Rhode Island Policy Reporter

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A look at the lousy situation Rhode Island is in, how we got here, and how we might be able to get out.

Budget Demystification!
Fiscal Derring-Do!
Economic Jiggery-Pokery!

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RIPR is a (paper) newsletter and a weekly column appearing in ten of Rhode Island's finer newspapers. The goal is to look at local, state and federal policy issues that affect life here in the Ocean State, concentrating on action, not intentions or talk.

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whole site RIPR back issues

Available Back Issues:

  • Aug 09 (38) - How your government's economic policies have worked against you. What a fake nineteenth century nun can teach us about the tea party protests.
  • Jun 09 (37) - Statistics of optimism, the real cost of your government. Judith Reilly on renewable tax credits. Review of Akerlof and Shiller on behavioral economics.
  • Apr 09 (36) - Cap and trade, the truth behind the card check controversy, review of Governor's tax policy workgroup final report.
  • Feb 09 (35) - The many varieties of market failures, and what classic economics has to say about them, review of Nixonland by Rick Perlstein.
  • Dec 08 (34) - Can "Housing First" end homelessness? The perils of TIF. Review of You Can't Be President by John MacArthur.
  • Oct 08 (33) - Wage stagnation, financial innovation and deregulation: creating the financial crisis, the political rhetoric of the Medicaid waiver.
  • Jul 08 (32) - Where has the money gone? Could suburban sprawl be part of our fiscal problem? Review of Bad Money by Kevin Phillips, news trivia or trivial news.
  • Apr 08 (31) - Understanding homelessness in RI, by Eric Hirsch, market segmentation and the housing market, the economics of irrationality.
  • Feb 08 (30) - IRS migration data, and what it says about RI, a close look at "entitlements", historic credit taxonomy, an investment banking sub-primer.
  • Dec 07 (29) - A look at the state's underinsured, economic geography with IRS data.
  • Oct 07 (28) - Choosing the most expensive ways to fight crime, bait and switch tax cuts, review of Against Prediction, about the perils of using statistics to fight crime.
  • Aug 07 (27) - Sub-prime mortgages fall heaviest on some neighborhoods, biotech patents in decline, no photo IDs for voting, review of Al Gore's Against Reason
  • Jun 07 (26) - Education funding, budget secrecy, book review of Boomsday and the Social Security Trustees' Report
  • May 07 (25) - Municipal finance: could citizen mobility cause high property taxes? What some Depression-era economists had to say on investment, and why it's relevant today, again.
  • Mar 07 (24) - The state budget disaster and how we got here. Structural deficit, health care, borrowing, unfunded liabilities, the works.
  • Jan 07 (23) - The impact of real estate speculation on housing prices, reshaping the electoral college. Book review of Blocking the Courthouse Door on tort "reform."
  • Dec 06 (22) - State deficit: What's so responsible about this? DOT bonding madness, Quonset, again, Massachusetts budget comparison.
  • Oct 06 (21) - Book review: Out of Iraq by Geo. McGovern and William Polk, New rules about supervisors undercut unions, New Hampshire comparisons, and November referenda guide.
  • Aug 06 (20) - Measuring teacher quality, anti-planning referenda and the conspiracy to promote them, affordable housing in the suburbs, union elections v. card checks.
  • Jun 06 (19) - Education report, Do tax cut really shrink government?, Casinos and constitutions, State historic tax credit: who uses it.
  • May 06 (18) - Distribution analysis of property taxes by town, critique of RIEDC statistics, how to reform health care, and how not to.
  • Mar 06 (17) - Critique of commonly used statistics: RI/MA rich people disparity, median income, etc. Our economic dependence on high health care spending. Review of Crashing the Gate
  • Feb 06 (16) - Unnecessary accounting changes mean disaster ahead for state and towns, reforming property tax assessment, random state budget notes.
  • Jan 06 (15) - Educational equity, estimating the amount of real estate speculation in Rhode Island, interview with Thom Deller, Providence's chief planner.
  • Nov 05 (14) - The distribution of affordable houses and people who need them, a look at RI's affordable housing laws.
  • Sep 05 (13) - A solution to pension strife, review of J.K. Galbraith biography and why we should care.
  • Jul 05 (12) - Kelo v. New London: Eminent Domain, and what's between the lines in New London.
  • Jun 05 (11) - Teacher salaries, Veterinarian salaries and the minimum wage. Book review: Confessions of an Economic Hit Man
  • Apr 05 (10) - Choosing a crisis: Tax fairness and school funding, suggestions for reform. Book review: business location and tax incentives.
  • Feb 05 (9) - State and teacher pension costs kept artificially high. Miscellaneous tax suggestions for balancing the state budget.
  • Dec 04 (8) - Welfare applications and the iconography of welfare department logos. The reality of the Social Security trust fund.
  • Oct 04 (7) - RIPTA and DOT, who's really in crisis?
  • Aug 04 (6) - MTBE and well pollution, Mathematical problems with property taxes
  • May 04 (5) - A look at food-safety issues: mad cows, genetic engineering, disappearing farmland.
  • Mar 04 (4) - FY05 RI State Budget Critique.
  • Feb 04 (3) - A close look at the Blue Cross of RI annual statement.
  • Oct 03 (2) - Taxing matters, a historical overview of tax burdens in Rhode Island
  • Oct 03 Appendix - Methodology notes and sources for October issue
  • Apr 03 (1) - FY04 RI State Budget critique
Issues are issued in paper. They are archived irregularly here.

