The latest shiny news object in Rhode Island media is the revelation that the Tidewater soccer stadium will cost Rhode Island taxpayers $132 million in order to finance $27 million of the construction costs, or $4.4 million per year for 30 years.  Grumbling is being heard from people with familiar names — “obviously these are not favorable terms,” said Democrat Speaker of the House Joseph Shekarchi — but that will fade, and nobody is putting forward ideas to protect Rhode Islanders from further increases on this deal or similar abuse in the future.

Tidewater reveals one of the great frauds of modern government.  The labor unions that placed Dan McKee in office secured a massive project with his tie-breaking vote on a bad idea, and the investors get to demand high rates of return by pretending the debt is riskier than it is.  That second point is more important than is usually acknowledged.

Heretofore, these “revenue,” or “moral obligation,” bonds have inspired what opposition they have in the Ocean State on the grounds that they end-run around voters.  Government officials simply borrow the money based on the pretense that taxpayers won’t actually have to pay it, because the money will come from some future revenue stream, when everybody knows there’s no way elected officials will let investors take a hit if the revenue doesn’t materialize.

This mismatch between the risk everybody pretends exists and the actual risk creates a fraudulent gap in which insiders can profit.  We should remember that Rhode Island voters (guided by partisans, special interests, and do-what-they’re-told union members) have reached the point of near 100% certainty for debt approval.  In that light, the use of “moral obligation” bonds looks more like a means of making it more costly for taxpayers than simply a means of avoiding our vote.  If government secures that vote, then nobody can pretend they might lose their money, and investor profits shrink.

With this observation in mind, I can’t help but think of a recent survey from the Heartland Institute and Rasmussen Reports that found 28.2% of mail ballot voters admitting “to committing at least one of… four types of fraud.”  The study found that the presidential election would have flipped if even 4% of mail ballots were found fraudulent and therefore excluded.  Even if the survey overstates fraud by seven times, it still changed the results.

Mammoth debt for Pawtucket’s minor-league soccer stadium is a drop in the bucket of the incentive for election fraud.  If greedy insiders would maneuver to avoid public votes on debt because it will make that debt more expensive (which conservatives and progressives can probably agree they would do), and if politicians would play along for the promise of power (ditto), then they’d certainly look for ways to control votes when it serves their interests to hold them.

The solution for the Tidewater fiasco-in-the-making is the election of officials who will have the intelligence and fortitude to say, when the revenue to pay the bonds doesn’t materialize, “Sorry.  You knew the risks and received a premium on your investment, and taxpayers shouldn’t be responsible for your bad investment decisions.”

Until recently, the election of such people was made unlikely by the many special interests who would be harmed by a reduction in government’s power.  However, the election of Donald Trump over consummate insider, Hillary Clinton, scared the power brokers, and nobody should dismiss as conspiracy talk the possibility that they’ve taken steps to ensure that it never, ever happens again.  And like the spurious prosecutions of the former president, we’d be insane to think they’ll treat him as a special case but otherwise leave the integrity of our government intact.

Featured image by Justin Katz using Dall-E 3.