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We’ll Get Internet Sales Taxes; Will We Get Our Rate Reduction?

With its more-conservative members taking the lead, the Supreme Court today opened the way for states to begin imposing their sales taxes on Internet commerce, even for sellers that don’t have a presence in their states, through South Dakota v. Wayfair.  The judges’ reasoning was that previous Supreme Courts had incorrectly applied the Commerce Clause of the United States Constitution on this topic.

From an originalist point of view, then, the states have always had the authority to collect sales taxes, but as various technologies have eased the ability to conduct commerce across state lines, Supreme Court decisions have incorrectly restrained that authority.  This point is especially relevant in Rhode Island, because our state law (RIGL 44-18-15.2) instructs the executive branch to begin collecting sales taxes from online retailers “upon passage of any federal law authorizing states to require remote sellers to collect and remit sales and use taxes.”

State law also (RIGL 44-18-18) requires the executive branch to lower the rate for all sales taxes from 7% to 6.5% “upon passage of any federal law that authorizes states to require remote sellers to collect and remit sales and use taxes.”  So, “on the date that the state requires remote sellers to collect and remit sale and use taxes,” every retailer in the Ocean State (and those outside of Rhode Island, like Amazon, that already collect our sales tax) should begin to collect 50-cents less for every $100 of a sale.

Here’s the possible catch:  Does a Supreme Court ruling count as “passage of any federal law”?  Rhode Islanders should watch closely for signs of the following possibilities:

  • The executive branch asserts that it is already authorized to collect the online sales tax based on 44-18-15.2, in which case taxpayers would have a very strong claim that it must also collect tax at the 6.5% rate.
  • The General Assembly rushes to change state law in a way that allows the collection of Internet sales taxes without dropping the rate.
  • The General Assembly attempts to sneak in the same result in some way, perhaps by inserting a phrase like “or upon a Supreme Court ruling to the same effect” into 44-18-15.2 but not into 44-18-18.

Frankly, it’s disappointing that no state-level politicians (particularly legislative leaders) have yet proclaimed their happiness that the state can now lower its sales tax rate.  Presumably the scheming remains offline for now.

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“Equal Pay”: From the Radical to the Uselessly Disruptive

Fortuitously, the Providence Journal ran an op-ed by me explaining how insanely radical proposed equal pay legislation actually is:

This legislation must, therefore, be about something other than simple fairness in the workplace. Sure enough, the biggest piece making this legislation so radical is its broad scope — going well beyond the battle of the sexes. Indeed, the “equal pay” umbrella extends to the categories of “race or color, religion, sex, sexual orientation, gender identity or expression, disability, age, or country of ancestral origin,” covering all “comparable work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.”

Plainly put, this gives the government power to investigate just about any business and dictate changes to its pay policies, because the only pay differences that wouldn’t have legal risks would be those between people of the same race, religion, sex, orientation, gender identity, disability, age, and nationality. For any two employees who aren’t more or less demographically identical, the lower-paid one could initiate a complaint with the state with the same weight as complaints that the employer withheld pay. The law explicitly puts the burden on the employer to explain it and to prove that no other business practice could erase the difference, even if it’s innocent.

Today, the Rhode Island House will consider an amended version of the bill that gives reason to think that some legislators are not quite as crazy as the original bill would require them to be.  House 7427A limits the scope of the bill to race and gender, exempts companies under 18 employees, and reduces employers’ liability in a variety of ways.

The question now is why the legislature is passing anything at all.  Existing law already covers such things, so all this bill will do is create some new regulatory burdens with unproven legal language that may have unintended consequences.

The only explanation is political: that politicians want to be able to say they did something, even if they did nothing good in practical reality.  This gives momentum to the people who are manipulating the cultural narrative while tangling up Rhode Islanders who are doing their best just to support their families and move our society forward.

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A Big Lesson from a (Relatively) Small Tax Increase

I’ve got an op-ed in the Valley Breeze today taking the opportunity of a new sales tax on software as a service products to illustrate the harmful thinking of our legislators:

In short, the state government is going to tax an innovation that empowers productive, motivated Rhode Island families who are making the most of technology that levels the economic playing field. Even if it’s “only” $4.8 million, why would the state government do that? …

So, when Speaker of the House Nicholas Mattiello, a Democrat from Cranston, tells reporters that “to not expect (the budget) to rise every year is not realistic,” he’s really saying it is unrealistic to expect state government only to grow at the same speed or more slowly than the household budgets of Rhode Island families. If that’s the expectation, then the governor and the General Assembly must find new ways to take more money from Rhode Islanders.

