Ahem, look what they are trying to do next door in Massachusetts

While RI politicians continue to avoid dealing constructively and aggressively with the structural problems underlying the state's financial crisis, some of our neighbors in Massachusetts are heading in the completely opposite direction.

Yes, in the state formerly known as Taxachusetts, a band of activist citizens are pushing for a statewide vote to eliminate the state income tax:

A group of antitax activists launched a campaign over the weekend to abolish the state income tax, setting the stage for a contentious public battle if the measure is added to the ballot this fall.

After pushing a similar initiative that almost passed six years ago, a group called the Committee for Small Government is back for another round, asking voters to end the income tax and save the average taxpayer $3,600 a year. The group, led by libertarian Carla Howell, is almost certain to gather the 11,000 signatures needed to put a question on the November ballot.

To say that state officials are worried about the prospect would be an understatement.

Community, political, and business officials are grasping for words such as "chaos," "devastating," and "catastrophe" to describe the scenario that would unfold if the measure passes.

Six years ago, Beacon Hill didn't pay much attention to what seemed to be a pie-in-the-sky campaign. Confident that voters would reject the plan as folly, no one even organized a campaign to fight it.

But it almost passed, gaining the support of 45 percent of voters...

A fledgling coalition of city and town officials and union officials hired former Blue Cross Blue Shield executive and civic leader Peter Meade to head a battle against the income tax cut, and is interviewing high-powered public relations firms. Their Coalition for Our Communities plans a fund-raising and public educational campaign to combat the allure of the tax-cutting measure, which would cost the state roughly $12.7 billion - about 40 percent of the budget.

Some political observers are expecting a public tax battle the likes of which has not been seen since Governor Michael S. Dukakis was in office...

These are the kind of engaged, activist people I had in mind when I wrote earlier this week about the crisis in RI and how important it was for RI to have a coalition of citizens committed to change. Why do we almost NEVER hear of similar groups of people in RI?

On a concluding note, I got a chuckle out of Andy Roth's words about the Massachusetts' initiative:

I don't know what I like more about this article. The fact that Massachusetts citizens are pushing for a repeal of the income tax, or the fact that bureaucrats are going bonkers with the prospect that they might succeed.

And how would raising taxes even higher in RI not incentivize further flight from the state by more residents?

ADDENDUM

In the comments section, Ken is kind to pass along the link to the American Legislative Exchange Council (ALEC) report entitled Rich States/Poor States: ALEC-Laffer State Economic Competitiveness Index. Key sections include the executive summary here and the section "America's Economic Black Hole: The Northeast" on pages 15-18 of the report. The Rhode Island summary can be found here, where they describe the economic outlook as 48th out of the 50 states.

There is no "moderate" solution option left anymore; the entrenched special interests and politicians have made sure of that. The state is headed for collapse under the status quo. So we might as well throw the state into bankruptcy and restructure it with some logic.

Anchor on the Air

As those who listened already know, Don switched with Andrew for this Wednesday's segment on the Matt Allen show. His commentary related to his post on Rhode Island's failure to address its current crisis can be streamed by clicking here (or download).

Next Wednesday at 6:50 p.m., Andrew will have his moment in the spotlight.

Gio Cicione: "This is your moment that the citizens take back the state from the special interests"

From today's Valley Breeze.

It is said that every man and every woman - somewhere over the course of their life - must have their moment.

It is a moment of recognition that something larger than the day to day details of our own family life is beckoning and we must answer to it. I would propose to you that such a moment has arrived for Rhode Islanders.

The checklist of unfavorable economic conditions in which our state now exists should be by now frighteningly familiar:

* A structural deficit at more than half a billion dollars and growing.

* Seventh highest property tax burden

* Overall fourth highest tax burden

* Worst business climate - including small business climate - in the nation

* Among most generous states in pay and benefits to state workers

* Eighth most highly paid teachers/school results in bottom fifth of nation

Haven't you had enough? If you have, I ask you to take action.

The Rhode Island Republican Party asks you to make a run for the General Assembly to show you are not going to abandon our state. This is your moment that the citizens take back the state from the special interests.

The Rhode Island Republican Party does not owe anything to the grip of greed of the public employee unions and their contracts - and many who do their bidding in our legislature - which have driven this state to its present condition of bankruptcy.

The Rhode Island Republican Party firmly believes the smallest state in the nation has no business being among the most free spending in the nation to those employees in nearly every measurable benefit, especially for the size of their retirement pensions which we cannot afford.

A bankrupted state cannot adequately finance its schools or public universities. It will leave all of our school age children with inferior educations when compared to other states and diminished prospects for college and beyond.

A bankrupted state does not attract businesses that provide jobs, careers and financial stability to college graduates and young people hoping to start families. It drives your own college-educated son or daughter far away from home to more prosperous states where they take their future earning power with them.

A bankrupted state will not nourish the stable, safe, small business-thriving, friendly communities many of us grew up in. Rhode Island is headed toward deteriorating into a state of rundown, boarded-up, forgotten neighborhoods offering far less prosperity, stability and safety to families here. If this is not the future state you want for your children, it's time to say "Enough."

Come join us. We will help you launch your campaign if you will help us fight back.

It doesn't take lots of money or any sacrifice greater than the ones you would make for your family on any given day. Like all things worth doing in life, it just takes desire and hard work.

When you win, we will together pursue a plan to drastically cut our out of control spending, immediately reduce your property and income taxes, put education dollars back into classrooms not just contracts, protect our environment, and to bring companies and good jobs back to Rhode Island. Oh yes, we can!

Contact our office at 401-732-8282. Contact me personally at 401-289-2380.

Giovanni Cicione

R.I. GOP chairman

Giving Legislators the Chance to Turn Down Their Cake and Eat It, Too

One wonders whether Senate Democrat Doyenne Teresa Paiva Weed feels that this came out wrong:

But while House leaders have declared themselves in support of the move [to require legislators to contribute to their healthcare costs], which has both financial and symbolic significance in a year when the state is facing a huge deficit and thousands face removal from state subsidized health-care rolls, Senate leaders are less enthusiastic. In a brief interview yesterday, Senate Majority Leader M. Teresa Paiva Weed explained why.

Asked about her reservations about the bill, she said she believes lawmakers show more "leadership" by contributing voluntarily to the cost of their health insurance, as she decided to do in recent weeks.

