Kasich’s Jobs Ohio Legislation is Unconstitutional.

Kasich’s Jobs Ohio Legislation is Unconstitutional.

         Summary: this bill violates three sections of the Ohio Constitution:

               1. It is a special act conferring corporate powers. Article 13.01

               2. It involves the state and its credit in a joint venture with private interests and uses tax dollars to support this private corporation.  Articles 8.04 and 8.13.

       Section 13.01 of the Ohio Constitution forbids special acts conferring corporate powers–the legislature is not allowed to create a corporation, it can only write laws that govern the creation of private corporations by individuals.  This is not a law of general application to corporations throughout the state but is being created only to confer these powers on JobsOhio.

      The cornerstone of Kasich’s plans for Ohio is to privatize the Ohio Department of Development. He plans to do this by spending tax dollars to create and fund a private nonprofit corporation to do the work of this state agency.  The reason for this is that he claims business operates more effectively than government.  Government leaves a lot to be desired, but who really thinks that most businesses are run by geniuses?  Kasich worked for Lehman Brothers, one of the authors of our financial ruin.  That company was doing illegal and unethical things for the last 30 years.  They took outrageous risks with other people’s money, robbed them with impunity and then went belly up after becoming fabulously rich as a result of their unethical behavior.  That is where Kasich learned about business and how a business should be run, so any ideas he proposes based on business principles is highly suspect.

         Kasich’s experience with nonprofit corporations also indicates that he will misuse his power as governor if he is allowed to operate a government financed nonprofit organization.  While he was at Lehman, Kasich set up three political PAC’s that provided financial support for Don Thibaut and two other members of his Congressional staff for years.  Since these are private organization, no one knows what these men did to earn the money they were paid. 

       The JobsOhio corporation will be funded primarily from the general revenue fund, beginning with a $1,000,000 appropriation this year. This entity will be given massive amounts of tax dollars to run, despite the fact that it is supposed to be a private corporation.  It will be staffed entirely by private individuals except the governor will be chair of the Board of Directors. 

     Apparently, the Kasich administration considers the Ohio Constitution irrelevant when drafting legislation during his administration.  Its seems that it is relevant to his plans here.   Article VIII Section .04 reads: 

§ 8.04 Credit of state; the state shall not become joint owner or stockholder
The credit of the state shall not, in any manner, be given or loaned to, or in aid of, any individual association or corporation whatever; nor shall the state ever hereafter become a joint owner, or stockholder, in any company or association in this state, or elsewhere, formed for any purpose whatever.      This section was added to the Ohio Constitution in 1851.  This section was adopted after the state became involved in ventures with private companies and the state lost money when these deals went bad.  It forbids the state to finance or partner with private enterprise, but that is the basis of JobsOhio.  Since the state is totally funding this entity, to say it is anything but a joint venture with the state strains credulity.
In the 1960’s the Ohio Constitution was ameneded to allow some leeway in issuing bonds and other activities to make it easier to provide funding for public works projects and other agency activities.  But this section states that section 8.06 still applies for any expenditure of tax dollars:   “Laws may be passed to carry into effect such purposes and to authorize for such purposes the borrowing of money by, and the issuance of bonds or other obligations of, the state… its or their agencies or instrumentalities, or corporations not for profit designated by any of them as such agencies or instrumentalities, and to authorize the making of guarantees and loans and the lending of aid and credit, which laws, bonds, obligations, loans, guarantees, and lending of aid and credit shall not be subject to the requirements, limitations, or prohibitions of any other section of Article VIII… of the Constitution, provided that moneys raised by taxation shall not be obligated or pledged for the payment of bonds or other obligations issued or guarantees made pursuant to laws enacted under this section.Section 8.13.  The JobsOhio legislation provides massive state funding for this entity in violation of these constitutional provisions.

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