It’s encouraging that a Sunday Eagle article on the experience of Tunica, Miss., with the Sumner County casino candidates found that all three — Harrah’s, Marvel and Penn National — run good operations. All hire locally. All contribute generously to local charities. All have minimal regulatory violations.
The positive record should reassure Kansans wondering which one of the casinos will win the bidding for a Sumner County casino.
Seems that in practice, they’re pretty much the same.
It’s still unclear whether a casino will provide a net gain to south-central Kansas, but the article should at least quiet critics still predicting that any casino will bring economic ruin and rampant corruption to the area.
That hasn’t been Mississippi’s experience with these companies.
The tomato scare and the South Korean mass demonstrations over U.S. beef imports brought to mind, for New York Times columnist Paul Krugman, the case of Arkansas City’s Creekstone Farms Premium Beef, which in 2004 was prohibited by the U.S. Department of Agriculture from testing all its cattle for mad cow disease “because other beef producers feared consumer demands that they follow suit. When push comes to shove, it seems,†Krugman wrote, “the imperatives of crony capitalism trump professed faith in free markets.â€
Krugman’s broader point was “that failure to regulate effectively isn’t just bad for consumers, it’s bad for business.â€
The fight over a western Kansas coal-plant expansion is more than legal and regulatory. It’s also political. The Kansas Chamber of Commerce is using the issue to raise money for its political action committee, with chamber president and CEO Amy Blankenbiller claiming in a letter that the air-permit denial of the plants “will have a chilling effect on Kansas’ entire business and manufacturing community.â€
But that “effect†is speculative at best. Obviously, the chamber is going to support candidates who support business, but shouldn’t that support be based in fact rather than fearmongering?
The oil industry is ramping up its “clean coal†ad campaign, observes Diane Silver, complete with Kool and the Gang singing “Celebration†— and all three presidential candidates seem to be buying the coal industry’s line that “technology will fix everything.â€
But experts say carbon-capture technology is years away, and may never be viable, she notes. And the energy industry, one analyst says, is facing a “de facto moratorium on coal power.â€
The good times for coal might be coming to an end.
Here’s an idea that Kansans on both sides of the fight over a proposed Sunflower Electric Power Corp. coal-plant expansion ought to be able to get behind, now that it’s clear Gov. Kathleen Sebelius’ latest veto will stand:
“I think what would be good news for the people of Kansas would be if Sunflower and the executive branch could sit down and start talking about real alternatives for meeting the base-load energy needs for western Kansas,†said state Rep. Tom Holland, D-Baldwin City.
Unfortunately, Sunflower may just want to carry on the fight in court. “We remain committed to providing reliable electric generation and transmission services to our member owners in central and western Kansas, and the Holcomb expansion is part of that mission,†said Earl Watkins, Sunflower’s president and CEO, in a written response to legislators’ decision not to try again for a veto override.
Kansas is represented on both sides of the congressional debate on what to do about high gas prices, and specifically a House-passed and Senate-blocked plan to rescind $18 billion in tax breaks for big oil companies.
“I don’t understand what some members of Congress tell their constituents,†Rep. Nancy Boyda, D-Topeka, told the Topeka Capital-Journal. “They send $18 billion to big oil when people are paying $3.45 for gas. Our farmers and businesspeople are getting hurt badly. Working people are struggling.â€
Countered Rep. Todd Tiahrt, R-Goddard, who voted against shifting the tax breaks to renewables: “Any tax increase that Congress imposes on the oil companies would only be paid for by consumers through boosted prices at the gas pump.â€
The Senate went into this week’s debate on revamping the air traffic control system having negotiated away the worrisome prospect of fees on general aviation’s airport use. Kansas Sens. Pat Roberts and Sam Brownback and Rep. Todd Tiahrt, R-Goddard, deserve praise for fighting hard against that funding method, which would have hurt Wichita’s planemakers by driving up the costs of owning and flying their products. Both the Senate proposal being debated and the House version, passed last year, would fund the new Global Positioning System for tracking air traffic through an increase in the tax on jet fuel used by noncommercial aircraft. Among the other pluses in the Federal Aviation Administration reauthorization bill: a three-hour limit on the amount of time airliners can hold passengers captive on a runway.
