About 40% of the first $ 113 million governor Daniel McKee wants to spend $ 1.1 billion on American Rescue Plan Act (ARPA) the funds would go to “help small businesses” wrote Andy boardman in his analysis of the governor’s spending proposal. If this rate were to apply to all ARPA funds, the amount of money donated to corporate and business interests would be well over $ 452 million.
But this figure is misleading. Much of the money Governor McKee has allocated to areas such as housing, child care and broadband also largely favors business interests. A lot of the money to increase the number of child care centers, which we badly need in our state, would be money that would go to the owners of the existing child care centers to grow their businesses. The money to expand broadband would go primarily to our state’s two largest ISPs, Verizon and Cox. And insider developers and building construction companies should make the most of all the money Rhode Island puts into housing.
It is impossible to estimate how much of ARPA funds will go to those who need it most. But you can be assured that the vast majority will go to commercial interests in the hope that perhaps some of this will “spill over” and grow our economy among the poorest.
But the massive government bailout of businesses is only part of Governor McKee’s economic strategy. Last Wednesday, the governor made two offhand comments about cutting taxes for the rich.
The premiere took place during a press conference at the Dunkin ‘Donuts Center, where Governor McKee teamed up with Gene Valicenti, radio and television personality, and John Hazan White, CEO of Taco comfort solutions, to distribute lottery tickets to people getting vaccinated. Hazan White was interviewed by Coalition journalist Pat Ford on its position on property taxes. Hazan White had once noticed that, “People like me can’t afford to die in RI.”
In response to Ford’s question, Hazan White replied, “My biggest problem in the state is the estate tax. It’s something that, [if it] were to be lowered or eliminated, would likely change this state dramatically. “
Seeming to be keen to please Hazan White, Governor McKee interjected, “We’re looking at the numbers on this now. “
Realize: No living person has ever paid inheritance tax. It is literally a tax on dead millionaires. See: Tax cuts for the rich, even if they’re dead, is sort of a non-partisan issue and that Twitter feed.
Later that same day, at the governor’s bimonthly press conference, McKee made a tangent about the interest companies pay when they are in arrears with tax payments.
“They are charged 18% interest on that late payment and an additional 14% penalty on that late payment,” Governor McKee said. “We cannot be a state that deals with [in] wear rate and then expect our business community to feel like it’s a friendly business environment …
“This is the point [we’re trying to make] with the General Assembly, ”continued Governor McKee. “Let’s not delay putting some of those stimulus dollars back into the economy in a way that makes sense. Back in [the] accommodation we requested [and] child care. We can prevent a lot of businesses right now, small businesses, from going bankrupt or being in a situation where they’re paying attrition rates in the form of penalties. “
Note that McKee views investments in housing and child care as investments in businesses.
UpriseRI noted that interest rates of 30% are common in the payday loan industry, which is protected by the leadership of the General Assembly from any attempt at reform. Rhode Island remains the only state in New England to allow payday loan companies to charge the kind of 30% interest rate McKee calls the usurper.
“Yes, I agree with that too,” replied Governor McKee. “It should go away.” Started as an afterthought, not as a policy per se.
The United States and Rhode Island have been in shock for more than 40 years from some form of supply side economy, runoff economical, or Reaganomics. The various economic policies we pursue as a state have been disastrous for the poor and the economically vulnerable, and have contributed to the success of people like John Hazan White, who proudly declared himself too rich to die.
I guess Governor McKee, like Governor Gina Raimondo before him, continues to whip the dead horse of the runoff economy not because it works for all Rhode Islanders (we know it decidedly doesn’t), but because it benefits key members of the class of donors who support their careers.
It’s time for new ideas.