Things We Read Today, 5: Make It Happen Edition

The Unspoken

Today’s Make It Happen RI conference started off with an auspiciously leading anecdote from Neil Steinberg of the RI Foundation: He marveled that, despite the high unemployment, the Dunkin’ Donuts that he visits daily has been looking for help for weeks.

In the first session in which I participated, one Rhode Island employer mentioned that he simply can’t compete, on the entry-level pay scale, with the government “safety net.”  It reminds me of an old stand-up routine by comedian Louie Anderson in which he acts out the agonizing decision between working grueling hours at the fast food restaurant versus the high pay and perks of dealing drugs on the street… only in this case, the decision maker is more like the junkie, with the government as a dependency pusher.

The bigger unspoken gorilla (from my free-market perspective) was more fundamental to the conference.  The mission on which attendees embarked was to determine what “we” are going to do to revive Rhode Island, but we never really defined “we.”  And Rhode Island is a case study in the fact that there will always be people willing to step forward to define “we” as “government” and themselves as the perfect recipients of funds and arbitors of action.

Why Aren’t Things Happening Already?

In all three sessions that I attended, it seemed to me that we were talking around the core issue.  We all know, generally, what needs to be done (lighten up burdens on private sector activity, ease tax burdens, make government more efficient and less of a special interest in its own right, and so on); everything else is just trying to fit that smooth, round peg into the mere cracks that remain for action.

One of the whiteboard drawings created during a session and posted in the hall read in one section: “We want to fix it. Government sucks.”

The real discussion has to be: How do we change that?  After pressing this question in session 1, I began to wonder if a prior consideration has to be: Is it even possible to change that?

Folks in the entrepreneur room during session 2 were coming up with some great ideas about activities and resources that would encourage, help, and attract innovative go-getters, so I modified my question to: Why isn’t somebody doing this?

One example was a sort of “speed dating” event for investors and entrepreneurs.  Another that I heard multiple times was making a new-business incubator hub of the Superman Building.  All fantastic ideas, but it seems to me that, if they were viable, people would be doing them at a profit.

If people aren’t doing them because nobody has had the idea or has managed to jump on it, then a definition of “we” might be “an enterprising individual or group to take the reins and get wealthy.”

Another reason people are not doing such things might be that the costs are prohibitive.  Updating the Superman Building for modern technologies might be too high of an investment hurdle for a viable business model. It’s an understandable impulse, then, to look for government help. Taking that route, though, means that the scarce resources of Rhode Island are arguably being spent inefficiently on a project that the market has deemed not worthwhile.

This is too-big-to-fail, government-sponsored enterprise (GSE), 38 Studios thinking — socialized risk and private reward.  It means that the Big Idea wasn’t big enough for people to invest in at their own risk, so its advocates turn to the strategy of confiscating money from everybody, via taxes, in order to cover themselves.

If the project works out, then the government gets a small reward, and the advocates get rich.  If it doesn’t, then taxpayers are stuck with the bill, and the advocates at least got to draw a salary for the time before the fall.

The Moral

By the end of the day, I was prepared to start pitching my new tongue-in-cheek idea: Put tolls on all of Rhode Island’s bridges, and use the money to fund some collaborative studies defining the metrics-based deliverables that might incentivize impactful cooperative action that incorporates all stake-holders.  First, I suppose, we’d have to float a bond to pay for a committee (appointed by the governor, with advice and consent of the General Assembly) to interpret what that sentence means.

More seriously, I think the answer is really this simple: Rhode Island needs an attitude shift from “what can we do together?” to “why aren’t you doing what you think needs to be done?”  A whole different attitude and set of conclusions would emerge.

The first approach somehow ends up under the control of people with government officials on speed-dial and funnels sticking out of their pockets.  By contrast, if there is a role for the public sphere in the second approach, the focus isn’t who can be duped into giving whom  money for things that don’t fit viable business models.  Rather, it’s what barriers need to be knocked down to make activities that clearly ought to be economically attractive plausible.

How Pervasive the Wrong Attitude

Different readers will find this anecdote relevant for different reasons: Last night, I had an edifying and enjoyable conversation with some folks in Tiverton, related to my school committee candidacy, with whom I have pretty fundamental philosophical and political differences.

They were insistent that education should not be considered an “industry,” and that public-sector activities and business activities are so different as to belong to different phyla of human activity.  One is focused on profit, they said, and the other is focused on service.

I pointed out that people choose careers for a variety of different reasons, no matter the sector, and in any event, the motive for working doesn’t necessarily change the advisable structure of the workplace.  I noted, further, that my companions had just been telling me that teachers had to be paid market rate or else they would leave for school districts that would pay them more. That’s clearly a “business” type of decision.

What’s more interesting, though, is that they seemed inclined to insist on electing school committee members who are sympathetic to the teachers’ cause — on their side, so to speak, in a cooperative effort to create an educational community for the children.

That’s well and good, and to be honest, I think employers ought to be advocates for their employees.  But that’s not the relationship structure within which collective bargaining and unionization are designed to operate.  If you don’t believe me, listen closely when union organizers are telling their members and the public that, absent their dogged professional intervention, “management” would walk all over “the worker.”

Collective bargaining assumes that the folks in charge are driven to maximize profit.  If voters are putting people into office who begin with the assumption that the process is meant to be almost familial between government officials and government employees, then the negotiations are so imbalanced that they become little more than a mechanism for extracting increasing amounts of money from the people paying the bill.

Personally, I would love a system that allowed a school district to create the family feel that so many of my private-sector employers have striven to create.  (In cynical moments, I’ve suspected that they do so because workers will work harder for an ostensible family.)

But if we’re going to stick with the Management v. Union model, then voters should elect people who will consider maximizing services for students and minimizing costs for residents to be the public-sector’s stand-in for the profit motive.



  • Dan

    Justin – You are one of the few who "get it." A good post. I was wondering what this "event" was all about, and I hoped to goodness it wasn't just another EDC-style expert forum on how to centrally plan the Rhode Island economy.

    Tonight I ate at Chick-fil-A. Their restaurant was clean. They provided free wireless access. I ate an entire meal for $6. The food was excellent. They came by twice and refilled my soda free of charge. They thanked me repeatedly for my business. Their receipt gave me a free sandwich for next time. Why would they do any of this if good service is incompatible with for-profit business? The answer is that they aren't, and the two are in reality conducive to each other.

    As it so happens, I work in a union workplace (but choose not to join, thank goodness I have that choice unlike RI teachers). The union members are locked in a never-ending, loud, vicious battle with management over trifling matters. I instead "represent" myself, get along extremely well with management, and have received two promotions in two years. The fact that they create their own self-fulfilling prophecy of conflict is painfully obvious to all of us who haven't gone down that deep, dark hole.

  • Warrington Faust

    " Another that I heard multiple times was making a new-business incubator hub of the Superman Building. "

    Nothing new here. I know several RI property owners who hae made substantial sums some equity in lieu of rent from "start ups". If I investigated, I expect I would finf that they did that during "hard times" in the rental business.We are having one of those.

    Dan above, unions "create their own self-fulfilling prophecy of conflict". Of course, how else can they tell the workers "what they did for them". If nothing, why pay dues?