The editorial board of Alabama’s Press-Register declared a new leader in the “Boeing political hyperbole contest over the selection of Northrop Grumman-EADS and Mobile for the $40 billion Air Force refueling tanker†— the statement by Rep. Norm Dicks, D-Wash., that “Congress has a responsibility to correct one of the worst decisions in modern history.â€
Its editorial went on: “Presumably that covers wars, pestilence, dictators, assassinations, environmental disasters, economic errors, political gaffes and the University of Alabama’s hiring of Mike Price as football coach.â€
ll this would be funny, the board said, if Rep. Todd Tiahrt, R-Goddard, weren’t “threatening congressional legislation that would essentially take the contract away from Northrop Grumman-EADS. Now that would be a disaster.â€
A Missouri utility company has abandoned its plan to build a new coal-fired plant because of rising construction costs and an uncertain regulatory climate. But wait a second — supporters of the Holcomb power plant expansion claimed that Kansas Health and Environment Secretary Rod Bremby created regulatory uncertainty when he denied their permit. So how could there be regulatory uncertainty in Missouri, too? Simple — the regulatory uncertainty is the likelihood of federal carbon regulations, not anything Bremby did.
A statewide smoking ban appears dead for the legislative session, the arguments for business rights and local control having prevailed. But clean-air proponents are calling for it to be a campaign issue. They’re also calling it inevitable. “Ultimately we’ll have a smoking ban, and we’ll have one as soon as a majority of Kansans and elected officials see it in terms of a health question,†predicted state Sen. Pete Brungardt, R-Salina, to Harris News Service.
It always has seemed strange that the Kansas Department of Health and Environment regulates hog farms. Now, or rather effective Oct. 1, the Department of Agriculture will inspect restaurants. Public health experts warned that shifting the restaurant responsibility away from KDHE would “set food safety back†in Kansas, but the Senate passed the legislation unanimously, the House approved it 119-4 and Gov. Kathleen Sebelius signed it. Anybody else wonder if this has something to do with coal?
Although this will hardly be news to frequent flyers, a Wichita State University annual survey of airline quality found a continued deterioration of services, with an increasing number of lost bags, overbooked flights and consumer complaints. And the forecast doesn’t look good: “It’s just going to be more frustrating,” said study co-author Dean Headley of WSU.
It’s worth noting, though, that AirTran Airways, which operates at Mid-Continent Airport, scored tops in baggage-handling and came in second in on-time arrivals and departures.
Meanwhile, Congress heard testimony last week from a Federal Aviation Administration whistleblower who revealed the agency’s shockingly lax oversight of safety inspection standards that allowed planes with cracks in the fuselage to continue flying.
Train travel is looking better all the time.
“To hide their lack of any actual ideas about what to do, managers sometimes make a big show of rearranging the boxes and lines that say who reports to whom,†columnist Paul Krugman wrote. “You now understand the principle behind the Bush administration’s new proposal for financial reform: It’s all about creating the appearance of responding to the current crisis, without actually doing anything substantive.â€
Inventors, start your engines: There’s a $10 million award for the first person to build a commercially viable car that gets at least 100 mpg.
The prize is being offered by the X Prize Foundation, which offered a similar contest a few years ago for the first private group to send a human into space. The Automotive X Prize already has attracted 60 teams from 10 countries — although none of the major car companies has entered.
Among the entrants is Wichita’s own Johnathan Goodwin, who plans to enter a 1959 Lincoln Continental owned by rocker Neil Young that he’s retrofitting with an electric biodiesel hybrid engine. I wrote a profile of him awhile back.
It will be fascinating to see the finalists when they’re tested late next year. Here’s hoping Goodwin’s “Linc Volt†takes the prize.