You see, they have to give themselves the opportunity to soak the Rhode Island taxpayers for $17,620 fully paid family healthcare so that they can have the opportunity to decline to take it. Or not:

At last count, only 26 of the state's 113 lawmakers — more than half of them Republican — are voluntarily paying a portion of their health-care premiums. The majority pay nothing; 21 lawmakers each get a $2,002 annual waiver payment for giving it up.

Ah, such leadership as we have in Rhode Island!

... a handful of legislators fretted that ending the $2,002 waiver payments might run up the state's cost by spurring some legislators into taking state-subsidized insurance they are now doing without.

"A handful," huh? Guess we'll just have to vote them all out of office.

Where Are The Appraisals?

The appraisals which justified and, therefore, facilitated the purchase of wet, polluted, unusable land from former Mayor William Macera (D-Johnston) and his family by the RIRRC, aka the Central Landfill, for many times its actual value. Mike Stanton reported in Sunday's Providence Journal:

Resource Recovery paid $163,000 an acre for the property, the current audit notes — a price that would have been consistent with other area land prices “assuming the land was usable.” But because of the dump, not all of the land was usable. And auditors could find no appraisals or any information “regarding the value of the property.”

“Serious environmental issues do exist” that will require “substantial” cleanup costs, the audit concluded.

In addition to the appraisals, we have an A.P.B. out for either the invoice of services by the appraiser or the cancelled checks in payment of same. These appraisals must have been quite special; extraordinary, in fact. Was a correspondingly extraordinary fee invoiced or disbursed for it?

We should note also that the source of the $8m was compulsory fees collected from the people and businesses of Rhode Island. Inasmuch as the RIRRC was able to accummulate $8m from those fees to spend on unusable land, clearly, there is room for an adustment of the fee structure at the Central Landfill.

Allan Fung: "Please Join Me Once Again as I Embark on This Journey to Bring Cranston Back and Make it a Place Where Dreams Come True"

Allan Fung, former Cranston citywide Councilman who lost a 2006 Mayoral bid to current mayor Michael Napolitano by less than 100 votes, announced last evening his intention to run for Mayor of Cranston again this year; here are a few excerpts from his announcement address…

Tonight, we stand here two years and a world apart from where Cranston was when I first announced my candidacy for Mayor two years ago. After serving on the City Council for four years, Cranston was headed in the right direction. The city was recovering from years of fiscal mismanagement, including having the lowest bond rating in the nation. I was proud to have been part of the team who worked to turn Cranston around....

Our city has suffered two years of broken promises. It is easy to shake hands and walk door-to-door telling people what they want to hear. Politicians who lack the basic knowledge of municipal finance believe that short-term fixes are enough. The current Mayor promised tax-relief at his campaign kick-off. Instead, Cranston residents were faced last year with the maximum tax increase allowed by state law after inheriting a city with a balanced budget, increased funding of the city's pension plan, and approval of three affordable labor agreements. This was the largest tax-increase that residents faced since the time when Cranston was merely days away from declaring bankruptcy. The Mayor's maximum tax-hike was uncalled for and was a betrayal of you, the taxpayer....

Mayor Napolitano's tax freeze budget this year is merely an election year trick, the same kind of trick that former Mayor O'Leary played on the voters of Cranston. Mayor Napolitano proposes to use a portion of the Rainy Day Fund in his budget while ignoring the multi-million dollar deficit that the City's schools are accumulating. Because the Mayor refuses to make real changes in how we operate, he will either raise taxes or spend substantially more of the Rainy Day Fund when the bills come due after the election. My friends, our City's future is in jeopardy as this Mayor makes decisions based on his own selfish political ambitions....

In these stormy times, Cranston needs a strong leader. It needs a leader who realizes that empty promises may win votes for a candidate, but do not result in a win for the people of Cranston. I will continue to tell you the truth as we move forward. I have the track record of being conservative with your money. During my tenure on the City Council, we ratified three reasonable labor contracts, ensured audits were completed on time, controlled expenses and ran surpluses that helped replenish the Rainy Day Fund. Together, we can stand up for the taxpayers of our great city....

So ladies and gentlemen, please join me once again as I embark on this journey to bring Cranston back and make it a place where dreams can come true…I am ready to take on that challenge -- and ask you tonight once again to believe in me and join me in facing the challenge. Together, let us lead our city back to greatness.

I was hoping to be able to bill this as Alan Fung's first official interview after announcing his candidacy, but the Channel 12 guys got across the room before I did, so here is the question I asked former Councilman Fung during his second official interview after announcing his candidacy…

Anchor Rising: Forgive me for using the wimpy formulation of this question; some people say that the problem with Rhode Island is that even though everybody knows what the problems are, Rhode Islanders keep sending the same politicians back into office who won't do anything about them. You have more direct experience with that than anyone. What's different about Cranston and/or about your campaign that's going to make things different this time?

Allan Fung: You know, my biggest platform plank is being honest with the taxpayers. I think they are frustrated with the broken promises they keep hearing year after year from the same politicians. I've always been forthright with them about where our city has been and where it's going, and during these next six months, I am going to be laying out my plan to get the city back on the right track, to make sure that Cranston is on sound financial footing, not only for the short term, but for the long term future.

Meaningless talk and inaction in a crisis: Why Rhode Island's crisis will get worse before it gets better & what to do about it

The state of Rhode Island is in a deep financial crisis. Resolving its large budget deficits will require real and significant structural changes to the status quo.

The status quo was best summed up in a passing comment by Representative Gorham last night on the Matt Allen show: Gorham talked about how the state budget deal is typically reached in a "clandestine" fashion in the office of a just a few state legislators and then rapidly moved to a vote.

That approach is, in no small way, how RI got into its current mess and maintaining such practices won't yield successful and lasting change.

As someone who has led corporate turnarounds for nearly 20 years and has read extensively on what it takes to lead successful change initiatives, it is appalling how little progress has been made to effect real change in the face of the current crisis here in RI. It's not like these structural problems are a new development!

One of my favorite authors on leadership and change is Harvard Business School professor John Kotter. He has been writing for years about the topic of leading change and is a world authority on the subject. More on his books can be found here.

For the last decade, Kotter has been writing extensively on what he calls the "Eight Step Process of Successful Change." Here is an excerpt from his "Iceberg" book, a book which uses a fable to describe what it takes to realize successful change. Easily accessible to the layperson, I recommend reading it.