After all, the politicians have to find some way to pay for election-year raises for unionized state employees. If they’re going to increase the tax credits for producers who film movies here, they’re going to have to start taxing your Netflix account. If they’re going to promise a big chunk of the state’s income, sales, and corporate taxes to the PawSox for a new stadium, they’re going to have to increase those taxes even more to break even.

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Sense of the RI Economy: Positive but Discouraging or Discouraging but Positive?

In a brief article in today’s Providence Journal, Paul Edward Parker juxtaposes the RI Center for Freedom & Prosperity’s Jobs & Opportunity Index (JOI) with URI Economics Professor Len Lardaro’s Current Conditions Index (CCI):

“Rhode Islanders should be happy to see the various measures of employment and jobs improving, and to see fewer Rhode Islanders relying on Medicaid,” said the center’s research director, Justin Katz. “Still, Rhode Island needs to move quickly if it wants to capitalize on the national economic improvement, and we’ve seen no sign that our elected officials understand the urgency or what needs to be done.”

The center found that Rhode Island continues to straggle well behind the U.S. average on its index and even farther behind the average for New England. …

Meanwhile, Lardaro reports the lowest CCI score since November 2016, but…

“While all of this appears to be rather bleak and foreboding at first glance,” he said, “I believe such a rush to judgement is not necessarily appropriate at the present time.”

He further explained that the April performance “was fairly strong as disappointments go.” He noted improvement over April 2017 in two employment numbers: the labor-force-participation rate and the employment rate.

So, which is it?  Are Rhode Island’s numbers not good enough to challenge long-term skepticism and concern, or are they not bad enough to temper general optimism?

As with all of these index debates, the answer largely depends on what indicators one traces.  I’d suggest that I was correct to warn that our upswing may be a consequence of national trends for which our state government has positioned us poorly.  Lardaro may be correct that positive momentum is moderating, but with continued opportunity for growth.

Either way, the prescription is the same:  Rhode Islanders need to stop settling for broader economic tides and free their neighbors to start rowing.

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Legislators Get That Old Elementary School Thrill Over Motion Picture Filming

I still remember the excitement around the elementary school when a house in the neighborhood was used to film some part of a movie or TV show.  (Obviously, my memory isn’t that clear, although I don’t know whether any of us ever actually knew what it was that was being filmed.)  It’s almost like finding a door to another dimension when a place in this world is used in the creation of some fictional world on the screen.

As with everything else, however, the excitement sours when politics enter the mix:

A major TV show is expected to start filming in Rhode Island soon and may have helped persuade lawmakers to sweeten the state’s motion picture incentive program. …

We aren’t allowed to know what the show is or who is in it before our elected representatives commit to giving it more money — much less whether it is the kind of content we would want to subsidize — but:

… they say it is big, with $34 million in estimated production costs, which would make it the most expensive Rhode Island motion picture since the $41.5-million canine superhero flick “Underdog” in 2006.

… those credits could swell to $10.2 million thanks to an amendment inserted into the state budget passed by the House on Friday night, which would allow productions to get 30 percent of their costs back instead of 25 percent.

So why are we doing this?  As Patrick Anderson reports in his Providence Journal article, the state’s own office of Revenue Analysis finds that these tax credits don’t come anywhere close to returning their investment for the State of Rhode Island (by which I understand the report to mean the state government).

Perhaps that old elementary school excitement about local movie making doesn’t ever sour for those who get to spend other people’s money to make it happen.

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Timbs v. Indiana May Not Go Very Far, but It Would Be a Good Step

It is unlikely that a ruling by the Supreme Court Timbs v. Indiana will go far enough to rein in civil asset forfeiture, even if it turns out to be a victory for that cause, but it’s certainly a step in the right direction:

The case is Timbs v. Indiana. It arose in 2013 when a man named Tyson Timbs was arrested on drug charges and sentenced to one year on home detention and five years on probation. A few months after his arrest, the state of Indiana also moved to seize Timbs’ brand new Land Rover LR2, a vehicle worth around $40,000. A state trial court rejected that civil asset forfeiture effort, however, on the grounds that it would be “grossly disproportionate to the gravity of [Timbs’] offense” and therefore in violation of the Eighth Amendment to the U.S. Constitution, which forbids the imposition of “excessive fines.”

The state’s forfeiture effort clearly qualifies as excessive. Timbs’ original crime carried a maximum financial penalty of just $10,000. And as the trial court observed, “a forfeiture of approximately four (4) times the maximum monetary fine is disproportional.” The trial court was right to deem the state’s actions unconstitutional.

But the Indiana Supreme Court took a different view when it decided the case in 2017.

If nothing else, the case is an excellent indicator of the fundamental injustice of civil asset forfeiture, inasmuch as it creates an additional category of penalty that isn’t technically considered a penalty.  “We’re taking your property away, but it’s not a penalty; it’s just that your property doesn’t really count as your property.”

