SHARE

Shortly after her 2010 election, Nikki Haley picked a high-profile fight with Georgia – sending a clear warning across the Savannah River regarding port-related issues.

“You now have a governor who does not like to lose,” Haley told a crowd of S.C. State Ports Authority supporters in Charleston. “Georgia has had their way with us for way too long, and I don’t have the patience to let it happen anymore.”

Georgia wasted no time in firing back … pointing out that South Carolina’s competitive position has slipped in recent years to the point that it no longer views the Palmetto State as competition.

“We’ve never looked at Charleston as a competitor,” Georgia’s port leader told The New York Times in December 2010. “All you have to do is look at the numbers. The stats speak for themselves.”

He’s absolutely correct … once the fourth-busiest port in America, Charleston has seen its competitive position plummet over the last seven years. In fact, Charleston has slipped all the way to No. 12 in the nation according to the American Association of Port Authorities.

Why the decline? Well, as we’ve noted on literally dozens of occasions, South Carolina continues to operate its port system under a 1950s-style “total state control” model – one that forbids private investment in public infrastructure. Meanwhile our competitors – like Alabama and Virginia – have dramatically expanded their port infrastructure (and created thousands of new jobs) by leveraging private investment.

In fact, our state’s leaders – including House Speaker Bobby Harrell and Senate President Glenn McConnell – were specifically warned in July 2006 that South Carolina’s restrictions against free market investment were “counterproductive” and would “discourage investment” in our facilities.

Anyway, Haley has done nothing to change that failed management structure since she was elected – but within the last month her stance on Georgia’s ports has softened dramatically.

“Every port is different, and every port has its challenges,” Haley told Savannah’s WJCL/FOX 28 last month. “We have to say ‘What do we need to do that is right for the region?’ Our goal is to make sure every port (in the region) is successful.”

Um, here’s a news flash for Haley … the Port of Savannah is already successful. In fact, it’s the fourth-busiest port in America (i.e. right where Charleston was seven years ago).

Accordingly, she should be focused on leveraging public-private partnerships to expand capacity in Charleston and build a port in Jasper – two goals which this state should have completed years ago.

Is that what she’s doing, though?

No. Apparently she’s too busy bending over for Georgia.

Specifically, Haley recently allowed Georgia officials to make their case for a $600 million harbor deepening project to the S.C. Department of Health and Environmental Control (DHEC) – whose board Haley recently took over. Had Haley not intervened on Georgia’s behalf in this matter, DHEC could have unilaterally rejected the permit appeal ruling its officials are seeking as part of their effort to deepen the Savannah River (both Savannah and Charleston are working feverishly to deepen the waterways leading to their ports in the hopes of accommodating the next generation of super-sized container ships).

Haley’s own accommodation on this issue – praised effusively last week by Georgia Gov. Nathan Deal – strikes us as overly-generous treatment in light of the way Georgia recently back-stabbed South Carolina on a bi-state port deal.

But why did Haley – who talked such a tough game – decide to back down on such a critical issue?

According to our sources, Georgia business leaders are telling South Carolina lawmakers and port officials that Haley’s loyalty was purchased.

Specifically, these sources say that Haley was recently feted at a high-dollar fundraiser in Atlanta, Georgia – an event that included several major donors with ties to the Port of Savannah. No such event is listed on Haley’s schedule – although the one-time “transparency” champion hasn’t exactly been forthcoming about these get-togethers.

The most recent fundraising quarter ended on September 30 – which was prior to this alleged event being held. Haley’s next campaign finance report isn’t due until January 10, 2012, but you better believe that shipping interests in Charleston (and free market port supporters in Beaufort and Jasper Counties) will be examining that document very closely.

“She’s vulnerable on this big time,” one South Carolina lawmaker told FITS. “We  are talking about billions of dollars going to the state that wins this race.”

Stay tuned … we hope to have a lot more on this developing story in the days to come.

***