Local Politics Should Work Out Problems, Not Put Them Off

I’ve put a post up on Tiverton Fact Check that takes up an aspect of the mixed-use Tiverton Glen project — which opponents are calling “the Mall,” now “the MegaMall” — that hasn’t been mentioned.

The issue and, especially, the opposition have really picked up steam in the past few weeks, in part perhaps because the process has set off a number of alarms.  Notably, after a long and controversial planning-board process, the developer submitted additional requests for zoning changes to the Town Council just before a town hearing.

Still, as often happens around here as issues heat up and a local political action committee called Tiverton 1st turns on its machine, personal attacks are poking through discussion of issues and there’s a frenzy for conformity that makes a too-simple “yes” or “no” question into a heated single issue under which all substantive discussion is rolled.

One larger question that’s been lost is what sort of development will ultimately go in that location.  Somebody’s paying around $20,000 in taxes on that land every year.  Making its sale and development a question of raw political power raises the possibility that the next proposal will come from somebody with more political power and less regard for the interests of the community.

With the state continuing to expand its push for affordable housing — including cut-rate tax bills for affordable developments — those opposing every commercial development that comes down the pike may be setting up a new neighborhood that, far from promising at least some fiscal benefit in the long term, comes nowhere meeting the costs of the government services it uses.

Government Housing Study Proves Deceit About Motivation

Reading Investor’s Business Daily on a Dept. of Housing and Urban Development study showing that forced integration of neighborhoods doesn’t work by its own accounting, one is tempted to find a progressive foible in the fact that the Obama administration is trudging along with its ideology regardless.  It’s another hoary cliché about government that when a pilot program has negative effects, it must mean that the only viable experiment would be to implement the idea fully.

I’d argue that the study actually does prove two things.

First, the ideologues pushing this stuff are lying about what they hope to accomplish:

From 1994 to 2008, HUD moved thousands of mostly African-American families from government projects to higher-quality homes in safer and less racially segregated neighborhoods. The 15-year experiment, dubbed “Moving to Opportunity Initiative,” or MTO, was based on the well-intentioned notion that relocating inner-city minorities to better neighborhoods would boost their employment and education prospects.

But adults for the most part did not get better jobs or get off welfare. In fact, more went on food stamps. And their children did not do better in their new schools.

The goal isn’t to inspire the inner-city transplants to the suburbs to change their ways and integrate with a healthier form of community.  Some progressives might not mind that if it happened, but it’s difficult to avoid the conclusion that the goal is really to inject the suburbs with a large contingent of reliable Democrat voters.

The second lesson from the experiment is that the conservative view of matters is substantially correct.  Simply putting a family in a different environment is not sufficient.

“Moving to lower-poverty neighborhoods does not appear to improve education outcomes, employment or earnings,” the study concluded.

Even then-senior HUD official Raphael Bostic, a black Obama appointee, admitted in a foreword to the 2011 study that families enrolled in the program had “no better educational, employment and income outcomes.”

Worse, crime simply followed them to their safer neighborhoods. “Males … were arrested more often than those in the control group, primarily for property crimes,” the study found.

People have to want to change themselves in order to take advantage of opportunities.  The best plan is to do what we can to give them the tools they need in hard circumstances, but mostly to make sure that there are only minimal barriers for those who’ve decided to go for it. Unfortunately, eliminating barriers decreases the control of government officials and other powerful groups.

Arthur Christopher Schaper: Doing Things the Welfare Way in Woonsocket

As elected officials in Woonsocket battle over the budget process and the tax rate, Arthur Christopher Shaper reminds us of the dependence of city residents on welfare programs.

New Childcare Union Info (More Money than Stated)

Childcare subsidy data from the state Executive Office of Health and Human Services (EOHHS) suggests that the numbers from the House Speaker’s office that I posted were too low.  The difference is that the legislative source included only childcare subsidies paid through the Department of Human Services (DHS), but the total should also include subsidies paid through the Dept. of Children, Youth, and Families (DCYF).

Including both departments, the baseline number for the upcoming fiscal year (FY16) is actually $63.2 million, making the $2.15 increase in the rates paid to private providers an overall 3.4% increase.  The FY15 total was $54.5 million, making the total increase from one year to the next $10.85 million, or 19.9%, raise included.

No agents of the state government will share details of the contract negotiated with the SEIU, but if the range of possible dues is 1.5% to 2.0%, then the total that the state will pay to the labor union in the upcoming fiscal year will be between $980,250 and $1.32 million.

Follow-Up on Childcare Subsidy Increase

Last week, Rhode Islanders learned of a $2.15 million increase in state childcare subsidy rates for providers.  Although details of the first-ever agreement with the Service Employees International Union (SEIU), which now represents the private, independent providers, have still not been released, the House Speaker’s office has provided The Current a few additional budgetary numbers.

