There are rumors on Mackinac Island that there is an attempt to create a new state venture capital fund. It seems like these ideas pop up every couple of years. The results, though, have been expensive and underwhelming.

A 2003 program, the Venture Michigan Fund, is coming back to bite state taxpayers right now. The state issued a bunch of tax vouchers that would zap the budget if the deals behind them didn’t work out. Some did not, and the state was on the hook for an expected $140 million. Worse, the program may end up costing another $310 million. If the program was successful in creating jobs, the results were unreported. There are bills to wind this program down.

The 2005 21st Century Jobs Fund is still ongoing. Over the years, the fund has been used to support a number of high-risk investments. Unfortunately, more than $1 billion of taxpayer money has probably been spent, and what the state has received in return is uncertain. Feel free to scan the reports and see if you can determine whether the program justified its costs in an economy that gains and loses hundreds of thousands of jobs each year.

Success is something that gets trumpeted. Failures tend to be ignored. Lawmakers should be skeptical of another round of support for venture capital.

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