July 8, 2010

A Reminder of Our Status

Justin Katz

Here's a reminder of why things have to change dramatically in Rhode Island:

Among the states, Rhode Island's [unemployment] rate of 12.3 percent was the highest in the region and the fourth highest in the U.S. Since May 2009, Rhode Island's rate was up 2.1 percentage points and was among 12 states nationally that recorded increases in their jobless rates during the last 12 months.

The rates in the other New England states were: Massachusetts (9.1 percent), Connecticut (8.3 percent), Maine (7.1 percent), New Hampsire (6.4 percent) and Vermont (6.2 percent).

Remember when Rhode Island hit 10% unemployment, and we all began (finally) to worry? Well, no other state in New England has even hit that point, and we may not see it again ever, unless we change our way of doing business.

One of 12 out of 50 states that saw increasing unemployment over the past year. We need to sweep out the State House and rehire the entire state bureaucracy.

Comments, although monitored, are not necessarily representative of the views Anchor Rising's contributors or approved by them. We reserve the right to delete or modify comments for any reason.

Since 1976, when I was 14 years old, I've held at least one job, usually two. Never during that time was I unemployed. I'm not so sure the government is to blame for our unemployment situation.

Posted by: michael at July 8, 2010 6:02 PM

So Michael, what do you think is to blame for our unemployment situation?

Posted by: BobN at July 8, 2010 8:40 PM


The writing was on the wall long before the bubble burst! Some people were paying attention and some people continued not to pay attention or negated the warnings by indicating it was the “free market” and things would find the natural level of adjustment.

When I purchased my home the rule of thumb was by the time I finished paying my fixed 20 year mortgage the property would be worth “6 times” the purchase price. When I was preparing to sell the properties in my neighborhood were selling at 12 times the purchase price. Also new neighborhood developments had been springing up on vacant farm land with asking prices at 20 times my purchase price.

At first I could not understand where all the money was coming from including all the BMWs and high priced martini bars. Low and behold it turned out to be borrowed money, credit for living the high life now and paying for it later. There were plenty of exotic mortgages floating around and being advertised. It was a feeding frenzy for the young wanting easy money and high life style! There was plenty of cable network TV shows on how to flip a house to make money driving housing market prices up! The new generation we had worked to make life better for was just eating the free and so called easy money up! I call it basic greed!

I must say I did luck out because timing is everything selling my house in 2006 just at the peak of the bubble to retire to Hawaii. I got my asking price of over 12 times purchase price for my house especially because of the added alternate energy.

In 2007 during the RI recession after the bubble burst the neighborhood housing sales and tax evaluations dropped house prices $100,000.00 in my old neighborhood and the prices dropped further in 2008.

Still I believe the couple that purchased my house got a great deal as first time home buyers due to the over 20 years of expansions and alternate energy efficiencies added to the house (documented $1,000.00 per year heat and hot water). It grew from 1,160 sq. ft. to 3,000 sq. ft. with an oversize attached 2 ½ car insulated garage/workshop, a 38 ft. by 12 ft. attached passive solar greenhouse with 6 ft. dia. Jacuzzi redwood hot tub and a ½ acre park like garden landscape that drew an award from the city mayor for neighborhood beautification all abutting 500 acres of sheltered wooded watershed with an unobstructed full sunset view to the west. If they are in it for the long haul they will make the money back as long as they keep the property and land in good shape.

RI is still bleeding in the housing, job, tourist and business markets mainly because there has been a regionalization within the state and a reluctance of working together for the greater good of the state. This goes back to each city and town, Chamber of Commerce, each tourist bureau, RI Business Round Table and RI Economic Development Corporation. There are a lot of politics played in the background as each area of the state vies for income dollars (Newport, RI tourist and dinning prices are outrageous! Downright robbery and Providence is right behind! According to tourist industry study Hotel, food and rental car taxes in RI are $5 a day total more than HI for same establishments). There is no unified state-wide plan. Nobody is really working together!