The $2.15 million is being added to base spending of $58.9 million, or a 3.65% increase, overall, bringing the total to $61.1 million.  If these provisions of the budget pass as currently written, it will represent a $7.45 million bump in spending for these payments over the current fiscal year, or a 13.90% increase.

Despite requests to multiple government agencies, the state has still not released any details of the agreement, including dues.  Child Care Union Info, with which the RI Center for Freedom & Prosperity has worked in the past, reports a wide variety of dues from other states, although some of the contracts have been terminated.  At the higher end are states in which the union’s dues are calculated as a percentage of subsidies, sometimes with a maximum.

In Michigan and Massachusetts (which is SEIU), the rate is 1.5%.  In Washington (also SEIU), it’s 2%.  Either rate would put the SEIU’s take in Rhode Island around $1 million, or about half of the total raise that the budget would grant.  (Given Rhode Island’s small size, the union would be likely to seek dues at the higher end.)

As I stated in a release just put out by the Center, the governor and General Assembly could have increased payment rates without the involvement of a union, if needy families are having difficult finding childcare providers.  As yet, there has been no claim of such difficulty.  In 2013, the law was changed (in a way that is likely unconstitutional) to give independent childcare providers more leverage, and now the Speaker of the House tells Providence Journal reporter Katherine Gregg that he believes they “deserve to be paid a fair and equitable wage.”

Clearly, these providers have advocates at the State House, and those advocates could have provided the same raises at a lower cost to taxpayers by cutting out the SEIU.  However, between 2004 and 2014, the SEIU gave $30,333 to Rhode Island politicians, according to the Board of Election’s campaign finance Web site.  This makes the interaction win-win-win for everybody except those who have to pay the bills.

UPDATE (2:57 p.m., 6/17/15):

See here for updated numbers.

Another Union Win in Rhode Island (SEIU Childcare Edition)

Yesterday, I noted that legislation in the budget currently under consideration in the Rhode Island House would not, in fact, provide more money to support all-day kindergarten.  Rather, it would give districts the portion of extra state aid that they would have received if their kindergarteners counted as full students in the funding formula even if they don’t have all-day kindergarten in the upcoming school year.

The original version of that legislation would have accelerated the funding formula phase-in to give switching districts the full state aid for all-day kindergarten.  If the General Assembly were to put that language back in, it would come at a cost of about $2.8 million.

Put that on the scale next to the fact that the General Assembly’s budget provides an extra $2.15 million for an increase in payments to state-subsidized childcare workers whom the Service Employees International Union (SEIU) successfully (and controversially) unionized after the General Assembly opened the door for it.  So, rather than helping to provide full-day classes for over 2,000 Rhode Island children, the General Assembly has chosen to give a boost to the cost of a service already being provided by 540 adults.

That’s not really the trade-off, though.

Because this would be the first contract that includes union dues, the actual providers (many low-income, themselves) won’t see all of that extra money.  We don’t know how much the SEIU’s dues will be, because as the Providence Journal article on the budget provision points out, the budget itself is the first indication anybody in the public has that a contract agreement has been reached, but we can put together some rough estimates.

In similar contracts across the country, dues tend to be flat fees of $25 to $35 per month or percentages ranging from 1.3% to 2%.  By the flat fee method, figuring 540 providers, the union dues would cost $162,000 to $226,800.  Going with percentages, the annual dues would be $719,550 to $1,107,000.

In other words, half or more increased cost of providing this service could be going directly to a labor union.

That, of course, depends on providers’ deciding to stay with the union.  Based on the U.S. Supreme Court’s Harris v. Quinn decision last year, it appears that childcare providers cannot be forced to join the union.  No doubt, the SEIU will tell providers that the big increase was entirely its doing, and cutting the union out of the loop would mean no future increases.  In that light, the portion of the $2.15 million that does not go to dues could be seen as some extra sweetener to make the union medicine go down.

Sum of All Fears; Sum of All Obama Policies

We tend to be nostalgic for the times of our youth, but one burden that I have been very happy not to see darken my children’s minds is the prospect of nuclear explosions.  Sure, as long as they exist (and they will, barring a complete global societal collapse) they will be conceivable, but with the end of the Cold War, there’s been a palpable decrease in the possibility.  Terrorists have striven to fill some of the void, but their capabilities are substantially less than those of modern nations and competing superpowers.

This period of relative tranquility may be nearing its end.  Here’s Investor’s Business Daily (via Instapundit):

In the latest edition of its propaganda rag, the Islamic State says it has enough cash to buy a nuclear weapon from Pakistan and smuggle it into the U.S. through Mexico. This is the sum of all fears, and it’s not overblown. …

Despite falling world oil prices that have slowed IS’ energy revenues to about $2 million a week, the terror group is still raking in more than $1 million a day in extortion and taxes alone. IS has also stolen some $500 million from state-owned banks in Iraq.

