1. Ban any pro-union advocacy opinions in the state’s media. While talk radio mostly does this already, some pro-union opinions occasionally do slip into the Providence Journal, RI Future, and maybe other local papers. I’m sure business will appreciate it if we close this loophole.

2. Cut pay of public workers by 50%. Though public workers have already made concessions on pay, health care and pensions, some of them can still afford to drive.  Halving their pay would not only lower the tax burden, but make more room on the roads for the important people.

3. Stop enforcing clean water laws.  Not only will this too lower the tax burden, but as public water supply gets more polluted, investors will see opportunities here to sell more bottled water and also to make money in the health care system treating the people who persist in drinking public water and thus get sick.

4. Stop funding bike, pedestrian and transit programs.  This will make the state more attractive to oil and auto companies.  Also, by discouraging physical activity, this will also increase obesity, making Rhode Islanders less fit and thus less able to challenge pro-business programs.  Those who persist in biking or walking can perhaps be made subject to a gasoline-avoidance fee that can generate revenue to subsidize business jets. But as there are proposals in the US House of Representatives to do something like this on a national level, we better do this quickly before we lose a competitive advantage over other states.

5. Sell all public beaches. Not only will this provide more shoreline for the rich to buy, but their view of the shore from their yachts will be improved if the hordes of riffraff on the public beaches are forced off.

6. End the sales tax on high-end cars. Though we already eliminated sales taxes on boats and private airplanes, the rich still have to pay sales taxes on BMWs, Cadillacs, Lexuses etc. It is not fair that their cars are not treated tax-wise the same way as their yachts and planes.

7.  Require all low income folks to be servants to the business class for 3 days a year. After all, we know how hard it is to find good servants these days. The low income folks serving the rich could polish their cars or silver, cut the grass, mop the floors and such. Giving up only 3 days would not be too much of a burden, but think how much it could improve our business climate rankings as no other state does this. Indeed we can market this initiative by emphasizing the “Plantations” part of our official state name that we voted to keep. not that long ago.

From the headlines, you would think that CNBC is the gold standard economic authority. After the cable news network released its 10th annual “America’s Top States for Business 2016” listing, in which Rhode Island was ranked dead last, local corporate media raced to bring the bad news to readers and viewers. CNBC ranks R.I. worst state for business, CNBC: Rhode Island ranked ‘Bottom State for Business‘, and RI back to dead last in new CNBC rankings are typical examples from the Projo, Channel 10 and Channel 12 respectively.

Missing from the Cassandra-like coverage is any hint that the rankings are meaningless and based on metrics that rate our state on how well our policies kowtow to the whims of business, not on how well they benefit the poor and middle class. Only Ted Nesi even approaches this angle in his coverage, but he did so through the lens of competing political discourse. But what about the economics of the report? Does it hold up under scrutiny? I’ve tackled the subject of economic rankings before, here and here, trying to bring some sort of real economic analysis to bear.

I asked Doctor of Economics Douglas Hall, Director of Economic and Fiscal Policy at the Economic Progress Institute, for some insights. Hall said that many of CNBC’s economic indicators “have a lot of merit and point to the need to address matters via public policy, such as repairing the state’s crumbling infrastructure and the need to help Rhode Islanders improve their educational attainment. But when you deconstruct their aggregate groupings,” said Hall, “many of the categories are deeply flawed and point to policies that would severely undermine the well-being and quality of life of working families in Rhode Island.”

One indicator the report uses is “union membership and the states’ right to work laws.” Low union membership and strong anti-union right to work laws contribute to a higher economic ranking for a state in CNBC’s report, yet Hall says that “research clearly shows that as unionization rates have gone down, the well-being of the American middle class has gone down.” In Hall’s view, this metric “taints the entire aggregate measure.”

Another metric, the CNBC aggregate category for the cost of doing business, considers the cost of paying wages and presumably, says Hall, “a state in which every employee worked for sub-poverty wages would get a very high grade in this category, while those paying living wages that can sustain a family and support a viable business community through demand for goods and services, would get a low grade in this category.”

