May 16, 2012
Shut Down the E.D.C. So That We Have an Unobstructed View of the Real E.D.C.
... though not because the Schilling deal, facilitated by the Economic Development Corp, might leave taxpayers on the hook for upwards of $100 million.
By almost any measure, Rhode Island has a very poor business climate. High taxes, too many fees, too many regulations, many of which were intended to protect consumers but, in reality, treat them like dull children. This condition has nothing to do with "irrational negativity" on the part of some residents or commentators but was legislated into existence on Smith Hill by some well-intentioned and badly misguided law-makers.
Patrick points out that this climate compels the state to occasionally turn to "gimmicks" like loan guarantees to entice businesses to come here. But gimmicks and one-off tax arrangements do not constitute an economic development strategy. The solution is to ameliorate the state's business climate. Only one body can do that and it's not the R.I.E.D.C.
The charade is over. It's time to disassemble the false-front E.D.C. so that the real E.D.C., its actions and, more importantly, its inaction, can come clearly into focus.
ADDENDUM
I'm happy to re-state and amplify, at Russ' request, that my views about abolishing the E.D.C. for the indicated reason long pre-date this week's development in - or deterioration of - the 38 Studios arrangement. Said deterioration simply posed an opportunity to comment on the larger issue of Rhode Island's poor business climate and exactly who is responsible for it.
That Governor Donald Carcieri might have made a bad call with 38 Studios (and definitely made a bad decision with regard to the They-Think-We-Have-Deep-Pockets-For-Blowing-In-The-Wind-Energy project ... er, with regard to Deep Water Wind) does not change my high opinion of him as governor. Far more importantly, it does not change the reality of the poor economic conditions that made such a "gimmick" seemingly necessary or shift responsibility away from those who created those conditions over the last three to four decades.
But steering the state economy through an economic planning board of political insiders like a 3rd-world banana republic has been working so well for RI. Maybe the World Bank can offer the struggling state some financial support.
Posted by: Dan at May 16, 2012 10:03 AMNothing at all to do with Gov. Carcieri, who rushed funding for this through the GA without disclosing who the funds were for... surprise! So much for the party of personal responsibility.
Note that those "political insiders" were appointed by the governor, who also served as chair of the organizition (but clearly had nothing to do with this). The buck stops somewhere else. Anywhere but here actually.
www.riedc.com/news/2010/01/riedc-board-of-directors
Nice one, Monique.
Posted by: Russ at May 16, 2012 11:53 AMThe business community at many times is their own worst enemy in RI.
Seldom does it happen that the business community rallies to lobby at the State House in order to move important legislation through the process. Seldom does the business community forcefully push to change some of the most harmful aspects of public regulation over business (the first thing that comes to mind is RI's highly regulated insurance marketplace that is now almost unaffordable for small businesses).
Most importantly, only the business community can put forward a viable plan for how to fix the economy and yet there is little organized push by that community to propose solutions. And no, the Providence Chamber is NOT representative of the RI business community.
Advocacy is hard, time consuming and expensive. And to a disturbing extent, RI's small business community is absent from the discussion.
Posted by: Ken Block at May 16, 2012 11:59 AM"only the business community can put forward a viable plan for how to fix the economy."
Ironically, almost exactly what Carcieri said about his EDC.
[quote]
“My appointments to the EDC board include highly successful business owners, young entrepreneurs, and representatives from higher education. They represent small, medium and large businesses across different industry sectors, including healthcare and life sciences, communications, infrastructure, manufacturing, hospitality and tourism, and financial services and insurance,” continued Carcieri. “The common thread they share is their belief in the potential for this state to be great and their commitment to improve our economic climate. The breadth of experience and know-how to be successful will serve the EDC and the state very well, and I am confident that their participation in the EDC will result in positive change for our business community.”
“Job creation, and the related growth of our state economy, has become the single most important issue in Rhode Island. A critical first step is to change and improve the way economic development is managed and executed by the RIEDC,” said Keith Stokes, incoming Executive Director of the RI EDC. “The new board leadership will bring an unprecedented level of business leadership and expertise to lead this important first step in rebuilding the Rhode Island economy.”
