Curt Schilling was a magnificent baseball player for a number of years. He was instrumental in removing the Curse of the Bambino for the Red Sox, and who can ever forget the ‘Bloody Sock’? Great stuff indeed. While it is evident that Mr. Schilling displayed significant talent on the diamond, his recent exploration into the world of business has come up a bit short.
Some pretty intelligent political and business types came up with the idea of giving the hard throwing Mr. Schilling $75 million to move his video game business to Rhode Island. Initially, a number of folk questioned this move but eventually their doubts were set aside and it was full speed ahead for 38 Studios.
Well, we all know what happened. The 38 Studios project appears to have fallen on hard times. Many in R.I. are asking why? Others are pointing fingers and assigning blame. I think all of this is a waste of time. The real question that needs answering is this: what did you think was going to happen?
You’re telling me that a bunch of business types got together and the best they could come up with was – let’s try the retired baseball star with little or no real business experience. How did this ever get by the Board Room? The equivalent would be having the highly respected business leader Gary Sasse being selected to start the 7th game of the World Series. Not gonna happen.
I’m hoping that somehow we will be able to sort all of this out. R.I. (and the country) is in the midst of a difficult financial crisis. We’ll need smart people making sound business decisions to help navigate us through this mess.
I’m wondering if the ghost of George Herman Ruth is trying to get back at the Red Sox. Basically, the Curse Of The Bambino R.I. style. The Sox got off to a difficult start this year and now 38 Studios. This possible explanation makes as much sense as anything else we’ve been hearing.
Curt Schilling is obviously a pretty bright guy. He is an insightful baseball analyst. But maybe not an astute business leader. While he extolled the virtues of 38 Studios it was a number of local politicians and business leaders who bought into the concept. Now it appears as if the Ocean State has its own ‘Green Monster’ – only this one is financial.
I recently read that gambling revenue is our state’s third highest source of income. Did you ever think that this and supporting 38 Studios would be among our best bets? I am sure we can do better than this. I am sure we can find ways to support our schools, promote real economic development and create an atmosphere of trust and cooperation amongst our political leaders. Right now its nothing but goose eggs. Not only are we experiencing a major financial problem we are also experiencing a leadership crisis as well.
Just to make clear….
This was a bipartisan failing.
It certainly appears to me that the ‘business’ folks got star struck and put together one of the biggest give aways ever seen.
But – keep in mind that the democratically controlled legislature fell all over themselves to approve the deal.
RI needs a professional EDC. RI needs to have experts crafting any future deals watching out for the best interests of RI (if there ever is a next time).
And…while RI is comparatively speaking a pretty lousy place to set up a business, we will need to do something to try to bring jobs into the state.
“RI needs a professional EDC.”
Mr. Block, if by “professional EDC” you mean an EDC that is focused on making RI attractive to businesses of all stripes instead of trying to plan what politically favored businesses from politically favored industries should move here, then yes, we need a professional EDC. If you don’t mean that, then we’re better off without an EDC.
“RI needs to have experts crafting any future deals watching out for the best interests of RI”
Riiiiight… if we just had smarter people making the decisions, everything would have been so much better. That’s always what proponents of interventionist governments say when their plans fail. What would the qualifications be for these so-called “experts”, and how could they possibly know for certain what’s in the best interest of RI’ers?
What I mean is if we are going put to taxpayer money on the line ever again, we need loan covenants with teeth and we need to evaluate the deal on the merits – like any sophisticated investor would naturally do. This was an awful deal for RI investors – to the tune of about $100 each for every man, woman and child in the state.
By professional EDC – I mean an EDC that works to make RI more attractive by effectively advocating for necessary changes. But more importantly, a professional EDC is not simply an extension of the region’s biggest chamber of commerce. A professional EDC would have spent far more time, energy and money on small business development. A professional EDC would have a clearly defined mission statement – and every decision made by that body would have to fit within the parameters of that statement. How could the EDC ever have given TD Bank close to half a million dollars in tax breaks to build retail bank branches in RI. What a joke. RI needs more retail establishments like it needs a hole in the head.
“need to evaluate the deal on the merits – like any sophisticated investor would naturally do.”
But I don’t have to tell you that such a thing won’t happen. Gov Chafee admitted to Buddy Cianci on Tuesday that Stokes was kept on after the governor was elected because Linc knew any other appointee would not pass the Senate, meaning Stokes was Paiva-Weed’s guy and that she would make sure any alternative appointee would fail confirmation. It was only serious public pressure that forced Stokes out.
There is no realistic way you can have an EDC that is separated from the political process (so they can evaluate a deal solely on its merits), and make sure there is sufficient oversight on what they give out in taxpayer money. That means the only feasible EDC is one that provides suggestions to Congress on how to improve the business climate in RI, which is to say they’ll simply be pissing into the wind.
