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Can Lawmakers Become Rhode Island’s Heroes?

Everyone concerned about the well-being of our state’s families should be alarmed by our unacceptable 48th-place ranking on the Family Prosperity Index (FPI). The FPI demonstrates quantitatively the undeniable link between economic and social policy in determining family prosperity. Whether it is criminal justice reform, taxation, or education, if we are to improve our state’s dismal 48th place ranking in overall family prosperity, we must make helping families the focus of our public policy and private advocacy. Lawmakers can become heroes if they can construct policies that actually address the real needs of real families.

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A More Holistic Path To Help Real Rhode Islanders

It is time to challenge the status quo insider mindset and to search for a more holistic path to help real Rhode Islanders improve their quality of life. This week, the Center held a forum at Bryant University that provided an ideal opportunity for community, religious, and political leaders to convene to begin the process. We brought together leaders on both the left and right to discuss the challenging questions, and the strongest voices stood in stark contrast to the corporate tax-credit policies that have been the center-piece of the Raimondo administration’s economic development agenda.

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Another Government-Wall-Street Scheme; Of Course, RI Is In

The Wall Street Journal’s Kirsten Grind raises a red flag over another mortgage-related investment scheme:

About $3.4 billion has been lent so far for residential projects, and industry executives predict the total will double within the next year. That would likely rank PACE loans as the fastest-growing type of financing in the U.S.

As the loans spread, so do problems that echo the subprime mortgage crisis. Plumbers and repairmen essentially function as loan brokers but have scant training and oversight. They often pitch PACE loans to help land contracting jobs and earn referral fees from lenders, according to loan documents and more than two dozen borrowers, industry executives and employees.

The referring contractor gets a cut.  The municipality gets a cut.  And taxpayers will wind up on the hook if things go wrong.

In case you’re wondering, yes, Rhode Island has this.  Democrat Governor Lincoln Chafee signed the legislation into law in 2013, after Democrat Art Handy (Cranston) passed H6019 and a gang of Democrat state senators led by William Conley (East Providence, Pawtucket) passed S0900.  The RI Center for Freedom & Prosperity did include this legislation in the 2013 iteration of the Freedom Index.

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Again: Minimum Wage Increases Are Political Thievery

When I read the Providence Journal headline, “Rhode Island lawmakers propose $10.50 minimum wage,” I can’t help but wonder: Propose to whom?

A group of Rhode Island state lawmakers has proposed raising the state’s hourly minimum wage by 90 cents this summer.

The bill introduced Wednesday proposes increasing the minimum wage to $10.50 on July 1. The current $9.60 minimum took effect a year ago.

The answer, obviously, is that some legislators are proposing it to other legislators, who are no more the business owners who will be forced to foot the bill than are those doing the proposing.  This is an insular, disconnected group debating whether to claim a political reward for spending somebody else’s money.

Rhode Island legislators are the only group in the state empowered to promise people a nearly 10% increase in pay without having to come up with the money, or even to worry whether people lose their jobs over it.  They’re thieves, plain and simple.

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Corporate Welfare – Are We Being Played?

For years, the insiders have conspired to create the cronyism rampant in the Ocean State. In their zeal for headlines, does the political class ever question the value of these corporate welfare deals? Just this week, we saw the results in questions surrounding the Governor’s claims in the Wexford deal. The tone-deaf Brookings report lays the ground work by recommending that we can achieve better results if, instead of taking the arbitrary approach to 38 Studios-style corporate cronyism that has dominated Rhode Island public policy for decades, we take the same approach in a more targeted and strategic manner. Nonsense.

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No More Blind Eye – General Assembly Must End Corporate Welfare Scam

In light of GoLocalProv’s blockbuster expose Friday that the Wexford job creation claim is off by nine hundred, the General Assembly needs to immediately defund all corporate welfare – and request that the Governor claw back much if not all of the taxpayer subsidies currently earmarked for Wexford.

