South Carolina prides itself on being a conservative state, having elected Republicans almost exclusively to statewide and national offices for the past 40 years. For most South Carolinians, “conservative” is not just a political moniker. It’s a personal affiliation, a belief system and a way of life.
It’s also a fiction. South Carolina is actually the opposite of conservative, at least by the conventional definition of a place where commerce is largely guided by market forces. In South Carolina, government is interwoven into the business sector to a greater degree than virtually any other state in the country.
We have, for example, one of the largest public railroads in America and one of the few ports that is entirely owned and operated by the state. The Legislature — specifically, about a dozen members — control the number of new hospitals that can open, the types of industries the state will recruit, and the amount of money taxpayers will spend to subsidize those industries.
The jewel in the crown of South Carolina’s political/industrial complex is Santee Cooper, among the largest public utility in America. Board members are chosen based on political connections, most lacking knowledge or experience in energy production.
Still, whether a company is public or private does not determine its performance. Governmental authorities can, and in many cases do, use their public sector status to promote programs that the market will not underwrite but are beneficial to citizens. Neither does government ownership always result in inefficiency and underperformance.
With this in mind, the question of whether to sell Santee Cooper to a private company ought not to hinge on ideology, or solely on its commercial performance. We should also consider the variety of ways the utility has advanced the public good.
Paradoxically, Santee Cooper has failed to deliver more public benefits than its private sector, investor-owned companions, and it has resisted almost every initiative that would provide even modest protection for the environment and public health, or that would help customers reduce power bills. It has even resisted complying with state and federal laws.
Seven years ago, following a scandal in which the utility was caught building a coal-fired power plant without federal or state permits, The Post and Courier’s Tony Bartelme explored the culture of the agency. The title of Bartelme’s article speaks volumes: “Santee Cooper allegations of racism, favoritism and environmental problems come amid billion-dollar miscalculations.”
On the modest side of those miscalculations is the $2 million civil penalty Santee Cooper paid for repeatedly violating the federal Clean Air Act. A few years later, the authority pushed forward — contrary to facts and logic, running roughshod over local and state opposition — with the construction of a new coal-burning power plant on the Pee Dee River.
The project would have been an economic catastrophe, and it would have emitted more than 30 times the federally allowed amount of toxic mercury into the atmosphere. The utility spent a quarter-billion dollars on land, equipment and parts prior to receiving the first federal or state permit. It spent hundreds of thousands of dollars on a public relations firm to promote the plant and, among other things, discount the seriousness of mercury contamination. Most of this investment was lost when Santee Cooper canceled the project a few years later.
Of course, these debacles pale in comparison to the loss of money, time and opportunity with the collapse of the nuclear project in Jenkinsville. Here, the utility sank billions in public dollars in a hole in the ground now filled with cement and rusting rebar. Formerly one of the state’s most valuable assets, Santee Cooper emerged from the calamity nearly insolvent.
Santee Cooper has for 80 years embedded itself into the soil from which it sprang, enabling and embodying the cronyism and bravado that characterize South Carolina’s political culture at its worst. Absent a seismic change in that culture, it would be a mistake to assume anything short of a sale to the private sector would stem the abuses, arrogance, mismanagement and waste.
Dana Beach is a conservationist and Charleston resident.