The state of Alaska, with all the legal wisdom of a political agenda and the flowing words of a high-priced law firm, has filed a claim against the federal government. Nothing new about that — the state has filed and signed onto more lawsuits against the national government in recent years than President Joe Biden has forgotten dates or former President Donald Trump has told lies.
Nothing to be proud of in any of that.
The state’s latest legal endeavor came July 2 in a dubious lawsuit — with a few errors and omissions for poor measure — that asks $25 billion to compensate the state for what it could have, might have, possibly may have earned as its share of federal royalties from potential oil production in the Arctic National Wildlife Refuge.
The Biden administration canceled the federal oil and gas leases in ANWR more than three years ago, much to the disgust of Gov. Mike Dunleavy and many Alaskans who have long complained that overly restrictive federal oversight has denied the state its rights to resource development.
The state already is in court to establish the validity of those leases, but all a win in that case would provide is the opportunity for someone to spend billions of dollars to explore for oil and gas on the contested acreage. Maybe make some money, but maybe lose a lot of money. A lot of exploration efforts come up empty.
This latest claim is much more lucrative than that: If the state wins, it gets a big check. No investment risk, no environmental impact statement to attract opponents, no worry about unsuccessful exploration and drilling, no carbon emissions. Just cash for the state treasury.
Yet the state’s claim to lost billions is a bit of a scam: It’s based on the unrealistic premise that everything is certain in oil development.
The $25 billion math assumes billions of barrels of oil are there, securely trapped between rock layers, just waiting for a drill rig to find the sweet spot to stick a straw in the ground and start pumping. If it were that easy, and guaranteed, everyone would invest in oil. But it’s not. Oil isn’t always where explorers think it is, and it doesn’t always flow to the surface as predicted.
The state’s claim is calculated on the best possible outcome of multiple “what ifs,” conjuring up the highest possible number. It’s not honest or realistic, but that doesn’t really matter when you’re just trying to score a political point that federal policy is holding back Alaska’s future.
However, there are no ifs about the errors in the lawsuit, such as the statement that the trans-Alaska oil pipeline is half full. Wrong. It is less than one-quarter full. Doesn’t anyone proofread these things before running to file in court and make the news?
The lawsuit got it right when it said Alaska has no personal income tax, and therefore is dependent on oil and gas revenues help pay for schools, roads, health care services, rural development and “care for its Alaska Native communities.” But it failed to mention that the single largest appropriation of state spending in this year’s budget is to send hefty Permanent Fund dividends to Alaskans.
Maybe the lawyers figured the state would gain more sympathy from the court if it pleads it needs the money to care for Native communities rather than to keep paying the dividend.
I hope the state didn’t pay the lawyers too much. This lawsuit is a gusher of politics, not reality.
Larry Persily is the publisher of the Wrangell Sentinel.
