our resource of the future.

    • “Sustainable Energy” is not sustainable, nor does it actually end up providing the needed energy. Look at California. They buy most of their electricity from other states and charge insane amounts of money for power. Wind power, solar power and many other forms of green energy are not reliable and the cost to produce them results in much higher power costs. If you want to talk about the environment, you need to actually look at the areas crying about climate the most and see what they have done to destroy their local ecosystems. California had lake Tulare, does not exist now, the 7th largest lake in the US. Look it up and think about how they ship produce all over the US. Do you think shipping all of the water out of a state will allow sustainable farming? They made a mistake and allowed farm runoff to create a salt sea that is dangerous to life. Further, almost all of the people worried about the climate ignore the damage caused by mining for the resources necessary to make electric vehicles, solar panels and other technology. Most people do not know that keeping your same vehicle for 10 years is better for the environment than getting that new EV or hybrid, as both getting the materials for the new and disposing of the old result in much more pollution.

      We cannot get the best deal for the people because of groups like teacher’s unions that only care about money and not educating children. We need to get rid of useless subjects from the colleges and stop allowing colleges to act as communist recruiting grounds. Given the large amount of colleges and companies that were recently shown to be infiltrated by the CCP, we probably have some house cleaning and professors to investigate given the number of students we have come through our institutions. Our universities need to be for students staying in Alaska. We have two colleges with Psychology programs, both at PhD and MA levels. How are we short on mental health professionals? We bring people in from all over the US, because of the low tuition rates, and we allow the universities to educate those that will never contribute to Alaska before our own citizens. The education system is cancer and needs an overhaul. State money goes to those universities, but they refuse to provide useful services or show preference to the community they take money from.

    • “The big oil companies have seen the future and are starting to move toward renewable energy.”
      They moved to capture as much of the federal subsidies as they could, and used their renewable resources operations as Net Operating Losses for their tax liabilities in their profitable extractive operations.
      So, yes, you are right that they have moved towards renewables, but so terribly wrong as to why.

  3. What was not accomplished in the Obama era will certainly be executed with precise action this next go around, especially with the same crew being brought on for another try. For those seeking to build a legacy and pass along opportunity to the next generation in AK, look no further than a Government job as this will be the only opportunities in such a remote and isolated location, albeit rich with essential and valuable resources to offer but, only to be locked up and inaccessible. So, the true essence of ‘opportunity’ vanishes in AK due to a Democrat wind. As this becomes ever so clear to every Alaskan, you can always find a “Biden-Harris” supporter and, thank them personally.

  4. Alaska has 500,000 barrels a day from one of the riskiest oil patches in the world, 6 medium-sized mines (most or all doing well) and many prospective mines talked about by politicians but no closer to opening than than they were 5 and even 10 years ago, and a flagging and subsidized in-shore fishery. We have a cruise ship tourism industry, possibly soon to return, but we cannot support 730,000 consumers (not to mention the out-sized government and welfare many demand) selling T-shirts made in Sri Lanka. Alaska has less manufacturing, less agriculture, and a lower adult workforce participation rate than any other state. Our construction industry largely depends upon government spending. We saw the world change from talking about peak oil supply to talking about peak oil demand, and still we held Alaska state government harmless. I would bet there are more spokespeople working for state government than there are employees at the largest manufacturer in the state! We have placed our economy in dire peril by building a state and local government workforce that has displaced the private sector. While oil production fell from 2 million barrels per day we grew government. While we talked about natural resource development our natural resource industries reduced production or left the state altogether. We held government harmless while the private sector experienced every kind of reduction; wage reduction, employment reduction, outlook reduction. We’ve begun the very same conversations year after year, decade after decade. We’ve used one-time government savings to keep the milk and cream coming while we forgot how to milk cows. We’ve gone from producing what the world wants to buy from us to disguising grants and studies as production. Some of the largest banks in the world are now avoiding Alaska as a matter of policy, and next month a new President will be sworn in to save Alaska from Alaskans as he saves the world from climate change. What do you think?

