Democratic viewpoints on politics, policy and activism

These Three Things for Oklahoma

Republished with permission from One World House

In conversation with hundreds of Oklahomans over the past couple of years and after years of analysis concerning systemic change in the Oklahoma context, I am convinced that Oklahoma needs three things to happen before we will be able to begin digging ourselves out of our current crisis, and these things are:

1.) the Repeal of State Question 640,

2.) the Restoration of the 7% Gross Production Tax on Oil and Gas, and

3.) the Implementation of Ranked Choice Instant Run-Off Voting. All three of these together will not fully get Oklahoma where it needs to go for the creation of a flourishing human community, but without these three things, we will remain a glaring example of what happens to our social fabric when we cut taxes for the wealthy to the detriment of the common good and encourage the economic and political hegemony of the oil and gas industry.

The repeal of Oklahoma State Question 640 would allow the Oklahoma Legislature flexibility to raise state taxes to address Oklahoma’s budget crisis. State Question 640 was passed by a vote of the people in 1992 and requires a 75% vote in both the senate and the house of representatives of the Oklahoma Legislature in order to raise taxes. The effect has been multiple tax decreases over the past 25 years, mainly for the wealthy and large corporations, and no tax increases, even in times of severe revenue failure and budget crisis. Only one other state (Arkansas) has a threshold that is this high for approving tax increases. At the very least, we need to lower the threshold for approval, if not revert back to a simple majority vote. (See https://www.facebook.com/RepealOKStateQuestion640/)

Restoration of the 7% Gross Production Tax (GPT) rate on oil and gas is needed to save our schools and save our state from its revenue failure. Oklahoma’s effective tax rate on oil and gas production is 3.2%  and is one of the lowest in the country. Restoration of the 7% rate is essential to raising teacher pay and reversing the largest decline in general state spending on public education in the entire country since 2008. Oklahoma has the lowest teacher pay in the nation, and ranks fourth lowest in the nation in per pupil spending. Our neighbor Texas, by contrast, has an effective tax  rate of 8.3%  on oil and gas production and pays its new entry-level teachers about $20,000 more than Oklahoma. Over time Oklahoma has lost billions of dollars of revenue owing to our unnecessary tax breaks for the oil and gas industry. (See https://www.facebook.com/OklahomansForRestoring7PercentGrossProductionTax/)

Ranked Choice Instant Run-Off Voting would strengthen participation in our democracy by allowing persons to vote for their candidate of choice in elections with three or more candidates without the concern that their vote would be wasted or contribute to the election of their least favorite candidates. This would allow political parties outside of the Democratic and Republican parties to gain more traction and to be taken more seriously in the political debate. It would likely also increase political participation of those citizens who do not feel represented by the two major parties. In such a system, you could give first preference to the candidate you really want elected. If he or she does not have enough votes to make the instant run-off,  your vote would go to your next preference on the ballot. (See https://www.facebook.com/RCVOklahoma/)

These three things (repeal of 640, restoration of the 7% GPT, and ranked choice voting) will at least give us a fighting chance for systemic transformation in our state, and for that very reason, those who benefit from the established environment will do almost anything to keep these three things from happening. If Oklahoma is to have a future other than becoming even more of a commodity colony than it already is, the people must take back their power through sustained participation in the political process to achieve these three things and then press on towards more systemic change for a more just, peaceful, participatory, and sustainable Oklahoma.

Once these three things happen, it will be more possible to do what is necessary to generate adequate revenue for education, infrastructure, basic services, public safety, environmental protection, healthcare (including mental healthcare), and care for the least vulnerable among us.

Once these things happen, we can begin to focus on diversifying our economy and break the dominance that the oil and gas industry has over our economic and political processes.

Once these three things happen, we can build on the increased political participation that will come when people have more political choices and are able to vote for their first choice in elections without hurting their second choice or helping their least favorite candidate. Vibrant third parties will finally be able to gain traction to allow more diverse voices in our political process.

You can see why these three things will be resisted, which is the very reason we must do all we can to begin with these three things. It is possible…

Oklahoma Oil and Gas and the Charade of Greed

Reprinted with permission from One World House

Harold Hamm and Larry Nichols are desperate to keep Oklahoma’s gross production tax on oil and gas at extremely low levels because they know that if they keep it low again this year, they will likely be able to keep it low for a number of years to come.

Here’s why – They know that the Saudis are cutting back on production to stabilize and increase global oil prices. They also know that the Oklahoma Legislature they own will likely pass lessened restrictions on long lateral horizontal drilling in non-shale formations. In other words, Hamm and Nichols know that a boom is likely on the horizon, and they want to enjoy that boom with the lowest GPT possible.

They also know that with a boom on the horizon there will be an increase in drilling and production and therefore an increase in revenue coming to the state from GPT even if there is not a restoration of a higher GPT. The increase in revenue will by no means cover the budget shortfall, but it will be an increase. When this happens, Hamm and Nichols will say “See, the Oklahoma Legislature did the right thing by keeping the GPT low because it led to an increase in production and therefore an increase in revenue for the state, and they will create a bunch of fancy videos with the chamber of commerce and the Oklahoma Energy Resources Board touting the return of economic prosperity to OKC and Oklahoma and highlight oil and gas as the fuel for that prosperity.

What they won’t tell you is that the increase in drilling and production that will likely occur in the next couple of years will have almost nothing to do with a low GPT rate and will have almost everything to do with global oil and gas prices, and perhaps some to do with less strict environmental regulations that will endanger our health and the climate over the long run but make it cheaper to drill wells and transport oil and gas.

They also will not tell you that in the last boom we cut education more than any other state owing to all of the tax cuts we keep giving to the wealthy and the oil and gas companies.

The oil and gas companies will have so much extra money from the coming boom that they will be able to increase their charitable giving, which will still be a tiny fraction of what they should be paying in taxes, and they will use this tax deductible giving as free advertising to claim that they are responsible corporate citizens even though many of the agencies they donate to might not need to exist if they paid in taxes here what they have to pay in other states.

The problem is that enough people keep believing this charade of greed and will thank the oil and gas companies for leading the state from a more horrible state of hell to a less horrible state of hell, and our politicians and their oil and gas patrons will pat themselves on the back for keeping the GPT low, which will mean billions to the oil and gas companies in the years ahead while our schools, hospitals, mental healthcare, and other basic services continue to languish; and we gullible Oklahomans will likely continue to reward them for this charade.

This is why it is so critical to restore the 7% GPT now, so we can enjoy a reasonable recovery towards a more flourishing state in the years ahead. Will we have the political will to make these changes, or will it continue to be the same as it ever was?

Oh. and by the way, with higher global oil and gas prices and higher production, there will be more waste water produced; so unless we figure out a way to deal with that appropriately, get ready for some more shaking, and guess who gets to pay for the earthquake damage?!