So you’ve probably heard – and if you haven’t yet, Commerce Corp, formerly the EDC, will be sure that you do – the mildly good news that General Electric will be creating one hundred new jobs in Rhode Island, and possibly more down the road.
But in announcing this, Governor Raimondo fibbed in a big way.
“This is real validation that the steps that we’ve taken to improve our business climate … are paying off,” Raimondo told reporters during a Statehouse news conference.
No, indeed. Just the opposite. General Electric is bringing those jobs here due to targeted taxpayer subsidies, a.k.a., corporate welfare. From the Governor’s own Commerce Secretary:
Commerce Secretary Stefan Pryor said the expected cost in state incentives for those initial 100 jobs is $5.65 million, over 10 years.
Look, I don’t agree with it, because it is unfair and bad policy. But the reality is that once in a rare while, tax incentives are needed to land a big fish.
Of course, the problem is that the Raimondo administration, with the unwise acquiescence of the General Assembly leadership, has substituted wholesale corporate welfare for the broad-based tax and regulatory cuts that the state’s business climate so badly needs. Worse, however, is that the Governor is attempting to mischaracterize the business-as-usual corporate welfare that she offered to G.E. as the broad-based improvement to the state’s business climate that she is strangely reluctant to undertake.
Rhode Island ranks forty eight out of fifty on the RI Center for Freedom and Prosperity’s JOI, Jobs & Opportunity Index. I’m not going to ask Justin Katz, the Center’s Research Director and chief architect of JOI, whether one hundred good paying jobs would improve Rhode Island’s JOI ranking, in part, because he has more than enough to do but mainly because it’s a good guess that the answer is: marginally if at all.
More important is the big take-away from the G.E. news, which WPRO’s Matt Allen nailed this afternoon: companies will respond to lower taxes by bringing jobs. Let’s throw open wide our doors by reducing taxes across the board, rather than on a case by case basis.