  5. The Republicans were in charge for 4 years. Nothing happened. The “final blow” was delivered by the Trump regime. And yet you’re preemptively pointing fingers at President-elect Biden (who has never in his life earned the “radical” tag)?

    • Americans should be so lucky as to have Biden accomplish nothing! But for Alaskans in particular you are quite wrong that “nothing happened.” We had the Tongass Roadless Rule lifted. We had ANWR opened up, and before that we had significant progress in other federal oil land. All Americans had a tax break which allowed workers to keep more of their own money; always a good move in a democracy. Also the standard deduction was raised and as a special help to Americans who live in states that have no state income tax the deductible amount of state taxes was capped, a double benefit given the standard deduction increase. For Alaskans it was a remarkably advantageous 4 years, and not surprisingly we supported President Trump.

      • Nothing is what Trump accomplished. The Tongass Rule, ANWR, and other lands opening to oil and mineral development all happened on paper, but there is no action in the field. Oil companies are retreating and mining companies are struggling with their toxic heritage.
        As far as the infamous Trump tax cut, it helped the middle class a middling bit but gave the truly wealthy and their businesses huge tax breaks. Ours are going away in the next few years. Theirs are not. Once again, we’ve been suckered.
        When I look around, I do not see anything happening that I would call remarkably advantageous for Alaskans. As far as the next four years, we’ll see.

  6. Another thing to watch is if the N. Slope producers have been stockpiling condensates and distillates. These are the lighter elements of petroleum, and are fluid enough to enable a cold restart should the TAPS shut down.
    TAPS can’t be shut down if it’s full of crude because that stuff is worse than molasses when it cools off. If that were to happen, TAPS would be almost, if not impossible to restart. As is, it does cool down quite a bit in the 800 mile transit.
    Not that long ago the oilies got permission to greatly increase condensate and distillate production, supposedly to enhance oil production. Reinjecting the gas does keep the pressure up and facilitates oil flow, but the condensates and distillates do what?
    Remember up to a year ago, or so, all the ADN comments from Joe Donley, who’s company was buying oil leases in Alaska? Lately, I haven’t heard a peep out of him, nor any of the others for that matter. Have even the oil lease speculators gone home?
    I’m stopping all unnecessary expenditures, to conserve cash. Whatever is going to happen, I want to be able to ride it out.

    • Correction: that’s Donkel Oil. My phone contact list refreshed my memory. Dang. Nobody wants to get old, but somebody has to know how.

    • I too hope to ride it out, unless there is a state income tax. But the problem we have is that working Alaskans will continue to ride right on out of here, especially private sector workers. That leaves us with retirees, government workers, people who cannot work, and people who choose to not work. Our economy could afford that (or at least we pretended we could) when we had oil revenues, and when we replaced diminished oil revenues by spending savings but now we are in trouble, big trouble. Alaska has a high cost of living and relatively lower wages, especially for skilled workers. Too many of our North Slope oil workers and our miners choose to live in other states, and a recession is unlikely to change that. Too many of our rural people, and our urban people, choose to live where there are no jobs for their qualifications, and SNAP, WIC, Section 8 and uncounted other programs make not working too easy.

  7. We can sure develop our state land and it is about time we stand up to the federal government on boxing us in. Southeasts overgrown timber is a tinder box waiting to be burned when lightning strikes again. We must manage our land and our timber and disregard the federal regulations especially on our state land…

  8. And yet Dunleavy shuts down Cook Inlet Commercial Fishing Industry and nary a peep. Haven’t seen that story here. I smell hypocrisy

    • Setnetter,
      Trouble is my friend, that when you get a special ” franchise to harvest a public resource” there will always be strings attached. Limited Entry was sold as a way of protecting the resource. The reality is, protection of the resource can be accomplished by merely limiting openings , or fishing times. Fish politics are always dirty and seldom fact based since one user group or gear group always thinks their ox has been gored and another group is getting their fish. Welcome to Canada style fish allocation, where political correctness and VOTES will be the new guideline. Fisheries science ? Forget about it!

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