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Rhode Island “Company of the Year” (and State Ward) Already Has a Broken Turbine

Much to the detriment of the state’s rate payers, Deepwater Wind began generating electricity on December 12. Less than three weeks later, one of its five turbines broke (oopsie). As though wind energy isn’t already expensive enough, now we have to add the cost of making repairs thirteen miles out on the ocean. (‘Cause the cost of water and seawater-related repairs is always very reasonable, right, boat owners …?)

It probably was not a coincidence that the company made this embarrassing admission on a day – the Friday before Christmas – sure to glean the absolute minimum amount of public attention.

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Why Go After the Car Tax?

I’ve been meaning to suggest that this doesn’t look like such a great idea:

[Democrat Speaker of the House from Cranston Nicholas] Mattiello says the state’s recent increase in revenue will help.“Our revenues are on the rise,” he said. “They’re $40 or $50 million ahead of our projections just last year. The first year I was elected our revenues were dropping like a lead ball, hundreds of millions of dollars almost overnight, and now we’re getting that revenue back. So it’s that revenue that we get back that we’re going to dedicate to our taxpayers.”

I get that the car tax is an emotional issue for some people, although it has seemed to come under fire mostly for the unfairness of assessments.  But tax policy should not be determined by emotion.

Other taxes have a more negative effect on jobs and the economy.  That means not only that the state would be better off applying its tax-cutting motivation to other taxes, but also that replacing the car tax with other revenue, as Mattiello suggests above, is by itself a job-killing reform.

Additionally, shifting more decisions about tax revenue and the spending thereof to state government reduces the independence of local government, and to the contrary, that’s something of which we need more.

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Disgraced Speaker Fox Fueled the ShapeUp State-Taxpayer Gravytrain

Responding to a question related to my finding that ShapeUp, which made news recently when its new owner, Virgin Pulse, agreed to remain in Rhode Island in exchange for $5.7 million in state-government subsidies, a Rhode Island House spokesman tells me that the Economic Development Corp. (EDC, now the Commerce Corp.) and Dept. of Health weren’t the only government agencies that whet the company’s appetite for taxpayer dollars.

Disgraced and imprisoned former Speaker of the House Gordon Fox, a progressive Providence Democrat, directed $12,000 to ShapeUp through the General Assembly’s controversial legislative grant program.  The first $7,000 installment of that money arrived in 2007, shortly after the non-profit started.  Another $5,000, half in 2010 and half in 2012, flowed the company’s way as it moved toward for-profit status and received its $100,000 EDC handout.

One wonders how much companies that buy Rhode Island start-ups consider the many paths of claiming Rhode Island taxpayer dollars when shopping for acquisitions.

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Forgotten Families

Will the political class in Rhode Island learn the lesson of the election? It is time to remember forgotten families. As President -elect Donald Trump, and Sen. Bernie Sanders have been claiming for a long time, the system is rigged. While other states are decisively moving forward, Rhode Island is falling in the wrong direction. The Ocean State needs to dare to disrupt the status quo and boldly evolve itself into a regional outlier so that we can become a magnet – on our own – for businesses, jobs and families.

The biggest election impact in the Ocean State is status quo politicians may no longer have their government-centric schemes funded by the federal government! We want a government that works for all of us, not just the chosen few. We understand that if the Ocean State is to become a better home destination, we must offer a better life for American families by creating an environment that will organically produce more and better businesses so as to create more and better jobs.

Rhode Island has the worst business climate in the nation. It ranks 48th on both the Family Prosperity Index of the American Conservative Union and the Jobs and Opportunity Index of our Rhode Island Center for Freedom and Prosperity. It has virtually zero population growth, and it has suffered the ignominy of dozens of other near-bottom rankings. Despite all this, our Rhode Island political class appears content not to rock the boat. We need to empower entrepreneurs, families and all of the people of Rhode Island to make the decisions for our state.

