Arkansas Governor Mike Beebe has recently issued a proclamation calling a special session of the Arkansas General Assembly (itself a major expense) for the sole purpose of raising the severance tax on natural gas. Gov. Beebe appears to have worked diligently behind the scenes not only with legislators whose support he needs but also with the various gas producers who are setting up shop in Arkansas exploring and drilling in the Fayetteville Shale. Gov. Beebe seems satisfied that he is able to offer to the legislature a package that the producers will be happy with and that will receive solid, supermajority support in the General Assembly necessary for quick passage.
Though gas and oil exploration are not exactly new to the state of Arkansas, it has been almost embarrassing to watch our “leaders” frothing at the mouth about this new-found wealth that, like gaming and a lottery purport to be, will solve all our problems. It’s all about how much money the state can collect because, after all, it’s all “ours”, right?
Wrong. While the state can reasonably expect to collect a reasonable severance tax, it is entirely unreasonable to attempt to be like Oklahoma or Texas when it comes to natural resources or even tax collections. Arkansas already has natural gas and some crude oil, but Arkansas has plenty of ore as well as renewable resources such as timber and food crops. We don’t give these the same consideration because the costs of these renewable resources is directly related to the cost of such resources required to extract them, raise them, cultivate them, harvest them, and/or move them. Gas and oil, because of the spiraling price increases in the past few years, have been demonized in the hearts, minds, and souls of the average consumer and government. Therefore it is reasonable that we all be expected to show up on the state house lawn with pitch forks and torches in hand demanding that these demons be punished (though not exorcised; after all, we’re not backwoods hicks … are we?).
Relative to these resources, however, the predominant mindset of our state government has been, and likely will continue to be: how much of it can we get for the state’s coffers? Seriously, who among our legislative or executive branches in this state has stepped forward and inquired: what can we do to help? Specifically, what can the state offer to these potential as well as existing EMPLOYERS that will increase the number of jobs they offer and enhance training for displaced workers? I am not necessarily referring to the onesies or twosies who consider setting up shop in Arkansas although they are certainly welcome, and the state should seriously consider what it will take to entice and encourage them to come to Arkansas. I am specifically referring to the industries which already exist in our fair state. What has our state’s government done to help them on any level, and more specifically, what has the state’s government done to encourage them to increase the number of available jobs in Arkansas relative to already-existing industry?
Now that the natural gas business is heating up, the state wants more of a piece of the production pie not necessarily because it will be good for the state but because there is a new opportunity for revenue and a new opportunity to spend it. Yes, Arkansas highways will apparently reap 95% of the benefit from this severance tax increase according to Gov. Beebe’s proposal and decent paying, though seasonal, construction jobs will come as a result, but this seems only incidental to the state government’s thought process
The jobs that come with the enhanced gas exploration and drilling seem only incidental to the grand scheme, but I see very little expressed thought from our legislators or the governor about how these new opportunities could themselves be enhanced FOR THE SAKE OF EMPLOYMENT deliberately rather than incidentally and that government benefit incidentally rather than deliberately. Regardless of the supposed noble intent of a tax increase, if the government does not give deliberate thought to partnering with industry for the sake of creating jobs rather than being inherently antagonistic by demanding a bigger piece of the corporate pie, then “the people” are reaping very little benefit.
Former governor Huckabee helped to oversee some pretty substantial tax increases during his tenure (is this why the Republican governor got along so well with the Democratic-controlled legislature?) which resulted in substantially increased spending in some social programs as well as a pretty hefty budget surplus which says two things: 1) the taxpayers were substantially overtaxed, and 2) the sole purpose of the tax increases was to enhance the government’s role in people’s lives. Would the state and its industries have been further ahead of the game if the state had chosen to partner with industry and work to help create more job opportunities and training for those who are recipients of the increased social spending rather than work to enhance the give-away programs for those who are unemployed or underemployed? It seems to be that we have it backwards.
None of this is to say that the state should simply turn its back on those who genuinely need help, but it also seems that we could do more for those who are unemployable by putting back to work those who are entirely employable. Government offering incentives to existing industry designed specifically to increase the number of paycheck earners is precisely what government should be about in the life of corporate Arkansas and corporate America. Helping people to help themselves is neither charity nor welfare; it is simply in the best interests of everyone, government and industry and wage earners alike.
The mindset that government exists only for its own sake is costing a lot of people a lot of jobs and training opportunities and is costing taxpayers a bundle. Rather than work to extend, for instance, unemployment benefits as Senator Barack Obama has proposed in his economic stimulus package, how about working with industries to get these unemployed citizens back to work? Should this not be what government does? Not according to the existing mindset and especially not in an election year.
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