The incompetent poseur in the White House has made a hazardous mess of the planet, particularly the Middle East, where dangerous people took the measure of the president far better than American voters did, and they’ve taken full advantage of the historic opportunity.

Meanwhile, in order to tilt domestic political scales, Obama has widened the holes in the sieve that is our southern border.  As a draw, to pull people through that sieve, he and his fellow Democrats (with a compliant lack of resistance from Republicans) have proceeded to expand welfare offerings while adding tripwires to the obstacle course of political correctness.

When history’s most momentous events touch upon our daily lives, they tend to seem impossible until bad decisions make them inevitable.

When Healthcare Providers Close

If you see news like this and think, “Maybe the government should step in and fix this,” think again:

Citing years of cuts and freezes in Medicaid payments, Gateway Healthcare announced on Monday that budget deficits are forcing it to close six group homes in Rhode Island for people with mental health and substance abuse issues.

About 70 residents, including 55 adults and 15 children and adolescents, will be affected when the homes close at the end of August, according to Gateway. The nonprofit agency, which is part of the Lifespan health system, pledged to either see their treatment to conclusion or transition them to “an appropriate care setting” before the homes are shuttered.

Closings like this benefit the government.  As the “provider of last resort,” the fewer other resorts there are, the more money the government can demand from the population, the more union employees it can hire, the more dollars get slushed around to their campaign accounts, and generally, the more power they have.

A government like Rhode Island’s wants more people dependent on it.  Watching private care providers for challenged populations go out of business serves that goal.

Wanted on Family Leave: Clarity of Thought

Herewith, an example of the reason our nation may be in inexorable decline, from the AP’s Jennifer McDermott, under the Providence Journal headline of “In R.I., residents gush about paid family leave“:

Rhode Island last year began allowing workers to take up to four weeks of paid leave. Many workers say they love the program, and employers say it hasn’t hurt business as some had feared. …

About 5,000 people have taken paid family leave in Rhode Island so far. New Jersey and California are the other states that provide it, and several states are considering it. Washington state passed legislation but has put off implementing it.

Those two paragraphs convey a fundamentally un-factual and misleading impression.  Rhode Island didn’t just “begin allowing” workers to take off paid leave last year.  There has never been a ban on paid time off.  I’m sure employers have offered that as a benefit to workers, whether formally or ad hoc, as circumstances have come up, and there’s private insurance that people can purchase (or receive as a benefit) to accomplish the same thing.  Similarly, the state doesn’t “provide it.”  In effect, the state is simply mandating the insurance, whether people want it or not.

This program is actually an excellent example of the illness that the West’s creeping progressive political philosophy has wrought.  The government is forcing us to pay for a program that not everybody needs or wants, and then the government takes credit for “providing” the program.  The state is forcibly taking money away from everybody, causing harm to the economy that is difficult to measure, and then taking credit for the relatively small population that benefits (buying votes and excusing even more government power).

The Associated Press found a couple of extreme examples, but we can be sure that the 5,000 people who’ve received some benefits range from those cases, on one end, to abuse of the system, on the other, probably with a bell curve between them.  And even then, only 1% of people holding Rhode Island-based jobs have benefited.

The fact that “the state’s largest employer” found the 500 of its employees who’ve used the program to be a “nonissue” does not tell us the economic effect.  The state is forcing people to pay real money to mitigate a risk that they’re otherwise willing to accept, perhaps because they have contingency plans (like, you know, savings).  When benefits are paid out, there’s no guarantee that the money isn’t just offsetting something that isn’t as economically productive.

Put differently:  Taking money away from people who are working to pay people for not working is not economically neutral, and it’s politically corrosive.

Credit for Healthcare Initiatives

When you read the following, from today’s Providence Journal, who do you think ought to get credit for the innovation?

So with Governor Raimondo pushing her cost-cutting Reinventing Medicaid initiative, Neighborhood Health Plan of Rhode Island is eagerly touting what it says is the early success of a program begun just five months ago to address Medicaid subscribers with frequent and hefty medical bills.

Astute readers might pick up on the fact that the program began five months ago, which would mean the governor would have been implausibly dynamic to get it rolling, if it was possible at all.  Still, you should be forgiven if you finished the paragraph with the impression that Reinventing Medicaid is to credit.  How about this one?

Most states have not [advanced data and analytics to target high-cost insurance members], because of the intense partisanship over “Obamacare” and in some cases because of technical problems.

Instead, they rely on the federal HealthCare.gov website. Rhode Island, however, has its own health-care exchange, HealthSource RI.

So, maybe it’s HealthSource to credit, then.  But wait a moment:

The program has been in development for two years and is similar to other projects under way in the state, Trilla said. Given Reinventing Medicaid’s goals of targeting so-called “high utilizers,” he said that Health@Home has “ended up dovetailing nicely” with the governor’s efforts.

