Stephen Moore: Double whammies keep R.I. down


I look forward to being at the University of Rhode Island this Saturday morning for what is likely to be an informative and spirited left-vs.-right debate about how to make Rhode Island a destination state for jobs again. My case is that the free market can save Rhode Island and make it a jewel again of the Northeast, by reforming the income tax system, becoming a right-to-work state, and treating businesses in a more friendly and welcoming manner.

There is an old saying: You can’t have jobs without employers. As one tax refugee from Rhode Island recently told me: “This state now treats businesses and rich people as if they are enemy combatants.”

The latest report on the economic competitiveness of the 50 states by the American Legislative Exchange Council, a conservative association of state legislators, came out last week. For Rhode Island, it was filled with more bad news. The report, of which I am a coauthor, ranks the Ocean State 41st out of 50 when it comes to policies that will lure new jobs and businesses into the state.

We find in our report that the two most powerful forces influencing whether a state is a desirable economic location in 21st century America are the income tax rate and whether a state has a right-to-work law. Rhode Island is a forced union state and it has one of the highest income taxes in the country — and these are double whammies.

Sadly, Rhode Island used to be one of the most prosperous states, with high-paying manufacturing jobs — and lots of them. It ranked near the top in terms of richest states. But in recent decades it has continually fallen behind.

Over the last decade, Rhode Island had the 47th worst economic performance. Many of the lawmakers in Providence say the jobs have been sent overseas to China and India, but manufacturing is doing very well in southern states such as Texas, South Carolina and Tennessee — and is even making a comeback in Michigan and Ohio. But Rhode Island is getting left behind, and is looking more like the aging Boston Celtics living on past glories.

Conversely, Rhode Island has been the leader in recent years with important Medicaid reforms that have saved the state money, improved care for the poor, and served as a showcase experiment for the rest of the nation in how to rein in costs. So this great state is capable of reform and economic renewal.

The residents I talk to say they are ready for bold action so their kids don’t have to escape across the country to find a job. If the politicians are ready to listen and learn, little Rhode Island can be a high-flying state again.

On Saturday I will explain how, as will others. Boldly contrasting ideas should make for a great debate. I hope to see you on Saturday, starting at 9:30 a.m., at Swan Hall, at URI.

Stephen Moore, formerly a member of The Wall Street Journal’s editorial board, is chief economist at the Heritage Foundation. Information about the debate and pre-registration can be found at

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