Last year when I was in RI RI Mall was an empty shell! Everyone had moved to strip malls or gone out of business! Hello???? If a city is bleeding stores like that doesn’t anyone want to know what’s happening?

Nobody in RI is thinking long term! It is all about the quick fix! I and my wife had lunch in Newport once after attending her Newport church one Sunday. Cost me near $100 for soup, sandwich, a drink and I had to pay additional $20 to park because the parking lot in front of establishment was not owned by them and there was no partnership deal. I have not eaten in Newport and refuse to eat in Newport or do any business in Newport during my annual visits to RI.

I can cite many many times and reasons my wife and I stopped attending events, fairs, festivals in RI and doing business in RI because of the short sightedness of the local RI establishments. Do you want your money now in one shot or a percentage over the long run with repeat business because if it is one shot we will not be back?

There was an up tic in rudeness, crass behavior, pushing and shoving including increases in admission prices that just were not worth the effort to attend. It was easier to go out of state (CT, MA, NH, ME, NY, or VT) to the same type of venue which was cheaper and more civil and family orientated.

When I was working with RI National Guard and Department of Administration under the Federal Government to help manage a business model activity providing world-wide international video telecommunications for at break-even cost state and local RI business did not want to buy in where other states saw the value and jumped in with two feet! After marketing and showing RI how much money would be saved there was finally a buy in but several State of RI agencies still tried to build their own systems (100 thousands spent) because they didn’t want to drive 15 min in the snow!

With the various RI Chamber of Commerce and private businesses it was always what are we going to get out of it besides lower cost? It was always like they wanted to be paid for using the service! However, with all the complaints of wanting something for nothing the Federal Government gave RI a “Top Ten in the Nation” award based on actual usage for doing business, saving money but it was frustrating and like pulling teeth every day!

Justin I don’t think you can pin everything on everyone located on Smith Hill. There is a cultural mind set in RI of a flying moth attracted to the burning candle light!

Posted by: Ken at July 8, 2010 10:44 PM

Ken writes:

"Justin I don’t think you can pin everything on everyone located on Smith Hill. There is a cultural mind set in RI of a flying moth attracted to the burning candle light!"

Is this not what is always observed about "working democracies"? the government reflects the people and the people reflect the government.

I have seen only anecdotal evidence, but I am convinced that all the Rhode Islanders who really care about their well being have already left.

I have been accused of being racist for this observation, but I think it is well settled that RI was losing 1% of its white population every year, for years. This seems to have abated with the current lack of opportunity elsewhere.

Posted by: Warrington Faust at July 8, 2010 11:36 PM

Bob N., part of the blame is lack of initiative among the citizens. It wouldn't kill people to be underemployed for a while while looking for work that suits them. The illegal immigration problem exists in large part because they do "The jobs Americans won't do."

I've washed dishes, tended bar, worked as a line cook, cleaned offices, ran a small cleaning company, built decks, I even made money watering people's lawns.

Posted by: michael at July 9, 2010 12:06 AM

Michael, I have no doubt that you are the kind of good citizen with a hard work ethic and a sense of civic duty that all citizens should be. No need to justify your own history.

I agree with your analysis "part of the blame is lack of initiative among the citizens. It wouldn't kill people to be underemployed for a while while looking for work that suits them," as far as it goes. But it's rather shallow. Why do the citizens have a lack of initiative? Do government policies and programs play a role in that cultural change?

I have my answers to those questions, but will not write them yet so as not to impose on yours.

Posted by: BobN at July 9, 2010 8:32 AM

Remember Bob, that these forums are like a discussion to me, I don't use them as a soapbox to dictate my ideas.

So, that being said, it is my opinion that the safety net of government programs, training, unemployment, disability and health care coverage, including EFT and welfare has grown to the point that to pay for these things we need to soak the working people and their employers to pay for the non-workers, including the baby boomers who look toward retirement as some kind of government sponsored vacation, and plan on Medicaide to take care of their elderly parents who have hidden their money so the "nursing home" won't get it, conveniently forgetting that "the nursing home" will still get it, only the rest of us will pay.

