Big Miracle (9 page)

Similar points were made following the 2010 deadly blowout of BP's Deepwater Horizon rig in the Gulf of Mexico. Why are companies like BP risking billions of dollars to drill so far out to sea and in waters so deep? Because environmentalists have succeeded in locking up available and accessible oil resources closer to shore not to mention dry land. Surely the oil companies would prefer to spend fifteen dollars to extract a barrel for oil in shallow waters, not to mention five dollars per barrel it costs on land, rather than the seventy dollars or more it costs to extract each barrel from deepwater wells.

If the BP disaster was caused by America's increasing reliance on foreign oil, then why have we locked up our domestic oil resources on land and in shallow waters in the Lower 48 and Alaska? The world's largest known oil shale deposit, the Green River Formation, lies under huge swaths of Colorado, Utah, and Wyoming. It is estimated to hold an astonishing 1.8 trillion barrels of recoverable oil; every drop of which is off limits.

Even the most alarmist projections about the BP disaster creating massive “aquatic dead zones”—which thankfully did not come to pass—paled next to supermassive aquatic dead zones that really do exist in the Gulf, created not by oil companies but by environmentalist and agribusiness demands that government mandate huge biofuel and ethanol production, which has dramatically accelerated corn farming, the colossal agricultural runoff of which is conveyed to the Gulf by the Mississippi River system.

Will the Gulf be cleaner after American oil companies are banned from drilling there? We can't ban Russia, China, Venezuela, or even Cuba from drilling in international waters—after all, we don't “own” the Gulf—which all four nations are now busy doing, less than one hundred miles from Florida. Will Chinese oil companies drill as safely as the American oil companies they would replace? Will Russian firms hire American workers? If so, will they pay their workers U.S. wages and protect them according to U.S. standards? Will Cuban oil rigs lessen America's dependence upon foreign oil?

One of the great ironies of the modern energy universe is that while governments around the world have dumped hundreds of billions of dollars into developing new “green” energies like wind, solar, and biofuel, nearly all the significant technology and production breakthroughs have occurred in the old-fashioned oil and gas industries. Everything from hydraulic fracturing that opens up huge new resources in shale to horizontal drilling that gets more oil from existing wells to new seismic technologies—they all mean we can open up literally oceans of untapped oil and gas.

If Outsiders knew anything about the Alaskan Arctic, most of it had to do with its native Inuit inhabitants—known commonly as Eskimos. For even the best educated, the history of the Inupiat Eskimo was a blank page. It wasn't much more than that to the Inupiats themselves. Most of what Outsiders thought they knew about the native Arctic people's way of life was incomplete, or even wrong.

Alaska's Eskimos never lived in igloos; they kiss just like everybody else, and they liked the accoutrements of the modern world. Few Americans were that familiar with Eskimo culture or history. They can hardly be blamed; there wasn't much recorded history to know. Few knew then or now that on a cash basis, Alaska's North Slope people were the richest in America. Nor did they know the reason why: oil. Before they realized its far-reaching potential to dramatically improve the quality and comfort of their lives, Inupiats were naturally uncertain about the impact oil development would have on their lives.

Inupiats wondered what impact it would have on their hard scrabble subsistence way of life. They found out with the passage of the 1971 Alaska Native Claims Settlement Act (ANCSA). The act was the first and last settlement between the United States government and the native peoples of Alaska for all the land and rights “usurped” or otherwise acquired by the federal or state government since the U.S. acquired Alaska from Russia in 1867 for $7.2 million—less than three cents an acre. The Alaska Native Claims Settlement Act awarded the natives a billion dollars and 45 million acres of Alaska's choicest land. The act gave Alaska's North Slope Eskimos power to tax their land, which just happened to sit atop trillions of dollars worth of oil and gas. Suddenly, Barrow was awash in cash.

For a village that had spent the previous few decades developing itself using whale meat as its primary means of exchange, Barrow's sudden petroleum based wealth brought enormous and mostly positive change. Not only were Barrow's elders not yet wise to the ways of managing money, most of them rarely used it. Illiterate subsistence whalers who didn't speak English were suddenly charged with figuring out how to manage multibillion-dollar portfolios. Inupiat culture faced a new but welcome challenge: progress.

