Cusack: Neither austerity nor taxing the rich is enough for RI

Bob Cusack is an ex-investment banker – now with Providence’s WhaleRock Point Partners – and a former East Providence City Councilman, giving him a unique perspective on the state’s economic crisis. He argues neither side of the political divide has the solution for Rhode Island:

What is needed is a dramatic reversal of the current trend, even as the country and the region’s economic growth is barely positive and getting weaker. We need a frank discussion among policy makers and outside policy analysts and local stakeholders on what steps to take immediately to get on course for real economic growth, then the negotiations with the special interest groups that inevitably must be part of the solution. As to the budget, just as there aren’t enough “rich” here to tax to fix this, there isn’t enough public sector employee income to reduce either. The numbers are too big.

The need is for more gross state income, in other words, a bigger pie. Our small size is a virtue here, as the right economic development initiative could be transformational. If the answer were obvious, it would already be in place. Austerity alone is never enough. Southern Europe is a recent example. And if more government spending worked, Greece would be Switzerland. We need to identify a job generator, make the changes needed to attract those jobs and then promote Rhode Island to execute on the strategy.

Read the rest here.

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