That was when Sarah Palin reared her head.
She saw the launching of a natural-gas-pipeline project as a God-given opportunity to prove herself bigger than Big Oil. Thus was born, in the spring of 2007, the Alaska Gasline Inducement Act, or AGIA, under the terms of which the state would pay up to $500 million in startup money to the company it selected to build the pipeline. The chosen company would have to comply with AGIA’s stringent, inflexible terms. Certain provisions, such as the state’s refusal to set tax rates in advance or even specify the formula by which they would be calculated, seemed designed specifically to discourage Exxon Mobil, BP, and ConocoPhillips from participating.
In fact, the terms discouraged almost everybody. In the end, the only bidder to meet AGIA’s requirements was the Calgary-based pipeline-construction company TransCanada. Nonetheless, Palin was thrilled. She felt that with AGIA, she’d stuck her thumb in the eye of Big Oil as no governor before her ever had. She was good, and they were bad, and she’d defeated them. She was Joan of Arc at Orleans.
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There was only one problem: TransCanada didn’t have any gas. Exxon Mobil, BP, and ConocoPhillips had the gas. In her populist fervor, what Palin had done--aided and abetted by the state legislature--was contrive to pay as much as $500 million to a foreign company to look into the possibility of someday building a line.
BP and ConocoPhillips had launched their own project in response to AGIA: “Denali--the Alaska Gas Pipeline.” The state would give TransCanada up to $500 million? Well, BP and ConocoPhillips, through Denali, would spend $600 million in preparation for an open season in 2010.
Thus, after 30 years without a natural-gas-pipeline project, Alaska now had two under way: one to which the state was committed and the other sponsored by the companies that had the gas--or at least some of the gas. Watching from the sidelines was the company that controlled the most gas of all: Exxon Mobil. Hal Kvisle, CEO of TransCanada, said that where a pipeline in Alaska is concerned, “nothing goes ahead until Exxon is happy.” And Sarah Palin--“off on some magical mystery tour,” as one state legislator put it to me--was definitely not making Exxon happy.
I was in anchorage in November when Palin flew back from the Republican governors conference, in Miami, just in time for the 50th Anniversary of Statehood Dinner, in Anchorage. Held at the Captain Cook hotel--which was owned by a former governor, 89-year-old Walter Hickel--the dinner was given in honor of the fact that 50 days later, on January 3, Alaska would celebrate 50 years of statehood.
Palin was joined at the dinner by seven former governors, ranging from Mike Stepovich, 90, who had been appointed governor of the Territory of Alaska by Dwight D. Eisenhower in 1957, to Frank Murkowski, Palin’s immediate predecessor. Sarah Palin owed a lot to Murkowski. It was the mess he’d made during his single term in Juneau that had cleared her path to the statehouse from the “Mad Zoo.”
The Mad Zoo is what Alaskans call the Mat-Su, which, in turn, is short for Matanuska-Susitna, the valley (geographically) and borough (administratively) that borders Anchorage on the north. Alaska’s fastest-growing region, it now holds 12 percent of the state’s population. Mad Zoo residents are whiter, less educated, more Republican, and more fervently evangelical than the people of Alaska as a whole. A former president of the state senate once called them “valley trash.” Sarah Palin, mayor of Wasilla, the economic and spiritual center of the area, didn’t deny it. Instead, she posed for pictures in a valley trash T-shirt.
After Palin ran for lieutenant governor and lost in 2002, Murkowski, the newly elected governor, appointed her to the state’s three-member Oil and Gas Conservation Commission, an obscure regulatory agency whose mission was “to protect the public interest in exploration and development of oil and gas resources.” At a salary of $122,400 a year and with the commission’s offices less than an hour’s drive from her home in Wasilla, the position was a ripe plum for Palin. That her understanding of energy issues did not extend beyond being married to an oil-field worker and knowing how to fill the fuel tank of a snowmobile seemed not to matter. She could learn on the job.
“There is so much information here, and it’s all very technical,” she said soon after starting. “But maybe by the time this is through, I can have an intelligent conversation with my husband.”
