Home Subscriber Only Op-Ed The folly of taxpayer subsidies

The folly of taxpayer subsidies

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05/12/2017

05122017chafee — PBN PHOTO/ MICHAEL SALERNO

Recently I urged the R.I. Commerce Corp. board to reject Gov. Gina M. Raimondo’s recommendation to pay tens of millions of taxpayer dollars to attract a company to the former I-195 land. I wrote that this large amount of taxpayer money would be more wisely spent replacing the proposed truck tolls, or cutting property taxes,

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Recently I urged the R.I. Commerce Corp. board to reject Gov. Gina M. Raimondo’s recommendation to pay tens of millions of taxpayer dollars to attract a company to the former I-195 land. I wrote that this large amount of taxpayer money would be more wisely spent replacing the proposed truck tolls, or cutting property taxes, or investing in our public-education system. I referred to a study done by The New York Times, which pointed out in detail the folly of taxpayer subsidies used to entice companies to a community. The Times study accurately noted that politicians with short-term thinking are happy to shovel our money at wealthy corporations if it helps their next election. The future be damned! Providence Business News editors disagree with me and with the editors of the New York Times. That is fair if they can construct a legitimate contrary argument. I have two requests for future debates on this topic. One: Produce a reputable study that shows these subsidies actually work for the long term. Two: Frame the argument without resorting to tired inaccuracies. PBN wrote that I did not create jobs as governor. Here are the facts from my last month in office, December 2014: • Through November, R.I.-based jobs were up 8,500 since the start of the year and up 11,000 since January 2011. • Rhode Island’s unemployment rate was at its lowest level since April 2008, down 2.2 percentage points since the beginning of the year, the best start since 1984. • The number of employed was up 15,000 since the beginning of the year. • The number of unemployed was down 11,800 since the start of the year, the best start on record. Here is another fact: The insanity of the Curt Schilling/38 Studios deal was approved by a [state economic-development] board consisting of a who’s who of R.I. business leaders. Rhode Islanders have every right to be wary. Lincoln D. Chafee is a former governor and U.S. senator from Rhode Island.