Unless we want our home state to continue with failed rankings, we must switch tracks and focus on policies that broadly help families and small businesses. Haven’t you had enough? Rhode Island has been crippled by a rigged system for far too long. Big spending, high taxes, and insider handouts have led us to where we are now. Unfortunately, in far too many cases, there are empty chairs at our holiday dinner tables. We all know people forced to leave Rhode Island. Your voice is powerful. Continue to speak out and the wave of change will come to the Ocean State.

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Stumbling into Better Policy with Tolls?

I tend to believe the assessment of Robert Pitcher, VP of the American Trucking Association, that Rhode Island legislators intended for a fee reduction on truck registrations to be an insider gimme to in-state truckers, not “to apply to vehicles based outside the state.”  As the Trucking Association describes the problem:

“The new section 31-6-1.1 lowers the fees for trucks and tractors registered in RI,” said Pitcher.  “This includes trucks and tractors registered under [the International Registration Plan (IRP)] and based in [] states other than RI, all of which are under the Plan registered in RI to which they pay fees for all travel in RI.  And of course, this means a reduction in registration fees for a whole lot of trucks — including tractor trailers running through Rhode Island on the interstate.”

Everybody’s been focusing on the incompetence of this poor drafting of the law (if it proves to have the warned-of consequence).  The effort to bring in new revenue from tolls may have the effect of removing existing revenue from registrations.

On reflection, though, maybe that’s not such a bad thing.  Any money not collected for more-general purposes and dedicated to maintaining infrastructure is a good thing, and if the trade is entirely within the tax-and-fees structure for commercial trucks, so much the better.

Of course, the trick would be to prevent the state from making up for the lost revenue from registrations by increasing registration fees on others or just increasing taxes on everybody.  That would just make the whole tolling fiasco ultimately an increase of general taxes.

I wish I could be confident that Rhode Islanders could prevent the state government from ratcheting up revenue in this way, but given that we don’t have a legitimate representative democracy, we’ll just have to continue watching the blundering as insiders move to fix the holes the poked in their graft boat.

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CVS Layoffs – Political Policy AGAIN Comes Home to Roost in RI

[The Gaspee Business Network just issued the following statement/exhortation.]

We are incredibly sad to announce that amid the long standing depressed job market in Rhode Island as well as the worst business climate in the nation, hundreds of moms and dads, struggling young adults, and professionals were laid off today at the CVS corporate office in Woonsocket. The members of the GBN family wish to extend our deepest condolences to those who must now find some means of making ends meet right before the holidays amid one of the worst economies in the country.

The people to blame for these layoffs are the politicians that have run Rhode Island into the ground for decades.

Nothing will change until each and every career politician is removed from office on Smith Hill.

These government bureaucrats have made the cost to employ the hard working men and women in Rhode Island so expensive, companies have no choice but to outsource their labor to other countries.

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Keable’s RhodeWorks Vote Shows Ballot Question #2 Would at Least Give a Chance of Inquiry

A concrete example of a situation in which the state Ethics Commission should have some authority over legislators might give anybody on the fence on ballot question #2 a nudge.  By way of a reminder, owing to a court case, the commission is not permitted to investigate allegations that legislators have conflicts of interest.  Senators and representatives can vote for legislation that will profit them directly, and the Ethics Commission has no authority even to investigate.  Ballot question #2 would repair that check against corruption.

Consider Democrat Representative Cale Keable (Burrillville, Glocester).  According to his official biography, Keable is employed by Providence legal firm Partridge Snow & Hahn, where he works in civil litigation, especially “real estate, construction disputes and environmental litigation.”  According to the state transparency site, Partridge Snow & Hahn has received more than half a million dollars of business from the state government of Rhode Island over the past few years, most of it specifically from the Department of Transportation, for which the firm has handled “infrastructure – engineering” matters and “agency bonds.”

And yet, Keable voted for the DOT’s RhodeWorks toll-and-borrow plan.