Then all hell broke loose. One of her colleagues on the commission was the chairman of Alaska’s Republican Party. Only as dim a bulb as Murkowski could have failed to recognize that as a conflict of interest. Palin caught him conducting party business in his commission office. She became instantly famous when she ratted him out and then resigned from her position, saying she couldn’t sleep at night because she was so upset by the breach of ethics.
Her insomnia didn’t keep her from routing Murkowski in the 2006 Republican primary. In the general election that November, she defeated a former Democratic governor, Tony Knowles, and a conservative independent, Andrew Halcro, and went to Juneau not only as the state’s youngest--and first female--governor, but also the first from the Mad Zoo and the first to have said “All I ever really needed to know I learned on the basketball court.”
At the start, everybody loved Sarah. Even the state’s largest newspaper, the Anchorage Daily News, which she’d denounced as a “yellow liberal rag,” hailed her as the “Joan of Arc of Alaskan politics.” Few noticed that her political skills were not matched by an interest in, or grasp of, policy. Or that her concept of truth was, shall we say, rather elastic.
“Facts to her are like Silly Putty,” said Larry Persily, former deputy commissioner of Alaska’s Department of Revenue, who later worked for Palin in the state’s office in Washington. “She shapes them into whatever people want to hear.”
What Alaskans wanted to hear as Palin assumed office at the start of 2007--what they’d been wanting to hear, in fact, ever since the Exxon Valdez oil spill in 1989--was that Big Oil, especially Exxon Mobil, was evil. Looking back over their 40-year partnership with the oil multinationals, most Alaskans concluded that no matter how many tens of billions of dollars in revenue the state had received as a result of North Slope production, it should have gotten more. And it would have, according to popular sentiment, if the greedy, crafty, amoral, conniving, duplicitous, and nefarious oil companies hadn’t robbed Alaska blind--in many cases, with the illicitly bought-and-paid-for cooperation of the state’s elected and appointed officials.
Such feelings intensified in October 2005, when then-Governor Murkowski, who had been secretly negotiating a gas-pipeline deal with the oil companies, fired Tom Irwin, the commissioner of the Department of Natural Resources, after Irwin questioned whether Murkowski’s secret talks were legal. Six Irwin aides resigned immediately, the negotiations went nowhere, and Murkowski became as unpopular in Alaska as Saddam Hussein.
Anger at the oil companies grew stronger still over the next two years. In 2007, an FBI investigation led to the conviction of a number of Republican political figures who had accepted bribes from the head of an oil-services company in return for their votes supporting oil-tax legislation and other favors.
Palin seized the day. One of her first acts as governor was to restore Irwin to his position as natural-resources commissioner. His closest associate, Marty Rutherford, returned as deputy commissioner. Under Murkowski, they had sat at the negotiating table and looked Big Oil in the eye. And they’d blinked. “We were so outclassed, it was appalling,” Rutherford said later. Never again, she added, should state representatives “attempt to sit across the negotiating table from Exxon, ConocoPhillips, and BP.” In a written decision, Irwin said that Exxon in particular could not be trusted, that it and the other oil companies had been playing the state for a sucker in a “constant shell game.”
Even in november, I thought it apparent that Palin had returned to Alaska feeling she’d outgrown it. Three days after Election Day, she bounced--black-booted and BlackBerried--back into her governor’s office in Anchorage. After having been absent for more than two months, she paused to greet the assembled press.
The press? Half a dozen camera operators in boots, jeans, down vests, and flannel shirts; a couple of local television correspondents; a reporter from the city’s not-so-slowly-dying daily paper: This was the press? After what she’d seen, heard, and been besieged by for the past two months?
She put on her stiffest upper lip. “Good to be here!” she chirped. “Good to be here.” She waved and winked. “A lot to do, as every day is a full day here in the governor’s office, so, ah, anxious to get to talk to the folks who have been holdin’ down the fort and workin’ real hard also, but, ah, you know, it’s gonna be busy days here, just like it was busy days on the trail, ’cause bein’ the governor’s a full ti…a full time…in addition to bein’ a candidate. Now, of course, we get to concentrate just on...one of those.” The last three words--“one of those”--emerged with jaws so tightly clenched that it wouldn’t have been surprising to see a broken molar pop out.
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