Set the Stage

1. Create a sense of urgency: Help others see the need for change and the importance of acting immediately.

2. Pull together the guiding team: Make sure there is a powerful group guiding the change - one with leadership skills, credibility, communications ability, authority, analytical skills, and a sense of urgency.

Decide What to Do

3. Develop the change vision and strategy: Clarify how the future will be different from the past, and how you can make that future a reality.

Make it Happen

4. Communicate for understanding: Make sure as many others as possible understand and accept the vision and strategy.

5. Empower others to act: Remove as many barriers as possible so that those who want to make the vision a reality can do so.

6. Produce short-term wins: Create some visible, unambiguous successes as soon as possible.

7. Don't let up: Press harder and faster after the first successes. Be relentless with initiating change after change until the vision is a reality.

Make It Stick

8. Create a new culture: Hold on to the new ways of behaving, and make sure they succeed, until they become strong enough to replace old traditions.

As we all reflect on the severe crisis here in RI, one of the most disconcerting conclusions is how RI is currently 0-for-8 in moving in the right direction.

Where is the sense of urgency?

Where is the powerful guiding team?

What is the change vision and strategy?

There will be no successful structural changes in RI until those questions are answered in tangible and affirmative ways. If they are not, the crisis will worsen instead of getting better.

Avoiding the hard choices which go with implementing difficult changes is a part of human nature and, at one level, perfectly understandable. Which is why it is so important for there to be leaders who display the requisite courage to initiate the change dynamic.

The structural status quo in Rhode Island is built on a foundation of economic fiction. And, whether certain people like it or not, economic fictions simply cannot persist - even if many people choose to ignore the problems in the hope they will just go away. Which is exactly what causes bad situations to turn into crises.

Tackling RI's economic fictions matters for reasons beyond just balancing a budget. The well-being and futures of many families will be affected. As I wrote back in 2004:

...Even so, this debate is about more than current taxation levels and today's family budgets. It is about freedom and opportunity for all -- and family budgets in the future. The greatness of our country is that people can live the American dream through the power of education and hard work.

High taxation and mediocre public education create a disincentive for new-business formation in Rhode Island. That means fewer new jobs, and less of a chance for working people to realize the American dream. It also means people have an economic incentive to leave the state -- and the ones who can afford to do so will continue to leave.

Unfortunately, the ones who cannot afford to leave are the people who can least afford the crushing blow of high taxation and mediocre education. The status quo dooms these families to an ongoing decline in their standard of living. That is unjust...

We are at a crossroads in Rhode Island. If we tackle issues now, a turnaround with only some pain is possible. If we delay, we will doom multiple generations of working families and retirees to further tax hell and a reduction in their standard of living. That is wrong.

This public debate is about breaking the chains of bondage and giving all citizens the freedom to live the American dream here in Rhode Island. What greater legacy can we leave for our children than a fair shot at the American dream here in their state?

...Let's tear down this wall of economic fiction, and let freedom ring out across the state. Let's make Rhode Island a vibrant land of freedom and opportunity, for all working families.

Either we will do change here in RI or change will do us. The failure to act over the last 4 years means the changes will now be far more painful. And the pain will only deepen more if further inaction accompanies the passage of yet more time.

So, have you done your part to increase the sense of urgency? Have you stepped up to become part of a team dedicated to real change? Have you worked, even at your town level, to identify a vision for change?

One of the most striking observations I regularly find when going into troubled companies is how many people at all levels instinctively know what is wrong. One of the most heart-warming outcomes is how many of those people want to pitch in and be part of a solution. And one of the most satisfying developments is watching those people rise to the occasion, often in ways that would never have been predicted. Never under-estimate the power of the human spirit to be selfless and do great things. Even when it requires going through pain.

But before those wonderful developments can ever occur, we have to start with the basic first steps of a successful change initiative. Unlike the business community where companies die if they base their plans on economic fictions, change in the political world is much more difficult because entrenched special interests have no incentive to be part of constructive solutions. They have no incentive since their demands are funded by third-parties - taxpayers - while the special interests suffer no direct adverse economic consequences from making unrelenting demands.

Any real solutions in the RI public sector will require taking enough power away from those special interests so that the economic price of their demands is reduced. Yet the people to do that - politicians - usually have a focus on their own re-election and thus have no incentive to challenge the very interests who can subsequently cause them to lose an election. The problem is compounded further because the same politicians and bureaucrats have no incentive to help solve the problems because they also suffer no direct adverse consequences from their failure to act.

So any solution to RI's problems will require some selfless and courageous politicial leaders who care more about change and doing the right thing than winning elections. Part of their challenge will be to build a large enough coalition of citizens committed to change. It is only then that a courageous citizen coalition can exert the requisite pressure on enough fence-sitting politicians, providing the latter with a sufficient re-election incentive to join the change initiatives and the majority votes for change.

Bluntly, I don't see any of those dynamics even starting to happen in RI right now. Which says things will get far worse before they have any chance to get better.

We are faced with an ongoing political stalemate in place in RI: The window of opportunity for "reasonable" solutions passed some years ago. When RI already has one of the highest taxation rates among the 50 states, raising them even higher is a certain doom loop. It is too late to solve the problem by tinkering on the margin. Yet the special interests have shown zero willingness to back off their entitlement demands so as to make structural changes possible. With each passing month, there will be even less flexibility.

We are on a treacherous path as a state. But sometimes it takes going through sheer hell before the will to make tough decisions arises. Given the incredibly powerful and entrenched special interests and the political balance of power, maybe the only viable solution for RI is to let it all blow up and then pick up the pieces. Maybe we just have to become a statewide version of Vallejo.

Since the status quo political debate on these problems is an abject failure, here is my provocative proposal for public discussion:

Building the sense of urgency: Begin talking publicly and bluntly about exactly how bad the structural problems are. No sense of urgency will be built until after these problems are crisply defined and transparently obvious for citizens across the state. Simply saying we have a budget deficit of $X million is insufficiently compelling; we need to talk about the ongoing budget deficit and how we have masked it previously, the structural problems which have caused recurring deficits, the unfunded pension liabilities, and the unfunded healthcare liabilities - all of which were incurred despite extremely high taxation levels.