Given its often-disappointing approach, the Ethics Commission might not find that to be a problem, even were it fully empowered to investigate.  It’s conceivable that Keable will receive direct benefit in his role at Partridge Snow & Hahn from RhodeWorks (say, by handling litigation arising from the road reconfiguration).  Or, on the other end of the spectrum, his role in the firm may be completely disconnected from anything having to do with its government contracts (as disconnected as it’s possible to be within a single company, that is).

In other words, the Ethics Commission might look into the matter and conclude that Keable’s vote did not represent a conflict of interest under the code of ethics.  But right now, the commission can’t even look into it, leaving Rhode Islanders with no reason to do anything but assume the worst about their legislators.

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Empty Chairs At Our Holiday Dinner Tables

The Providence Journal’s endorsements of House Speaker Nicholas Mattiello, spending bond questions, and incumbent congressman are, in essence, support of the status quo. Such endorsements should be made with a broad, external-looking, national perspective, not with a narrow, inward-looking local lens – as we see so many in our political and media elite continually do.

This perspective is vital for voters. The political class believe that large corporate handouts and small, targeted tax cuts are good for economic development. As compared with other states, these measures are insignificant and ill-directed.

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You Mean People Make Money by Selling Drugs?

Sometimes following the news makes one feel as if everybody else is willfully living in some sort of fantasy.  Today’s Providence Journal article on the profits of medical marijuana in the state, by Jennifer Bogdan and Tom Mooney, gives me that sensation:

Medical marijuana is big business in Rhode Island. It wasn’t intended to be.

Advocates wanted dispensaries to provide a safe, ample supply of medicine for those who needed it. But the program has proliferated virtually unchecked, offering yes, relief for the ill, but also opportunity for investors who can operate behind the opaque screen surrounding Rhode Island’s three dispensaries. …

There were so many questions that they couldn’t answer at the time [legislation was crafted]. “I mean who knew?” How should the dispensaries operate? How much marijuana should they be allowed to grow? Would the legislature be more receptive if dispensaries weren’t influenced by shareholders?

“We said they were supposed to be nonprofits. Why? Well, first of all, we didn’t want them to be in it for the money.”

Oh, come on.  Are people really that unable to break down issues to their core components and categorize them properly in order to predict outcomes?  With medical marijuana, our (famously corrupt) state gave oligopoly authorization to three entities to sell an otherwise illegal product.  As I put it in 2011, the state was estimating that each dispensary would be “an instant $20 million business facilitated by the Department of Health.”  According to today’s article, the profits appear to be smaller and not quite so instant, and yet, the article presents 78% growth over a year, to $17 million for all three dispensaries, as if it’s unexpected and suspicious.

To the extent that the organizations aren’t making big returns on their investments, the article expresses suspicion about other ways in which participants are trying to make money.  It never fails to surprise that people really believe that those who work for non-profits can’t be “in it for the money” and that government power tends to breed corruption.

Look, there’s nothing wrong with making a profit.  Money is just an indication of value, and our economic system is supposed to determine what people value and provide it — whether that means innovating to create new products or building new capacity to produce and supply existing products.  People value drugs, but it takes an investment to get the industry over a start-up hump, and then it takes the flow of money to prove the consumer interest.  (As a society, we love to harvest the fruits of investment, but we never want to pay the reward.)

The way in which Rhode Island legalized marijuana was almost expressly designed to ensure that the government maintained pent-up demand in order to drive up prices and increase the tax take.  That’s been obvious along; people who are surprised really need to go back and review the assumptions that they have about the way things work and reevaluate how they believe government should behave.

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Enough Of The Insider Machine

It is a result of the failed status quo of increased government intervention in our personal and business lives that the Ocean State ranks so poorly on so many national indexes. It is not acceptable that we rank 50th with the worst business climate in the nation, 48th on the national Family Prosperity Index, and 48th on the Center’s Jobs & Opportunity Index. It is up to voters to review all the data, and decide whether or not to hold lawmakers accountable for their voting records this November.

