Debt strangles R.I. finances

 / Source: usgovernmentspending.com
/ Source: usgovernmentspending.com

An oft-heard complaint is that Rhode Island’s public sector spends too much money, with poor results. But that is not always the case.

For instance, according to usgovernmentspending.com, the Ocean State ranks No. 13 for the highest health care spending as a percentage of the gross state product, at 3.73 percent. And one of Gov. Gina M. Raimondo’s key initiatives in her first year in office has been to bring down the spending the state does for health care, specifically Medicaid.

But a recent study by the Center for Secure Retirement ranking the best cities for a healthy and affordable retirement gives Providence (and thus the state) a very high ranking for health care, using factors such as hospital ratings and affordability, helping land the city at No. 20 on the list.

On the other hand, Rhode Island ranked No. 33 in percentage of GSP spent on transportation (0.68 percent to be exact). So it shouldn’t come as a surprise that the state’s roads and bridges are considered among the worst (if not the worst) in the nation.

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Still, the state is not in the middle of the pack for total spending (No. 7, at 13.64 percent) or pensions (No. 6, 1.84 percent) as percentages of GSP, so just to get spending to a more middling rank will require much more work.

One area in which the state is a standout, however, is public debt.

At 17.18 percent of GSP, Rhode Island has the highest percentage of state gross public debt in the nation, followed in order by Massachusetts and Connecticut.

Even more troubling is that, according to the website, the amount of interest that Rhode Island spends as a percentage of GSP is 1.17 percent. No. 2 on the list, Delaware, spends 0.76 percent of GSP on interest, while Massachusetts, No. 3 in the ranking, spends 0.57 percent.

How it is that Rhode Island spends far more on interest than even other high-debt states is certainly worth more study. But the debt numbers especially show the enormity of the challenge that Raimondo faces as she tries to use find tools to inject a little life into the Ocean State’s economy. •

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