For Palin, “Reform” = Cronyism

The Alaskan executive branch, 2008 team photo

Many of the details in this LA Times piece have been reported before, but the argument — that Governor Sarah Palin has engaged in ritual cronyism since taking office in 2006 — is worth hearing again, given John McCain’s continuing argument that his running mate’s executive experience makes her uniquely qualified to take over the presidency if circumstances required it. (In their interview with Brian Williams the other day, McCain reiterated these claims — the video is here — while overstating the number of employees under Palin’s direction. McCain claimed the state of Alaska has 24,000 employees, when in fact the figure is closer to 14,000.)

In any event, while looking into the governor’s commission appointments — many of which went to high school chums of the Palins — the LA Times discovers some new information about favorable loans received by campaign donors.

Records show that Palin donors obtained state-subsidized business loans from the Alaska Industrial Development and Export Authority, or AIDEA, whose mission is to encourage “economic growth and diversification of the state, including expansion of small businesses.”In one case, Jae G. Lee, a former Los Angeles businessman who is the proprietor of Party Time, a rundown grocery store and bottle shop in Anchorage, sought a $2.7-million state loan to buy an aging strip mall in midtown Anchorage. It was on the market because of a glut of similar malls in the area, all of them losing customers to big-box stores.

Lee and his wife, who had contributed $3,000 worth of office space to Palin’s 2006 campaign, won the low-interest, state-backed mortgage although it was unclear how the old mall would add jobs. Lee said he did nothing to improve his acquisition, but with the cheap loan his profits have been robust.

Lee said he did not seek Palin’s help to obtain the loan.

Two other state-backed loans with favorable terms and questionable development benefits went to Palin contributor and local dentist Scott Laudon and his partners. The investors got $1.2 million to refinance debt on Northern Lights Village — a gritty collection of shops including massage and tattoo parlors, a secondhand-clothing store and a video arcade. Its neighbors along a 1 1/2 -mile stretch of Northern Lights Boulevard in midtown Anchorage include a dozen strip malls.

Laudon and other partners also received $3.6 million to buy two automated car washes in Anchorage. The benefit to Alaska, according to the approval documents, was the retention of five jobs — which would have remained without the subsidy. Laudon declined to comment.

Mmmmmm. Mavericky!