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Unionizing Home Care Workers

Reading the section in this week’s Providence Journal “Political Scene,” one can’t help but think that our legislators are either not thinking things through or have ulterior motives:

Sponsored by Majority Whip Maryellen Goodwin in the Senate, and Rep. Christopher Blazejewski in the House, the legislation envisions a new class of worker — the “independent″ home care worker — going into the homes of the elderly and the disabled to help them with basic daily activities such as eating, bathing, dressing and getting to and from the toilet. The legislation would allow these independent contractors to choose a “representative″ to negotiate with the state over their rates, benefits “and other economic matters.”

Granted, the consequences of this bill would be much less than they would have been a few years ago, before the Supreme Court ruled that Illinois couldn’t force this class of worker to join a union.  Before that ruling, parents who were simply seeking financial assistance to care for their disabled children were being billed for union dues.  Even so, allowing unions into the equation will raise concerns about whether care providers are being fully informed about their rights and the pluses and minuses of joining the union as well as provisions that the unions might negotiate to be written into laws affecting even non-union workers.

More directly, though, this legislation would be another issue raising the question of who is actually advocating on behalf of taxpayers.  As the Providence Journal points out, “since then-Gov. Lincoln Chafee signed the child-care unionization bill, the state subsidized cost of child care has increased by 54 percent.”  Is Rhode Island’s budget not growing fast enough?

The article also raises the question of why this is needed.  The legislation already calls for 10–20% raises for home care workers and implements annual inflation adjustments.  Moreover, the column closes with Speaker of the House Nicholas Mattiello arguing on behalf of making pay for the workers more-competitive.

Two possibilities emerge:  Either unionization is absolutely unnecessary and is simply a way to siphon off home care dollars to the unions and then back into politicians coffers, or it will drive up costs beyond what even sympathetic legislators think is reasonable.

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Fun-Sized Depends on the Comparison

Have you seen the “Fun-Sized” promotional videos that the state Commerce Corp. is crediting with an up-tick in tourism?  You can watch all 14 videos, here, pretty quickly, because each is only 10 seconds long or so.

Each one starts close in on people doing something fun and then quickly zooms out so the viewer can see that it’s all happening in close proximity to other things.  The idea is clever, and the idea of being able to enjoy a variety of activities across a small state is compelling, for some kinds of vacationers.  Still, the cumulative effect gives the sense that Rhode Island isn’t so much a small state as a large, loosely coordinated resort.

I’m not saying that’s necessarily bad.  I’m not sure how I feel about it, when it comes to promoting tourism.

As a cynical small-government conservative in the Ocean State, though, I’m inclined to dislike the impression on grounds of political philosophy, though.  A resort, after all, tends to be more-tightly coordinated, run by a central authority.  To the extent that the “resort area” is part of the appeal, they’re explicitly catering to customers of the resort.  If Rhode Island is a resort, then the central powers are the driving force.

And of course, there’s the point I’ve made before.  A key reason Rhode Island has such diversity of aesthetics around the state is the independence individuals used to have to define their neighborhoods.  The more we centralize power and concern ourselves with the minute affairs of people who live in other towns and attempt to redistribute wealth from one area to others, the less that diversity will characterize our state.

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The Market Improves Decision Making (For People and Government)

Whether for individuals in a job market or nations dealing with trade, the competition of the market leads us to make better decisions.  The cause is not only the motivation that competition creates, but also the ability to learn from each other.  Such was Richard McKenzie’s argument in a Wall Street Journal op-ed this weekend:

… While some behaviorists support government “nudges” to improve human decision making, politicians and bureaucrats often are no better at making rational decisions than ordinary citizens. Markets are a more effective mechanism for rewarding rational thinking. Persistently irrational decision makers in a competitive marketplace can be expected to misjudge costs and overlook profitable trading opportunities—and, consequently, lose access to resources. They can also be pressed to move from highly competitive markets to low-pressure venues (for example, university and government bureaucracies), leaving markets to more (though not perfectly) rational decision makers.

The more rational decision makers can, by their market decisions, show their irrational counterparts how they can be more prosperous by altering their working heuristics. This means competitive processes can make remaining participants more inclined to consider opportunity costs, ignore sunk costs, and discount future opportunities more accurately.

McKenzie is an emeritus professor, so presumably he wouldn’t argue that “low-pressure venues” do not have value, but his point is an important one.  The dynamics of a collective entity, like a nation, are similar to those of individuals.  People can make irrational decisions, and because government is made up of people, we err if we rely too heavily on them to make decisions for everybody.

And just as individuals thrive when they have to compete and have examples around them of those who are competing better, so too can states or nations advance through rational competition.  If only Rhode Island’s politicians would come to understand competition in this true sense, rather than irrationally focusing on competing on subsidies for major companies and movie producers.

