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News from the Plains: All this RED can make you BLUE

Horizontal Dumbshittery
by Barry Friedman

Have I mentioned how free Oklahoma is? Of all the states, we're #5 with a bullet (and I do mean bullet).

But I digress.

Yet since 2009, Oklahoma’s public education budget has been slashed by $221 million or 10.8 percent, according to data analyzed by the Oklahoma Policy Institute (OPI).
Two hundred million here, two hundred million there and pretty soon you're talking about fourth grade classrooms in portable trailers and gyms without volleyballs.

Well, as long as we're all sharing in the sacrifice.

Oops!

In 2010, the tax rate for new horizontal wells, which constitute the vast majority of current drilling, was reduced to 1 percent. As Oklahoma Secretary of Finance and Revenue Preston Doerflinger reported a few days ago, gross production tax collections have dropped by more than $300 million, largely as a result of this bill. They are projected to drop by approximately another $300 million over the next three years. That $600 million-plus annual revenue reduction amounts to more than 25 percent of what we spend on schools, about 60 percent of what we spend on higher education and more than all individual tax reductions granted during the past several years.
By the way, the above was not written by Robert F. Kennedy, Jr. to Robert Redford on tree-free hemp paper; this was George Kaiser's editorial this past Sunday in the Tulsa World.

Yeah, that Kaiser.

It is his contention that not only is the tax too low, it's aimed at the wrong people and, worse, it's not even part of the equation when guys like him decide to do whatever it is guys like him decide to do.  

"Some say that Oklahoma needs to be competitive with other states. Well, at 1 percent, we certainly are competitive, but the biggest boom is taking place in North Dakota - where we and many other Oklahoma producers drill actively - and the tax there is 11.5 percent - more than 10 times as high as in Oklahoma! It sure appears that producers drill where God deposited the hydrocarbons, not where the taxes are lowest."
This morning's sermon: God and hydrocarbons. Babysitting Available

North Dakota taxes on horizontal wells are ten times higher than Oklahoma's? Not the taxes assessed in the European Union; not the taxes collected by California.

North freaking Dakota!

And Oklahoma legislators are still falling over themselves trying to find new ways to fall over themselves.

But Sen. Brian Bingman, R-Sapulpa, argued that the tax breaks make Oklahoma more attractive to oil and gas companies. “The oil and gas industry has done their part—drilling more wells and creating more revenue for the state and the economy. They’re taking those dollars and drilling more wells, which creates more jobs and keeps people employed.”
Mr. Kaiser, you wanted to say something?
If the money were going to small, independent Oklahoma producers to help them keep "stripper" wells in operation, it would serve a useful purpose. But virtually none of the reduction is awarded to small producers or small wells. It goes instead to the most expensive wells - where it has the least influence on the drilling decision - that are drilled primarily by a few large public corporations, all but one of which are majority owned by non-Oklahoma shareholders.
Which brings us to education.

Unfortunately, for state leaders, God didn't just deposit hydrocarbons in Oklahoma, he also dumped a bunch of kids--626,159 to be exact and they're in 1831 schools.

Those students need text books, supplies, security guards, buses, gas to go into the buses, paper towels in the Girls Room, Bunsen burners, hall pass notepads, lunchroom personnel who serve inedible pizza, and a hundred other things.

Including teachers ... who presently rank 47th in the nation in salary.

As mentioned, the state legislature has cut education by $221-million; it has given $300-million in tax breaks to non-Oklahoma oil producers.

This doesn't seem difficult to fix.

The former mayor of Jenks, Oklahoma, Vic Vreeland, told me one time that when people and businesses thought about relocating to his town, one thing was on their minds: the quality of his schools.

"That's the first thing they asked about; that's the last thing they asked about."

While most states are cutting spending on education, as the figures in this analysis show, a few states are boosting it. A few states such as Alaska, Montana, North Dakota and Wyoming have significant oil and gas revenues and therefore have not suffered the same level of economic problems as other states, and thus they have enacted fewer budget cuts.
I'll try not to scream: OKLAHOMA HAS SIGNIFICANT OIL AND GAS REVENUES!

Adjusted for inflation, from 2008-12, while Oklahoma spent 18.7% LESS per student, North Dakota spent 24.2% MORE.

North freaking Dakota!

As Kinky Friedman (no relation) once said about states, priorities, children, and oil--he called it 'Dinosaur Wine'--"It takes a real dumbshit not to understand the value of education."

Oklahoma Department of Education

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Comment Preferences

  •  The drillers might leave the state! (3+ / 0-)

    you know, because of taxes! This was Ed Rendell's declaration when people started pushing for a severance tax in Pennsylvania.

    Finally under Tom Corbett we got a very weak "impact fee"--fee per well--instead of a severance/production tax. The two governors have stalled and stalled and before we get a decent tax on drilling, the gas will have peaked out, but the destruction will remain.

     Our education funding has been cut,too, as have been many other things. But not the corporate tax cuts. Oh no, there's plenty of largesse for that.

    I don't know how our tax compares with Oklahoma's, but it's just ludicrous to suppose the drillers would be leaving, under a higher tax.

    The gas and oil aren't going anywhere, you damned fools! Or is that what you take us citizens for?

  •  Is it OK to use the term (3+ / 0-)
    Recommended by:
    vuzvilla, unfangus, TheDuckManCometh

    "Dumbfuckistan" while freely admitting that many of the smartest people I know have escaped from Oklahoma?

    It almost seems like the automatic impulse to lower taxes on hydrocarbon production is a matter of faith, which is ultimately linked to fear and insecurity about the future. It goes something like this: Liberals and black people want higher taxes. We're scared of black people and liberals are not good Christians. We have suffered from repeated booms and busts in the energy sector, so we need to create zero friction for energy extraction companies in the hopes that this will prevent busts. So for these reasons we oppose revenue for government. Also we are self-sufficient to the point of rejecting any need for a safety net.  And we've run out of questions and have all the answers already, so there's no need for education.  Besides, do you really need science and literature and art to repair a well or drive a truck?

    “If the misery of the poor be caused not by the laws of nature, but by our institutions, great is our sin.” Charles Darwin

    by ivorybill on Fri Jul 26, 2013 at 07:11:31 AM PDT

    •  Run out of questions (2+ / 0-)
      Recommended by:
      unfangus, TheDuckManCometh

      ... and, in fact, reject the time wasted in universities the past 100 years asking them. The world is 9,000 years old; Jefferson, when writing the Declaration, was a merely a scribe for God; and global warming is a myth. I remember plenty of hot days growing up and playing in the swimming hole. Why do we keep going over this?

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