So firms are fleeing Mass. for business-friendly RI?

Tough words:

“[The state] lacks the competitiveness to compete for jobs. It’s the overall business climate: utility costs, workforce costs, unemployment insurance and workers comp.”

If all that sounds familiar, it’s because that is the same litany of private-sector complaints we’ve been hearing around here for the past 40 years.

The simple truth is that it’s more expensive to do business here than it is in other states, and guess what? In this day and age, many jobs … are highly mobile. The work can be done anywhere. …

[P]oliticians for decades have failed to fix our crippling competitive disadvantages. … [Time] to drop the baby talk and get serious about repairing our job-repellent business climate.

Sounds like some pundit is taking Rhode Island to the woodshed again, right? Is it Ed Achorn? Maybe Len Lardaro?

Nope – it’s actually WBZ’s Jon Keller writing about Massachusetts in the wake of Fidelity’s departure for … Rhode Island! (And New Hampshire.)

Keller – whose book was subtitled “How Democrats Created the Massachusetts Blueprint for American Disaster” – apparently thinks Rhode Island is a capitalist paradise compared with the Bay State, despite our much higher jobless rate and ultra-low competitiveness rankings.

Keller’s column makes no mention of the significant financial incentives Rhode Island has given Fidelity, including $35 million in subsidized bonds and millions in annual tax credits, to woo the company to Smithfield and keep it expanding there. (Of course, Massachusetts has done some of that too.)

As I mentioned yesterday, Fidelity’s decision to shift jobs here brings to mind the same move being made by Curt Schilling’s 38 Studios after Rhode Island offered his firm a $75 million taxpayer-guaranteed loan.

Mass. Secretary of Housing and Economic Development Greg Bialecki scoffed at the idea of matching that enticement. Schilling “was, I think, hoping we would get in a bit of a bidding war with Rhode Island, and we weren’t prepared to do that,” he told State House News Service last July.

If anything, Fidelity’s decision looks like further evidence that Rhode Island is good at bribing firms to leave Massachusetts. But until I see companies choosing us on a level-playing field, color me skeptical.

Update: If you really want to understand the deal Rhode Island has with Fidelity (as well as Bank of America), check out this piece my pal Bill Hamilton wrote for PBN last year.

Update #2: Keller and I debate in comments.

9 thoughts on “So firms are fleeing Mass. for business-friendly RI?

  1. Ted, the big wigs pay no tax on bonus’s here thanks to a break that only Fidelity was given.

    So the biggest Fidelity bonus babys will come to RI while the lessor lights will go to New Hampshire where there is no income tax.

    Either way its good news for RI because they’ll build big and move in to new homes.

  2. Unfortunately for your theory, I have never characterized RI as a “capitalist paradise compared with the Bay State,” merely commented on Massachusetts’ competitiveness problems when it loses jobs to RI and other states. If you have evidence to the contrary, I’m sure you will link to it here to edify your readers.

    • The first piece of evidence I’d point to are the CNBC Top States for Business rankings: Massachusetts was #5 last year, while Rhode Island was a dreadful #49. Not that CNBC is infallible, of course, but it makes Fidelity’s decision seem all the more curious.

      http://www.cnbc.com/id/37554006/

      I’d also point to the example of LFI – also in Smithfield, just like Fidelity.

      When LFI was expanding two years ago, it opted to open its new office in Walpole, not Smithfield. Its owner told me one of the reasons was that Massachusetts is a “state with a little better business climate” than Rhode Island:

      http://www.pbn.com/Smithfields-LFI-adds-Walpole-office,41025

  3. No, buddy, one more try. You wrote that I made a specific claim about Mass. having an inferior climate to RI. I don’t believe I’ve ever made such a claim. If you can show that I did, fine. If you can’t, it’s correction time.

    • Your headline said: “Why Did Fidelity Move Jobs To NH, RI?” Your answer was, in part, that Fidelity “chose to leave for greener pastures because Massachusetts politicians for decades have failed to fix our crippling competitive disadvantages. Fidelity would probably have done this long ago if the family that founded it wasn’t rooted here.”

      That said, “capitalist paradise” was absolutely hyperbole on my part.

    • Jon Keller wrote:

      http://bit.ly/egBJtq

      “The simple truth is that it’s more expensive to do business here than it is in other states, and guess what? In this day and age, many jobs, certainly those created by a financial services company like Fidelity, are highly mobile. The work can be done anywhere.”

      Unless we are speaking another language here in RI you wrote the above and Ted is on the money.

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