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Summing Up the Budget (And RI’s Problem) in One Sentence

The Providence Journal article on the Rhode Island House’s budget vote last night captures in one quotation the problem our state is struggling to overcome:

“I expect the budget to rise every year,” said House Speaker Nicholas Mattiello after the final vote, a few minutes before 10 p.m., in response to Republican complaints about overspending. “To not expect it to rise every year is not realistic.”

First, let’s go along with the premise that the state budget should rise every year.  Does it have to go up 3.9% every year, regardless of the health of the economy or changes in taxpayers’ ability to pay?  That’s the important next question.  From Mattiello’s explanation, it doesn’t seem that there is any limiting principle.  From his comments to WPRI’s Ted Nesi:

“I always look at the specifics,” he said. “The level of spending in this case was appropriate to the needs of our society.” He noted that the cost of social services continues to rise faster than other areas.

But there is no reason a budget this big has to climb every year.  If it’s possible that annual growth of 3.9% is too much, then it’s possible for it to be too high, right now.  Sadly, state leaders exhibit is no underlying philosophy.  There is only a balance of various interest groups’ power.  Raises for state employees.  Increases in welfare-related spending.  More crony deals (as foreshadowed by the increased generosity of tax credits for movie productions).

Taxpayers will only become a consideration when they do one of two things:

  1. Change their voting habits in a way that threatens entrenched politicians.
  2. Leave the state in sufficient numbers that the politicians have no choice but to reduce spending or squeeze those who remain painfully enough that they notice (and resort to #1).
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Bowling Subsidies Now!

Appearing on Rhode Island Public Radio’s “Political Roundtable” show, recently, Rhode Island House Minority Leader Patricia Morgan, who is running for governor as a Republican, had an exchange with political analyst Scott MacKay:

MacKay: It sounds, in a way, like you don’t really care whether the PawSox go or not.  Do you realize this is a part of Rhode Island culture and family entertainment that hundreds of thousands of people go to every year?

Morgan: I do understand, and I have taken my children, as well, to the PawSox stadium, but I still believe it’s a private company at this point.  We can’t build a facility for every private company.  I mean, why don’t we build bowling allies; a lot of families like to go bowling.  Why don’t we build miniature golf entertainment areas?  At some point, we really have to keep taxpayer monies for the things that actually are economic development, will actually build good jobs in Rhode Island.

Morgan should have concluded that thought by saying we have to keep taxpayer monies for things that are actually government responsibilities, but her point is otherwise right on.  The problem, however, is that conservatives can’t win this sort of reductio ad absurdum argument with progressives, because the latter will happily say, “Go ahead.”

Perhaps progressives won’t generally have the personal affection for bowling or mini-golf that they have for baseball, but nobody should doubt that they’d be happy to use government resources for family entertainment if somebody were to credibly propose doing so.  After all, family time is very important.  Why shouldn’t government build facilities to foster it?  Isn’t government supposed to do everything important for us?

Of course, the conservative reply might be that the lack of a private market for a bolling alley in a particular area is simply evidence that people aren’t interested in that activity in sufficient numbers to make it worthwhile.  But however inexpensive the activity is, there might be some families that would jump at the chance if the price came down a little and who, without that opportunity, instead spend their time doing unhealthy things isolated from each other.  And hundreds of thousands of Rhode Islanders have fond memories of bowling with their families.

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Another State Edging Toward Licensing Reform (Including for Hair Braiders)

Occupational reform catches on in Pennsylvania:

Being a barber, an auctioneer, or even a “campground membership salesperson” in Pennsylvania requires a state-issued license.

That should change, says Gov. Tom Wolf.

Wolf, a Democrat, called Thursday for the state legislature to abolish 13 occupational and professional licenses, following the completion of a year-long review of Pennsylvania’s licensing laws. In place of some of those licenses, the Wolf administration says workers could be required to register with state boards. For others, such as hair-braiders, the administration has recommended eliminating the state’s role entirely.

Is Rhode Island going to take the lead on economic freedom for its residents or be among the last states holding on to insider deals?  Sadly, that isn’t difficult to predict… unless voters start surprising us.

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RI Middle of the National Pack for Life Expectancy

Compared to our usual experience on national rankings, Rhode Island’s having the 19th-best ranking for life expectancy is good news, although that puts us second to last in New England, before Maine.  Writes Bill Murphy:

People in Minnesota live the longest in the United States: 78.7 years old on average. Mississippi ranked 51st (the study includes Washington, D.C.). Live expectancy there is just 71.8 years. That’s a 9.6 percent difference.

