Moving Forward, Double Dip or Not

The specter of a double-dip recession is in the air, and it doesn’t take an economics degree to understand that a return to economic retraction, in a state that entered the Great Recession early and as the rest of the country limps forward, would be bad.  Worse, the solutions being proffered by those in power and those who advise them do not give any evidence of bold visions, or even much understanding of human nature.

One could pick, almost at random, any article describing Rhode Island’s economic condition for an example, but here’s John Simmons, of the Rhode Island Public Expenditure Council (RIPEC), voicing one of my least favorite tropes about what the state needs to do:

“We need to improve the work force we have,” Simmons said, referring to the gap between the skills Rhode Islanders possess and the kinds of skills needed for jobs in this economy.

Frankly, it’s only a little bit of an exaggeration to suggest that the single most-important skill for struggling Rhode Islanders would be relocating.  But note this, Rhode Island:  The dreaded “skills gap” is your fault, and to the extent that the ruling class takes responsibility, it’s of the sort that deflects blame: We didn’t make it easy enough for you to become the kind of people we need you to be.

They’ve sat around some tables and spoken from some podiums, and they’ve determined what sorts of businesses we ought to have.  They’ve looked into the future and declared a winner.  And it’s up to you to make their vision a reality.  Tinker Bell can revive if only the children in the audience will believe strongly enough, and the RI economy can fly if only its people invest their lives sufficiently in somebody else’s plan.  Or be replaced.

Look at Rhode Island’s rankings.  Its reputation for difficulty and regulation.  Its affection for requiring licenses.  The ever-looming threat of tax hikes.  And the dark insinuations of a government that wants to dive more deeply into state-run gambling.

There are many people in Rhode Island who would gladly invest their lives in economic activity, but everything about the way the state does businesses with its people pushes them toward an overall economy chosen by a few groups with vested interests in past practice.  This isn’t a problem that can be resolved by increments.

Some new expenditures on education, with an innovative twist here or there, will not suffice.  Each person in Rhode Island will only get one life, and a twenty- or thirty-year turnaround scheme — even if it had a chance of working — would cost him or her a critical portion of it.  Those with the most to offer cannot be expected to wait around or to conform their talents and dreams to the presumed business acumen of government operators.

  • michael

    It is not impossible to open a business here. It could be a little easier, that's true, and now and then some goofy guys in suits come in and charge you $120.00 to inspect your four gallon water heater, but other than that and the $500.00 "incorporation fee" and the $250.00 Department of Health permit, and the fire department inspection and mechanical inspection which includes an electrician and plumber, not on the same day of course, and the license to make sales at retail, which doesn't include the Sunday sales permit which you have to get from your local police, and the obligatory workmen s compensation insurance, which for some crazy reason was just raised by ten percent, other than that, things are quite easy.

    Except for the tax on tangible property, which is a city tax, and payroll tax, and I almost forgot about the excise tax of 10% of my profit, not to mention income tax, but I'll have none of that for a few more years due to all the other taxes, but at least I get to write it off, except for this year, because they eliminated itemized deductions…yeah, it's easy.

    I think I wrote an editorial once about how easy it is to open a business in RI. It really wasn't as bad as I expected. Staying in business, well, that's another story.

  • Dan

    Why would they make it difficult to open a business? They want you to do that so they can bleed you for everything you have once you've invested too much to move. The politicians are corrupt, not stupid.

    Glad to see you've backed off from your "everyone else just likes to complain – the business climate in RI is fine" message from 2010, Michael. I'm sorry you had to learn the hard way why Rhode Island is perpetually economically depressed. It's not the weather.