The ACES effect.

• Author: Harrington, Susan
• Position: FROM THE EDITOR - Alaska's Clear and Equitable Share

As we venture into 2013--having made it through the end of the Mayan calendar--we've got some tough decisions to make (since the world didn't end after all). In order to successfully go forth, we need to rein in a bit--quite a bit, actually. As we've held our breath through the D.C. fiscal cliff politics, what stands out most are the bitter arguments for reductions: spending reductions, tax-break reductions.

In Alaska, phenomenal oil revenues have spurred the State Legislature to spend at an unsustainable level. Add to that the ACES effect and we are approaching an Alaska fiscal cliff of Denali proportions. One parallel with the reds is the need to reduce spending, and we're working on that. Where we branch off down another trail though is with taxes: Some folks in D.C. want to raise taxes, but in Alaska some folks want to reduce taxes, specifically ACES taxes.

Otherwise, well, we all know what's happened since ACES--Alaska's Clear and Equitable Share--passed. The ACES effect has caused big oil to take a big pause and instead of drilling for oil in legacy fields to fill up the trans-Alaska oil pipeline (as they were doing before ACES), drilling has stepped up in other states and other countries. Instead of investing the ACES windfall revenues into a sustainable future, the State Legislature has spent much of it. Instead of recognizing the long-term harm ACES is causing the state, the Legislature has been too blinded by the...