The two houses of the Republican controlled legislature plan to consider a variety of bills in the upcoming Fall session to continue the drive to create 250,000 jobs by 2014, a goal set forth by Governor Scott Walker.

While many of these initiatives have tremendous merit, such as the legislation to update mining laws so the Iron County Taconite mine can become reality, one that sticks out as a blatantly non-free market idea involves the creation of a state sponsored Venture Capital Fund. Venture capital is a wonderful thing. And real Venture Capitalists fill a very necessary role in the free enterprise system.

When the state gets involved, that's when we get into trouble.

Some people in the legislature with the backing of the Governor are floating a plan to create a venture capital fund involving as much as $500 million in Wisconsin state money. Taxpayer money. This would be another one of those famous "Public- Private Partnerships."

Any public-private partnership, regardless of how it is created or the intentions of the founders, has the same seeds of destruction embedded in its DNA. All taxpayer money utilized in this deal, taken in part by the state through conscription of labor via income tax, becomes a slush fund with the following inevitable consequences:

a) Risks of losses become the dominion of the tax payers and profits become the dominion of the "favored few." The fact that states cannot go bankrupt makes these angel investors that much more reckless with evaluating their projects, since they always have government backing and the implicit guarantee of a bailout.

b) Any profits shared with the taxpayers are far less than any other entity would require considering the risks involved. Investors get compensated for risks taken. These "favored few" venture capitalists will gain much more in profits with state money than if they had to use borrowed money or had to cut up the pie with more investors.

c) All government expenditures are politically determined. How will the lucky "Venture Capitalists" selected to "invest" the fund money be determined? How about that great Venture Capitalist Steve Welcenbach? Regardless of how you frame it, this process is correctly called Crony Capitalism. And this process will inevitably result in political contributions by selected "Venture Capitalists" to their favorite legislators and Governor. Will these contributions be refused? They better be.

d) All real successes of this scheme would have occurred anyway if true economic fundamentals for the venture existed. These projects would have been privately funded. So the state ends up competing with private enterprises on viable projects, displacing more successful possibilities from the private sector which would otherwise build true long-term economic activity.

e) There will be failures, especially with the economic policies pursued by Barack Obama. Any investment failures and political contributions from involved parties will be used by political adversaries to support charges of political corruption and/or malfeasance.

f) All of these creations are susceptible to political subversion. The Obama administration, with its hatred of Scott Walker and the uppity Wisconsinites which have embarrassed his entire organization, will do all that it can to undermine all we do. Making this scheme blow up will be like shooting fish in a barrel.

Republicans need to be smart. Republicans need to be principled. And Republicans need to adhere to all of the tried and true principles of free enterprise.

At one of our breakfast events over the summer, Representative Dale Kooyenga of Wauwatosa uttered these words of tremendous wisdom: "Pro-Business does not necessarily mean Pro-Free Enterprise. I am Pro-Free Enterprise." Amen, brother.

This Venture Capital Fund may be able to be classified as pro-business. It can certainly not be called free enterprise.

Why do we need to go down this road? What new concept is so compelling (besides the aggressive lobbyists) or obstacle so overwhelming that this must be done? And why now? Both fiscal and political prudence tells me that this venture capital fund idea is a bad one.

A better strategy involves pursuing and enacting tried and true conservative freemarket principles such as real tax reform - the reduction of income tax rates, going to a reduced flat tax or eliminating the income tax all together. We know that these things work. Why not pursue things that we know actually work?

Why not cut more of the budget? Eliminate departments and agencies. I have a copy of the budget of all state agencies. Upon inspection, it becomes apparent cutting non-essential services gives you a huge part of the budget to work with.

And regulations. Their are more than plenty that could be eliminated tomorrow that will never be missed or noticed, except for the huge amount of money we all would save.

Businesses flourish in an environment of low taxation and reasonable, reduced regulation. Let's focus on creating just such an environment here in Wisconsin. If we do this, the Venture Capital will come.