It should be noted that the leading causes of death are lifestyle-related, such as smoking, drinking, and eating poorly, so this is another area in which the best prescription may be a healthy economy.

Given the hot topics of the day, however, this bit from the underlying research is interesting:

Other notable findings seen in Table 1 are declines in deaths [from 1990 to 2016] from self-harm by firearm (13.2%) and physical violence by firearm (28.5%) but an increase in self-harm by other means (16.9%).

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Michigan Helps Us Imagine the Possibilities on Prevailing Wage

Warner Todd Huston and Jeff Dunetz report on a cost-saving measure in Michigan that seems nearly unthinkable in Rhode Island:

Its common knowledge that parts of Michigan are falling apart. One reason for the disintegration of infrastructure within Michigan is a jobs-killing union rule that drives up the cost of government projects. This puts many necessary repairs and upgrades outside the reach of State’s budget. Finally, this budget-killing rule has been thrown in the trash by the state legislature.

Wednesday, June 6th the Michigan House of Representatives and Senate passed a measure to put an end to the budget-killing union rule called the “prevailing wage.” This rule required that all construction projects initiated by the state government to pay workers the same wage union members make, even if the workers hired for said projects are not members of a union.

Rhode Island’s infrastructure maintenance budget would go so much farther (and require much less debt) if the government would allow itself to pay market rate for the work.  Unfortunately, when it comes to our state government, we’re not a pragmatic state, but one concerned mainly with keeping insider arrangements alive.

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The Dark Humor of North Providence Little League Sponsorships

Let’s start Thursday on a lightish note.  Is it me or does news about the North Providence West Little League read like some sort of Rhode Island–specific Abbot and Costello routine?  From the Valley Breeze:

Senator Ciccone and FOP-13 NPPD [Fraternal Order of Police Lodge 13, North Providence Police Department] earned a share of the North Providence West Little League’s Major Division regular-season championship by capturing their respective finales at Romano Field and concluding their schedules with 14-2 records.

On Monday night, Senator Ciccone posted a 9-0 triumph over Christiansen’s Fine Milk that was the ballclub’s fourth straight victory. Nathan Bautista pitched a superb one-hit shutout that saw him strike out 13 batters and Mazeo DiScullio led the offense with three hits and as many runs scored.

FOP-13, meanwhile, will head into the postseason with an eight-game win streak, thanks to its 12-5 victory over Mayor Lombardi last Wednesday night. Ethan Leveillee delivered the game’s biggest hit, a grand slam home run over the left-field fence.

It’s possible I just don’t remember something, but I can’t recall any labor unions sponsoring teams when I played Little League years ago in New Jersey and definitely not any politicians.  The latter seems flatly inappropriate.  Politicians aren’t promoting a product in the same way private businesses are, and to politicize children’s athletics in this way is wrong.

That said, it is inarguably appropriate, symbolically, for Rhode Island teams named after politicians and labor unions to be “triumphing” over those sponsored by the private businesses that move our economy forward.

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Allowing Candor on Tennis Pay Equality

Here’s a confession: One reason I’m looking forward to the end of the legislative session in Rhode Island this year is that I’ll be able to clear out my news feed and stop paying such close attention to issues related to specific bills.  Near the top of the list of topics I’ll be happy not to watch so closely is the matter of “equal pay.”

It’s not that the question isn’t an important one to answer or that it doesn’t raise very interesting philosophical questions; the problem is that so few of the articles or essays that flit across my computer screen address the actual questions, much less the interesting ones.  The progressive assertions and statistics are simply taken at face value.  More than maybe any other issue I’ve followed, this one marches along with a moral certainty that never bothers to wonder why people would be doing things that would be obviously wrong if they were really doing them.

Tennis pro Rafael Nadal stumbled right into the path of this intractable march when he suggested, in response to a direct question, that the pay rates of men and women in professional tennis is “a comparison we shouldn’t even make”:

Female models earn more than male models and nobody says anything. Why? Because they have a larger following. In tennis too, who gathers a larger audience earns more.

Pause for a moment and put aside the identity politics and the ideological war.  When an athlete has a large audience, isn’t it reasonable for that athlete to receive more of the financial rewards?  Isn’t this the same as musicians or other performers?  If we take the identifying quality of sex out of it, nobody would be incensed that stronger, more-aggressive competitors attract larger audiences and more money.  Those who elevate a tangential quality are the ones bringing sex into it.

I haven’t seen any indication that Nadal was saying that the pay difference is just the natural order of the universe and ought to be maintained as a matter of principle.  He was just making a plain statement of fact.  If the audience changes, then the pay should and will.  Anybody who wants to achieve a world in which people are as interested in female tennis as male tennis should work toward that end, but attacking it pay rate first sows division and is unfair to players currently in the game.

