It's no surprise that the oil industry insists it can't stomach any increase in Alaska taxes or any decrease in the flow of hundreds of millions of dollars in annual state cash rebates.

The oil companies, large and small, are fighting every element in House Bill 247, a proposal from Gov. Bill Walker that would increase oil taxes by about $100 million and reduce the amount the state is paying every year in subsidies to oil companies by about $400 million a year.

Armstrong Oil and Gas Chairman Bill Armstrong, never at a loss for a colorful phrase, says the measure is known inside his company as "Hell Bent 24/7 to Run Every Oil Company off of the North Slope." He also said that the generous tax credits in Cook Inlet created the "greatest tax regime on the planet" for oil companies.

To put HB 247 in context, a $100 million oil tax increase would be about half of what would come from the state income tax proposed by the governor. It would be about double what would come from his proposed increase in motor fuel taxes.

What fate awaits the various tax proposals in Juneau — none of them wildly popular — is anyone's guess. One point to remember about the oil revenue plan is that it centers on cutting state subsidies, not increasing taxes, though the industry tends to treat them as one and the same.

The state's practice, easy to overlook when annual oil income ran in the billions, has been to hand out millions in refundable tax credits without knowing whether the subsidies were sound investments.

The exaggerated language decrying anything that would cost the companies more stems from a political reality — any company or industry group that hints it can accept a dollar more in taxes or a dollar less in state subsidies will be inviting legislators to raise the tally.

The plan to increase the gross minimum tax from 4 percent to 5 percent — which comes into play only at low oil prices—is an example. "While a one percentage point increase might not sound significant, it would represent a 25 percent increase for those companies that already pay the 4 percent tax," the Alaska Oil and Gas Association said.

The companies fear a slippery slope, a consultant for the Legislature said.

Something like that happened a decade ago, when former Gov. Frank Murkowski got the three major oil companies to sign off on an oil tax plan, which became the all-clear signal for others to up the ante.

At prices below $40 a barrel, companies are losing money, but no one who sees a future for the oil industry in Alaska believes the price will stay this low.

If oil prices do not double or triple from the current level, anyone with a job or a house in Alaska will be watching nervously to see how far and how fast the economy shrinks.

The undeniable problem today is that oil tax collections and oil subsidies are out of balance by hundreds of millions of dollars. The drop is not a slippery slope but a free fall.

If the state repealed its entire production tax system and set the oil tax at zero, the financial ledger would be strengthened by stopping the flow of hundreds of millions from the state to the industry. The state is paying up to 65 percent of the cost for many projects during the development phase.

The House Resources Committee, which has several members who would love to see Walker's bill killed, has already held more than a dozen hearings on the measure.

As it tries to deal with the multibillion-dollar shortfall, the Legislature is under pressure to do something about stemming the cash credits — which are close to $1,000 per Alaska resident. The state predicts a total of nearly $1 billion in refundable credits over the next two years, a little more than half on the North Slope.

These are difficult questions about how much of a subsidy Alaska can afford and which projects are great investments that will promote more competition, lead to more oil production and benefit Alaska. Given what is happening in other parts of the state budget, the argument for cutting subsidies is a strong one.

The biggest revenue measure likely to emerge from the Legislature this year is a withdrawal from the Permanent Fund Earnings Reserve, the account that funds the Permanent Fund dividend. While extra billions are in that account at the moment, the longer the oil price downturn continues and the longer stock market returns are less than stellar, the greater the pressure will be on future dividends.

Permanent Fund earnings have to be a part of a fiscal plan for the state. Nothing else comes close to filling the gap or preserving the economy.

But if the Legislature withdraws a large sum of Permanent Fund earnings without also reducing oil company subsidies, enacting an income tax and taking other steps to create the sense of a shared burden, incumbent legislators will be handing a powerful campaign weapon to their challengers this year.

From the right and left, it will be something along the lines of: "You want to take my dividend while protecting the oil companies and rich people."

It's not saying it's fair, just that it will happen.