Anchorage Daily News - Resource development means jobs

Anchorage Daily News (Alaska)

January 13, 2004 Tuesday, FINAL EDITION

HEADLINE: Resource development means jobs;
Compass: Points of view from the community

BYLINE: By GOV. FRANK MURKOWSKI

BODY:
One-third of Alaskans are under age 20. They are 210,000 members of the next generation for whose future we must prepare. We have an obligation to provide our young people with options in life and productive outlets for their energy and talents.

Economic development of Alaska's plentiful natural resources has been and will continue to be the driving force of our economy. My administration is working hard to assure there will be new, high-paying jobs and opportunities available for the next generation.

The financial benefits to Alaska's economy are enormous. Our $27 billion Permanent Fund is one result of building infrastructure to access the valuable resources on Alaska's North Slope.

Another example is the state-funded access to the Red Dog mine, the world's largest zinc mine. It is the economic engine of the Northwest Arctic Borough and provides one out of every seven jobs in the region.

Economic development in these rural areas of Alaska has allowed borough governments to form and generate local revenues. This reduces the burden on state and federal governments to provide local social services and elevates a region's level of self-sufficiency.

I am encouraged by the strong Native and community leadership in the Bristol Bay region. After being hit hard by a decline in the fishing industry, local leaders are taking responsibility for their future and are re-evaluating the benefits of oil and gas development in their region. They recognize that successful production will diversify the economy, lower energy costs, improve quality of life, and provide jobs for local residents.

Recent news articles suggest that upcoming development projects, such as Pogo Mine near Delta Junction, will not provide economic benefits to state or local governments. This suggestion is inaccurate and shortsighted.

Canadian and Japanese companies are partnering to invest $250 million in capital to open Pogo. To date, they have invested nearly $100 million in Alaska. This new money from foreign sources circulates and multiplies throughout our economy.

The Department of Natural Resources estimates the direct economic benefits to the state from developing Pogo to be nearly $10 million. Additionally, if the mine is profitable, the companies will be paying tens of millions more in corporate income taxes, mining taxes and royalties.

The Pogo mine is expected to create nearly 700 jobs during construction and 360 full-time jobs during production. Its annual payroll of $25.4 million will support average salaries of $66,000. Workers will buy homes and contribute to their communities through local sales and property taxes. An additional 600 indirect jobs are expected to be created in Delta and Fairbanks to support the mine activities.

New jobs also result in cost savings to government, if those jobs are filled by Alaskans who were previously unemployed and were receiving benefits from government programs. To achieve this result, in mid-November I announced a new initiative to encourage local companies to set a goal of 90 percent Alaskan hire.

Social problems diminish as people get well-paying jobs. Social problems with extremely high government costs, such as substance abuse, domestic violence, and other crimes are often directly related to unemployment and to people losing hope. Courts, public defenders, jails and treatment centers are all expensive costs to government to combat these social ills.

That's why the best social program is a good job.

Our pursuit of economic development is not to fund government but rather to ensure Alaskans and their children have jobs and a high standard of living. Government revenues are a result of a successful economy, not its purpose.

We are already starting to see the beginnings of positive changes taking place in our economy. The Department of Labor reports 3,400 new jobs have been created in the first nine months of 2003. This is an excellent start, and we expect job expansion to continue.

My commitment to Alaskans is to work hard to facilitate career opportunities for Alaskans and hope for our youths so that their future will be productive and prosperous and they can choose to remain here and raise the next generation of Alaskans.

Gov. Frank Murkowski was elected in 2002. Before then, he represented Alaska in the U.S. Senate for 22 years.