[end quote]
Look, unlike Monique I'm not railing against the EDC. I just think it's funny to see comments like these that act as if the EDC board who signed this deal had nothing at all to do with the "business community."
Posted by: Russ at May 16, 2012 12:21 PMThe 2010 version of the EDC represented mostly the 'big' business community in RI - i.e. the PVD Chamber.
There is way too much of 'looking out for number 1' amongst most of the activist business community.
I will also point out that the way that the EDC operates is not well suited to well informed decision making by the Board. Board members are spoon fed materials by the full timers at the EDC just a few days before they are to make decisions based on those same materials.
Posted by: Ken Block at May 16, 2012 12:44 PM"The 2010 version of the EDC represented mostly the 'big' business community in RI - i.e. the PVD Chamber."
What a shock! Republicans in bed with big business? I'm truly floored.
Seriously, though, you've got a point. I was glad to see Jack Templin appointed in 2011. Arguably could still use more representation.
Posted by: Russ at May 16, 2012 12:53 PMSo what, Russ? A bad idea is a bad idea. What difference does it make whether the governor was a Democrat or a Republican? Nobody is denying that Carcieri was involved. You're part of what's wrong with RI with these kinds of pointless partisan comments.
Posted by: Dan at May 16, 2012 12:57 PM"Nobody is denying that Carcieri was involved."
Really? Curiously his name isn't evem mentioned in this post. I'm sure some would prefer folks didn't remember that.
Posted by: Russ at May 16, 2012 1:28 PMI my experience, you can put the most business-minded people in the world on a board... As soon as they're spending someone else's money they 'change'.
Posted by: mangeek at May 16, 2012 2:46 PM"You're part of what's wrong with RI with these kinds of pointless partisan comments."
Call me partisan if you like. I'm admittedly a lefty. But don't pretend I'm not making a point. You even responding to it!
Posted by: Russ at May 16, 2012 2:49 PM"As soon as they're spending someone else's money..."
Unlike at say FM Global where can assume Shivan Subramaniam is spending his own money?
Posted by: Russ at May 16, 2012 2:52 PMRuss, when a company does it, it usually comes and bites them in the behind. Insurance is a pretty competitive business, I'm guessing they watch costs pretty closely.
Posted by: mangeek at May 16, 2012 3:22 PM"Really? Curiously his name isn't evem mentioned in this post."
Very good, Russ. Things that "don't matter" are properly ignored. Republican/Democrat is irrelevant to the central issue. Turning it into a partisan issue is not responsible.
"But don't pretend I'm not making a point. You even responding to it!"
I'm responding only for the purpose of stating that your "point" is a poor one.
Posted by: Dan at May 16, 2012 3:44 PM"Advocacy is hard, time consuming and expensive. And to a disturbing extent, RI's small business community is absent from the discussion."
You're not wrong, Ken. But who is busier than a small business owner? (Like I need to ask that of a small business owner!) Is it too much to ask that our elected officials make decisions with the best interest of the entire state in mind?
"Maybe the World Bank can offer the struggling state some financial support."
Sa-a-a-a-a-ay, there's an idea. Could our business model be THAT much worse than some of the applications that they have undoubtedly approved in the past???
"Things that 'don't matter' are properly ignored. Republican/Democrat is irrelevant to the central issue. Turning it into a partisan issue is not responsible."
Ah, I disagree. It does matter who was responsible because he was still running the show over at the EDC. Keep in mind I was supportive of Saul Kaplan under Carcieri. I suppose I was a partisan Republican then?
Posted by: Russ at May 17, 2012 4:26 PMADDENDUM - Here's the problem with that. Consider New York..
www.bizjournals.com/albany/news/2012/01/25/new-york-one-of-the-most-business.html
So what's city has the hottest tech sector right now? (hint it's not in Wyoming)
www.nycfuture.org/images_pdfs/pdfs/NewTechCity.pdf