Exxon: Exxorbitant, Exxtortionists

     Note to self: The oil industry is not our friend. Especially Exxon.

     This note to self is inspired by a series of unfortunate events that are Exxon-centric.

     First: "The State of Alaska does not have a good track record on fiscal stability. Not trying to single them out or be critical, but they've changed fiscal terms on us 13 times over the last couple of decades." (Rex Tillerson, ExxonMobile chairman and president speaking to Wall Street analysts Wednesday.)

     This is inflammatory on so many levels but let's leave his statement by noting it is an untruth so bold it twists the innards.

     Second: I'm a bit fried that the Exxon honcho who reportedly made about $13,700 an hour last year can so blithely spout such nonsense to Wall Street analysts. If the Exxon board is going to pay someone that much they should at least demand he tell the truth. If he can distort reality as much as he did Wednesday when speaking to financial analysts, how can his board be sure he's being transparently truthful with them?

     Third: Exxon, not trying to single them out or be critical (to borrow Mr. Tillerson's predicate before speaking this week about Alaska), for well over a decade has been stiffing Alaska's fishermen by not paying billions of dollars of court-ordered restitution--restitution ordered, remember, when their drunk skipper fouled our shores in 1989.

     Fourth: Federal Energy Regulatory Commission (FERC) staff recently opined that Exxon and other owners of the Trans Alaska Pipeline have been stiffing the state with unfair oil pipeline tariffs. The state could have lost as much as $800 million in just four years. That FERC staff report is in line with a 2002 finding by the Regulatory Commission of Alaska (RCA).

     If FERC agrees with their professional staff and the RCA, litigation on this latest corporado tactic by Exxon and others could drag on for years as we try to recoup money they diverted to their bottom line by artifice.

     Fifth: How do we know that Exxon won't do what's right on oil pipeline tariffs if FERC accepts their professional staff analysis? Well, we don't know for sure. Remember though, they fought the state for well over a decade on royalty oil disputes before they and others paid us back hundreds of millions they took from us. Remember too, the years and years of litigation to avoid paying Alaska fishermen. The tiger in their tank doesn't change its stripes.

     Sixth: Exxon is the company that's been sitting on the resources at Pt. Thompson for three decades. They were warehousing resources that terms of their lease with Alaska compelled them to develop. The state finally cancelled the lease. Predictably, instead of sending drillers to the slope, Exxon is sending lawyers to court to try and defend their 30-year violation of lease terms.

     Seven: Exxon's profits were nearly $40 billion last year. That broke the previous record for U.S. corporate profits set, by the way, in 2005 by Exxon. The 2005 record set by Exxon broke the previous record for U.S. corporate profits set in 2004 by Exxon. Exxon's been gushing money. The obvious question, given their Alaska history, is how much of their record setting profits really belong to Alaskans.

     So, there's my first seven rebuttal points to Mr. Tillerson's Wednesday comments. Given this history, I guess we can conclude the least egregious behavior by Exxon over the past several decades of operating in Alaska is the blatant disregard for the truth Mr. Tillerson demonstrated this week. Not being truthful, I guess, isn't the worst of their offenses: they don't pay our fishermen for their bad; they don't pay us fairly for our royalty oil until compelled by courts; they are charged with overcharging us and others for shipping oil through TAPS; they sit on our resources at Pt. Thompson, and their definition of profit sharing with the owners of the resource is akin to the definition espoused by robber barons.

     Finally, this column has focused on Exxon's egregious behavior. Alaska has had its disputes with other multi-national oil companies. But there is an opportunity the others now have--they can set the record straight in the wake of Mr. Tillerson's distortions or they can allow his distortions to stand. Their choice.

     Note to self: The oil industry is not our friend. They can be our partner if we are vigilant, but they are not our friends.

Third branch ways--Former state representative Eric Croft won his first case as an Anchorage municipal prosecutor in court a few days ago. He reportedly told friends that after the verdict was read he expected someone in court to rise to move for reconsideration. That's the way it works in the legislative branch--take a vote and a colleague can move for reconsideration so the bill doesn't get a final vote until the next floor session. But that's not the way it works in the third branch of government, the courts. There they can appeal to another court and, instead of waiting a day or two, the final decision may not be made for years.

Power politics--Massachusetts' top guy barely edged out Alaska's top gal in a survey that ranks the power of all 50 state governors. Political science prof Thad Beyle (University of North Carolina) has ranked relative gubernatorial power since the 1980s based on tenure, budget authority, appointment power, veto powers, and to what extent the governor's party controls the legislature. It was how much the governor's party controls the legislature that gave a very slight edge to the Massachusetts governor--sorry  Sarah. Other powerful governors reside in Maryland, New York and West Virginia. Governors with a power outage try to reign in Alabama, Oklahoma, Rhode Island, and Vermont. Beyle's rankings will be fleshed out in a soon-to-be published book, Politics in the American States: A Comparative Analysis.

Power is as power does?--A. Dillon, a displaced Alaskan now reporting on energy out of Washington, D.C., notes on his blog the debut of another blog: Governor Sarah Palin for Vice President. Guess it could happen if Sarah really is the second most powerful governor in the U.S., outranking political luminaries like New York's Elliot Spitzer and California's Arnold Schwarzenegger. Check out the blog for yourself at: palinforvp.blogspot.com.

Put a sock in it--The New York Times reported this week that officials in the Alaska division of the Federal Fish and Wildlife Service appear to require government biologists or other employees traveling in countries around the Arctic not to discuss climate change, polar bears or sea ice if not designated to do so. The employees apparently must have a better understanding of the Bush administration's position than they have of science.

The bucks stop there--The top-paid lobbyist registered to lobby the Alaska legislature in 2006 made as much as the combined base salaries of 37 state legislators. The top two lobbyists made about $150,000 more than all 60 Alaska legislators combined.

The winter of our discontent--It's March 9 in the capital city and the word snow is in the forecast every day until at least March 18. Eaglecrest, the local ski area, has more snow than any other ski area in the world, a blizzard warning froze the city last weekend and there is a severe winter storm warning for tomorrow. Guess it was to be expected. The 2007 Farmers' Almanac said "shivery is not dead" in its forecast for this winter. The venerable almanac's editor, Peter Geiger, reports that "while global warming has taken up much of our attention (as well as news coverage), our winter predictions are pointing toward widespread cold from coast to coast, especially for the western sections of the country."

Not quite Greek to me--The House watches the senate like a hawk and vice versa. That explains, perhaps, why a member of my staff was handed a version of a House budget subcommittee closeout memo "for the senate". The memo was written in Italian--as if budget language isn't dense enough.