4 Things RI’s Government Can Do to Improve the Economy, But Won’t
Saturday, March 08, 2014
There are four things the Rhode Island legislature could do to move our state from the bottom five to the top five in economic rankings, but won’t:
- Eliminate the personal income tax
- School choice / Vouchers / Right to Work
- Delaware style corporate reform, including tort reform.
- Eliminate the estate tax. Don't simply raise the exemption threshold, We want billionaires dying here!
In both business and sport the competition is constantly analyzed, especially if they are beating you. A common refrain from the boardroom to the locker room is:
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST“What are they doing that we’re not that is leading to their success and dominance over us?”
This isn’t rocket science; in fact it’s conventional wisdom. A team that’s getting beat, like Rhode Island is, should naturally look to the teams that are thrashing them and determine what those teams are doing differently, that is leading to the thrashing.
Fortunately in the League of States where Rhode Island is a chronic last place finisher, it’s easy to determine what the leading states like Texas, Florida and others are doing that we’re not. Unfortunately Rhode Islanders have developed an affinity for politicians, who for one reason or another, ignore conventional wisdom and repeat the failed policies and tactics of a loosing team. On the playing field of business and sport this gets you fired, in Rhode Island, oddly, this gets you re-hired.
Eliminate the income tax
If you want to encourage people to work, so they make money and spend it locally and remain self-reliant (a pre-Obama American virtue) you don’t penalize or tax them for working.
A sales tax is the only true measure of productivity and the fairest way to fund government. Furthermore raising taxes on vises like Alcohol (society’s most destructive drug) and legalizing marijuana would help raise revenue, the rest would be made up in growth (because people would have more money to spend), reforming education and right sizing government. Keep in mind NH has no sales tax, no income tax, is 7 times our size and their roads freeze and are destroyed every winter, yet they operate on about half of our budget. Go figure.
School choice
It’s a proven fact, that parents will move mountains and to mountains to get their kids into a great, free or affordable school.
Unfortunately, Rhode Island schools are nothing to brag about. About 30th nationally in a country that is 28th out of 32 industrialized nations. In other words no one anywhere is studying what we are doing in education. Not surprisingly in the government jobs program that is masquerading as an education system, we are spending at the top as a nation and state on below average schools and our children are paying the price in a competitive global marketplace. My hometown of Newport is spending over $18,000 per pupil--and trust me the private schools on Aquidneck Island are a thriving alternative and unfortunately families that can afford to, are making the sacrifices to prove it…
As a comparison, the government doesn’t make the food in this country, but they do supply vouchers to people who can’t afford food. Sheldon Whitehouse, a big supporter of food stamps, is really, really rich and can afford to send his kids to the best private schools, and he does. However, he is the exception in Rhode Island, not the rule.
Most people have one choice for their kids’ education, a government school, the same school that Sheldon Whitehouse and other progressive leaders in Rhode Island have opted out of for themselves and their children. These progressives are big fans of vouchers to be redeemed for private sector food, yet against school vouchers. In fact they are big supporters of the single choice government monopoly on education for people who can’t afford private school. Why? If Rhode Island became a school choice state, educational opportunities would explode into a true competitive marketplace enabling families and educators a broad selection of places to work and learn. And where there is competition, quality always improves.
Furthermore, tax payers and our struggling towns, would benefit from lower costs derived through competition. And trust me, people would move here to take advantage of our enlightened education system. Rhode Island children from all walks of life would enjoy the same schools that people like Sheldon Whitehouse choose for their children…In fact you’d hear a big sucking sound from states around us, as hard working people, pursuing a better education for their children, flock to Rhode Island to work and live.
Who knows, Langevin may even hold on to his congressional seat for the rest of his life if our population decline turns around and we keep that seat which is now getting sent to a Pro-Growth state in a few years.
Tort reform
When business people drive through Rhode Island, generally on the way to a state where they have jobs, they can’t help but notice the Heavy Hitter and others like him gracing our billboards and airwaves. This sends a clear message to business owners, “that guy must be making a lot of money suing people like me, probably not a good idea to locate my next facility here”…
Common sense tort reform with real consequences for frivolous lawsuits would make Rhode Island a much friendlier place to conduct business. Rhode Islanders can get ahead through job choice rather than falling prey to unscrupulous litigators…and while the legislature is reforming one system ripe with fraud, the workers comp system could use a business friendly overhaul as well…
Finally, wealthy retired people have time and money
Smart policy would be designed to keep them in Rhode Island spending their time, spending their money, here, not in Florida. The income tax already drives the high taxpayers out of state, the exact people the progressives need in order pay for their dependency programs. As one of the few remaining states with an inheritance tax, Rhode Island’s hefty estate tax is the final straw for all those on the fence. In fact I had many lawyers, accountants and financial planners all say same thing to me during the campaign, “it would be malpractice if I didn’t tell my clients to move to Florida to set up their estate”, and of course they do… and in response Rhode Island, has a system that points a gun to the head of our wealthy spenders forcing them to leave the state, for six months, right before the holidays, so they do their shopping and dining in Florida. And to add insult to injury, one of the tests of residency, is where you donate, so of course the Florida charities benefit while the Rhode Island charities suffer…
Duh. Let’s keep them here, spending in our shops and restaurants and donating to Rhode Island charities. Maybe they’d leave for a couple months after the holidays to avoid the worst of the weather, but six months, which includes the shopping and giving season is just plain stupid.
Who wants to bet me these things will never happen in Teresa and Gordon’s Big House on the Hill?
Former U.S. Senate candidate Barry Hinckley is an entrepreneur, most recently founding and building Bullhorn, Inc. into a world leader in staffing and recruiting software. Bullhorn was sold in 2012 to Vista Equity Partners. Barry, a free market libertarian, lives in Newport where he is working on his next business venture.
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