A return to ACES?
The Fraser Institute’s “Measuring Labour Markets in Canada and the United States,” has some stark news for Alaska.
Using eight equally weighted criteria averaged over the period from 2016 to 2018, Fraser examined each U.S. state and the provinces and territories of Canada, to calculate an “Index of Labour Market Performance.”
Those weighted criteria, the Alaska Policy Forum reports, included:
• Average annual total employment growth;
• Average annual private-sector employment growth;
• Average total employment rate;
• Average private-sector employment rate;
• Average unemployment rate;
• Average long-term unemployment;
• Average share of involuntary part-time workers; and,
• Average output per worker (2015–2017).
How well did Alaska do? Using a scoring index from 0 to 100, Alaska came in with a score of 51.3 of 100, making it 46th of the 60 states and provinces examined. When you just look at the United States, Alaska came in 45th.
The Policy Forum notes the state’s chronically high unemployment and “an alarming negative trend in employment growt hobble our economy.”
What Alaska clearly needs now is growth that spurs employment – and it needs it just as a group moves to put onto the 2020 ballot a question that could wring another billion dollars or so out of the oil industry to give Alaskans – read government – what it considers a “fair share.”
Remember Sarah Palin’s Alaska’s Clear and Equitable Share oil tax? It was touted as doing the same, but in pursuit of more oil dollars for government, ACES contributed to a 90 percent marginal tax rate at higher oil prices – among the world’s highest at the time. That had negative consequences.
Industry responded by moving investment to other oil provinces with rational tax regimes. In Alaska, that cost jobs and economic growth so that government spending could go on unchecked.
No matter what the “Fair Share” initiative’s backers are thinking, if they somehow are successful it will be a return to the bad ol’ days of ACES, where government gets fat and Alaskans suffer.