Two years ago would be May 2013, at which point HealthSource was still in development (based on wildly inflated projections).  That suggests this innovation was not driven by Governor Raimondo, and it was not driven by ObamaCare or HealthSource RI.  Rather, one can infer that it was driven by a private organization’s assessment of how it might better use its resources.

Maybe we can find our way to giving government some credit if Neighborhood’s innovation was inspired by the much-maligned Global Waiver program (to which Raimondo’s Reinventing Medicaid initiative bears some striking resemblance), but then the credit would have to go to Republican President Bush and Republican Governor Carcieri.  ObamaCare and Democrats actually hindered savings from that effort.

Sheehan’s Taxation Without Representation and Woulda, Coulda, Never Did on All-Day K

Commentary from state senator and history teacher James Sheehan points to a skewed understanding of representation and the government’s tendency to siphon money away from the public good.

Rhode Island’s Medicaid Reforms Bank on Speculation and Shift Costs

As a state under annual threat of budget deficits that also has the country’s highest Medicaid cost per enrollee, Rhode Island can’t afford not to think about reforming the public health care program.

In the waning days of the presidency of George W. Bush and the governorship of Republican Donald Carcieri, the state experimented with a nation-leading“global waiver” to lower costs in exchange for flexibility.

Even though the experiment was largely successful, intervening governors and the federal Affordable Care Act (ACA; ObamaCare) appear to have blocked parts of the reform and let others peter out.

Now, progressive Democrat Governor Gina Raimondo has convened a Working Group to Reinvent Medicaid, with a collection of reforms of her own, designed to save or raise $91.1 million in state money next year–a little less than 10 percent of the state’s total Medicaid spending.

Continue reading on WatchDog.org.

Letting Disadvantaged Communities Improve

A secondary theme from this Kevin Williamson essay relates to something I’ve been hearing on the subject of school choice, lately:

Being poor is a burden; being poor in a poor community is a danger. Poverty — individual poverty or family poverty — is difficult enough to overcome; overcoming it in an environment in which everybody one encounters is in roughly the same situation (or worse) is much more difficult. One of the best ways to increase generational income mobility for children born in places such as the poor sections of Baltimore is — this will not surprise you — to get the hell out of Baltimore, the sooner the better: The income effects of leaving Baltimore are more pronounced the younger the child is when he leaves.

But exit is not really going to be much of a broad solution for places such as Baltimore and Detroit. The white middle class left long ago; less remarked upon was the dramatic exit of the black middle class from those communities. In poor urban communities, as in the Big White Ghetto of Appalachia, most of those with the resources to leave left long ago. Simply abandoning poor cities is not really much of an answer.

I’ve heard a number of comments from people who express skepticism about school choice based on the assumption that it won’t immediately benefit children in the most challenging circumstances.  The child of the drug-abusing single mother won’t be as likely to benefit from school choice as those of his classmates whose parents have their acts together.

A first-order answer is that this isn’t really true.  School choice programs lead public schools to improve.  Some of that’s simply the pressure of competition, but some of it is also the increased ability of the public schools to concentrate on the needs of the students who remain, for whom there will be more money remaining per student.  And then there are organizations, like the San Miguel school and Star Kids, whose mission is to help such children, specifically.

The more-important answer, though, is that the skeptics’ concern ties into the whole welfare-state mentality that, in actuality, preserves a culture of failure.  Looking at the personal stories of Rep. Ray Hull and Gertrude Jones posted on RIFreedom’s school choice page, it’s striking that they both had families that worked hard to do what was right for their children.  They should be models, not opportunities for naysayers to slip in a “yeah, but.”

Public policy should strive to help people who’ll maximize the opportunity that the community is able to offer.  Some of those people will choose, as Williamson suggests, to exit their bad neighborhoods.  Others will stay.  Either way, though, they’ll point the way toward a path that the next family down the line can follow.

Life boats on a sinking ship should be withheld until the people who are farthest away can reach them.  They should load up shipwreck survivors as they arrive.  Disadvantaged communities need opportunity and inspiration more than they need government holding down others in order to enforce a perverted vision of fairness.

No Superhero to Save Businesses Killed by Minimum Wages

If you harbor any support for minimum wage laws — or, especially, “living wage” laws — Ian Tuttle’s profile of a San Francisco comic book shop is must reading:

“I’m hearing from a lot of customers, ‘I voted for that, and I didn’t realize it would affect you.’” So says Brian Hibbs, owner and operator of Comix Experience, an iconic comic-book and graphic-novel shop on San Francisco’s Divisadero Street, of the city’s new minimum-wage law….

… Hibbs says that the $15-an-hour minimum wage will require a staggering $80,000 in extra revenue annually. “I was appalled!” he says. “My jaw dropped. Eighty-thousand a year! I didn’t know that. I thought we were talking a small amount of money, something I could absorb.”

