European vacation or legitimate business? Haley's fiscal priorities under fire as summer 'jobs' trip detailed

Nikki Haley

Gov. Nikki Haley's weeklong trip to Europe in June in search of "jobs, jobs, jobs" cost South Carolinians more than $127,000. But the governor and her entourage of more than two dozen returned without any finished deals to bring new employers to the Palmetto State.

Haley, who captured the governor's office preaching fiscal restraint, spent the cash so she, her husband and the rest of the state's contingent could stay in five-star hotels; sip cocktails at the Paris Ritz; dine on what an invitation touted as "delicious French cuisine" at a swanky rooftop restaurant; and rub elbows with the U.S. Ambassador to France at his official residence near the French presidential palace.

The South Carolina group also threw a soiree at the Hotel de Talleyrand, a historic Parisian townhouse where they feted foreign employers in hopes they'd set up shop in South Carolina. The Department of

Commerce billed the $25,000 event as a "networking opportunity for members of the South Carolina delegation."

"It was a great party," Commerce Secretary Bobby Hitt said in an interview last week.

Expenses from the trip still are being submitted, Hitt said. The $127,000 figure represents spending only by the Commerce Department, which covered many but not all of Haley's expenses, he said.

It's unclear exactly what Haley accomplished during the taxpayer-funded excursion. Many documents released Monday to The Post and Courier in response to a July 7 Freedom of Information Act request were heavily redacted.

During a press conference -- unrelated to the trip -- Friday afternoon in Charleston, Haley told the newspaper the state "closed two deals" while abroad. She referred further questions to the Commerce Department.

In a follow-up interview Friday, Hitt said the state, in fact, closed no deals. Two agreements involving foreign employers are in the works, he said. He provided no details.

Spending criticized

Critics called the mid-June trip an inappropriately timed junket: It took place at the zenith of legislative debate over the tightest budget in recent history.

Benefits of the trip for South Carolinians -- who confront an unemployment rate of almost 11 percent -- are unclear, said the critics, who include a respected state senator from the governor's own party and a Columbia Tea Party organizer.

John Crangle, executive director of South Carolina Common Cause, asked, "What did they bring home from the hunt?"

Crangle, whose organization is a government ethics watchdog, then answered his own question: "They came back with an empty whiskey bottle," he said. "Or I guess since they went to the Ritz it was an empty Champagne bottle. They had a good time at the state's expense."

S.C. Democratic Party Chairman Dick Harpootlian said Haley was "channeling Marie Antoinette."

"Has the average South Carolinian ever stayed in a $650 a night hotel or spent almost $4,000 in one week on airfare?" Harpootlian said. "Her response to the people who footed the bill would be, 'Let them eat cake.' "

S.C. Sen. Tom Davis, a Beaufort Republican, called the logic of economic development trips "flawed."

"If you get the fundamental things right -- solid education and health care -- capital will come to the state," Davis said. "Those are the functions of government. Not creating jobs. ... It's a socialist state when the government's core function is to create jobs."

But Hitt, the Commerce secretary, defended the excursion as a "vital link" for attracting foreign employers to South Carolina instead of other nearby states.

"We have to go out and market ourselves," he said. "It's a tough game to play."

Following repeated requests, Haley spokesman Rob Godfrey said Thursday he would "find three to five minutes" for a phone interview with the governor, but by Friday Godfrey said in an email "the governor is not available." Godfrey said in the email that the governor had offered the newspaper an "exclusive opportunity to accompany the delegation" to Europe to "cover, first hand, the productivity of the trip." The newspaper declined.

Godfrey had requested an emailed list of questions for this story, but he did not respond to them. In a statement, he said: "Governor Haley will never miss an opportunity to talk about our great state's business opportunities to companies across the world -- and that's what her trip to Europe was about."

The newspaper briefly spoke with Haley after finding her at the Charleston news conference Friday.

Accomplishments?

Haley and the two dozen-member South Carolina contingent traveled to France and Germany the week of June 18. They attended the International Paris Air Show at Le Bourget and toured BMW headquarters in Munich.

A daily itinerary shows the governor and her staff scheduled more than 20 meetings in France and Germany, but the details are heavily redacted because they contain "confidential proprietary information," the governor's attorney said in a letter. Among the only unredacted business meetings were appointments with Boeing and BMW, which already have large operations in the state.

Haley's office cited no expectations or results involving the mission, although the newspaper specifically requested both in its Freedom of Information Act letter.

The governor had planned to discuss economic development progress with the media during her trip. Her itinerary twice shows time set aside for "availability with South Carolina media." But the time slot was 10:45 a.m. Paris and Munich time -- that is 4:45 a.m. South Carolina time.

