Saturday, September 26, 2015

Alaska, the Owner State

As aggressively as Alaska is marketed as a Last Frontier where the rugged individualist reigns supreme, it has collectivist quirks written right into its state constitution.

You can own land, and outside of congested areas you can do with it pretty much as you please; you can drill a well for water and install a septic tank with no more red tape than you'd expect in any other state. There is -- or was, things may have changed -- an organized borough where you wouldn't even have to pay property tax.

But aside from the water, nothing below the surface is yours. That all belongs to the state government. Because the state's "Founding Fathers" decided that what had gone wrong in the Lower 48 over the previous few decades -- we're talking about the mid-1950s here, so their experience extended through the Great Depression -- was caused by private property rights extending too far.

This means that those with the resources to extract and market Alaska's mineral wealth have only one vendor to deal with: Juneau. When I was studying economics, that was called a monopoly. And what happens in a monopoly? Things cost more.

Alaskans wonder why they're still paying a dollar more per gallon for gasoline refined in their very own state from oil produced in their very own state. In Fairbanks, they even convinced themselves the answer was to raise taxes on the oil companies -- as if that would bring gas prices down.

Maybe if more than one entity owned that oil, things would be different.

Alaska's "last frontier" marketing has been a lie for 60 years.

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