I don’t know how a small-business owner could have not done the quick math of what a $15 minimum wage would cost him.  Whatever the case, now Hibbs is in the position of trying to think of new add-ons to his business model that will bridge the gap.  A small local bookstore that was going to have to close down was saved, temporarily, by crowd-funding — essentially charitable gifts to cover the additional expenses.

Hibbs notes that only so many businesses can get away with charging a “keep us open” fee before customers are tapped out.  His solution has been to put together a graphic novel club that provides at least some semblance of additional service for the money given, but if it’s enough to bring in another $80,000 in revenue per year, it’s difficult to understand why the store and its customers hadn’t figured that out already.  In other words, it looks like a pretense for charity.

The comic-store owner says he’s a progressive, but even so, he’s inclined to wonder:

“Why,” he asks, “can’t two consenting people make arrangements for less than x dollars per hour?”

One suspects that he’s missing the key aspect of progressivism.  Promising minimum wages allows politicians to buy votes, selling a pledge to make people’s bosses pay them more.  Supporting minimum wages allows voters to capture charitable endorphins on the cheap, by forcing others to pay the bill.

There’s no rational compromise, because the point is for people facing no or minimal consequences to tell other people what to do, and the consequences require some understanding of logic and economics.  Consider: If Hibbs’s new innovation turns out to be a profit center, he might credit the minimum wage law with forcing him to innovate, but the next business down the block might not have the advantages of an artistic and cliquey industry.  One hopes Hibbs and his customers would still be realizing the damage they’ve done to real people’s lives with their votes, but it’s unlikely.

On HealthSource RI on State of the State

4-9-2015 HealthSource-RI: Cost, Performance, Future Funding from John Carlevale on Vimeo.

The key points come at the end, when I suggest that Rhode Islanders should see if their representatives and senators are on some of these bills for socialized medicine and never, ever vote for them again.  It’s frightening that people who want to do these things to us could get into office.

Following Up on EITC

While looking into Rhode Island’s earned income tax credit (EITC) benefit for lower-income workers, I asked Director of Revenue Analysis Paul Dion to clarify something in the revenue expenditure report that his office maintains.  The answer might put Governor Raimondo’s proposal to increase the EITC in a new light.

Under current law, recipients of the EITC can receive 10% of the federal version of the benefit, and 100% of it is refundable, meaning that even if the credit is greater than their actual tax liability, they get the money back as a refund.  (I have confirmed, by the way, that beneficiaries do actually have to have some taxable income.)

The estimates for the cost of the program that I cited from the report were based on the law as it was before the General Assembly changed it last year.  Before, beneficiaries could get 25% of the federal EITC, but they would only receive 15% of a resulting refund.

That change slipped through without much notice, though, because budget documents paired it with a reduction of property tax relief for elderly and disabled residents.  The two changes together actually had a taxpayer savings of $3.9 million.  I, for one, had thought that meant the EITC change turned out to be a reduction, so both parts of the package were cuts.

According to Dion, that was not the case.  The EITC change actually increased the cost of the program by $4,293,291.  Roughly speaking, then, the cost of the program, in 2015, is more like $16 million, rather than $12.2 million, with an average benefit of $167 per year.

For the next budget year, Raimondo’s benefit increase would bring the total program up to $19.1 million, about a 70% increase over two years, bringing the total average benefit to around $192 per year.  The following year would bring the program’s cost up to $22 million or so, because the budget increases it by the same increment in the second year, essentially doubling the cost from its 2014 base.

Can Rhode Island really afford to continue ratcheting up its degree of income redistribution?  Add in other burdens on the economy, like the continually growing minimum wage, and it’s little wonder that our labor force is shrinking and employment struggling.

Reviewing the Earned Income Tax Credit

Debate about Governor Raimondo’s proposed increase in the earned income tax credit illustrates both the spin of advocates and the danger of making wealth redistribution the province of the political process.

Correction on Getting Away Without Paying the New HealthSource Tax

HealthSource RI has asked me to clarify my statement about how many Rhode Islanders will have their payments of the proposed new tax covered by their federal subsidies.

The Ongoing Welfare Argument in Rhode Island

The generosity of Rhode Island’s welfare system is a matter of recurring debate, with taxpayer advocates’ having a general sense that it’s too generous and welfare advocates’ giving the impression that they’re picking points to serve their script.  The latest iteration of the latter comes from Scott MacKay on RIPR.  His first salvo pretty well sets the tone:

Well, let’s start with the basic welfare program that helps the poorest folks in the Ocean State. That’s a program called  Temporary Aid to Needy Families, known by the acronym TANF. The vast majority of these families are single-parent families headed by a single woman. A typical family is a woman with two children. The monthly welfare benefit for such a family is $554 a month, a figure that has not been increased since the 1970s.