Pull together a team of leaders and active citizens: There has to be a conscious building of a powerful group of people from across the business community, policy community, and political community who are committed to change. It is a group which will only coalesce when we stop being so delicate in our conversations about the crisis. In RI, that means we need some people who are willing to take on previously unseen levels of personal risks. As they say, we need a few good men and women who have both the sense of urgency and the willingness to talk about the stark challenges faced in RI. Who are equally willing to talk bluntly about how the inaction of politicians and bureaucrats as well as the resistance from powerful special interests make it necessary to either do some major restructuring immediately or implement a radical solution of throwing the state into receivership/bankruptcy. Said another way, we need leaders who are willing to use that blunt public conversation to shake the foundation, thereby either stimulating real and previously non-existent policy ideas for serious change outside a legal restructuring or making the case on why there is no other alternative.

The change vision for RI: By the middle of the next decade, do what Massachusetts did in recent years by going from taxation levels which earned it the nickname "Taxachusetts" to middle of the pack among the 50 states.

The strategy for achieving the change vision: Set a specific and firm near-term time deadline for implementing the necessary major structural changes to realize the change vision. If the changes don't occur by the deadline, throw the state into some form of receivership/bankruptcy and then restructure everything by brute force.

What do you want the future of RI to look like? How are you willing to help bring about change?

Changing the scope of what is subject to union contract bargaining for RI public employees

On the Tuesday evening Matt Allen WPRO show, Matt interviewed State Representative and House Minority Whip Nick Gorham about Gorham's bill H-7664, which would redefine the scope of issues subject to bargaining for RI public employees.

During the interview, Gorham noted that there are very different approaches across the 50 states as to what issues are subject to bargaining by public employees. At one end of the spectrum, some states do not permit any such bargaining for certain public employees. Unsurprisingly, RI is at the other end of spectrum, where current law says the following is subject to bargaining for all public employees: wages, benefits and all other terms and conditions of employment.

Gorham notes that current RI law disenfranchises management, such as school superintendents and principals, and creates the structural incentive which results in the state spending significant financial resources while getting only meager results on its investment. As I have written for years about the teachers' union contracts, RI overpays for under-performance and has created an entitlement mentality instead of a focus on performance.

Gorham's bill would limit the scope of what is subject to bargaining to only wages and benefits, applying such a scope definition to fire fighters, police officers, state police officers, correctional officers, certified teachers, municipal employees and 911 employees. The bill would place RI in the middle of how the 50 states approach public employee bargaining. And, by default, leave the remaining issues of how they get their respective jobs done to the people who actually do the work - instead of union officials.

Ed Achorn had this broad observation about the current conditions in RI and how this entitlement mentality has gotten the state into a very deep hole:

...Thanks in part to unsustainable benefits for public-employee unions, the state confronts a budget deficit of a half-billion dollars or more. And it cannot effectively tax its way out of the nightmare, since its radically high taxes (including property taxes) have already driven out jobs, businesses and many middle-class taxpayers, cutting revenues and leaving Rhode Island one of the few states in recession, while Massachusetts right next door adds jobs and boosts its tax revenues.

Rhode Island, with its beauty, superb location, intellectual infrastructure and potential for port activity, should be one of America’s booming places. Instead, its politicians have left its citizens living in fear that they will lose their jobs or be forced to pack up and leave.

The kind of thinking that brought about this economic debacle also prevails in public education. Thanks to state labor laws that tilt the playing field against taxpayers, and local officials who consistently give away the store in contract negotiations (either deliberately or because they lack the intensity and experience of their well-funded foes), the Ocean State pays one of America’s highest tabs per pupil for public schools, and gets generally mediocre results. And when even more money is invested in the schools, it seems to go into the pockets of special interests in the form of unsustainable benefits, rather than getting to students in the form of new books, science labs, sports, art, music and first-rate teaching.

It doesn’t have to be this way, Mr. Gorham argues...

Indeed, it does not.

Update on Legistlative Grant "Sunshine" Bill

When both Anchor Rising and RI Future agree on the merits of a piece of legislation, one would think passage through the House would be a no-brainer, no? I haven't seen anyone who doesn't agree with Rep. Nick Gorham's Legislative Grant Sunshine Bill. It would require that all such grants:

...must be included in the annual state budget and must include the following information:
(1) Recipient's name and address;
(2) Name of contact person for the grant recipient;
(3) Name of the legislator who sponsored the grant;
(4) Statement of whether the finance committee of either or both houses of the general assembly have had a hearing on the proposed grant; and
(5) Brief description of the nature and purpose of the grant.

Alas, a look at the current legislative calendar reveals:

House Bill No.7627
BY Gorham, Coaty, Long, Mumford, Trillo
ENTITLED, AN ACT RELATING TO PUBLIC FINANCE -- STATE BUDGET
(provide that all legislative grants awarded by the general assembly must be included in the annual state budget)
{LC639/1}
02/26/2008 Introduced, referred to House Finance
05/06/2008 Scheduled for hearing and/or consideration
05/06/2008 Committee recommended measure be held for further study

Ah yes, the ol' "further study" canard. We all know what that means, huh? Never underestimate the ability of our legislators to stall on good government legislation (how's full implementation of Separation of Powers working out?). Perhaps it would be a good time to remind your legislator that you think this is a good idea.

Digging a Deeper Hole

See, here's the sort of proposal that illustrates that our legislators truly do not understand and/or are unwilling to address the structural problems that plague Rhode Island:

After a lengthy debate, the House put off a vote on a bill sponsored by Majority Leader Gordon D. Fox, D-Providence, that would require all state public works projects with price tags of $100,000 or more to be performed by contractors who pay apprentices in an on-the-job training program.

Supporters including House Labor Committee Chairman Arthur J. Corvese, D-North Providence, said the bill ensures that the construction industry prepares a future generation of laborers to replace what is now an aging work force.

But Republicans slammed the legislation as excluding smaller contractors and wasting money in a year when the state is struggling to cut costs.

House Minority Whip Nicholas Gorham, R-Coventry, said lawmakers need only look to a strongly worded letter from the state’s Division of Purchases to get a whiff of the proposal's flaws:

"By requiring contractors to have apprentice programs in order to bid, the bill essentially knocks [small contractors] out of the bidding process which favors larger contractors that have apprentice programs already in place," the state’s acting purchasing agent Lorraine A. Hynes wrote in a March 25 letter to Corvese. "Further, by decreasing the number of bidders, the bill will drive up the cost of State contracts which will hurt Rhode Island taxpayers.

