Contributors
Giovanni D. Cicione: Inviting graft, corporate welfare
01:00 AM EST on Wednesday, February 27, 2008
ON THE FEB. 10 Commentary pages, House Finance Committee Chairman Steven M. Costantino laid out what he calls a “New Economic Vision for Rhode Island.” If that is what passes for vision at the General Assembly, we are in more trouble than I thought.
And before you write off my response as partisan criticism, let me tell you why I think I know something about this topic. For eight years, I was responsible for policy development for the Economic Development Corporation. For three of those years, I was an EDC employee, working on the front lines with many other good people trying to attract businesses to this state, and retain and grow the ones that were here. I testified before Costantino’s Finance Committee dozens of times.
Eventually, however, I realized that the economic development strategies of this state were never intended to grow the economy. Instead, they were simply the ultimate source of political handouts, insider trading, and corporate welfare.
After a decade of advocating for the average Rhode Island business, digging into the fine details of the laws that affect our economy, and watching the results of the frequent “new great idea” or “structural reorganization” for economic growth, I understood that we have nothing but a quasi-legitimized system of stealing from the poor and giving to the rich — and only a select few of the rich, at that.
When one state tries to outsmart the rest by targeting a particular industry or company, it is trying to do something even Wall Street can’t do consistently. We’ve created special deals for software companies, investment companies, call centers, and many more, and still we are in the tank. We excel at addressing the symptom, not the cause, of our economic woes. (Of course, the cure is great for the companies that took the handout — they always feel better).
Now our legislative leaders want more of the same, and, unfortunately, they want to do this on the backs of the small businesses that make up the core of our economy. What they fail to understand — or intentionally ignore — is that only broad-based strategies help the economy, and that targeted strategies only help the politicians and the corporate welfare queens.
We are in “tax hell” because our rates are too high. We can’t lower them because, after all the special deals are accounted for, only the little guy pays full freight. Alas, there are too many hands in the cookie jar for the legislators to seriously consider fixing this. Even if they know better, they prove repeatedly that they are just political cowards, more afraid of losing elections than hurting the economy.
Are you upset that we can’t fund your child’s school properly? Then look at the millions of dollars handed out each year by the Slater Centers — a program Costantino lauds — and ask why these few companies deserve these generous six-figure handouts (even when many end up moving out of state).
Do you want to help fix the budget so as to restore anti-poverty programs? Then look at the walk-on part in the Showtime series Brotherhood by House Speaker William Murphy that you paid for with useless film and TV tax credits to the tune of tens of millions of dollars.
Are you concerned about the sky-high cost of health insurance? Then raise your hand and ask why near-monopoly Blue Cross is getting tax subsidies to build its new Taj Mahal headquarters building downtown.
Do you think that the hundreds of dollars of property tax you pay through your rent or your mortgage each month are outrageous? Does that tax mean you struggle to buy food or pay for heating oil? Then ask your elected representatives where they stand on these multimillion dollar handouts and the hundreds of others just like them.
And should we ignore the corruption these special deals breed? Costantino wants to make the EDC a “more effective conduit” of “policies and investments that promote job growth.” What that means is that key legislators can now be the gatekeepers of taxpayer-funded handouts, and they can enrich themselves more easily by holding tax credits and other incentives hostage. Ask the Duie Pyle Co. how well that worked.
Is there hope? I think so.
There are solutions. End the special deals — all of them — and lower our tax rates dramatically. Don’t empower the legislators to control our tax dollars in the name of economic development. Stop paying for movie cameos and ribbon cuttings and press releases with our money. Stop pretending to promote economic development on the backs of the real economy of Rhode Island — on the back of the little guy. Costantino calls for bipartisanship: I’ll draft the bill. Do you think they’ll hear it?
We face a choice between a centrally planned economy run by and raided by the leadership on Smith Hill, or an economy where all Rhode Islanders can pursue the American dream and actually keep what they earn for themselves and their families. One choice has driven us to the brink, where we can no longer even afford to provide the most basic government services. The other choice lies in front of us.
Haven’t you had enough? If so, it’s time to get involved.
Rhode Island can be fixed, but the Republican Party cannot do it alone. It will take a coalition of independent advocates, of activists, and of people who care enough to fight for our future.
In the nine months between now and the November election, we must seed a revolution. So instead of just griping, become the solution. Attend a rally. Run for office. Fight for change. Together, we have the power.
Giovanni D. Cicione is chairman of the Rhode Island Republican Party, and a small-business owner.
We want to hear from you
How to submit a letter to the editor
More from contributors
Stanley M. Aronson: We all need a bit of heresy
Most viewed yesterday
Best! Worst! Sexiest! Providence is on the list
Middle-class concerns about closing the deficit
Most active surveys
What's your solution to the state's budget crunch?
Rate the transformation of the Silvas' home
Does Bill Belichick deserve any further punishment over Spygate?
What, if any, recognition should there be of same-sex relationships in Rhode Island law?
Most e-mailed in the last 24 hours