MacKay next compares this payment amount to those in other New England states, finding that Rhode Island’s payment is lower than every other state’s in New England except Maine.  First, for clarification, let’s note that it overstates things to say that “the vast majority” of TANF families are single-parent.  Sixty percent are, with another 33% being “zero-parent families” and 7% being two-parent families.  I haven’t found a good definition of “zero-parent families,” but they’re likely children in foster care and teens who, in both cases, have other sources of support.

The more important point, though, comes with MacKay’s comparison to other states.  I looked into this point back in May 2004 and noticed that Rhode Island is slower to reduce benefits for those with other income, which quickly improves Rhode Island’s comparative standing.

Another point I made back then was that it’s too narrow of an analysis to define “welfare” as only the simple cash payments; there are so many other ways that taxpayer dollars flow to social services.  To his credit, MacKay addresses this argument to some degree, giving comparisons for a few other programs, but then he undoes any reasonableness by getting on a high moral horse to spear some straw men, calling on us to “dial down faux rhetoric that demonizes the poor.”

MacKay should dial down the faux rhetoric that demonizes the taxpayer:

  • Who is generous in many ways, including healthcare, education, and more.
  • Who already has the second-highest state and local tax burden in the region.
  • Who has long been struggling to make ends meet in New England’s worst employment environment.
  • Who has a relatively low median income and a struggling middle class.
  • And who has reason to doubt the effectiveness of the state bureaucracy, considering that only 11% of participants in the TANF program are actually fulfilling the program’s theoretical requirement for work or work preparation.

MacKay goes so far as to complain that Governor Raimondo’s budget would remove the extra tax that businesses pay for electricity, but households do not.  That’s shortsighted, inasmuch as every dollar that a business doesn’t have to pay for taxes (or energy) is a dollar that can be spent directly on somebody’s paycheck, or indirectly on employment by growing.

Policies So Good, You’re Not Allowed to Say “No”

Kevin Williamson’s “Utiopia’s Jailers” would be good assigned reading for a low-level political philosophy course:

The Left’s heart is still in East Berlin: If people want to leave your utopia and have the means to do so, then build a wall. If they climb over the wall — as millions of low-income parents with children in private schools (very commonly Catholic schools) do — then build a higher wall. …

It isn’t just education, of course. In much of Canada, private health insurance is effectively banned. The existence of private insurance is a very strong indicator that there are some people who are not entirely pleased with Canada’s single-payer system. (Monopolies rarely have happy customers.) So they opt out, at least in part, exercising the right of exit that is the most fundamental of civil rights. This is an affront to progressive values. Solution? Ban private health insurance. …

… try opting out of Social Security or Medicare and see how long it takes for Uncle Stupid to put you in prison as a tax evader. Those metaphorical prison walls are almost always political veneers for actual prison walls.

A more difficult question is why we let them do it.  In East Berlin, there was the little matter of an invading military force, but Americans are letting progressives rope them down like an incrementally compliant Gulliver.  Williamson’s examples give a good indication of the answer.

Acquiescence to the pitiful likes of President Obama and former Governor Chafee, let alone the legions of Whitehouses, Cicillines, Foxes, and so-ons, requires a long-term effort to miseducate the population, promise them things at others’ expense, and gain a patrician’s power over them.  As the wall goes up, the effort of dismantling it becomes greater and greater, making it easier and easier to succumb to the hope that the malicious builders will stop after one more row of bricks.

They won’t.

RI, Becoming the Medicaid State

Last August, I noted that HealthSource RI had largely become a means of shuffling people into Medicaid, highlighting this grim fact:

The number of new Medicaid enrollments in Rhode Island from March to August was more than five times greater than the number of seasonally adjusted new jobs based in Rhode Island.  If you want a barometer of the direction in which the state is headed, that’s a pretty good one.

Well, herewith, one of the more depressing things I’ve ever read in the Providence Journal:

The total personal income of Rhode Islanders rose 4.3 percent from 2013 to 2014, ranking the Ocean State as the 16th fastest growing state in the country and second in New England, according to figures published Wednesday by the Bureau of Economic Analysis.

But a large portion of that gain was the result of the expansion of Medicaid benefits under Obamacare. 

Total net earnings   — wages, salaries, benefits and business owners profit — rose 3.5 percent in Rhode Island, below the national average of 4.0 percent. Similarly, investment income — including dividends, interest and rent collections — rose 3.2 percent in Rhode Island, also below the national average of 3.4 percent.

Rhode Island can’t wait for Governor Gina Raimondo’s court of handpicked economic apothecaries to stumble upon a formula for turning lead into gold — or welfare handouts into jobs.  We need the state to get off of the economy’s back and stop pushing freebies onto our neighbors, even if the elite progressives have to go into withdrawal with the removal of their steady source of self-affirming power.