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Assets Forfeited and Returned by RI Police

Based on data provided by the attorney general’s office responding to an Access to Public Records Act (APRA) request, the state’s various police agencies have seized $10,337,190 worth of cash and property since 2012, returning $1,417,559.  That’s an 86% forfeiture rate.

RI-assetforfeiture-forfeitandreturned-2012-2018

 

That rate is not evenly distributed across programs, however.  Law enforcement kept every dollar seized under a search warrant or on the grounds of eluding police, with other crimes producing the following forfeiture rates:

  • Tobacco: 10%
  • Gambling: 30%
  • Prostitution: 50%
  • Counterfeiting: 60%
  • Narcotics: 92%
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Yes, That Political Double Standard

Just sayin’.  Neither of the following is purely objective reportage, but the first is stealthily positive, while the second is overtly negative in its focus, its overstatement of the action taken, and insistent reduction to partisan disagreement.

Washington Post in 2011:

In gay rights victory, Obama administration won’t defend Defense of Marriage Act

The Obama administration said Wednesday that it will no longer defend the federal law that bans the recognition of same-sex marriage because it considers the legislation unconstitutional, a sudden and rare reversal.

Washington Post in 2018:

Trump administration won’t defend ACA in case brought by GOP states

The Trump administration said Thursday night that it will not defend the Affordable Care Act against the latest legal challenge to its constitutionality — a dramatic break from the executive branch’s tradition of arguing to uphold existing statutes and a land mine for health insurance changes the ACA brought about.

Look, I’m not going to pretend that I haven’t been on the media-bias bandwagon almost since I began really paying attention to politics nearly 20 years ago, but we’re getting to the point that anything negative that a mainstream news source reports about the president must, almost by necessity, be assumed to be spin, potentially to convey the opposite meaning from the truth.

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FY19 Budget: When Government Outgrows the Governed

With the House budget released, the RI Center for Freedom & Prosperity has updated its annual chart showing how the state’s spending has actually grown during this century versus inflation and population.  As you can see, it isn’t a pretty picture:

RI-expendituresallfunds-2001-2019

 

For some perspective, the state budget has grown at a compound annual rate of 3.9% per year.  Inflation’s growth rate, by comparison, has been 2.0%, and the population’s has been 0.0%

Granted, for the ease of the comparison (and making it easy to repeat), we’ve just used the national inflation rate, here, and people periodically argue that some other metric would be preferable.  Well, using data from the Bureau of Economic Analysis, personal income in Rhode Island has grown at a rate of 3.0% per year, and the state’s gross domestic product (GDP) has grown at 3.1% per year.  (Both of those are current, unadjusted dollars.)

That means year after year, the state government eats up more and more of the Rhode Island economy and takes more of Rhode Islanders’ real income.  Over the period shown in the chart, the state government has grown to the point that it’s taking another two percentage points of income and GDP out of the economy each year.

Even worse:  This isn’t just a loss to the people right now.  It actually affects broader economic growth, and likely plays a significant role in Rhode Island’s economic growth rate coming in below the national GDP rate of 3.8% over these two decades.

This is why Rhode Islanders often feel like they are serving the government, not the other way around.  Few people would complain about the growth of government if the people of the state were becoming relatively wealthier, but that it’s the other way around.

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Missouri Takes the Obvious Step for Hairbraiders

Missouri has taken a step that Rhode Island should follow:

Previous state legislation in Missouri had required people who wanted to braid hair for profit to obtain a cosmetology license — which required the completion of 1,500 hours of training.

This requirement was time-consuming, expensive, and created an unnecessary obstacle that made using one’s knowledge and skills to earn a living more difficult. Furthermore, it mostly affected women of color, who primarily make up both the customers and the braiders.

The requirement was yet another example of the ways regulations hurt everyday Americans’ ability to provide for themselves and to pursue their own economic liberty.

We can discuss in a more rigorous way when licensing is needed.  Is the use of chemicals a line?  Should it be a matter of life and death or contagion?  But surely, when one person consents to give money to another to braid her or his hair, the government doesn’t have to be in the middle of that transaction, especially to require a license for something that hair braiders don’t actually do.

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That Teacher Absenteeism Issue

Linda Borg reports in the Providence Journal:

A national education magazine reports that Rhode Island has among the highest rates of chronic teacher absenteeism in the nation.

Among the states in the Civil Rights Data Collection, Nevada had the highest percentage of teachers, with nearly half of all teachers taking more than 10 days off, followed by Hawaii, at 48 percent, and Rhode Island, at 41 percent, according to a story in Education Week.

In South Dakota, the state with the lowest rate of teacher absenteeism, only 18 percent took more than 10 days off.

