By Tribune-Review

Published: Wednesday, June 6, 2012, 12:30 a.m.
Updated: Wednesday, June 6, 2012

The first word that comes to mind as details begin to leak about what carrots were hung from what sticks to lure Shell to Beaver County to build a multibillion-dollar ethane "cracker" plant is "BLECH!" (as in "disgusting"). For Pennsylvania has been down this road before. Think Volkswagen, Sony, Kvaerner and Comcast, among others.

The proposed plant is designed to appropriately exploit the region's growing Marcellus shale natural gas industry. It's an exciting new industry with the greatest of promise -- for jobs, the economies of local communities, support industries and for companies such as Shell, which stands to make huge profits from the cheap and abundant shale gas byproduct.

So, why should Shell be offered an "incentive" package that, by one accounting, totals $67 million annually for a quarter of a century or nearly $1.7 billion? In fact, according to another accounting, not only would Shell end up not paying any taxes, taxpayers effectively would end up paying Shell -- and all with no guarantee of jobs created.

Jake Haulk, president of the Allegheny Institute for Public Policy, says Pennsylvania taxpayers should not be forced to invest in any project that should be able to forecast sufficient profits to justify building the facility. He sees the "incentives" as "little more than an insurance policy" against future "market vagaries."

Just as government has no business turning taxpayers into venture capitalists, "Taxpayers should not be in the insurance business," Dr. Haulk reminds us in an email.

Defenders of this deal (details of which the public is learning far too slowly) will trot out some oldies but goodies from the Shibboleth of the Month Club:

• If Pennsylvania didn't offer Shell not just a slice of corporate wealthfare but the whole pie, "competing states," such as Ohio and West Virginia and offering almost as large carrots, would have landed the cracker plant.

• And Pennsylvania's "lack of foresight" to make such an "investment" would mean forfeiting tens of thousands of jobs.

But as the Allegheny Institute's Haulk reminds: "Even if Shell decided to go to West Virginia or Ohio, a large percentage of the gas it uses would still have to come from Pennsylvania. ... This is all about generating demand for Marcellus gas to keep activity going in that direction. ... We do not need to give away the store to keep Marcellus production up.

"What's more," Haulk adds, "if we start down this road, how much will we have to give to companies that promise to build plants to use the cracked ethane (used in the making of plastics)? A slippery slope is what this is."

Pennsylvania taxpayers have hosed down far too many Slip'N Slides over the years. And they've drowned, repeatedly, in promises that turned out to be belly-smackers. They don't deserve to be hosed again.

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