Possible Budgeting Illusions from Raimondo

Shortly after Governor Gina Raimondo gave her presentation on Rhode Island’s economy and its budget implications, somebody asked me what I expected in her budget.  Here’s a succinct summary of the presentation from the Cranston Herald editorial board:

Neither cuts nor tax increases, the presentation asserts, will solve the problem. The sales tax would need to be raised from its current 7 percent to 8.8 percent in fiscal 2017 to close the projected budget gap. Meanwhile, the $255.6 million shortfall foreseen for that year significantly exceeds the total budgets of 21 combined state agencies.

The governor’s presentation proposes instead a shifting of resources to focus on job growth, creating a “virtuous cycle” in which those investments in education, infrastructure and property tax relief expand employment opportunities and thus grow the state’s revenue base.

My expectation is that Raimondo will follow the playbook from pension reform, with these steps:

  1. Declare a dire problem, consisting of a short-term emergency and long-term doom.
  2. Propose some technocratic solution that will supposedly fix the long-term problem once and for all.
  3. Make sure that there are enough gimmicks in the solution to defuse the short-term emergency and expect attention to have drifted by the time it falls apart.

The short-term emergency, in this case, is a balanced budget for the  next fiscal year, starting this July, and the long-term doom is the unyielding projected deficits resulting, in large part, from Rhode Island’s continuing economic decline.  The expectation, then, is that Raimondo’s budget will include some sort of new revenue stream, perhaps justified by its use toward some economic development scheme, mixed with budget reductions of the “waste and fraud” variety.  Whether the elusive waste-and-fraud savings could be realized is actually immaterial, inasmuch as the budget would be balanced on paper, and adjustments could be made when the budget is reviewed in November and fixed sometime during the fiscal year, when the eyes of those few who pay attention are mainly focused on the next year’s budget.

That’s what I told the person who asked me.  It was notable, therefore, to see this in yesterday’s Providence Journal:

House Speaker Nicholas Mattiello on Tuesday disclosed that Gov. Gina Raimondo had asked him if she could include “$40 million to $50 million’’ in Medicaid cuts, as a “placeholder” in her first budget proposal, without spelling out how and where she intended to reduce spending in the $2.7 billion government subsidized health-care program.

Mattiello said the governor told him, “in very general terms that there would be some kind of a placeholder and a request for a task force to figure out the cuts.’’

Illegal Immigrant Surge Not Showing Up for Required Court Dates, and Welfare Benefits (By the Way)

Gee, who could have seen this one coming?

The vast majority of the families and minors who where apprehended illegally entering the United States during the border surge of 2012-2014 have vanished to the interior of the U.S., according to an analysis by the Center for Immigration Studies.

According to CIS extrapolations from data obtained by Houston’s KPRC, few of those undocumented immigrants are actually legally allowed to remain in the county, but 91 percent have ignored requirements to appear in immigration court.

Here’s another interesting tidbit that isn’t really a surprise if you were paying attention:

Using the numbers detailed in the report, Vaughan was able to determine that there were more families than unaccompanied minors arriving in the U.S. illegally, even though the problem was often described as an influx of children. Also, she found that at least 92 percent of family units were released into the U.S. even after being apprehended.

There’s no direct link reported (yet), but somehow I can’t help but connect this story with another one, found via the RI Taxpayers‘ daily newsletter.  According to a recent report by Michael Tanner and Charles Hughes, released by the Cato Institute, a few common welfare programs supply the equivalent of a pre-tax income of $43,330, equivalent to $20.83 per hour (if a person were actually foolish enough to work 52 40-hour workweeks to earn it).  Make note, please, that this number does not capture every benefit that’s available in Rhode Island.

According to the report’s Table 4, Rhode Island is number 4 in the country for giving more than the state’s median salary, through these programs.  The $43,330 in government assistance is 117.6% of the median salary of $36,858.

Call me crazy, but this doesn’t seem like a good formula for reviving Rhode Island’s economy.  I wonder if Governor-elect Gina Raimondo will turn this number around.  (Just kidding.)

Gary Morse: PolitiFact RI Wrong on Stenhouse Statement

The Dept. of Housing and Urban Development is very concerned about fairness, and its definition falls within Mike Stenhouse’s characterization of it.

Why Rhode Islanders Have No Hope, Judicial Branch

I frequently state my opinion that there’s basically no rule of law in Rhode Island.  An article in today’s Providence Journal about a lawsuit concerning an “affordable housing” development illustrates why.

The basic point is that citizen groups almost never win.  Either the government agency appeals to the department under which it works, and that department rules in its favor (as with a school committee appealing to the Dept. of Education) or some quasi-judicial agency, like the Ethics Commission, waves the language of the law away, or the courts carry the water.  The foreclosure of that route to reform and civic engagement leads people who might otherwise become more politically active, perhaps even running for office, to give up totally, sometimes directing their efforts to an exit strategy from the state.

I didn’t realize (but probably could have guessed) that Maya Angelou, the poet, has precedential weight in Rhode Island courts:

In his written decision, filed Wednesday, Procaccini opened with a quote from the late Maya Angelou: “ ‘The ache for home lives in all of us, the safe place where we can go as we are and not be questioned.’ As this Court considers the case before it, it keeps Maya Angelou’s wise words in mind.”