That’s on a work-year of generally 180 days, and it’s in addition to things like field trips and professional days taken as part of work. Granted, the absent time includes sick and personal time, but the state-by-state comparison is the central concern.

Considering that Rhode Island is pretty much the average state on the National Assessment of Educational Progress (NAEP) test, having a big chunk of the school year with absent teachers suggests missed opportunities.  That suggestion is reinforced by the Ocean State’s status as last in New England by this measure.

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When Blackouts Come, Will We Remember to Blame the Right People?

Valley Breeze publisher Tom Ward has an important warning related to the latest government-backed wind project in Rhode Island:

I’m OK with wind turbines miles offshore. But when the May 31 Journal story ran out of political high-fives and got to the end, it came to our daily reality. Wrote Alex Kuffner, “The price of power from the Revolution project is still uncertain.” Its cousin, the Block Island Wind Farm, “will ultimately cost ratepayers (that’s us!) hundreds of millions of dollars in above-market costs.”

One day later, an opinion column also appeared in the Journal, by Meredith Angwin, of Vermont, a physical chemistry researcher and pro-nuclear power advocate. The headline: “We’ll lose power in the winters ahead.” In it, she detailed the now well-known facts surrounding the coming closing of many of New England’s traditional electric plants. …

What I know with 100 percent certainly is this: If in eight years rolling blackouts come to New England during the winter, families who live here will have been put in danger by radical environmentalism and the politicians who practice that religion. Short-sighted decisions from a decade earlier will come home to roost as energy costs explode, children shiver, schools close, and businesses grind to a halt. Those who caused the problem will be long gone. Reasoned people need to demand predictable power today.

In too many areas, across too many levels of government, we’re simply failing to take the future into account.  The incentives of big government all but ensure that this will be so.  Our government is very skeptical about the goodness of people and our ability to guide our own lives, but it ought to be skeptical of its own ability to micromanage the universe.

Look to any socialist country to see what happens when the predictable consequences of big-government policies come to pass:  They scapegoat the people who are trying to keep things going, nonetheless, particularly those in industry, perpetuating a cycle.  We can already see the beginnings of this process with all of the ideological legislation that treats business owners as if they are morally suspicious characters.

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A Relatively Small Sports Gambling Payoff for Host Communities

As I highlighted on Tiverton Fact Check, the budget proposal from the Rhode Island House would change the legislation initiating sports gambling at the two Twin River establishments: 

Now another chunk of cash looks likely. When we mentioned that a Supreme Court ruling had put sports gambling on the table for Twin River, supporters of Budget #1 took to social media to say it was misleading even to hint that the town might receive revenue from this new source. Well, with the introduction of the Rhode Island House’s version of the budget, Friday, a number has been put on that windfall:

The state shall pay the Town of Lincoln an annual flat fee of one hundred thousand dollars ($100,000) and the Town of Tiverton an annual flat fee of one hundred thousand dollars ($100,000) in compensation for serving as the host communities for sports wagering.

Of course, while that’s something, it doesn’t seem like much in comparison with the $23 million the state’s expecting for itself.  Why the state wouldn’t simply define sports gambling as either a table game or a video slot for the purposes of calculating host community shares (which would be 1% or 1.45% of revenue, respectively), is not clear.  Local residents of Tiverton and Lincoln should hope their representatives and senators are still pushing for more.

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As the General Assembly Releases Its Budget, at Least the National Economy Is Improving

On a sunny Saturday morning, while another depressing state budget dominates the local media’s output, this is a nice bit of news to recall from the week:

While the DC press corps worries whether Trump was booed at a White House event and curates elaborate conspiracy theories about Melania, a slightly more important story isn’t getting enough pixels. The economy is doing so well that, for the first time ever, there are now more job openings in the US than unemployed Americans.

Of course, this is national news, and my employment and Jobs & Opportunity Index (JOI) research suggests Rhode Island is not (let’s just say) maximizing the advantage.

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The Size of the Forfeitures

As the Stephen Hopkins Center brief (PDF) mentioned in this space yesterday explains, the actual amounts of cash and property that law enforcement agencies seize aren’t huge on a case-by-case basis, bringing into question the assertion by supporters of forfeiture that this power is central to disrupting cartels and kingpins.  Out of curiosity, I put together this chart of the amount of money forfeited to Rhode Island law enforcement agencies in 2016.  (That is, money the agencies got to keep.)

RI-assetforfeiture-cash-2016

 

Consistent with the Hopkins Center brief, these results don’t show an obvious focus on major busts.  The largest number of cases (45) involved cash amounts in the $1,000 to $1,500 range.  Sure, that’s a good bit of money for a person to be carrying around in cash, but that could just be proof of the complaint from anecdotes around the country — namely, that law enforcement is considering having a good amount of cash to be suspicious activity of itself.  But money in this range could be intended for benign things like buying a used car or preparing to go on vacation.

