Rhode Island has arrived at Hell in its hand basket. Lots of reasons listed here but I’m surprised they don’t mention corruption: that will crush an economy faster and more permanently than anything else: ask a Russian or African.
When it comes to state economies, bigger is not necessarily better — cf. California.
But the nation’s smallest state remains stuck in reverse while the rest of the country slowly regains its footing.
Pick any survey or economic indicator, and Rhode Island is at the bottom.
The state was the only one to register rising unemployment last month.
They also scored dead last in CNBC’s survey of states’ business climates, third-to-last in Forbes’ and fifth-worst in the Tax Foundation’s.
We asked to two Rhode Island economists why such a small state could have such massive problems, and they were unanimous in their response: the state has the same problems as other former industrial powerhouse states, but lacks the Rust Belt glamour and urgency to have done anything about it.
“It’s not a recent problem,” he said. “It has a history that goes back to the 1990s, when the U.S. economy moved away from a traditional economy,” to a knowledge-based one. “With that, you had to change the way you organized your economy, a more flexible system to take advantage of innovation.
“We failed to make that transition.”
Permits can take months to get approved, and regulations remain excessively burdensome, he said.
Recent history has further compounded the problem, he said. After 2003′s “Great White” concert fire, which claimed 100 lives, the state revised its firecode that Tebaldi says unwittingly made it one of the most expensive in the nation.
University of Rhode Island Professor Leonard Lardaro agreed.
“Going back decades, if there was any revenue stone to be gotten” state leaders would grab it, he said.
An even greater problem, he said, was brain drain.
“The most glaring deficiency is the lack of skilled workers,” he said.
While the state trains a lot of skilled people, there is no knowledge-based economy to keep them from leaving for Boston or Connecticut, he said.