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Massachusetts, Scorched Earth Capitalism, Hostile Takeover of Rhode Island and Connecticut Economies


p eN659JA3TYkXq Massachusetts, Scorched Earth Capitalism, Hostile Takeover of Rhode Island and Connecticut Economies



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AESantos January 23, 2013

Massachusetts Governor Deval Patrick may be a hard core Progressive, but unlike Rhode Island Governor he’s got firm grip on capitalism, and how to eliminate the competition.  For the second time in 2 years, Massachusetts has launched legislation that will fatten their coffers while throwing an anchor to a desperate Rhode Island economy just treading water.   Governor Patrick’s plan to overhaul current Tax Code drops the current sales tax to 4.5% from 6.25% jeopardizing some $900 Million in R.I. Sales tax revenue.  In keeping with his Progressive side, the drop in sales tax comes with the sting of $1.9 Billion in new taxes (Income Tax).  R.I. Loss projections by the Casino bill (Ma.) passed November 2011 are still pending, but the first of three Massachusetts Casino’s scheduled to open 2014, are expected to take a bite out of R.I. gambling revenues, just south of $380 Million.   Massachusetts shares Connecticut’s northern border clear to New York State. Governor Patrick’s looking to carve out a his share of Connecticut’s  $4 Billion Sales Tax, and $14.7 Billion Gross gambling revenues.   In the private sector this strategy would be likened to “Scorched Earth Capitalism”.    Massachusetts has no interest, in competing with the RI and Ct. economies, this is a straight up Hostile Takeover.  Given the lack of vision, leadership and shortage of Political Spartans on Smith Hill, and pressing matters of Lapdog legislation and equal opportunity Father Daughter dances, best we might expect from management is another Task Force, or Economic Commission…

Lowering taxes to generate higher revenues doesn’t reckon well with many on the hill.  Fact is, a “Zero Percent” sales tax is the only defense to Governor Patrick’s hostile takeover,  reverse the flow of cross border spending,  establish new business, new jobs, Taxpayers all.  Coupled with a bit of short term fiscal pain and the generous use of a chainsaw in the Department of Business Regulation, the state could stage a real recovery.  The “Zero.Zero Report”  produced by The Rhode Island Center for Freedom and Prosperity, a local Think Tank should be required reading reading for every business leader and member on the Hill,  a digital roadmap to Zero Percent Sales Tax.

There’s good reason the Tax Foundation a left leaning think tank ranks the state in the bottom five in the country, Hostile to Business and individuals.  The State’s short form resume is Bear Ugly, the R.I. 7% “Temporary Sales Tax” is now in it’s 23rd year, Dead Even with Nevada for the highest unemployment in the country.   On a good day one can motor across the entire state in 30 minutes whose geographic footprint is no bigger than a small county in Texas or California, yet still props up a bloated government of 39 Municipalities, 39 Police and Fire Departments, 37 School departments complete with 39 redundant town bureaucracies.  Current technology would easily support Central services after surviving 39 Municipal “Cage Matches” in dismantling the bureaucracy.

Past history on the Hill reckons Crisis and Elections are the only catalyst to action in Rhode Island.  This is in fact a Crisis that “Re-Branding”  won’t fix.  Without the quick action the state stands to become an Economic Dead zone,  with our chief export of  Rhode Island Refugee’s and business seeking friendly territory… no doubt Governor Patrick will welcome their arrival.   Last to leave the State don’t forget to turn of the lights.

We’re Deeply Obliged to Prof. Jacobson at Legalinsurrection.com for Linking to this post

5 comments

  1. Your analysis is spot on … but incredibly, you left out 3 other looming (imminent?) disasters headed Lil Rhody’s way … (1) the 100+ Million $ due to 38 Studios (Special) Bondholders for the failure of a Moral Obligation Bond (2) The Pension Fund “Reforms” that face a serious court challenge (presided over by a State Judge who, in addition to herself, has 2 other immediate family members in the pension system) and (3) continued losses (to the tune of 300M$ this year) in the states underperforming, and now underfunded pension system … Sleep tite, Lil Rhody … but fear not, one of the State’s leading Useful Idiots, Rep Peter Palumbo, spent today traversing the media scene pimping his legislation, are you ready for this? Forbidding lap dogs/cats in motor vehicles … yes, you can’t make this up …

  2. Much obliged for your comments… When it comes to 38 Studios the State is going to Stiff the Bondholders of the $100 Million, and here’s how they’ll get it done… (Subject of another blogpiece in the works)
    We known many of the details on 38 Special but there hasn’t been a substantive Post Mortem by a 3rd party.. Until now the House Oversight committee hasn’t launched an investigation in the last thousand years… but in this case the focus of the investigation has been narrowed only to EDC not the primary Architect of the deal namely Gordon Fox or the Chair of EDC Gov. Linc Chafee having turned a blind eye on his watch and allowed 38 Studios to Crash and Burn…
    The End Game of this investigation is to Exonerate (by omission) the principal scoundrels House Speaker Gordon Fox, and Governor Linc Chafee of any wrong doing, they’ll conclude 38 Studios imploded by their own hand… That said their recommendation will be to Not Pay the $100 Million to the Bondholders… All is forgiven on the Hill when they investigate themselves
    No arguments on items 2 and 3 Heard Rep. Palumbo on the Talk Radio circuit pushing his lapdog legislation AGAIN…I reckon it’s no mystery why the state is Circling the Bowl…

    Much Obliged…

  3. Heh… As a twenty-two year RI transplant to TX, all I can do is chuckle.

    Duvall might be a raging liberal progressive but he’s still ions smarter than the idiot Chafee in RI not to mention the state’s population mentality is generally in single digits.

    RI is totally snared by the public service unions. Hell, half or more of the the legislature has a union connection and these connections extend all the way through the executive and judicial branches.

    There’s no hope folks…

  4. Better start prospecting for gold in Burriville!

  5. Economic war between MA and RI? That’s the kind of war you hope both sides lose.

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