Russell Moore: Under Taveras, Providence Goes Lawsuit Crazy

Monday, August 18, 2014

 

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So this is what it’s come down to under Mayor Angel Taveras in our capital city?

The city's pension system has a funded ratio of just 30 percent (meaning its assets only cover roughly 30 percent of the plan's liabilities), the roads look like the city was just attacked by a foreign super power with holes that resemble craters, and a violent crime has wreaked havoc on the capital and dominated the news over the last month. 

And what is Taveras doing to address these catastrophic problems? Sue everybody! Then hope for a massive settlement that will drastically improve the city's finances.

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Waiting for superman, or a settlement

Yes, you've read that correctly. Providence is now the guy sitting on Beverage Hill in Pawtucket wearing the tank top and jean shorts and waiting to hear from his lawyer that the insurance company has agreed to settle his case.

GoLocalProv's Stephen Beale reported last week that the city of Providence, over the last several months and weeks, has filed separate lawsuits against General Motors, Santander bank, and a series of Wall Street money management firms. Who knows what else they might have in store for us going forward?

It irked me when Providence sued Buck Consultants a few years ago, claiming that the highly respected company gave them bad advice on their pension plan, which caused the city to balance its books incorrectly. There's nothing like blaming someone else for your own mistakes and then suing them in the process.

Desperation

But at least, in the Buck case, the city was suing a company with which it had a direct business relationship. In the case of Santander, General Motors, and these Wall Street firms, the city is suing organizations with only ancillary ties to Providence. It reeks of desperation.

And you could see it in Beale's article. Some of the Providence Councilmen he interviewed for the story made the city seem like a busted out gambler betting on long shot horses in order to make his rent money that month.

"If we hit the jackpot in one of them, I think that would be great", said city Councilman Sam Zurier, sounding like every single Twin River patron.

The lawsuit against the Wall Street firms also seems like a politically motivated ploy, taking aim at General Treasurer and Gubernatorial candidate Gina Raimondo's cozy Wall Street connections. 

Taveras spokesman David Ortiz said that the lawsuit against the Wall Street firms is also intended to "reform Wall Street". The city of Providence should be more concerned with paving roads and keeping crime in check--not reforming Wall Street. 

Playing Politics

Look, with the exception of Forbes Columnist Ted Siedle, I'm not sure there's been anyone more critical of the high fees the pension fund has been paying to Wall Street money managers under Raimondo's stewardship of the pension fund than me. When her predecessor, Frank Caprio, the former Treasurer who is seeking the office again this year, was in charge, the state paid just a fraction of the fees, about 25 percent, of what we're paying the Wall Street Fat Cats and Hedge Fund Cowboys now.

But that doesn't mean Taveras has the right to use the city's law department for political expediency and to make a point about Wall Street greed. That reeks of desperation from a candidate who was once considered by some to be the overwhelming favorite in the Governor's race.

The city is suing Santander over what it claims were discriminatory lending practices. Let me clue Taveras in on something here. Santander bank loans money to people that it believes it will make a profit off of. The only discrimination is whether they believe someone will pay back the loan. That's the name of the game.

With respect to GM, they're suing them due to a nationwide recall of millions of vehicles over faulty ignitions. What that has to do with the City of Providence is beyond comprehension. 

The city claims that Rhode Island's Tobacco Settlement money it received over the lawsuits against the big tobacco companies was somewhat of an inspiration for these lawsuits. The city has even retained the same firms that prosecuted those cases.

Same mistake twice

How lovely and ironic considering a report in GoLocalProv last week that detailed the fact that the tobacco settlement monies, instead of being used for tobacco abatement programs, has now become toxic debt for the state of Rhode Island! What an act to try and emulate.

It's sad to see Angel Taveras, who became mayor with such promise and high expectations, executing such jayvee player moves as of late. A city should be funded by sound fiscal practices and prudent spending decisions. The way to fund a city is not be spending more than you can afford and then hoping to win a big settlement against some national firm to bail yourself out. Providence should be better than making wild, desperate moves.

If this is how Taveras plans to run the state of Rhode Island--is it really any wonder why his campaign is struggling so mightily as of late?

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A native Rhode Islander, Russell J. Moore is a graduate of Providence College and St. Raphael Academy. He worked as a news reporter for 7 years (2004-2010), 5 of which with The Warwick Beacon, focusing on government. He continues to keep a close eye on the inner workings of Rhode Islands state and local governments.

 

Related Slideshow: 10 Questions Taveras Has to Answer When Running for Gov of RI

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#10 Fundraising

Can Taveras Keep Up with the Big Boys and Girls in Fundraising?

In America today, one issue that is a factor in nearly every election is fundraising. To date, Taveras has yet to demonstrate any consistent ability to keep up with the leading fundraisers in RI.

Taveras will have to compete with General Treasuer Gina Raimondo, who has $2 plus million on hand and a likely run from Clay Pell (grandson of US Senator Claiborne Pell and whose wife is Olympic skater Michelle Kwan).

Raimondo is on pace to raise $5m and Taveras presently has just $692,000 on hand and would be on pace to raise less than $2 mliion. 

Pell's family has access to nearly limitless dollars - back in the 1990's Pell's grandfather was ranked as one of the wealthiest members of Congress.

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#9 Curse

Can Taveras Break the Providence Mayor's Curse?

For more than 60 years, no Providence Mayor has been successful running for Governor of Rhode Island. You have to go back to the 1950 election when Dennis Roberts was elected Governor.