It seems clear that these rankings of states by various business interests, including corporate entities such as CNBC, puppet organizations such as ALEC and members of the State Policy Network (which includes the RI Center for Freedom and Prosperity) and various Chambers of Commerce are are not objective measures of a state’s economic well-being, but are tools crafted to shape public policy to the advantage of large business interests and to the detriment of the poor and middle class.

The most sensible tactic in dealing with such garbage is to file it accordingly.

1. South Dakota
2. Texas
3. North Dakota
4. Nebraska
5. Utah

That’s an entire eighth of America that, with the exception of Austin, Texas, where I would not want to relocate a business no matter how much you paid me. I think I only know one Rhode Islander who ever left the Ocean State for any of these five states; point being we don’t have a lot in common with the states that do well in this study.

Conversely, let’s look at the bottom 10 states: Hawaii, Rhode Island, West Virginia, California, Nevada, Connecticut, Alaska, Louisiana, New Jersey, Mississippi, Maryland. 8 of 10 are coastal and only Mississippi doesn’t have a vibrant tourist sector. Is this an anomaly or is tourism secretly bad for business? Or does CNBC just not accurately factor tourism into their rankings?

There is one thing that troubles me about this ranking every year, and that’s that Rhode Island doesn’t do better in quality of life. This year we came in at 20.

Here’s, I think, where the Ocean State should be focusing its attention. Simply because of our small size and lack of abundant natural resources, we’re never going to beat South Dakota or Texas at attracting miserly CEOs. On the other hand, we really do have the potential to have the highest quality of life in the nation here in the Ocean State.

Small businesses, like the kind that could drive Rhode Island’s economy, tend to care more about quality of life issues. Big businesses, like Met Life, will go where the money is.

Or, as Ted Nesi put it.

“They bought it.”

Five years ago, CNBC ranked us 48^th in the country.  At the time, our unemployment rate was less than half of what it is today, 5.2% for July of 2007.   In the legislative session that followed, there was a progressive proposal to revamp the tax structure of the state, known as the Economic Growth and Fairness Act of 2008.  I’m not interested in re-arguing those ideas here, what I am interested in is the response to the bill from the corporate class in Rhode Island.  Writing in The Providence Business News, Greater Providence Chamber leaders Laurie White and Ed Cooney specifically referenced the CNBC ranking as a reason to kill the bill.  But more interestingly, they ended their essay with these words:

Protect our jobs. Fight for our ability to compete. Stay the course on tax reform.

I could be snarky and ask “Whose jobs?” but I won’t.  But I will point out the current unemployment rate is 10.9% according to DLT. But it is the “stay the course” line that is intriguing to me for two reasons.

1.  We have stayed the course.  And it hasn’t worked.

If 5 years ago we were ranked near the bottom in the country we are now at the bottom (again, assuming these lists matter, which I am not willing to concede, but for arguments sake….).  In those 5 years, we have seen the Flat Tax option for high income earners made permanent, cuts to the income tax, two rounds of draconian pension reform to public sector workers including teachers and state employees, an erosion of collective bargaining rights in the public sector, cuts to social services in the state budget, aid to cities and towns in the state budget slashed and slashed again, and the escalation of the property tax cap at the local level thanks to the 3050 law of 2006.

In other words, state mandated austerity for the last five years and our  “Business Climate Ranking” declined.  Now, we can believe the corporate class and say “stay the course” or as more recently stated “give the cure more time to work” or we can wake up to the realization that Ferris isn’t sick…he’s skipping school.