"At a time when the State is facing large budget deficits, it is unwise to consider measures that potentially increase costs," she wrote.

The General Assembly ought to be stripping these regulations from the law, not adding them to it.

Surviving the Post-Transition

The current news and politics atmosphere has something of the feel of a transition. We're between the passage of the supplemental and the initial markers presaging the debate over next year's budget. We've seen the parade of interested parties, and we're well aware that discussion has returned to the back room. What's next?

Well, the supplemental budget offered some morsels of hope that the General Assembly is beginning to figure out the problems that the state faces — with cash welfare held more strictly to limits, healthcare provision decreased (notably in the gift to childcare providers), and changes to the public sector's healthcare deal. Some further positive steps are at least receiving a hearing, such as Coventry Republican Rep. Nick Gorham's proposed reforms of the legislative grant system.

What concerns me is that, although some of the restrained spending apparently represents long-term changes of policy, none of the voices with substantial carriage are calling out proposals to fundamentally change the way RI does business. The cuts in expenditures are money-savers — sharing the pain and meeting our financial obligations. They aren't being cast as structural corrections. And that doesn't quite inspire confidence in the direction of the next round in the budgetary arena. We have already heard Senate President Joseph Montalbano declaring that a budget is "really a policy statement," and we can easily imagine legislators' claiming that those dependent upon social services and unionization have "already sacrificed."

"We've already stripped the extra fruit from that tree," one can hear. Thus the powers that be may declare a need to balance the reluctant plucking of low-hanging fruit from those imposing limbs with the unripe blossoms deep among taxpayers' branches. Moreover, cuts to services and benefits — presented as such — are ripe to be renewed with the first signs of an economic spring, whereas their presentation as structural changes would herald an intention to make Rhode Island a better sort of state.

A truly engaged and well-intentioned government would be announcing studies and bills to address the state's dreadful business climate. It would be looking to deregulate the many areas in which Rhode Island makes it more difficult than its neighbors to do business. It would be redirecting its limited funds to improve failing roads and bridges — changing the calculation whereby it makes almost no investments in transportation beyond federal funds and dedicated revenue from the gas tax. It would be taking dramatic steps to change the way our schools operate — not only in seeking proof of student learning, but in channeling more funds to resources and services that help those students to be capable of such proof, rather than to work-to-ruling unionists.

With the revenue gap expected to widen, our state needs nothing so much as a change of attitude. Allowing the oppressive largess merely to slip away as minimally as possible will extend the period of decay, while decisive action will spark confidence. For that to be a possibility, those who've vested their hopes in extracting gifts and promises from the state will have to begin siding with their fellow Rhode Islanders in the push for change. No longer can they back Their Guy — the one who pushes for their special interests — "even though..."

As for the rest of us, our hope must be that everybody involved is taking this moment of transition not as an opportunity to regroup the troops for another assault, but to reflect on the basics of government and economics, to cast their eyes toward long-term goals, rather than short-term exit strategies.

"Tricky" Sue Menard

It appears that Woonsocket Mayor Susan Menard has been channeling Richard Nixon. She had a secret recording operation set up in her office.

The mayor has a concealed audio/video recording system installed in a credenza behind her desk in her City Hall office.

The device recently came to light during a work session regarding the latest in the battle between the City Council and the mayor over the council’s investigation of whether city employees have misused city resources. The mayor has filed an injunction to prevent the council from conducting its investigation. In the latest twist, the mayor has asked that three council members be deposed regarding the investigation....

“It has recently come to light that there exists within the Mayor’s office a concealed audio/visual recording system, this notice shall also include any and all audio and video recording made with said system,” [Woonsocket City Council lawyer Raymond] Marcaccio says in the letter.

Paranoid?

Jim Baron's Biggish Thoughts on Smallish Legislation

I tried to excerpt down Jim Baron's weekly column in today's Woonsocket Call, but couldn't find much to cut out. It's worth fighting through the lack of proper spacing between paragraphs to read the whole thing.

Jim Baron's Biggish Thoughts on Smallish Legislation

I tried to excerpt down Jim Baron's weekly column in today's Woonsocket Call, but couldn't find much to cut out. It's worth fighting through the lack of proper spacing between paragraphs to read the whole thing.

Raising Concerns

Methinks there's a missing "my" in Karen Lee Ziner's "Remarks raise concern" piece on the front page of yesterday's Local News section:

A nonprofit group whose board members include First Lady Sue Carcieri asserts that nearly 45 percent of all immigrants in Rhode Island — legal and illegal — lack high school diplomas and "this low-skilled cohort of immigrants to Rhode Island costs state taxpayers about $212 million per year."

"It is because such a high percentage of immigrants, legal or not, lack a quality formal education that they represent a relatively high cost to the taxpayer," said the statement by the Ocean State Policy Research Institute. Its executive director, William Felkner, said he wrote the statement.

Felkner called people who sponsor immigrants to this country "the new deadbeat dad." He said he means that the government has assumed the financial role for immigrants that "family, faith and friends" formerly played.

The only person whom the remarks seem to have concerned is Ziner. It was then Ziner who proceeded to drum up concerns among others — specifically OSPRI's board members (emphasis added):

Carcieri spokesman Jeff Neal said Felkner's statements "are at odds" with Governor and Mrs. Carcieri's views on the subject of immigration. He said they were unaware of Felkner's news release until Neal brought it to their attention after The Journal sought comment. ...

Board member Edward M. Mazze said he also was unaware of the statement until a reporter asked him about it. Mazze is a regular contributor to the opinion and financial pages of The Journal.

In other words, if the Projo were to follow the editorial rule of avoiding the passive voice, the headline should have been: "Reporter raises concerns about remark." Perhaps the follow-up could have been: "Report raises profile of nonprofit group."

Singleton Retiring from the House

According to Vinaya Saksena of the Woonsocket Call, former Republican currently Independent State Representative Richard Singleton will not seek re-election because he is moving out of state. This creates an open-seat election in House district 52 (Cumberland).

A System of Scapegoats

Although I haven't yet managed to get a handle on the realistic role and responsibilities of Rhode Island's Economic Development Corporation (EDC), I can't help but feel that a little outrage on the part of its president, Saul Kaplan in response to legislative hammering:

Lawmakers yesterday demanded answers from Rhode Island's Economic Development Corporation about why the agency has not done more to curtail job losses and bolster the state's flagging economy.