Since Roberts, a number of Providence Mayors have taken their shot at running for Governor and each has failed mightily.

Most notably, Buddy Cianci's run against J. Joseph Garrahy - Cianci got less than 30% of the statewide vote.

Joe Paolino was expected to win the Democratic primary in 1990, but was beaten badly by Bruce Sundlun and then Warwick Mayor Frank Flaherty.

Sundlun went on to win the general election and Flaherty was later named to the state Supreme Court.

Taveras will have to break a very long curse.

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#8 Hire or Fire

Can Teachers Trust Taveras - and Will Voters Trust His Relationship with the Teachers Unions?

In the midst of the city's political meltdown, Taveras just into his first few months in office fired all the teachers in Providence.

Taveras received strong public support, but within months he capitulated to pressure from the teachers' unions.

Three years later, he is emerging as the candidate of the teachers' union leadership. Will teachers trust him in a statewide race and will voters trust him if he is perceived as too close to union bosses?

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#7 Hispanics

Will Hispanics Vote as a Block in the Primary for Taveras? Are They Influential Enough in the General?

Conventional wisdom is that Angel Taveras will get a big boost from the Hispanic voting block in the primary, but more recently Council members Luis Aponte, Danian Sanchez and Sabina Matos have all openly battled with the mayor on his tax increases and efforts to close pools in low income wards around the city.

While Taveras can rebound and the impact may be large in the primary, the percentage of voters who are Hispanic in the general election is just 7% according to Pew Research:

  • Rhode Island’s population is 12% Hispanic, the 13th largest Hispanic population share nationally.
  • There are 54,000 Hispanic eligible voters in Rhode Island—which ranks 35th in Hispanic eligible voter population nationally. California ranks first with 5.9 million.
  • Some 7% of Rhode Island eligible voters are Hispanic, the 13th largest Hispanic eligible voter population share nationally. New Mexico ranks first with 39%.
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#6 Temperament

Can Taveras Handle the Campaign Pressure and the Office Pressure of Governor?

Taveras had no experience as a chief executive in business or government before taking office in 2011 in Providence. He has increasingly gotten into some very non-productive scrapes.

In 2012, his law office delivered a document to GoLocalProv as part of a FOIA request and those documents included the social security number of every retiree of the City. Instead of taking responsibility he sent his lawyers to court to try to block GoLocal from writing about the mishandling of social security numbers. The judge ruled against Taveras.

In 2013, Taveras has tried to demolish a commuity swimming pool in South Providence because, according to Councilman Danian Sanchez, Sanchez would not vote for Taveras' tax increase.

Will Taveras be able to prove to voters he has the right stuff?

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#5 Base outside Prov

Can Angel Taveras Build a Political Base Outside of Providence?

While Taveras has a strong political base in Providence, it is unclear if he can build a strong political network in critical Democratic strongholds like Woonsocket, Pawtucket, East Providence, Johnston and North Providence.

It is well known that both Democratic Mayors in North Providence and Johnston have had a strained relationship with Taveras.

This strain has played out over critical matters like mutual emergency aid and in 2012, North Providence, Johnston and East Providence all cancelled emergency aid compacts with Providence.

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#4 Women Voters

Can Taveras Compete for Women Voters?

When Taveras ran for Mayor he won the critical block of East Side Democratic women. Part of his success with this critical block of voters was the support he enjoyed from Democratic power Myrth York. 

The two-time Democratic nominee for Governor went all in for Taveras in 2010, but she no longer is active in the inner circle and reportedly would have supported Governor Lincoln Chafee in the primary.

Taveras will need to compete with Raimondo who has already signed former EMILY's list bigwig Kate Coyne-McCoy.

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#3 Star Power

Can Taveras Keep Up with Clay Pell's Star Power?

In 2010, Taveras ran under the motto of "from Head Start to Harvard."  His claim on the American dream proved a successful juxtaposition to two Democrats who had the same political base - Federal Hill (Steven Costantino and John Lombardi).

Now, Taveras may face the fresh-faced Clay Pell. His bio exceeds Taveras as he can claim the legacy of his grandfather's work and hit the circuit with his superstar wife, Olympian Michelle Kwan.

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#2 Issues and Vision

Can Angel Taveras Articulate a Vision for Rhode Island?

Taveras earned good scores for managing the City of Providence's financial crises, but never seemed to develop major policies for economic development, schools, parking, crime, reducing the cost of government or improving the efficiency.
 
The Superman building's closure happened on his watch, technology company Dassault Systèmes is moving out of Providence, and no major employers were recruited into the city other than the scrap yard on Allens Avenue.
 
Taveras will need to define a forward looking vision for Rhode Island.
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#1 Crime and Education

Can Taveras Explain His Record on Crime and Education?

The biggest problem for Taveras is his record in Providence.
 
Most people care about the basics - their jobs, education for their children, how safe their neighborhood is.  These vary questions could be Taveras' Achilles' heel.
 
According to GoLocal's study of the FBI crime data, Providence is ranked #2 for violent crime per capita in Rhode Island.
 
The condition of Providence's schools may be worse. Of the 24 schools ranked as poor (de facto failing) in Rhode Island by the Department of Education, 6 of them were Providence Schools and in the rankings of the best high schools in the state, most of Providence's schools consistently litter the bottom of the rankings.
 
Taveras lead the city to win the $5 million Bloomberg award. But in a Governor's race one of Taveras' opponents is sure to ask, "Mr. Mayor, are you going to bring the same policies you used on crime and education in Providence to the rest of the state?"
 
 

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