I can understand why “Moderate” wants to apportion blame in a bi-partisan way but need to face it that the role of Governor Carcieri and his EDC is far more reponsible than the Assembly on this one. And we should learn the lesson, politicians and “business” types who talk about the “free market” cannot be depended on to really mean it, they are as often as not ready to take government subsidies or give them to their friends (especially when a celebrity mouths a few right-wing talking points) as readily as any welfare queen.
While a real solution is elusive given our “free trade” laws, our limited natural resources, and the downward cycle we are already in where bad times cause greater need and inadequate support for infrastructure, public eduction (especially at URI, RIC) and the like, another lesson I think is that raiding another nearby state is not a good strategy. At best it adds nothing to the regional economy, and it leaves both states more subject to economic blackmail and declining resources.
I agree with an above post that a goal should be a fair playing field for all businesses rather than the current who-you-know system that rewards insiders at the expense of everyone else. To get there I hope folks will consider helping get away from the party insiders who hae so often screwed up and consider electing “moderates” and independents less beholden to the old ways.
“but need to face it that the role of Governor Carcieri and his EDC is far more reponsible than the Assembly on this one. ”
Without the vote from the GA, the loan doesn’t get made though, correct?
The GA vote was to extend the amount of the loan fund from $50 million to $125 million – NOT to give one unproven company a $75 million loan. It is clear that Carcieri and Fall Guy Stokes deceptively pushed the GA to extend the EDC fund in order to push through the shady deal 38 Studios deal.
Most of the GA members didn’t know that Carcieri’s grand scheme was to give $75 million to his new buddy, Curt Schilling. So, Barry is absolutely correct: most of the blame for this bad deal is on Carcieri’s shoulders. Funny how Don has nothing to say about it now.
“Funny how Don has nothing to say about it now.”
What do you want him to say? Maybe when some of you get over the blame game you’ll realize the whole EDC system is flawed. Anytime you need to provide tax credits and/or taxpayer backed loans for business to come and/or stay without addressing the actual business climate you have a recipe for failure. Carcieri’s failure was trying to hit a home run. Everyone gets it and no one is denying it. Well maybe he is but the point that some of you miss is while your keyboarding you’re Carceiri hate you’re ignoring the real problem and that’s this states total disregard for it’s poor business climate. Name one effort in the GA or the Governor’s Office to address it besides a lot of lip service.
Well they said tax cuts for rich people would do the trick, so the GA and Governor’s office have done lots of those. And they said that reforming regulations and permitting would do it, so the S of S office has been given the legislative go-ahead and some dollars to do that (and they are well on their way). And they said that a cap on property taxes would do it, so the GA and Governor have done that. And they said that some targeted tax credits would do it, so the GA and Governor have done that, too. And, of course, the loan program itself is an attempt to improve the business climate. Well ok, that’s more than one and all of them are real dollars, not just lip service. You want more?
Well, Fox and Paiva-Weed and Costantino knew what the $125 million would be used for, so yes, Democrats bear the blame as well. And they bear the blame, along with Carcieri, for all the terrible trickle down feed-the-rich economic policies listed by Tom – policies that were paid for by cutting kids off RIte Care, destroying aid to cities and towns, cutting unemployment benefits and child care suport and rtrvies for the disabled and driving porperty taxes up on middle-class families and renters, and so on and so on. The conservative ideas have been tried and seem to be failing, the fault is bi-partisan, and its time to make real investments in the things that build economies – good schools, good infrastructure, and lower proerty taxes, pauid for by a modest increase in taxes on the elites that have been ripping us off for decades.
“driving porperty taxes up on middle-class families and renters,”
C’mon now… property tax rates did not go up just on middle class families and renters, they went up on everyone.
“pauid for by a modest increase in taxes on the elites that have been ripping us off for decades.”
I hear all the time how taxes should be increased on the rich, but I never hear how much. What is the magic number? And will your number pay for everything you want government to do?
“I hear all the time how taxes should be increased on the rich, but I never hear how much”
A top marginal tax rate of 70% or seems optimal, at least at the Federal level.
http://elsa.berkeley.edu/~saez/diamond-saezJEP11opttax.pdf
Who’s “they”? And if we’ve done all of these things, why does RI rank dead last in business friendliness? Perhaps then, the things we did weren’t the right things?
Tom,
I’m sure you’ve perused the bills currently pending in the GA. What bills have been submitted to improve the business climate? The majority are labor strengthening, tax the rich, pension anti-reform, same sex marriage, and marijuana dens. Maybe I missed it but the only lightening of regulations I’ve seen is the fire code.