Monday, October 8, 2012

U.S. Energy and Tax Policies: Implications for Alaska's Economy

Dr. Margo Thorning is an internationally recognized expert on tax, environmental, and competitiveness issues and has testified as an expert witness on capital formation and environmental issues before various U.S. congressional committees. Dr. Thorning is senior vice president and chief economist with the American Council for Capital Formation and director of research for its public policy think tank.

Dr. Thorning writes for numerous online and in print publications. Below is an excerpt from a piece she wrote for the National Journal:

“Without question, the U.S. needs to do everything it can to promote domestic energy, especially oil and gas, to help meet our future population demands. And don't forget that enhanced energy production means an enhanced job market. Energy-producing states including Texas, Oklahoma, Montana, Wyoming, North and South Dakota and Nebraska are seeing impressive income and job growth gains mostly attributed to the growing demands for their robust commodities, including oil and gas. Allowing the Keystone Pipeline would also enhance our energy supply and create more jobs. We should also allow companies export our robust supplies of natural gas.

The private sector is already making strides in new business models that accommodate changes in climate and weather patterns through "no regrets" solutions (or changes that would be undertaken in the normal course of business). Examples of this might include companies that are developing more drought-resistant seeds or hardening coastal infrastructure at risk from sea level rise.

To promote more energy production and more "no regrets" business solutions, we need a tax code that retains robust capital cost recovery. Tax provisions including accelerated and bonus depreciation, Last In First Out (LIFO) and Section 199, and provisions utilized by the oil and gas industry which are all on the table as potential eliminations as a trade-off for reductions in lowering corporate tax rates should be preserved.

Finally, we need reductions in regulatory and permitting barriers that are often factors hindering U.S. companies from making investments to improve or expand their facilities. For example, in addition to permits to meet federal regulations there are often additional state and local permit requirements, which add time and cost to a project getting underway. Environmental regulations should meet a cost/benefit test--those that have minimal environmental impact but place a chokehold on businesses should be eliminated.”

Clearly, Dr. Thorning’s expertise and recommendations concerning tax and energy policy is extremely relevant to Alaska’s own energy and development issues. To learn more from Dr. Thorning in person about how the U.S. government’s tax and energy policies will be affecting Alaska’s economy, attend our luncheon on Friday, September 21st, at noon in the Anchorage Hilton Hotel.

If you are interested in attending, we strongly suggest that you RSVP to us by Wednesday October 24th. Admission is $23 for members, $26 for non-members if paid in advance, and $26 for members, $30 for non-members if paid at the door. All students are free, as are UAA staff and faculty. To pay in advance, click here.

If you would like to pay at the door, you can still RSVP by sending us an email (info@alaskaworldaffairs.org) or by giving us a call (907-276-8038).

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