More evidence for Kansas lawmakers that the rules of the energy game are changing: The Wall Street Journal reports that a new study by the Department of Energy’s Berkeley National Laboratory finds that many of the nation’s utilities have begun including the cost of carbon regulation in their planning. But it advised that many probably are underestimating those costs.
“If utilities estimated the future cost of GHG regulation compliance to be higher, that might lead them to invest less in fossil fuels and more in renewable energy,†the report said.
Energy efficiency also is playing a major role in utilities’ plans for lowering their carbon profile.
A new Wichita State University study confirms what Fair Fares supporters have long argued: that public subsidies to lure low-cost carrier AirTran Airways to Wichita have paid for themselves many times over in economic benefits.
The study by WSU’s Janet Harrah found that landing AirTran has brought about 9,700 new jobs to Wichita with a payroll of $238 million.
Moreover, local and state governments, which have contributed $22.3 million to AirTran in the past six years, have received about $70 million in taxes.
And passengers and businesses have benefited from the lower fares. In 2002 alone, Wichita airport passengers saved an average of $84 per ticket — almost $84 million total that year alone.
Not a bad return for the investment. This is a good example of the kind of smart economic development effort that can pay big dividends for a community.
It’s good that Wild West World has a buyer and that the defunct theme park could have another shot at succeeding. Murphy Brothers Exposition of Tulsa has signed a contract, though other bidders have until May 8 to top the offer. The rock-bottom $2 million sales price for the $30 million park won’t help creditors much. But without the huge debt load and with more cash reserves, the park might be able to make it this time. We hope so.
Air Force officials say European Aeronautic Defense and Space Co., parent company of Airbus, built a $100 million fuel boom on spec to demonstrate its technological know-how.
Boeing, meanwhile, promised a new boom but didn’t build a prototype.
It was that kind of aggressive one-upmanship from EADS/Northrop Grumman that apparently made the difference with Air Force officials, according to a New York Times story.
“Northrop Grumman brought their A game,†Sue C. Payton, assistant secretary of the Air Force, told Congress last week.
Questions remain, though, whether the playing field was fair.
More ammunition for those looking to blame the tanker contract on John McCain: Associated Press reports that three of McCain’s current campaign advisers lobbied last year for EADS to get the contract over Boeing. Two ended their lobbying when they joined the McCain team. But one, former Texas Rep. Tom Loeffler, lobbied for EADS while serving as McCain’s national finance chairman. McCain’s presidential campaign also has received $14,000 in contributions from EADS employees. His campaign said that though McCain sent letters to the Pentagon in December 2006 urging the contract be awarded through an open competition, he had no role once rules were in place and bidding began. “All I asked for in this situation was a fair competition,†McCain said Monday.
As the national media awake to the Air Force tanker flap, much of the tone mirrors that of the New York Times’ editorial, which concluded: “For Congress to reverse the decision on ‘Buy America’ grounds would be bad for taxpayers: requiring them to pay for aircraft that provide less value for the money. It would also be bad diplomacy and bad business. And that can’t be good for the country.”Meanwhile, the contract is fast becoming a partisan issue, and part of the presidential campaign, because of GOP candidate John McCain’s role in nixing the lease deal in 2004 and setting the rules for the do-over that went Airbus’ way. “Having made sure that Iraq gets new schools, roads, bridges and dams that we deny America, now we are making sure that France gets the jobs that Americans used to have,” said Rep. Rahm Emanuel, D-Ill. “We are sending the jobs overseas, all because John McCain demanded it.”
President Bush’s response to $103-a-barrel oil and $3.15-a-gallon gas has been to call for more U.S. drilling and, as he did Tuesday after meeting with Jordan’s King Abdullah II, to urge OPEC to pump more oil. But the New York Times editorial board — frustrated with the Senate’s Bush-sanctioned refusal to offset tax credits for wind, solar and other renewable fuels by eliminating equal credits for oil and gas producers — reminded Bush of something he said just three years ago: “I will tell you with $55 oil we don’t need incentives to the oil and gas companies to explore. There are plenty of incentives. What we need is to put a strategy in place that will help this country over time become less dependent.†Then the Times asked: “If that was true at $55 a barrel, why isn’t it even more valid and urgent at $100 a barrel?â€
Rep. Henry Waxman (in photo), D-Calif., recently expressed concerns that a government agency helping to finance Sunflower Electric Power Corp.’s proposed Holcomb coal-fire plants had not adequately accounted for the costs of future carbon regulation.