Suddenly Barrow was not a forlorn frozen wasteland. It was the newest open gate to American opportunity on the Last Frontier. The newcomers descended on Barrow and reconstructed it in their own image. They came to build, manage, and profit from the remarkable societal transformation taking place. When the snow settled, Barrow had a new lifeline, a 7,000-foot jumbo-jet-ready commercial runway that connected the town with an Outside anxious to get in. Modern Barrow sprang up around the runway's southern edge.

The Arctic had a new and thriving bird: the construction crane. Modern prefab houses flown in from the Outside were assembled next to tiny driftwood hovels. Pathways were widened, sprinkled with gravel, and called streets. Several of them were laid out on tundra near the airport. For eleven months of the year they were frozen, snow-covered, and navigable. But in the short weeks of summer, when the top few inches of the 1,200-foot-thick permafrost melted with nowhere for the standing waters to go, Barrow's five miles of roadway were long thought impassable rivers of mud. Then a clever Eskimo mounted an old abandoned set of DC-3 aircraft tires on his pickup truck. The vehicle created a terrible mess, but the Eskimo got where he was going.

Barrow grew more in the twenty years since the oil discovery than it ever had. Its population increased about threefold to around three thousand. Although it was always the Alaskan Arctic's largest town, Barrow's sudden wealth put it on the fast track to veritable cosmopolitanism. It brought get-rich-quick schemers, wonderlust start-agains, real entrepreneurs, and plenty of Inuits from surrounding (a 1,000-square-mile radius) smaller Arctic villages anxious to experience life in the big city.

But having said all that, even with its Arctic-inflated two-billion-dollars' worth of oil-financed growth, Barrow in 1988 was still not a whole lot more than a tiny outpost at the top of the world. On foot, depending on the weather, the village was around five minutes wide by nine minutes long. The colder the temperature, the smaller the town got. People walk faster in the cold. But with all their newfound wealth, Barrowans proved themselves to be very much like the rest of us—they grew more sedentary. As a result, industries not thought needed in town emerged. In a town as small as Barrow, taxis did a booming business. There were at least three companies that each charged about twenty-five dollars for the five-hundred-yard ride from the bottom of the town to its top: the Top of the World Hotel. Eighty hotel rooms sprang up to accommodate an increasing number of business travelers looking to hawk their wares to nouveau riche Eskimos.

Barrowans didn't blanch at spending $200 million to build an all-glass, three-story office building, reputedly the most expensive per square foot building in the world. Nor did they balk at buying their children the world's most expensive school, but the $80 million price tag attached to Barrow High School included a modern basketball arena and the Arctic's only swimming pool—indoor, of course.

Not only was Barrow on the fast track, it could eat fast food on the way. Arctic Pizza delivered for just fifty dollars a pie. A cheap breakfast at Pepe's North of the Border Mexican restaurant could be had for as little as twenty bucks, and one even had a choice of Chinese. Good and bad. On Wednesday nights, Sam & Lee's offered egg roll specials for just eleven dollars. An extensive gas main network pumped the heating oil into dwellings of all kinds; rickety shacks to well-groomed homes. Women no longer needed to risk their lives collecting driftwood for heating from the frozen ocean shore. Virtually every home had telephones and electricity.

Even indoor plumbing was available, albeit at a nominal charge of $400,000 per hookup. Nimble ski machines whined past unemployed sled dogs. Barrow's high-tech television studio and satellite transmission and reception facility piped the world into the most modest Eskimo abode. Sonny Crockett and his fellow vice-fighting cops were as popular in snowbound Barrow as he was in his pastel-colored Miami.

Caribou, which migrated through Barrow backyards by the hundreds of thousands, could now be killed during commercial TV breaks just by sticking a rifle out the kitchen window. Their carcasses, dressed and hung frozen outside in the winter, could be quickly defrosted in Barrow's ubiquitous modern appliance: the microwave oven. In a place where the summer's highest temperature rarely rose above freezing, instant defrosting became a sudden necessity.

