SPECULATING in rare coins, according to some experts, is so fraught with risk that it should be attempted only by those who can afford to lose their investment. A key question prompted by news of Tom Noe's six-year venture with $50 million in public money is whether Ohio taxpayers are those kind of people.
The answer is yes, according to the Ohio Bureau of Workers' Compensation, even though we would bet an Indian-head nickel that Ohioans from Put-In-Bay to Ironton are shaking their heads in amazement that a state agency would risk so much money in so dubious a scheme.
The story of how a Lucas County coin dealer turned Republican political operator ended up making $2.5 million from this questionable state investment begs so many questions of possible conflict of interest and political payoff that one scarcely knows where to start.
Unfortunately, key officials who should be confronting those inquiries - Gov. Bob Taft, workers' comp administrator James Conrad, and others - have fallen silent.
But this is cronyism by any definition, and it's what happens when one party is in control of state government so long that it becomes more interested in enriching its friends than in good governance.
It is also wrong by any definition, and Governor Taft needs to disavow it - and disallow it - or he will tarnish the good name of one of Ohio's most venerable political families.
Ohio is the only state out of all 50 to invest in rare coins. That's not a surprise. Those entrusted with handling large amounts of public money should not - and normally would not - be risking state dollars in such a speculative venture.
Moreover, claims of profits are tenuous without full disclosure of what was bought and sold on the state's behalf. Insistence that such information is a "trade secret" is absurd when public money is being invested in a commodity so volatile.
Bad business deals totaling some $850,000 were written off and two coins worth $300,000 disappeared in the mail. Mr. Noe may be an expert in rare coins, but why entrust something that valuable to the post office?
Only one audit was conducted, and it turned out that the state initially was given no inventory of coins purchased by the web of enterprises set up under the "Capital Coin" program.
To the apparent surprise of state officials, some of the coin money also was invested by Mr. Noe in real estate of questionable value owned by John Ulmer, who has a history of slumlording in Toledo's central city.
A long-time GOP political insider, Mr. Noe has appointments under two governors to the Bowling Green State University board of trustees, the Ohio Board of Regents, and the Ohio Turnpike Commission. Yet he claims that politics had less to do with his $50 million opportunity than with his ability to "sell a coin deal."
In 1997, a little over a year before Mr. Noe's "Capital Coin" was granted its initial $25 million from the workers' comp investment fund, he had been chairman of a Lucas County Republican organization that was so cash poor that it had to vacate its headquarters in downtown Toledo.
In the intervening years, the fortunes of the local GOP have picked up, and so have those of Mr. Noe, who became a major donor to local and state Republican candidates.
To believe that his later political generosity had nothing to do with his success in investing state money strains credibility past the breaking point.
The story of Tom Noe's coin fund says a lot about the way Ohio is run these days - and how it should not be run. The only solution is a full investigation into the fund's activities and complete disclosure of all records to the public.