Moore: Let Procaccianti Build a Hotel on Fountain Street
Monday, September 07, 2015
As everyone enjoys the day off today, it's appropriate to take a moment and reflect on all the undeniable good that the labor movement has done for the American worker over the last hundred years plus.
The labor unions in America are responsible for the 40-hour workweek, paid vacations, and many other perks that workers probably otherwise wouldn't have. While that's all true, it doesn't necessarily mean that labor is always on the right side of every issue. One can appreciate the good achievements of the labor movement while, at the same time, understanding that every particular issue is it's own case and that organized labor isn't always right.
Nor does it mean that the labor movement even is this monolithic movement. Sometimes, the labor movement is forced to fight with itself.
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That's currently the case in Providence, as was showcased at a city council meeting just over one-month ago. The Procacinti Group, which owns two hotels in Providence--the Renaissance and the Hilton--is seeking a tax stabilization deal from the city, which will allow them to construct a new, extended hotel on the Fogarty building on Fountain Street, which they own.
The measure, however, is opposed by the United Here Local 217, the hotel worker's union. The union is demanding that the project be thwarted until the hotel promises to pay better wages and improve working conditions. The Building and Trades Workers Union is in favor of the project, as it would provide some much-needed jobs for that particular union.
Better Working Conditions
Nobody can blame the hotel workers union for seeking better pay and working conditions. That's the very essence of the job of the leadership of that union. But it's hard to see how stonewalling the project is a benefit for the taxpayer's of Providence, the building and trades workers, or even the hotel workers.
Yes, the taxpayers of Providence will be giving the Procacinti Group a break on their taxes for the first several years of the project, but once the deal ends, it will provide the city with long-term revenue. Also, even with the tax break, the city is still expected to take in upwards of $3.5 million in taxes.
Much Needed Jobs
Meanwhile, the leader of the building and trades union complains of unemployment of almost 50-percent, according to some news reports. It's hard to make a case for preventing constructing a new hotel when there are that many workers looking for a job.
And believe it or not, it makes more sense for the current hotel workers to allow the hotel to be built instead of shelving it indefinitely. Basic economics seems would tell us that the hotel workers are better off with a larger supply of jobs as that would make wages and working conditions more competitive since it would give the workforce a bit more leverage. In other words, the more jobs there are, the more of a demand there is for labor, and that puts workers into a much stronger position.
More Jobs, Better Wages
To thwart the hotel, and therefore the creation of new jobs, only means that workers are competing for less jobs, which gives the employers leverage over the workers. That's exactly what Bryant University Professor Edinaldo Tibaldi told GoLocal earlier last month.
"Economic opportunities created through construction and operation of a hotel, for instance, change the labor market dynamics, lead to increased demand for labor (unskilled and skilled labor), and benefit the whole community via indirect (economic activity created throughout the supply chain) and induced (economic activity created by household spending of income earned either directly from hotels or from the supply-chain )," said Tibaldi.
With that in mind, it makes more sense for the hotel workers union to advocate for the tax stabilization agreement than to keep attempting to block it.
Chance To Show Leadership
Thus far, it seems as if Mayor Jorge Elorza has stayed out of the situation. The Mayor has made few, if any, on the record comments about the issue. It might be a good time for Elorza to show some leadership on the issue and make the construction of the hotel a reality first, then fight for better wages and working conditions for the people who will work there later.
Otherwise, the mayor risks losing a project that be an economic boon to the city that provides additional revenue moving forward. And it does nobody any good to have an empty building in downtown Providence just rotting away when it could be put to use, create jobs, and provide tax revenue (more in the future) for the city.
Let's build a new hotel.
Russell Moore has worked on both sides of the desk in Rhode Island media, both for newspapers and on political campaigns. Send him email at [email protected]. Follow him on twitter @russmoore713.
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