In less than a decade, Barrow went from being one of the poorest towns in North America to one of its richest. In fact, by 1988, measured in real dollars, Barrow had the highest per capita income of any city on Earth. Royalty payments from the North Slope oil amounted to more than $90,000 per person per year. But so inimical was this region to even the most basic elements of modern life that it took the world's highest per capita income to support a lifestyle the U.S. government still classified as impoverished.

Barrow was not only the world's richest poor town, it was also its most expensive. The one grocery store was as well stocked as any grocery in Alaska, but every item on the shelves was flown in from Anchorage or Fairbanks, where prices were high to begin with. By the time groceries reached Barrow, the prices were high enough for families with six-figure incomes in 1988 dollars to easily qualify for food stamps. Fresh milk was six dollars a gallon, corn flakes were seven dollars a box. As long as the price of hamburger hovered near five dollars a pound, subsistence hunting for many remained a necessity. Besides, most Eskimos, at least the older ones, preferred muktuk and caribou steaks to “white man's food,” which they considered bland and unwholesome.

Barrow's rapid-fire modernization gave the Eskimos the one commodity they never before had: leisure time. Since the beginning of time, whaling had been the backbone of Eskimo life. Whalers were once society's most important members; now that skill was no longer critical. Seventy percent of Barrow's working age populace depended upon government work programs for their livelihood. The only difference between them and the Soviet laborers who joke, “They pretend to pay us, we pretend to work,” was that the minimum wage was eighteen dollars an hour and the workers didn't even have to pretend.

Contact with Western society remained limited until the discovery of oil in the Alaskan Arctic. Suddenly, in the late 1960s, the Eskimos confronted wrenching change as they were forced to become part of American society. Barrow's sudden material wealth resulted in a monumental cultural meltdown. The Eskimos were collapsing under the weight of their own riches. The elders, who embodied Eskimo culture, were shunted aside by Barrow's new masters. Their talents no longer necessary for their people's survival, many of the Eskimo elite fell into despair.

Alcohol, already a severe problem, now impacted everyone, from the third of the town that were directly alcohol dependent, to the two-thirds who lived with them. The problems related to this scourge were Barrow's cross to carry into the twenty-first century. The primary difference between the late twentieth century and the period following the decline of commercial whaling was that Barrow's survival was no longer physical—it was spiritual and social.

Barrow voters overwhelmingly adopted a 1986 referendum outlawing the sale, consumption, and even possession of alcoholic beverages. The very people consumed with alcohol voted to ban it. It instantly became the most widely evaded law in town. Consumption actually went up, not down. Enforcement was impossible because everyone continued to drink. Bootleggers thrived. They were so confident they would not get caught, they had listed phone numbers and plastered advertisements across town. Before the media arrived to jack up the price, a case of beer or a fifth of cheap whiskey could be had for as little as one hundred dollars.

The local Eskimos of Barrow didn't have many positive local models to draw upon in the 1980s. Their town was so ravaged by alcohol and drugs it seemed unfazed by the regular drunken rages of its then mayor, George Ahmaogak. Just months after the whale rescue in January 1989, he was arrested on an Anchorage street for allegedly assaulting his wife with a metal briefcase after she reportedly refused to accompany him to another bar. News of his arrest ran on the front page of the
Anchorage Daily News
. No charges were ever filed.

But news of this kind was sadly neither new nor news to the people of Barrow. The problem was that there was so much bad local news. Barrow was no longer just an isolated Eskimo hamlet on Alaska's northern rim. Its sudden wealth made it a household name across the state, a name synonymous with fantastic and sudden wealth, corruption, and crime. But outside Alaska, Barrow remained on the periphery of America's geography and consciousness.

4

Here Come the Media

Oran Caudle wasted no time spreading the news. Immediately after KING-TV told him they were editing footage for the Thursday, October 13 edition of
NBC Nightly News
, he phoned home. He was so excited he dialed the wrong number twice before finally getting through to his parents back in Texarkana. He could hardly contain himself.

“Hello Mama, you're not going to believe this. I am producing a piece on tonight's
NBC News
. We are going nationwide!” he exclaimed in his North Texas drawl.