PROPER PRIVATIZATION …
South Carolina governor Henry McMaster – the consummate political insider – surprised us this week by taking a page from the playbook of fiscally conservative State Senator Tom Davis, a maverick political outsider.
McMaster said he was considering the sale of government-owned energy provider Santee Cooper as a way to advance a recently abandoned nuclear power project in the Palmetto State.
Davis – who is eyeing a possible gubernatorial challenge against McMaster next spring – first proposed the sale of Santee Cooper last week.
“We must begin debating whether privatizing that utility would be in the people’s best interests,” Davis said at the time. “I believe it would.”
McMaster seems to agree … although it is worth taking a moment to ponder the vastly different paths traversed by these two elected officials in reaching this common ground.
To recap: The debate over Santee Cooper’s future comes in the aftermath of the utility’s controversial decision to bail on the V.C. Summer nuclear power project – which would have resulted in the completion of a pair of new nuclear reactors in Jenkinsville, S.C.
That decision killed 5,000 jobs, squandered billions of dollars in investment (including $2 billion coughed up by Palmetto State ratepayers) and threw the state’s energy future into chaos.
Santee Cooper partnered on the V.C. Summer project with SCANA, a private sector energy provider that had planned to move forward with the construction of the two reactors – until it was sandbagged by the utility’s political appointees. Just one week prior to pulling the plug on this project, Santee Cooper’s board members – all appointed by the governor’s office – announced rate increases for customers based in large part on “nuclear construction” needs.
Eight days later, though, came the sucker punch … an announcement that there would be no “nuclear construction” after all.
Santee Cooper’s announcement has sparked widespread public outrage … which has sent McMaster and other establishment politicians indebted to the government-run energy sector scurrying for political cover (and belatedly acknowledging that Santee Cooper needs to be sold).
Actually, it should have been sold decades ago …
(Click to view)
(Via: S.C. Governor)
Davis said he had “mixed feelings” on McMaster’s announcement regarding the privatization of Santee Cooper.
“On one hand, I am encouraged to hear (McMaster) acknowledge what limited-government advocates have been saying for years,” Davis said. “On the other, however, his stated reason for considering a sale of Santee Cooper is wrong. He sees a sale of Santee Cooper not as a way to get government out of the power-generation business, but as a means of funding its continued involvement.”
According to Davis, McMaster’s privatization plan would be dependent on government dictating a specific outcome – the completion of the Jenkinsville reactors.
“Completing those reactors might ultimately be found to be in our best interests; it might not,” Davis said. “But that decision cannot be made by politicians; political fingerprints are already all over our state’s power-generation industry and the consequences of that meddling have been laid bare. It has to stop.”
Indeed … the meddling of politicians in this industry is precisely why South Carolina ratepayers now find themselves holding the bag for this project.
So … what’s the answer?
“We must we start taking broader steps to restore market forces in our energy sector and take as much power as possible out of the control of politicians and their special-interest supporters,” Davis said. “Nothing less will suffice.”
We concur … although Davis’ next comment represents the real challenge.
“Nor should we stop there, for this isn’t just about a government-run utility and a government-subsidized energy provider catastrophically mismanaging risk,” he said. “More broadly, it’s about insisting that state government focus on core functions and stop meddling where it does more harm than good.”
Amen to that …
As we’ve written on numerous occasions in the past, South Carolina’s “Republican” leaders are addicted to taxing, borrowing and spending – yet their ever-escalating investment in big government continues to produce terrible outcomes for the people they claim to be serving.
Despite putting taxpayers on the hook for billions of dollars in new spending, the Palmetto State keeps falling further behind the rest of the nation – economically, fiscally, educationally and with regards to infrastructure, public safety and other core functions of government.
Enough is enough. It is past time South Carolina’s “leaders” heed Davis’ advice and fundamentally reconsider what tasks government should and shouldn’t perform – and then amend government’s structure (and spending) accordingly.
That is the ultimate lesson to be learned from the #NukeGate debacle …
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