This week, the Center released a new voter guide for the upcoming ballot questions. In heaping over $321,000,000 of additional debt burden on Rhode Island families, as well as on future generations, we are recommending to voters that they “reject” bond Questions #4-7. Just like families who must tighten their credit card debt and avoid luxuries they cannot afford, voters should reject the exorbitant spending proposed by the state, much of which is earmarked to benefit special interest insiders. Only Question #2 – to amend the state constitution restore Ethics Commission authority – received an “Approve” recommendation from the Center.

Haven’t you had enough of the broken status quo here in the Ocean State? We have seen over and over again that the special interest thinking is failing the people of Rhode Island, while enriching the elites. You and your family deserve more. The headlines are full of examples of regular people being kept out of the process and silenced. It is time to stand up to the same old way of doing things here in our state. It will be up to voters to decide this November if they want to continue down the path our state is on or to change things here in Rhode Island.

I think Rhode Islanders have had enough of the insider machine. It is time to make a complete turnaround from the poor scores and last place rankings. We must adopt the free market reforms that can make our state a place where our families can be prosperous. You are powerful. You do not have to tolerate the cronyism and elitist attitude any longer. Don’t be on the sidelines. The rigged system in the Ocean State has kept too many people out of the process. Now is the time for you to speak out and make sure your legislator does more to make Rhode Island a place where our families can achieve their hopes and dreams.

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Take-Aways from the Blockbuster Curt Schilling Interview?

Rhode Islanders for the first time this morning started getting some straight answers about the 38 Studios debacle that put us all on the hook for $89,000,000 as 38 Studios founder and CEO Curt Schilling broke his silence for three riveting hours on the John Depetro Show on WPRO.

So many interesting items came out of the interview. Two of the bigger ones – but by no means the only big ones – for me are:

1.) Gordon Fox crony Michael Corso played a huge role in putting the deal together and acted as traffic cop for the lucrative contracts that arose from the company coming to Rhode Island. Were all of his actions legal? And were the Rhode Island State Police permitted to conduct an adequate investigation of this question? Or was it … um, shepherded by the Attorney General so as to narrow its scope?

2.) Rhode Island and Providence have some of the most onerous building and fire code requirements in the country. Yet the newly built-out 38 Studios headquarters NEVER OBTAINED A CERTIFICATE OF OCCUPANCY because at least in part, Schilling said, he signed autographs for people. (Editorial comment: We pass highly intrusive laws and they don’t get enforced??? ARGH!!!)

Ahem. What were your take-aways?

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Are Rhode Island Elections Rigged?

In a promotional tweet for an article he published in early September on RIPR, Ian Donnis highlights the unseating of Rhode Island House Majority Leader John DeSimone as “evidence that elections in RI are not rigged.”  But I’m not so sure the evidence supports the claim.  Consider:

In a strong display of anti-incumbent sentiment, one-third of the 18 incumbent state lawmakers facing primary challengers went down to defeat. …

With 100 percent of the vote in, according to unofficial results, Ranglin-Vassell got 50.6 percent of the vote (677 votes), compared with 49.4 percent (660 votes) for DeSimone. That count includes mail ballots. …

Six of the 18 General Assembly incumbents facing primary challenges were defeated, reflecting anti-incumbent sentiment among voters.

So only about one-quarter of incumbents even had challengers.  Six new faces in the General Assembly would represent turnover of 8%.  And the highlighted case, here, involved a slim majority win for the challenger of 17 votes.  About the best one can say about these results is that they prove Rhode Island’s electoral system is not perfectly rigged.

I’d go further, though.  Ranglin-Vassell is a member of arguably the most powerful insider group in the state: teachers unions. Moreover, she and her five fellow victorious challengers won by peddling progressives list of vote-buying schemes like an unsustainable minimum wage and more paid days off from work.  In other words, one big-government Democrat defeated another, effecting maybe a slight change in who gets the money they all rob from taxpayers and how they steal it.