"Your feet are to the fire ... things are looking pretty bad," Rep. Elizabeth Dennigan, D-East Providence, told EDC officials at a hearing targeting the agency's economic growth plan.

Dennigan, chairwoman of the legislature's Joint Committee on Economic Development, chastised the organization for allowing the state to slip into what economists earlier this week called the Northeast's only recession.

The lawmakers' position was clear yesterday: the agency must commit itself to more daily hands-on work to try and reverse the state's economic forecast.

Kaplan's response might have been that there's only so much that a policy organization can do in the face of a take-away-and-give-away legislature. As with much else, in Rhode Island, the EDC appears to be yet another scapegoat whom those who've ultimately brought about calamity may blame.

Term Limits Proposed

Via N4N:

Rep. Stephen R. Ucci (D-Dist. 42, Johnston, Cranston) has introduced legislation that would allow voters to decide on a proposal to increase term lengths for and impose term limits upon members of the General Assembly.

Under the proposal, elections held after 2010 would be held every four years. Legislators would serve four-year terms and be limited to three terms (totaling 12 years) in the same chamber.

Here's the proposed amendment and Ian's post contains some of Ucci's reasoning. OK, setting aside the likelihood that this thing is probably DOA, it's an interesting proposal. Term limits at the expense of longer terms. Question is, is the that a trade off people are willing to make?

Supplemental Budget a Go

The RI Senate has approved the supplemental budget, largely in the form that the governor proposed. I haven't had the time to figure out this, though:

The plan restores $5 million of the $7 million the governor had proposed to eliminate for the Neighborhood Opportunities Program, which supports affordable housing initiatives. That funding will go to projects that were already in the works and had been promised state support.

The General Assembly also saved the Historic Tax Credit program, which the governor had originally scrapped in his supplemental budget proposal, but did so in a separate bill passed by both chambers and signed into law earlier this month. While the bill closed the program to new proposals, it kept commitments to already-approved projects, albeit at a slightly lower reimbursement rate.

The press release isn't explicit about what the trade-off was in order to make these "saves."

Indicative of Obviousness

Times are so dark — and the general thrust of the solution so obvious — that special interests and other general-revenue soakers can't even escape to the Lifebeat section for relief. Credit goes to Rita Lussier for using her influence for the cause of sanity:

Not to alarm you, but this situation is a ticking time bomb. My fear is that if we can't get the numbers to add up, the problem is going to stay unresolved and while you and I are out sailing or playing tennis or watching the Red Sox or whatever sweet distractions of summer might capture our attention, our legislators might to be tempted to take THE EASY WAY OUT so that they too can go off and sail and play tennis and watch the Red Sox. ...

Keep in mind that part of the problem here is that everybody else besides us is organized. The lobbyists are organized. The social welfare groups are organized. The unions are extremely organized. We, on the other hand, are not, mainly because we're so busy working to pay for all of this.

Well, I say it's time to get involved, time to say good job so far, now stay the course. And this is coming from someone who has never written to or called her representative. This taxpayer is speaking up:

DO THE RIGHT THING FOR OUR FUTURE. CUT SPENDING.

Pure Politics as Usual

It is simply not possible that a reasonable person acting out of a desire for mutual, productive dialog could attempt to paint an extremely recent executive order pertaining to illegal immigration from a relatively powerless governor as a contributing factor in our current economic crisis.

The strategy is transparent and disturbing: push policies that benefit a narrow range of special interests, then blame attempts at reform for the calamity that years of such pushing have wrought. One wonders whether Rhode Island's Progressives will keep pushing their poison until the last family in Rhode Island has moved or starved, or whether they'll flee for sunnier climes when even their carefully funneled largess begins to dry up.

Time to Re-Tort

A caller to WPRO's Matt Allen Show today came up with the idea of charging a fee for every bill that a Rhode Island legislator wishes to file. Matt suggested $500 a pop, to be deducted from the legislator's annual salary.

In view of the many look-at-me, pointlessly distracting bills that are filed every session, that strikes me as a fine idea and one that I would not modify so much as amplify. In addition to the above stick, a carrot: for each bill filed by a legislator which either removes an existing bad law from the books or would move Rhode Island in the right direction on one of the many bad lists that we are on, a bounty of $250.

It appears that such a bounty could be put to good use in the area of tort reform. Rhode Island ranks last in the area of tort liability. [Page 54 of this link.]

But isn't this good? Doesn't this mean that justice is being done? Well, yes and no. Disproportionate awards are not usually bravely shouldered alone by the losing defendant. They are passed on to the consumer in several ways. So they cost us all money in the form of higher prices or higher insurance premiums. Excessive tort liability is also a contributing factor to our state's stinky business climate. [You know, the climate that has bestowed a recession on us - as Justin points out, the only state so far in the Northeast to get one.]

Once again, averageness - that is my fairly modest aspiration for the state of Rhode Island. In the area of tort liability, neither crusaders nor corporate hatchetmen. Just to be in the middle of the pack on this and the other unfortunate lists that we are on.

Cuts for Thee but not for Me

Sure, it may be an easy mark, but just because they make it easy, doesn't mean it shouldn't be noted:

During their marathon House budget-cutting debate last Friday, lawmakers talked again and again about the need to “share the burden” and “share the pain.”

But they decided to spare themselves from making any contribution to their own 100-percent state-paid health insurance.

For several days last week, House leaders talked among themselves about possibly proposing an amendment to the big midyear budget-cutting bill that cleared the House on Friday. It would have required all 38 senators and 75 House members who elect to take the benefit to do what some are already doing voluntarily — that is, pay 10 percent of the cost.

But they backed off in response to reported opposition from Senate Democrats during a rare — and unannounced — closed-door caucus at the State House Thursday night.

Way to "share the pain." Oh, sure, they might "revisit" it next time around. And it's true that some are forking over a voluntary 10% co-share. But then you have the others who take the $2,000 and change buyout (the ProJo names names). How noble.....Well, here's an idea, how about not taking it at all? According to the ProJo, that'd save around $1.4 million.

