News, notes, and observations from the James River Valley in northern South Dakota with special attention to reviewing the performance of the media--old and new. E-Mail to

Sunday, November 3, 2013

They call corruption "economic development."

South Dakota's business climate is often rated as number one, and that may well be because it is the most corrupt. 

It is a state that raves about free enterprise, but free enterprise is interpreted as being free to screw customers and bilk taxpayers.  The Governor's Office of Economic Development is undergoing investigation which appears to lead to many avenues of perfidious connivance, actually dark and seamy alleys of larcenous enterprise. The now-defunct Northern Beef Packers plant in Aberdeen seems to be at the center of the investigations, but its relationships with state and local government-sponsored organizations are typical of other situations in which the government has been involved in providing special and secret advantages for business operations, few of which have the trappings of open and honest dealings.   

A majority of people in South Dakota accept under-the-table and behind-closed-door transactions as business as usual.  For years, South Dakota has striven mightily to be at the bottom of the Better Government Association's Integrity Index for state governments.  Many times, it has succeeded.  In the latest Index, it is ranked 47. 

State officials have discretion about making sensitive records secret.  When records do not have to be made available to the public and there are no sunshine laws requiring them to be produced at some point, officials have no need to conduct themselves forthrightly and above board.  So, they don't.

The right to do business in clandestine and prejudicial ways has even been written into state law.  An example is when Dick Butler, a Democrat, was state treasurer from 1995-2002.  When Butler took office, he instituted a number of reforms.  This spurred  the Janklow administration to campaign to cut Butler off from access to information on state financial matters and to restrict his authority in exercising the office of treasurer.  The Lakota-Dakota-Nakota Coalition, which has a full account of Butler's work, recounts, "The Commissioner of Banking in South Dakota, Richard Duncan, wrote a memo to all state banks in South Dakota advising them not to give information to Butler regarding executive accounts, and a bill was proposed that was intended to strip the State Treasurer of his banking authority for colleges and universities."

In 1996, Governor Janklow initiated a gag law that would restrict Butler's activities.  The law selectively closed  corporate records and prohibited state officials from disclosing information on investigations into the actions of corporations, even the fact that such an investigation was taking place.  Janklow's chief henchman in shepherding the law through the legislature was then Senate Majority Leader Mike Rounds.  The law has since been revised, after a number of challenges pointed out that it violated every aspect of a democracy.   

As Governor, Mike Rounds was involved in the beef plant scheme when it was first advanced in Huron under the Ridgeway Farms schemers, then floundered and went to Flandreau, where it seemed to die until it popped up again in Aberdeen. 

Even where information is available, the press has not tracked the state's involvement in economic development.   One thing it could have done and can do is track the number of enterprises to which the state has contributed money and adjusted rules and regulations and kept an account of how many such enterprises succeeded, fulfilled expectations to some degree, or failed. 

The only place any account of Dick Butler's tenure as state treasurer appears is at the Lakota-Dakota-Nakota Coalition, which is largely based upon reporting from the Lakota Journal.

State government is corrupt. The record is long and detailed, as the Coalition points out.   It gets lots and lots of help. 

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Aberdeen, South Dakota, United States