2.     When did Tax Reform Start?

When Ferris says “They bought it”  who is “they” in this case?  The legislature? The Press? Both? Maybe…. you can help decide.  See, the theme in the debate over the proposal in the last legislative session to raise income taxes on the wealthy centered in part on giving recently enacted tax cuts a chance to work.  SOME local media outlets (I won’t link to them, you can find them on your own and decide) fell for the argument hook line and sinker that tax reform just started in 2010.  That’s why when Chamber Lobbyist Kelly Sheridan wrote in The Providence Journal “It would extremely unwise to dismantle the 2010 reform before the first returns are evaluated” it was a theme repeated by members of the legislature AND, unfortunately, members of the media.

But wait a minute: Didn’t the Chamber use the exact same argument in 2008 about letting tax reform take affect so that it can be evaluated before it is changed?  Yes, as we see in the 2008 piece in PBN referenced above.  They also did it in 2009, when there was a strong push to repeal or reform the Flat Tax for high income earners. That is where the line “give the cure time to work” comes from. ( Of course in 2009, we were still ranked in 48^th place by CNBC).

Why does it matter?  Because if the Chamber and the powerful corporate special interests are allowed to pull the wool over the media and the politicians eyes every year by saying “hey, we just implemented this last year, let’s give it a shot” most people are good natured enough to say “ well, sure, why not? We’ve got to try SOMETHING.”  Well, we’ve been giving them their shot for the better part of a decade, and if only people would remember that they keep using the same argument that “this time, things will work out” then maybe we won’t fall for the sales job. Again. Maybe?  Hopefully? Hello? Bueller? Bueller? Bueller?

Look, I get it.  Ferris Bueller is an endearing kid.  He’s funny, likeable, smart and in a 1980’s John Hughes movie kind of way showing a safe way to “fight the power.”  But it isn’t real.  And neither is the line of argument put forward by the corporate class in Rhode Island that we need to “stay the course” or “give the cure time to work” on austerity.  Hopefully Rhode Island can turn things around – but we will never do it by continuing to run the same plays and chase ideas that continue to drive out economy deeper into a ditch while enriching those at the top of the economic ladder.  You want a cure that works? We can start by stopping doing the things we know that don’t work.

Get ready for the conservative barrage that because Rhode Island ranked as the least business-friendly state we should adjust policy to appease the good editors at CNBC. But before we do, take a look at what CNBC says are the top two states in which to business – Texas and Utah – and the bottom two – Rhode Island and Hawaii. Where would you rather move your business to?

By the way, every northeastern state finished in the bottom half of this list. Conversely, Rhode Island was the only northeastern state not to finish in the top 10 for education.

Speaking of public education, RIDE’s own Jason P. Becker has a great post today filling in for Ted Nesi titled: “Woonsocket, not the state, failed to fund city schools.” He writes that because the state has increased education aid to schools there and the city has decreased funding that it’s Woonsocket’s fault it doesn’t have enough money. If only government were so simple … for at least the past three years, Woonsocket has raised property taxes very close to as much as the state allowed, and during that same period Woonsocket lost out on some $12 million it expected in state aid. I would argue the question is not did the state do more than Woonsocket, the question is did either do enough.

The Projo’s story on a Middletown group home with more than 400 at-risk kids living there that was closed due to conditions the state felt were “not suitable for the children” reads like something out of Dickens, or Annie.

Maryellen Butke’s campaign for state senator has a new advocate: Donna Perry, who is both the executive director of the Rhode Island Statewide Coalition and John DePetro’s sister. I bet she won’t be bragging about that endosement as she door knocks on the East Side.

Nice to see an op/ed by CD-2 congressional candidate Abel Collins on the Journal editorial page today. Some inspiring words: “The biggest obstacle to change is not money, it is cynicism. Did we really fight for nearly two centuries to get access to the ballot box for all just to decide now that voting doesn’t accomplish anything? How would Martin Luther King Jr., Susan B. Anthony, or Thomas Dorr judge the lack of political participation that has come to characterize the U.S.?”

Awesome headline of the day: “House Republicans Spend 89 Hours Trying To Take Away Health Coverage From 30 Million Americans”

CNBC might not like Rhode Island, but Gold Digest does!