Updated March 27 at 6:35pm

The hunt for wasteful spending

By Patrick Anderson
PBN Staff Writer

Editor’s note: This is the first in a series of articles focused on the 2014 gubernatorial candidates and their plans for economic development. More

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POLITICS

The hunt for wasteful spending

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If elected governor, Ken Block promises to do for Rhode Island on a large scale what his company, Simpatico Software Systems Inc., tries to do for government clients on a smaller scale: wring waste and fraud out of public services.

The Moderate Party founder running for the first time as a Republican in 2014, Block has assembled an economic platform geared toward making Rhode Island more competitive and less expensive for businesses.

Block’s economic plan includes six separate cuts on taxes he argues are stifling growth and would pay for them exclusively by seeking out and eliminating wastefulness from programs and agencies.

Through reforms such as consolidating state human resources staffing, rescuing the R.I. Department of Motor Vehicles database project and cracking down on temporary-disability-insurance abuse, among other things, Block said he can find the savings he needs to pay for his tax cuts.

“The problems we have had in our economic climate, and by that I mean the taxes and regulations that make doing business in Rhode Island far more expensive than other places, have been with us a long time unaddressed,” Block told Providence Business News in a recent interview about his plan. “We have to start by examining all our big areas of spending and asking if the money is achieving its intended purpose.”

Exactly how much savings Block would have to find to pay for his proposed tax cuts is difficult to say. Only two of the six cuts in the plan come with a cost estimate ($60 million combined).

Although pinning down the cost of the entire package is difficult, it would likely be more than $100 million and may be closer to the $200 million tax-cut plan proposed by Republican rival Allan Fung.

Block’s tax cuts would start, unlike a number of other current tax-cut proposals by candidates and sitting politicians, with the vehicle excise tax, a levy the state doesn’t even collect.

Block proposes raising the current $500 minimum car-tax exemption – how high is undetermined – and offering cities and towns up to two-thirds of the revenue they would lose from that higher exemption if they can find the remaining one-third through shared services with other communities. He would cap the state reimbursement at $50 million total.

How interested cities would be in the plan is unclear, but Block casts it as a way to attack two problems – the state’s high car taxes and duplication of services – in one fell swoop.

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Obadiah2

Block does not address a few significant and cultural based economic issues. For example, the case of many companies closing is not a problem unique to only Rhode Island and focusing on business closings masks the real problem which is clearly the low birth of new industries. For this latter to occur, you have to have a good representation of entrepreneurial, risking taking, talented individuals. When you have a population that is low on initiative, that has low education and does not support higher ed like other states, how can government turn this culturally based problem around?

Also, RI is a city state and recognizing that fact and taking action to change the prevailing fragmentation of services requires bold action and this kind of action does not play to the strengths of conservatives who have hide bound ways, often protect the status quo and are change adverse.

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