What a Crock

Pat Crowley's complaints about a letter that Governor Carcieri apparently sent to Bob Walsh, Crowley's NEA boss, are transparently two-faced in so many ways that I won't enumerate them. Simply put, the idea that Walsh would respond otherwise than with the mind-numbing reply that Crowley publishes is laughable. It is, let's just say, improbable that the scene in the office was of Walsh demanding that Crowley come to his office, closing the door behind him, and lecturing him about the messes that he gets the organization in. More likely, the message from above was more akin to: "You must be doing something right." The governor's office surely understood as much.

The tragedy of the matter is that opportunity exists for a more profitable discourse. For a taste of the light so thoroughly extinguished, consider a comment to Crowley's post by Mike in RI:

It's precisely posts like this Pat that should cause concern. Why the hostility? I care very much about what you have to say publicly because I do believe you represent teachers. As a teacher I watch carefully the public statements and behavior of anyone who speaks on the topic of education. You Pat seem more than eager to stir the controversial pot, and therefore you are sure to garner more attention from teachers. I haven't seen any letters-to-the-editor from Marcia Reback picking a fight with the governor publicly, calling his wife a racist, or sharing her opinions about the Catholic church. She hasn't picketed local businesses, or flipped off those with whom she disagrees. If she had I would be sharing my thoughts with her personally. As an RIFT member it is my dues that pay her salary. You are NEA Pat, so I am not afforded that opportunity.

Feel free to review each and every one of my comments on this blog or any other. You will find that none of them were ever made during the time when school was in session. As a public employee, I feel it important to keep separate my opinions about politics and things not related to education out of respect for my students and parents. Therefore I will not use my name.

And just to clarify, are you suggesting that you wrote a letter to the ProJo with your Lincoln address and the editors changed it to Cranston? That seems odd.

Pat, you are passionate about your causes, and I have a great deal of respect for that. You must have been very good as a union organizer with the Teamsters. I mean that honestly. But teachers' unions are more professional in nature, and play a public role in communities across the state. We work with children and their families, and our approach must be very different from that of the Teamsters. I feel the political hostility you often exhibit publicly is a detriment to the cause of public education, which is my passion. Picking fights with the governor might make you feel good, but does little to help teachers and only angers more of the public that pays our salaries.

The only response to Mike came from RIFuturite Evan, dismissing him outright on the basis of past "conservative rants." The point is that, if Walsh had his own reservations about the hues with which Crowley paints his professional organization, he'd have at least mustered an empathetic response to what is clearly a sincere and thoughtful point on Mike's part.

And the reality is that, if Crowley weren't a high-ranker with the NEA, he'd be just another progressive crank, easily ignored and sparsely published. The damage that the educators' union is doing to education in Rhode Island is an affront to decency and an insult to intellectual endeavors.

Being Lazy Makes Them Money

There's something very Rhode Island about this proposed legislation:

A bill filed recently in the state Senate would forbid all vehicles with more than two axles from driving over the Sakonnet River (Route 24) and Pawtucket (I-95) bridges. While the 22-ton limit on both bridges would remain in effect, Senate bill S 2891 would ban a number of vehicles that are presently able to use the bridges. ...

The measure was introduced by Senators Dennis Algiere (Westerly, Charlestown) and James Doyle (Pawtucket). Sen. Algiere said he did so at the request of the governor's office and the state Department of Transportation (DOT), and referred any questions to the DOT.

Robert Rocchio, managing engineer of the DOT's traffic design section, cited two reasons for the proposal.

First, "to preserve the integrity of the two bridges for as long as possible."

And second, "to provide means to pay for enforcement" of the bridge restrictions. The bill proposes fines of $3,000 for the first offense, $5,000 for second offense which Mr. Rocchio said could help cover the $40,000 monthly cost of paying State Police to enforce the limits at overtime pay rates.

Mr Rocchio doesn't mention that all the detouring will increase gas sales, which will also increase gas-tax revenue. Cynicism can go too far, but there must be some reason that the lawmakers involved (elected and otherwise) aren't trying cost-saving measures first — fewer patrols, with random stops and higher penalties for violating the weight limit.

The rickety bridge doesn't care, after all, how many axles are on a particular vehicle. If raising money is the primary objective, then the folks behind the legislation should say so. And then the rest of us should respond, first, by explaining the utter lunacy of piling burdens on an ailing economy and, second, by voting the bums out.

The Economic Self-Interest of Early-Retiring State Workers

So, faced with a reduction in benefits, about 2,500 state workers are expected to retire. Under the new plan, they'd have to be 59 years old, have 20 years in and then would have to pay $1,700 per year for health benefits (20% of the total health package). Currently, retired state workers pay nothing towards their own health care and they can retire much earlier. Those of us in the private sector know just how tough it must be.

According to the Governor, the intent was to save money (around $120 million overall--$6.1 million this year) by reducing health care expenditures, but others--like state employee unions and some Democrat legislators--think the intent all along was to reduce the state work force by pushing people out who'd want to preserve their benefits. Shucks.

But let me get this straight. Apparently the unions and some Democrats acknowledge that early-retiring state workers, realizing that they will pay more/receive less if they don't take certain actions by a certain time (retire early to get better benefits), are acting in their own economic best interest. Yet, these same people fail to recognize (apparently) that, golly gee, private sector workers and companies act the same way when faced with onerous taxes and a bloated state government. They decide to either leave Rhode Island or not come in the first place.

Not a Bad Idea, but Dumb

Yeah, well, while I'm not so sure that forcing hospitals to pay property taxes is such a good idea, RI Senator Harold Metts (D, Providence) has a point when it comes to universities:

"In 1989, it was estimated that 35 percent of the city's taxable properties were owned by a few tax exempt institutions," said Senator Metts. "That grew to 40 percent by 1997 and today's estimates put the figure at around 48 percent or even higher. That means 100 percent of the property taxes are coming from 50 percent of the property owners, working-class homeowners. It's not fair."

Unfortunately, Metts seems to suffer from a common intellectual blindspot among those on the class-warfare Left:

"I am aware of the opposition this legislation will generate," said Senator Metts. "I also firmly believe that not one tenured professor at Brown will suffer a pay cut if the school has to start paying taxes on the vast amount of property it owns. I firmly believe that not one executive at Rhode Island Hospital will suffer a pay cut if the hospital has to start paying its fair share to the city."

Perhaps he's right that not one tenured professor or hospital executive would suffer financially from the tax, but you could bet your bottom quintile that a significant number of low-to-midrange employees would find their jobs eliminated, and that clients, patients, and students across the socioeconomic spectrum would see their costs go up, with a bit of trickle-out inflation.