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The Rhode Island Policy Reporter is an independent news source that specializes in the technical issues of public policy that matter so much to all our lives, but that also tend not to be reported very well or even at all. The publication is owned and operated by Tom Sgouros, who has written all the text you'll find on this site, except for the articles with actual bylines.


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Mon, 30 Mar 2009

Deep six the supplemental budget

The House rewrite of the Governor's supplemental budget could hardly be a worse document than the original budget, but it is just as bad. On balance, you have to say it's slightly more realistic in its assumptions, but it is crueler to the cities and towns. So take your pick: a bad budget, based on unrealistic assumptions (from the Governor) or a worse budget, based on realistic assumptions (from the House).

The budget ends general revenue sharing for the cities and towns. This is a pot of about $55 million that is shared with all the municipalities, and which they were all counting on in order to fill out this year's budget. This is cut to zero in the House version. Let's be clear about what's happening. Three-quarters of the way through the fiscal year, cities and towns are being told they have to suck it up and make up a whole year's worth of state aid. Providence will lose $15 million under this budget. For comparison, the police and fire departments are both about $43 million departments, and the rest of the municipal government is about the same. So they'll have to cut about 13% of their annual expenses in three months. In other words, if everyone took six weeks off and went home, they might make it. This doesn't consider the cuts to education aid, but there are some of those, too, despite the addition of federal stimulus money.

To pick a random suburban town, in North Kingstown the loss appears to be about 4-5% of the general municipal budget. So they'll only need to give everyone two and a half weeks off, or otherwise find a way to cut 20% of the budget for three months.

According to my understanding of the ARRA (stimulus) money, the House budget front-loads the money more than the Governor had. The Governor appeared to be saving some of the ARRA money for the next fiscal year, which is sort of counter to the spirit of the stimulus. On the other hand, the House budget scoops more of this money, giving less of it to the towns, so that's counter to the spirit of the stimulus, too.

A big part of the fiscal stimulus money was an increase in the Medicaid match, which means the federal government's split of medicaid costs would change from 52/48 to 55/45 or so. The legislature scooped that money, too, cutting Medicaid expenses and keeping the additional Medicaid money for the general revenue budget.

The good parts of the House changes are they scotched the idea of selling state buildings to RI Housing as a way to loot that agency, and they put off the Governor's weird pension savings, which weren't really supported. But they didn't reject the pension cuts. They just said we're not going to make any pension payments between April 2 and June 30, while we await more documentation. I'm sure that on June 30, they'll be happy to pony up.

And let's not forget that there is still a multi-million-dollar tax cut in this budget. The flat tax is still due to go down a half-percent this year, providing a huge break for a small number of lucky people. While the rest of us watch the state crumble, those folks will continue to fly first class.

There's much more; almost every page has a new outrage. This budget is a disgrace to the people who wrote it and an affront to anyone who cares about the future of our state, not to mention the future of whatever city or town you live in. I don't think what's wrong with it can be fixed by amendment, and I hope it goes down in flames. Sadly, I fear this is unlikely, because there are very few legislators with the courage to defy the leadership, but when the leadership has led you into a disaster, why do you still follow?

22:28 - 30 Mar 2009 [/y9/ma]

Sun, 29 Mar 2009

Plus ca change...

From O. Henry's Rural Sports, one of his tales of Jeff Peters, the con man:

"Farmers are not fair game to me as high up in our business as me and Andy was; but there was times when we found 'em useful, just as Wall Street does the Secretary of the Treasury now and then."

07:21 - 29 Mar 2009 [/y9/ma]

Sat, 21 Mar 2009

Stimulus estimates

Have you wondered where the numbers come from when people say stuff like "tax cuts are less stimulative than food stamps"? Much of them come from estimates made by Moody's economy.com, and presented to Congress last summer (2008). Find them here.

09:43 - 21 Mar 2009 [/y9/ma]

Mon, 09 Mar 2009

More good reading

Can be found at Closing Arguments, a new blog by Matt Jerzyk, the founder (though no longer the proprietor) of RI Future. He intends to make it more about the legal and intellectual background to the news. It's good stuff, go there and read it. Often.

22:30 - 09 Mar 2009 [/y9/ma]

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