Forget the studies, action needed for R.I. revitalization

As a former town council president, five-term Rhode Island state senator, 27-year vice president of a major Rhode Island corporation employing 1,200, and former president of the Greater Providence Chamber of Commerce for 18 years, I thought I would weigh in on the state’s efforts to reinvent itself in the years ahead. More

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OP-ED/LETTERS TO THE EDITOR

Forget the studies, action needed for R.I. revitalization

Posted 1/21/13

As a former town council president, five-term Rhode Island state senator, 27-year vice president of a major Rhode Island corporation employing 1,200, and former president of the Greater Providence Chamber of Commerce for 18 years, I thought I would weigh in on the state’s efforts to reinvent itself in the years ahead.

While all well-meaning and producing some worthwhile ideas, do we really need more studies to solve Rhode Island’s economic woes? When I retired from the Chamber six years ago, there must have been a 2-foot pile of old economic-development studies gathering dust, probably never to be referenced again. Quite honestly, you would have had to live under a rock not to know the problems facing the Rhode Island economy.

So please, no more studies. As we begin a new year, now is the time for action, courageous leadership and perseverance.

Let’s review some of the issues detrimental to growing Rhode Island’s economy: a weak national economy, high taxes, burdensome government regulations, an unfavorable business climate, health care costs, a shortage of skilled workers, high energy costs, and access to capital for small business.

With the exception of a weak national economy, all of these issues can be addressed through a joint effort of state agency leaders, business leaders and education leaders. But most importantly, the General Assembly, working together with the above-mentioned parties, can create a favorable business atmosphere that will help those businesses already here to grow and expand here, and attract investment from other parts of the country and other parts of the world.

We know the challenge. What we need now is for all of our leaders to make a unified effort to prioritize economic development and send a message to those here and far that Rhode Island is once again open for business.

In the short term, the General Assembly might want to jump-start this economic revitalization by reforming public education, so a better job is done for providing students with the necessary skills employers require.

In addition the legislature should undertake the following:

• Lower taxes for small business.

• Provide additional funding to the state Department of Labor and Training to better link employers with people looking for work.

• Eliminate or modernize the Rhode Island estate tax.

• Restore the historic-preservation tax credit.

• Send a message to prospective employers that only 7 percent of Rhode Island’s private-sector workforce is unionized.

The decision of my former employer, the Tupperware Corp., to shut down operations in Rhode Island, where we employed 1,200 factory workers, designers and engineers, was made by officials from a parent company located outside Rhode Island. They made this decision based on Rhode Island’s incredibly high energy costs, the pathetic business-climate rankings and an antiquated manufacturing facility.

The Rhode Island economy was originally devastated by the exodus of our manufacturers to the southeastern part of the United States. But beginning in the mid-1980s, Rhode Island began to reinvent itself by focusing more on health care-related institutions, hospitality and tourism, universities and colleges, corporate headquarters, manufacturing technology and defense-related businesses.

With regard to organizational structure, to think that a cabinet-level commerce czar or any economic-development director can turn the state’s economy around on his own is a misguided notion.

To really stimulate job growth, it will not take just a reorganization of state government but a call to action by the General Assembly. A legislature that understands what it takes to build a vibrant economy and transfer that understanding into legislative action.

It’s all about job creation. •


Jim Hagan is the retired president of the Greater Providence Chamber of Commerce, as well as a long-time business executive and member of the General Assembly.

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