That said, I wholeheartedly endorse Metts's plan as a first step in pushing delusional liberals toward their own epiphanies about the need for structural government reform in Rhode Island.

Early Hearing: Early Death or Fast Rubberstamp?

The following bills were scheduled to be heard by the House Finance Committee today at 1:00 pm instead of late afternoon at the Rise of the House.

House Bill No. 7791
BY Moffitt, Mumford, Story, Singleton, Loughlin

ENTITLED, AN ACT RELATING TO HUMAN SERVICES -- PUBLIC ASSISTANCE {LC2210} (require the department of human services to establish a community service requirement as a condition for receipt of public assistance benefits)

House Bill No. 7846
BY Dennigan, Ferri, Handy, Silva

ENTITLED, AN ACT RELATING TO HUMAN SERVICES -- FAMILY INDEPENDENCE ACT {LC1988} (amend the poverty threshold for eligibility for child care assistance under the family independence act)

House Bill No. 7875
BY Diaz, Segal, Almeida, Slater, Ajello

ENTITLED, AN ACT RELATING TO HUMAN SERVICES -- HEALTH INSURANCE {LC1619} (provide health insurance to children ineligible for federal medical assistance due to citizenship or alien requirements and to resident parents or caretaker relatives of these children)

The Big One's Yet to Come

Today's Providence Journal has more on the supplemental budget. There's some reason to hope that the General Assembly will manage to avoid making things worse — although without bold changes, treading water could simply mean drifting further out to sea. Here's the key part of the report, though:

The vote marks a significant step forward in the state government's struggle to close massive budget deficits that Governor Carcieri says have pushed Rhode Island to the brink of financial disaster.

But it was just a first step.

The package passed yesterday addresses only the deficit projected for the current fiscal year. It does little to address next year's estimated hole of $384 million, a number that state leaders largely agree will grow substantially when fiscal advisers examine state revenues next month.

This was an emergency lunge. We'll see what the debate looks like when it's not peppered with promises about "next year's budget."

Not Going Around the Block

You don't name a new entity "the Moderate Party" in the current political context without the expectation that social liberalism will be implied. If Ken Block wanted to emphasize the single-minded nature of his new party, he would have called it "the Fiscal Party" or something along that line.

Rhode Island conservatives should allow Mr. Block's effort to accomplish what it will do with or without their participation (assuming some degree of success): draw moderates away from the Republican Party so that it may be reformed with a clear and conservative message.

Supplemental Spending Bill

Here's the supplemental budget that our legislators are being asked to read, digest and pass this evening. I'm short for time and in a hurry, but here's what I can gather for "highlights":

Reduction of almost 300 Full-Time Equivalent Positions (ie; jobs cuts)

Amendment that essentially kills the future privatization of government services.

Makes the accumulation of "good time" easier for early release of prisoners.

"Provided that any family where an applicant adult has reached or exceeded his or her sixty (60) month time limit, no person in that family shall be eligible for cash assistance under this chapter as of June 1, 2008. This provision shall not apply to the minor child(ren) for whom there is a caretaker relative deemed responsible for the care of the minor child(ren) due to the absence of a parent."

Removes medical assistance benefits from non-citizen children "who w[ere] lawfully admitted for
permanent residence on or after August 22, 1996 or who first become otherwise entitled to reside in the United States on or after August 22, 1996 and was receiving medical assistance on or before December 31, 2006." Also REMOVED the previous $10,000 family income cap.

RITE CARE to families at 133% of Poverty Level instead of 185%

Health care subsidies for Child Care providers are repealed.

Council set up to investigate whether or to what degree Central Falls can contribute to its own education funding.

"For the fiscal year ending June 30, 2008 the apportionments of state aid as derived through the calculations as required by subsections a through c of this section shall be adjusted downward statewide by $10,000,000."

Limits the total amount of allowable "tax credits to be claimed against the state’s tax revenues [not] exceed twenty million dollars ($20,000,000) for tax year 2007 or forty million dollars
8 ($40,000,000) for tax years 2008 through 2017."

Reduces the PUC from 5 to 3 commissioners.

No more "good driving" passes: fee = fine.

General Laws in Chapter 45-19 entitled “Relief of Injured and Deceased Fire Fighters and Police Officers” amended to be applicable prior to April 1, 2008.

Cell phone ban while driving is imposed.

UPDATE: 7to7 has a bit more and so does Ian Donnis.

Last week, when I took part in a taping of A Lively Experiment, Ron St. Pierre asked whether it was wrong for state lawmakers to take a spring break with the state facing such dire fiscal problems. Lou Pulner offered the best response, describing how the traditional last-minute passage of a cascade of legislation poses a greater concern.

Now, House Finance, on the second day after the legislative break, says it is expected to vote today on the supplemental budget. While a small number of individuals controlling the process is status quo on Smith Hill, it hardly seems to offer the chance for thorough consideration of the budget.

Shining the Light on Legislative Grants

Rep. Nick Gorham has proposed a bill to let us all know who is getting walking around money from the State Legislature (h/t Ian @ N4N). The legislation (PDF) states:

SECTION 1. Chapter 35-3 of the General Laws entitled "State Budget" is hereby amended by adding thereto the following section:

3 35-3-28. Legislative grants. – All legislative grants awarded by the general assembly must be included in the annual state budget and must include the following information:

(1) Recipient's name and address;
(2) Name of contact person for the grant recipient;
(3) Name of the legislator who sponsored the grant;
(4) Statement of whether the finance committee of either or both houses of the general assembly have had a hearing on the proposed grant; and
(5) Brief description of the nature and purpose of the grant.
SECTION 2. This act shall take effect upon passage.

Rep's Coaty, Long, Mumford, and Trillo are co-sponsors.

Mayor Scott Avedisian on the Concept, if not the Practice, of a Third Party

And speaking of Russell J Moore's article in last week's Cranston Herald, does anyone have any clue what Warwick Mayor Scott Avedisian is getting at in this quote...

Warwick Mayor Scott Avedisian, who is known as a moderate Republican with socially liberal positions, said he wishes Block luck, but warned he shouldn’t count on his support.

“I think the time is right for a third party, and I wish him well, but I have said all along that I was elected as a Republican and I plan to stay a Republican.”

Hmm...