How Sarah Palin Got a AAA Credit Rating for Alaska
This is unquestionably a good thing for the people of Alaska, just as the country’s downgrade is a bad thing. The state enjoys lower borrowing costs as a result. But especially in light of the current dysfunction in Washington, it’s important to understand why Alaska’s fiscal situation improved: It was largely because Palin raised taxes. Specifically, the state oil tax. Her central achievement as governor was signing a law, Alaska’s Clear and Equitable Share (ACES), that dramatically increased the state’s share of oil profits just as oil prices began to take off. There’s a direct line between increased revenue and improved fiscal health. (Alas, the good folks at Conservatives4Palin have posted a gloating item about Alaska’s credit-rating that both attacks Obama for raising taxes and neglects to mention that Palin’s own tax increase was the basis for the improvement.)