And furthermore, since I'm not using this forum as a soapbox (haha) the citizenry is being indoctrinated into class warfare (word-fare really) between left and right, public and private workers, rich vs poor and insured vs uninsured. We (middle class) are sheep being led by people who make tons of money spinning their ideas, writing bullshit speeches for bullshit politicians, running talk shows for no real ideological reason other than to improve ratings to increase revenue for the corporation to negotiate better endorsement deals and salaries for themselves.

The government needs to get out of the over governing position, people need to learn to provide for themselves and capitalism will take it's natural course.

Necessity is the mother of invention, complacency kills it.

This is the problem with forums. I don't have anybody to slow me down when I get on a roll. I could go on all day but my fingers are getting tired, and I have a business to run.

Looking forward to your reply.

Posted by: michael at July 9, 2010 2:43 PM

The Federal government gave no COLA this year on federal civil service pensions;social security;and disabled veterans' benefits.As a recipient of all three(albeit severely reduced social security)I figured that was something I had to accept because so many people are taking a worse hit.
The state and municipal workers won't budge.I hope their greed undoes them.A COLA on a non-pension from a bankrupt system is zero.They have to accept some loss to preserve what they have.
It's not like my taxes and expenses are going down.
And we have people like Stuart asking for ever more tax burdens on middle class people-he wants us to believe only on the rich,but like his god Obama,that's a load of crap.
The upcoming return of the marriage penalty and the cutting of the child credit will hit middle class families harder than anyone else.F**k liberals where they breathe.The liberal politicins cater only to special intersts.So do a lot of conservatives,and this is why people like Stuart,OTL,and others of like mind spare no invective against Tea Party members and sympathizers-they are scared.just notice the never ending onscenities directed at Sarah Palin by the like of Rudy Cheeks;Nancy Green(couched in dulcet tones);the RIF gang,etc.
Why does this woman bother them if,as they say,she represents very few?Because a lot of people,even those like me,who wouldn't support her for national office know that she tells thee truth a lot.You don't have to be enamored of someone to appreciate them being on the right track.Glenn Beck is a good example.I find his histrionics annoying,but he frequently is correct.The supercilious character calling himself Stuart refers to Beck as a zookeeper.Beck makes stuart nervous or he wouldn't waste two sentences on him.
BTW,our"President",Obama,is acting more thin skinned and childish than ever when dealing with criticism.Whatever Bush's faults(they were numerous and serious)he didn't throw tantrums every other day.
Obama's disgusting remark that the Israelis didn't trust him because his middle name is Hussein,is an example.
They certainly trusted King Hussein of Jordan because he was a man of honor.
This guy is someone to be trusted by no one except the ACORN crowd.

Posted by: joe bernstein at July 10, 2010 9:25 AM

One has to wonder if people read tea leaves based on every stat and event.....like, BobN, it has been very hot recently. Is that proof of Global Warming? The righties laughed when it was cold and told us that proved we were not in a GW phase...does it work both ways?

Comparing RI to VT and many of those other states is silly stuff. RI is a unique city-state, and if you check the unemployment rate in more urbanized areas - guess what? It's higher!

It has absolutely nothing- or very little- to do with government, and everything to do with the business cycle and bubbles. Construction companies that had 100's of workers during the 2000-2006 period now have few or none. Do you expect government to make some jobs for them?

The last bubble created thousands of jobs in finance and mortgage flipping, etc. etc. - all are gone now.

RI needs to build the next economy, and although government can help this along a small amount, most of it has to do with individual innovation. So, when is Justin gonna strike out on his own with the new "Catholic Carpenters" business...and help build jobs and an economy? That's what it takes - complaining never built anything. If it did, AR would have built a skyscrapers with corner offices for many of you.

Posted by: Stuart at July 10, 2010 1:11 PM
Post a comment

Remember personal info?

Important note: The text "http:" cannot appear anywhere in your comment.