Putting Rhode Island in Deep Water
Well, the Rhode Island Public Utilities Commission (PUC) has reached the decision that the General Assembly and Governor Carcieri all but required it to make, signing off on the expensive contract for an offshore wind farm between Deepwater Wind and National Grid:
“It will be four cents a day more,” Carcieri said. “Who wouldn’t be willing to spend that to invest in our economy, keep our money here instead of sending it to Saudi Arabia [for oil] and start a major new industry?”
It may be only $15 dollars per year to whatever demographic Carcieri is describing, here, but it will be much more to companies and manufacturers that require large amounts of energy. Indeed, the best the PUC could say about official complaints from two Rhode Island companies, Toray Plastics and Polytop Corp., was that “at least they didn’t threaten to leave.” But they did note that the increased costs would make it more difficult for them to expand in the state. That statement raises another item in today’s Providence Journal:
The United States is selling fewer products around the world and spending more on cheap imported goods, an imbalance that hurts the job market at home and means the economy is even weaker than previously thought.
The trade deficit of nearly $50 billion for June is the biggest in almost two years, and economists fear that economic growth for the second quarter, which came in at a sluggish rate of 2.4 percent in early estimates, may turn out to be only half that.
“The problem is that to the extent we have a recovery in the United States, it is pulling in a lot of imported goods. That means it is not translating into production and jobs at home,” said Nigel Gault, chief U.S. economist at IHS Global Insight.
Redirecting our energy dollars from the Middle East to the United States is certainly an important objective, but when the cost difference is so dramatic — with guaranteed increases year after year — it affects the activities of those who are required to pay the inflated rates. Government should not be as deeply involved in the economy as the Deepwater deal has exemplified, and I fear that Rhode Island is going to be on the bleeding edge when it comes to finding out why.