Several years ago the federal government lost north of half a billion dollars investing in a solar energy company called Solyndra. You may remember the faux scandal. Conservatives howled, how could the government "pick winners and losers?" Seriously! If a company can't make it in the free market, why should the public underwrite its risk?
Energy Secretary Steven Chu ultimately resigned because of Solyndra. If you divided that particular loss to the treasury, it worked out to be about $1.80 per American man, woman and child.
This week, in an equally sweeping act of corporate socialism, Alaska's self-proclaimed "conservative" governor signed off on a loan of $270 million to two Canadian companies to mine near Ketchikan. The companies couldn't get funding through normal channels because their plans are too risky. Banks -- and even mining speculators -- wouldn't back them, so their lobbyists turned to the state. Apparently their own country didn't want to lend them the money.
Can you hear the Republican outrage?
Nope. Oh, I understand the people who pushed this want the promised 390 jobs (many of which will likely go to Canadians) but at that price we could give every citizen of Ketchikan $33,540.37 in cash or pick a random 390 people and write them checks for $692,307.69. Hey, I'd rather give to Alaskans than Canadians -- at least they have health care.
In this particular case, Alaskans will pick up the tab for infrastructure costs that aren't profitable. If the mine makes money, the companies keep the profits. If it's a bust, the state eats the costs. Alaska doesn't even have an ownership stake in the mine if it succeeds. This deal is one more example of the Republican philosophy of socializing business risk and privatizing the profits. They just never seem to tire of transferring public assets to private corporations.
I'm not opposed to state investments that provide real public benefits -- like roads and docks, schools, libraries and health care. But this compulsion to underwrite private schemes with public money reeks of hypocrisy from those who decry "socialism" except when it benefits their political interests. Remember, this $270 million giveaway to Canadian mining companies is courtesy of a governor and Republican Legislature who proclaimed we couldn't provide health care for 43,000 Alaskans, even though it would cost the state virtually nothing, because, um, socialism.
Friends, this is not the Republican Party of Teddy Roosevelt.
Remember the state buying a jack-up rig to help Australian-based Buccaneer Energy and Ezion Holdings Ltd. of Singapore drill in Cook Inlet? At the time the deal was done, the Alaska Industrial Development and Export Authority said the state would get its money back in five years. The state invested $27 million and Buccaneer put in $6.9 million.
Last month Buccaneer filed for bankruptcy. Read this as "picked a loser."
Republicans, if you really believe in the "free market," put your money where your mouth is. Leave it in the state treasury instead of doling it out to politically connected companies. Your idea of a "free market" is costing Alaskans an arm and a leg.
Mining is the second largest export for Alaska. According to the Alaska Resource Development Council, total mining made about $1.6 billion dollars last year. Total tax and royalty payments? About $150 million.
That's $120 million less than we're loaning to these Canadian companies for the presumed benefit of one community. Another way to look at it? That's less than 1 percent in taxes. The fishing industry pays more than five times what mining does. I don't want to burst any biology bubbles here but if you put a boy fish and a girl fish in a stream, you get more fish. If you put two gold nuggets in a bag and send it to Canada, you have next to nothing. One of these is a renewable resource; the other is dug from the ground and gone forever.
A principled conservative would say we're better off leaving it in the ground for future generations than we are paying a foreign corporation to take it now for a pittance. But then that wouldn't generate a whole lot of political contributions for the next election, would it?
Shannyn Moore is a radio broadcaster. You can hear her show, "The Last Word," Monday through Friday from 4 to 6 p.m. on KOAN 95.5 FM and 1080 AM and 1480 We Act Radio in Washington, D.C., and on Netroots Radio.