Whatever the law says, the ruling class of Rhode Island will find it to say whatever they feel is right.  There’s no way citizens can work to craft language that will actually do what they want it to.

That’s not the rule of law.  It’s an aristocracy.

SNAP Data Sings the Rhode Island Tune

Month-to-month trends of SNAP beneficiaries in Rhode Island and across the country show another way that Rhode Island is unique and reinforces a theory of decline that seems to fit every picture in the Ocean State.

Rhode Island Lags in Food Stamp Reductions

Neil Shah reports, in the Wall Street Journal, that food stamp usage (Supplemental Nutrition Assistance Program [SNAP]) is down in the United States.  Although “food-stamp use remains high, historically speaking”:

There were 46.2 million Americans on food stamps in May, the latest data available, down 1.6 million from a record 47.8 million in December 2012. Some 14.8% of the U.S. population is on the Supplemental Nutrition Assistance Program, or SNAP, down from 15.3% last August, U.S. Department of Agriculture data show.

According to the data, there were 3.0% fewer SNAP participants in May 2014 than in May 2013.  In Rhode Island, the reduction over that same period was 1.3%.

In Rhode Island in May, 178,110 people were participants in the SNAP program.  That’s 16.9% of the population, according to the latest estimate of the U.S. Census, That’s 2.1 percentage points higher than the number for the United States as a whole.  Rhode Island has the 14th highest SNAP usage in the country.  Only Maine is higher, in New England.  (New Hampshire’s at 8.4%, while Connecticut and Massachusetts are both between 12% and 13%.)

It’s interesting, though, that Rhode Island’s reduction of SNAP participants has been so much slower than the national average, given the employment boom shown in Bureau of Labor Statistics (BLS) data.  I’ve asked the U.S. Department of Agriculture if it provides previous monthly estimates of SNAP participation.  It’d be interesting to see how that’s changed month to month.

RI’s Bad Decisions and Burning Money Instead of Tobacco

My op-ed in today’s Providence Journal places the match of Rhode Island’s experience of the tobacco settlement money (a one-time-fix turned bad debt) on the pile of bad decisions that the state government has made in the past decade or so:

According to a review by ProPublica, Rhode Island has just refinanced some of the resulting debt, with the expectation that “the deal would shave $700 million off a $2.8 billion tab due on the bonds in 2052.” In that regard, it’s a bit like the state’s pension reform, which was marketed as salvation but merely shaved about $3 billion from $9 billion of unfunded liability.

The people who operate Rhode Island’s government are racking up quite a list of these liabilities.

RI’s Bad Decisions and Burning Money Instead of Tobacco

My op-ed in today’s Providence Journal places the match of Rhode Island’s experience of the tobacco settlement money (a one-time-fix turned bad debt) on the pile of bad decisions that the state government has made in the past decade or so:

According to a review by ProPublica, Rhode Island has just refinanced some of the resulting debt, with the expectation that “the deal would shave $700 million off a $2.8 billion tab due on the bonds in 2052.” In that regard, it’s a bit like the state’s pension reform, which was marketed as salvation but merely shaved about $3 billion from $9 billion of unfunded liability.

The people who operate Rhode Island’s government are racking up quite a list of these liabilities.

Wrong Term for the Welfare State

It’s a small thing, perhaps, but indicative of the wrong attitude held by supporters of big, nanny government, that Alisha Pina, of the Providence Journal, used the word that I’ve italicized in the following quotation in her article today, about a conference at which Rhode Island’s Department of Human Services touted its efforts to make it easier to hand out taxpayer money:

The department plans to roll out the changes in its five other offices over the next few months.

A new customer-focused system, says Powell, will also debut in September. Applicants will then have a unique PIN and password with which to look at their benefits information and change phone numbers or addresses without having to contact a caseworker.

There are 176,146 individuals getting SNAP assistance and 13,586 residents getting cash assistance — previously referred to as welfare — from the state as of July, said Michael Jolin, Department of Human Services spokesman.

A quick check of Merriam-Webster confirms that the word, “customer,” means “one that purchases a commodity or service.”  Beneficiaries of government hand-outs are not purchasing anything in that transaction.  If anybody is a “customer” of this system, it’s the taxpayer who buys his or her way out of personal responsibility for helping people in the community who are facing tough times.

There’s no shame in using what means are available to support one’s family (if that’s the intention), and it’s understandable, at least, that activists in this day and age would find it appropriate to confiscate money from other people (whose problems they can’t see) in order to give it to people in need (whose problems they can see).  Be empathy what it may, however, we shouldn’t lose the distinction between purchasing and collecting.

Unless, that is, the bureaucrats and journalists intend to suggest that the beneficiaries have purchased the hand-outs with their votes.

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