Challenge to Governor Chafee: Rebuild the RI Economy
Wednesday, November 10, 2010
On the day you take office, Rhode Island will be facing an unemployment rate greater than ten percent, an underemployment rate of over twenty percent and a state budget deficit exceeding $350 million for FY 2012.
During the last six years, Rhode Island lost over 37,000 jobs, the medium price of a house went from $262,200 to $207,000, the state’s population decreased by 18,000 and 28,000 Rhode Islanders and businesses filed for bankruptcy.
You have the opportunity to return Rhode Island to a stronger economic position by providing leadership, setting realistic priorities, selecting the right team and adopting “best practices” to state government administration and economic development.
Rhode Islanders want you to succeed. The state’s assets such as location, educational institutions, strength of small businesses and diverse population can be used to get Rhode Island back on the right economic track.
Many believe that government expenditures can be reduced to balance today’s state budget deficit. There will still be a need for additional sources of revenue when state budget deficits exceed $400 to $500 million a year in FY 2013 and FY 2014.
Here is what the business community expects from you as Governor.
First, your direct leadership in dealing with these problems is required. Although some of the economic activities may be delegated to others such as the Economic Development Corporation, you must be the state’s champion for growing jobs and making the state business friendly. You must partner with the general officers of the state, the leadership of the House and the Senate, the state’s educational institutions, the business community and unions in looking for viable solutions to these problems.
Second, you need to select the right team to manage your departments. In the past, individuals with little or no experience or with their own agenda were appointed to deal with economic issues and the results were poor.
Third, you need to prepare and implement an economic development program that will attract and retain businesses and create jobs and support education that prepares the workforce for the future.
Fourth, you need to adopt the “best practices” from other states and businesses to the running of state government. You may want to consider a zero-based budgeting system where each expenditure is reviewed. This is a good way to allocate limited resources to where they will do the most good.
Fifth, Rhode Island’s economic future is small businesses and the development of new businesses through entrepreneurship. Small businesses, and particularly those in the urban areas, need your support. They will create the jobs needed in the state.
Sixth, there is an opportunity to make economic development and job creation more transparent with a public scorecard issued semi-annually reporting on the state’s economic development activities and the number of new jobs created by industry sector.
And seventh, you must turn around the state from protecting the status-quo to requiring all levels of government to be more transparent, accountable and efficient in managing resources, investments, activities and personnel.
The greatest opportunities for economic growth will come in the future if we begin to make progress today. Good luck and best wishes for success – Governor-elect Chafee.
Dr. Edward M. Mazze is a Distinguished University Professor of Business Administration
College of Business Administration
The University of Rhode Island
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