That seems pretty rigged to me.

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Anti-Tolling Rally Tomorrow!

At the truck stop in West Greenwich off Route 95: 849 Victory Highway, West Greenwich, RI 02817. Tuesday, October 18, at 11:00 am. (No question, a bit of a tough time of day for a lot of us working folks.)

The Rhode Island Trucking Association and NATSO, the national association representing travel plazas and truckstops, announced today that they will host an informational rally and press conference Oct. 18 to discuss the devastating effects that “RhodeWorks” — the Rhode Island Department of Transportation’s truck-only tolling plan — will have on local businesses and commercial truck drivers that operate within the state of Rhode Island.

The small group of state officials advocating for truck tolls say that they are necessary because the money to repair our bridges cannot be found within the budget. Like most of the data and talking points that accompanied the passage of truck-only tolls, this is a flat-out lie. This money can be found in the budget. Remember also that, under Governor Gina Raimondo’s highly destructive RhodeWorks toll plan, shepherded through the General Assembly by a flip-flopping Speaker Nicholas Mattiello, hundreds of millions of dollars would be completely squandered on items other than bridge repairs: gantries, toll fees, interest – meaning that hundreds of millions of dollars would be coming out of the pockets of truckers and all Rhode Islanders and going down a rat hole rather than into infrastructure repair.

Adding urgency and danger to the situation, a recent federal court ruling in New York has brought tolls on cars in Rhode Island one giant step closer. As WPRO’s John Loughlin correctly pointed out on air Saturday morning, this is almost certainly why the start of work on the 6/10 Connector was rushed. Governor Raimondo and her organized labor supporters want to be sure to sink their toll claws into the state as quickly as possible by getting projects hooked on this destructive new revenue source ahead of a court ruling. (“Oh darn. The courts ruled that we can’t toll just trucks. We have no choice but to toll cars because look at all of the borrowing and construction that we rushed through … er, that is now underway.”)

In addition to the big red flag of the federal court ruling in New York, it is important to note that no other state tolls only trucks. From the beginning, this posed an enormous constitutional flaw in the RhodeWorks toll law. (For more on this, check out Rep Blake Filippi’s excellent op-ed in Thursday’s Providence Journal.) Accordingly, any state leader or legislator who voted for truck tolls in February took the unnecessary and very dangerous step of inviting the toll vampire into all of our homes. If state leaders don’t wise up and rescind truck tolls, it is now just about impossible to envision a scenario by which the toll vampire doesn’t turn to feast on the blood … er, wallets of car owners. It is critical, therefore, that state legislators who voted for tolls be held accountable. Please go here to see how General Assembly incumbents voted on tolls, where their challengers stand on the matter and vote for the candidate who did NOT invite the toll vampire to Rhode Island.

And if you’re able to get away from work for an hour tomorrow, please also stop by this rally. Garlic is optional. But your presence at the rally and, especially, your anti-toll vote on November 8, would send an important message against the toll vampire.

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There are Better Solutions Than Rhode Island’s Status Quo Public Policy Environment

Does anyone trust that an elite cabal of political cronies should centrally engineer our economy? Or do we place more trust in the great people of Rhode Island to be able to unleash their suppressed capacity in a fair and free-market economy, via major tax and regulatory reductions across the board? The top down ideas being presented in the upcoming election would be harmful to our state. It is up to voters to decide for themselves if Rhode Island will be a place where our families can prosper.

There are many examples. We have proven in our Freedom Index that the status quo is moving our state in the wrong direction. Led by Rep. Patricia Morgan and Sen. Elaine Morgan, only 11 of 113 lawmakers earned positive scores on our 2016 Freedom Index. The Sheeple Index, released in partnership with WatchdogRI, shows that there is a dangerous pattern of lawmakers blindly following the leader.

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