Note, by the way, that these bars use the ranges from the Hopkins Center report.  If we were to break them out by even $500 increments, the largest group would be $501-1,000, which even less suggestive of big-time drug dealers.

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The Union Organizer Who Thinks States’ Worth of People Don’t Care About Their Children

Americans periodically complain about the rancor in our political discourse, and while it’s certainly nothing new (and is better than, say, murderous feuds between factions), they have a point.  We do better as a society to the extent that we can discuss difficult matters without doing and saying things that escalate emotions unnecessarily.

For the most part, doing and saying such things is probably inadvertent; relatively few people are so deeply engaged in public debate that their rhetoric is thoroughly conscious.  Among those who are deeply engaged, some portion who use inflammatory rhetoric do so because they’re passionate and their sincere beliefs can’t help but inflame the other side.  And then there are those who escalate emotions in order to isolate their opposition and manipulate everybody else.

I’d put American Federation of Teachers leader Randi Weingarten in that last group, and find the sort of rhetoric that Dan McGowan reports from her to be beyond the pale:

“Providence, Rhode Island is not Oklahoma City or Phoenix, Arizona,” Weingarten told reporters gathered outside Mount Pleasant High School. “And the fact that a mayor of this city is not sitting down trying to solve these problems and acting more like what we see in states that haven’t really cared about their kids is shocking to me.”

According to this self-interested union organizer, entire states’ worth of Americans don’t care about their children.  Why?  Presumably because their elected officials don’t give as much money to her members as she’d like.

If this were some isolated statement, that’d be bad enough, but we’ve more than ample experience with teachers unions in Rhode Island to know that it’s part of a deliberate organizational strategy to keep union members feeling undervalued and citizen-governments in constant turmoil that can only be relieved by giving in to the union’s demands.  In short, it’s exactly the sort of attitude and behavior that ought to embarrass professional teachers and, if the Supreme Court decides for freedom in the upcoming Janus decision, lead them to cancel their memberships.

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Some Numbers on Asset Forfeiture

The Stephen Hopkins Center for Civil Rights this week released analysis (PDF) of the state’s narcotics-related civil asset forfeitures, wherein police agencies take money and property from people who have not been — and may not be — charged with a crime, under suspicion that the money or property is connected with the illegal drug trade:

Joee Lindbeck, lobbyist for Rhode Island Attorney General Peter Kilmartin, testified at both the House and Senate Judiciary committee hearings in opposition to legislation which would require a criminal conviction before seized assets may be forfeited. Ms. Lindbeck asserted in both hearings that the proposed reforms would serve only to protect drug cartels and drug kingpins.

The Hopkins Center reviewed data collected by the Rhode Island General Treasurer on forfeiture cases in in 2015 and 2016, which was provided to us and requested under the Rhode Island Access to Public Records Act. The Center then aggregated and analyzed that data in order to assess the realities of how the law is currently being used. The results are clear – the majority of forfeitures were for small dollar amounts, not the type of cash or property “wealthy drug lords” have on hand.

As the brief explains, out of the $970,524 seized, 28.34% was given back as not legitimately confiscated.  A closer review of the numbers shows instances in which law enforcement ultimately returned most of the money or property, but kept some of it.

Rhode Islanders can disagree about whether the ability to take citizens’ property without prosecution is a legitimate use of government power even when those citizens are big time drug dealers.  We will probably mostly agree, however, that the limits should be strict and the guaranteed due process rights very strong on behalf of those whose property is taken, which is what the legislation mentioned in the brief would do.

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Self-Discipline and a Right to Consider Data for Our Children’s Schools

Here’s an interesting finding from the Thomas B. Fordham Institute:

  1. Students in Catholic schools are less likely to act out or be disruptive than those in other private schools or in public schools. According to their teachers, Catholic school children argued, fought, got angry, acted impulsively, and disturbed ongoing activities less frequently.
  2. Students in Catholic schools exhibit more self-control than those in other private schools or public schools. Specifically, they were more likely to control their temper, respect others’ property, accept their fellow students’ ideas, and handle peer pressure.
  3. Regardless of demographics, students in Catholic schools exhibit more self-discipline than students in public schools and other private schools. Thus, there is at least some evidence that attending Catholic school may benefit all sorts of children.

Of course, I’m predisposed to find this encouraging, not only for personal reasons because it affirms that something is nowadays missing from secular education and society.  But even if we can write off the results of this study for some reason, that a credible study does find evidence for the conclusion is important.  It indicates that families are rational to want access to different types of schools, given their specific circumstances, and should have increased ability to make those decisions.

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