Haley did, however, express her hopes in a YouTube video shot at the Paris Air Show on June 20. In it, she said Boeing's arrival in South Carolina has fanned the interest of "so many suppliers who are looking to do business here." She continued: "We will continue to work on jobs, jobs, jobs, but just know that everybody in this beautiful city is talking about our beautiful state of South Carolina."

The state's official overseas economic development missions date to the 1960s, when the textile industry's decline made officials scramble to find replacements, said Douglas Woodward, a professor at the University of South Carolina's Darla Moore School of Business.

"It laid the groundwork for the revitalization of the state's economy," said Woodward, who specializes in economic development studies. "German chemical companies and BMW put us on the map. Before that, I'm not sure that Europeans would know where we are. ... The benefits can be enormous, but it takes time."

Critics, though, are wary of vague benefits, saying state officials shouldn't waste taxpayer cash on overseas trips while simultaneously approving deep cuts in education and health care spending.

"It's hard to know whether or not there was any benefit to these trips," said Crangle of Common Cause.

Allen Olson, an organizer for the Columbia Tea Party, said he wants to know how the money was spent.

"If there was waste, we have a problem," he said.

Upgrading to compete

South Carolina has had a presence at the Paris Air Show each year since 2005. Gov. Mark Sanford, who took at least one major international trip each year he was in office, had attended.

The Commerce Department did not respond last week to a request for Air Show spending details for each of those years.

This year, though, the state had some upgrades.

For the first time, South Carolina abandoned the standard booth in favor of a "chalet," an area with shared conference rooms, business equipment, private bathrooms, a patio and a "beverage service," Hitt said.

"My view was that we needed something different. ... It's more professional," said Hitt, a former BMW executive who filled the Commerce post in January. "The things we did this year are the things we have to do to be successful."

By comparison, North Carolina's commerce department got a booth and sent seven people to the Air Show, spending about $112,000, according to a spokesman for that state. Georgia sent two people and had no booth, a spokeswoman for that state said.

Neither state's governor attended the show.

Critics such as Harpootlian, the Democratic party chairman, said ancillary industries connected to Boeing and BMW would be unswayed by the governor's visit to Europe. Suppliers would follow the major industries to the state regardless, they said.

"At this point you don't have to go pitch them," the Columbia attorney said. "They will come here."

But Hitt said South Carolina must make a grand appearance at the show to compete with nearby states like North Carolina and Georgia for the new employers.

"It's naive to think people will show up no matter what," Hitt said. "Simply responding to emails and phone calls -- it's not the way it works."

Harpootlian countered that argument, saying, "You can recruit employers without staying in a five-star hotel."

Hitt, who originally denied the group stayed in five-star accommodations, said, "We have a special rate we worked out."

The average daily rate for the governor's hotels was $430, according to the Commerce Department.

More perks

When they weren't dining out, Haley and her entourage had "warm meals" delivered to their hotel rooms. They used the "VIP access" at the airport, according to an itinerary. Airfare to and from Europe cost about $1,530 per person, according to travel receipts from the governor's office.

Some members of the group also traveled by plane and train while in Europe, trekking to the German cities of Munich, Dresden and Stuttgart. Airfare from France to the German cities cost about $2,000 for Haley alone, the records show.

Michael Haley -- the governor's husband, who is a technician for the South Carolina National Guard -- paid his own travel expenses, according to Commerce Department. He traveled by train to the German cities, where he attended meetings with the U.S. Europe and Africa Commands. Hitt, the Commerce secretary, said those meetings also involved economic development.

Commerce officials said 27 people were in the South Carolina delegation, which included staffers and security agents from the governor's office, managers from the Commerce Department, S.C. Sen. Hugh Leatherman, a Florence Republican, and Columbia Mayor Steve Benjamin. The group charged more than $5,100 in per diem expenses to the state, according to the Commerce Department.

About a dozen members of the group represented the state's regional economic development "alliances." Eight of those groups, which receive a share of tax dollars, contributed $8,000 apiece to help cover the trip's expenses.

Additional overseas economic development trips are on the horizon.

Hitt said last week he is planning a trip abroad later this month. He said the governor would not be attending, but he declined to provide any further details.

Haley's June trip, her first overseas trip as governor, is not likely to be her last.

India is one location she has considered. Haley met Meera Shankar, the Indian Ambassador to the U.S., in Washington, D.C., earlier this year, according to a March press release posted on the ambassador's website. At that time Haley said she wanted to "visit India along with a trade and business delegation," the release said.

Reach Renee Dudley at 937-5550.