In response, Kansas Senate President Steve Morris, R-Hugoton, and House Speaker Melvin Neufeld invited Waxman to tour the existing Holcomb plant.
Waxman declined in a follow-up letter last week, citing scheduling difficulties, but he restated his principal concern, asking “whether RUS (Rural Utilities Service) analyzed the financial risks associated with climate change when it agreed to allow Sunflower and its partners to take on $3.6 billion of new debt to build coal-fired power plant units with large greenhouse gas emissions. I am concerned that if this financially risky project faces costs that were overlooked in the initial financial assessment, American taxpayers and Kansas ratepayers will be left to make up the difference.â€
He added, “I’m sure you would agree with me that safeguarding taxpayer dollars is one of the most important responsibilities of elected officials.â€
The state of Kansas spent nearly $1.5 billion in the past five years on various “economic development†projects, but it’s hard to point to clear economic benefits from the spending, according to a Legislative Division of Post Audit study.
From 2003 through 2007, the state agencies spent about $630,000 on “economic development†— most of that federal dollars. The state also had $860,000 in “forgone revenue†from tax credits, according to the study. And the figure doesn’t count the loss of some $400,000 in the next five years from the repeal of the state business machinery and equipment property tax, which was designed to spur economic growth.
What are taxpayers getting for the investment? It’s hard to quantify, because of the difficulty of tracing a direct cause-and-effect relationship between the spending and economic growth.
“A billion and a half dollars is a lot of money to put on the table without being certain what you’re getting in return,†noted state Senate Majority Leader Derek Schmidt, R-Independence.
Wal-Mart gets plenty of criticism about employee benefits and driving small retailers out of business. But it deserves credit for taking action on problems that Congress can’t seem to address.
“As the federal government debates how to wean the country from its addiction to oil, Wal-Mart just announced it would require suppliers to make major appliances that use 25 percent less energy within the next three years,†the New York Times recently reported. “While Congress wrings its hands over higher health care costs, Wal-Mart vowed to save companies $100 million this year by processing their prescription drug claims. (It already sells generic versions of prescription drugs for just $4, well below the national average.)†And since it started pushing compact fluorescent lightbulbs two years ago, Wal-Mart has sold 145 million of them, claiming to have saved enough electricity to forestall the need for three coal-fired power plants.
“We live in a time when people are losing confidence in the ability of government to solve problems,†said Wal-Mart chief executive H. Lee Scott Jr. But Wal-Mart “does not wait for someone else to solve problems.â€
Maybe Wal-Mart should tackle peace in the Middle East.
With more bleak national economic reports last week, it is reassuring that Wichita planemakers say that they should weather any slowdown in the U.S. economy. If fact, because of a backlog of orders, new models, increased international demand and the federal stimulus package, the companies expect continued growth for the next several years. “These are wonderful times for us,†Hawker Beechcraft chief executive Jim Schuster told The Eagle.
But the success of the airplane manufacturers also presents a challenge for our region and state. As J.V. Lentell, outgoing chairman of the Greater Wichita Economic Development Coalition, warned last week, other states will aggressively seek to lure away the companies. He said that Wichita and the state need to be ready to fight to retain these companies.
One state move that would help is funding for aviation training and research. Kudos to local lawmakers for helping last week to include $5 million in funding for each effort in the House Education Committee budget.
It’s encouraging that a Sunday Eagle article on the experience of Tunica, Miss., with the Sumner County casino candidates found that all three — Harrah’s, Marvel and Penn National — run good operations. All hire locally. All contribute generously to local charities. All have minimal regulatory violations.
