Policy Reform: Reform Renewable Energy Mandates

Laws maneating that a certain portion of our energy must be derived from renewable sources actually force households and businesses to pay higher energy costs, creating another drag on our already failing state economy. These laws are based on false assumptions. The cronyism and rate-payer funding of related special-interest projects are examples of corruption that are needlessly encouraged by such laws.

Rhode Island’s energy prices are among the highest in the nation. During these difficult economic times, we must do everything we can, no matter how small, to enhance our business climate and to reduce the cost of living for everyone. To this end, renewable energy mandates must be repealed or reformed.

Further, there is a new energy reality in America, with less of the perceived green benefit that inspired these laws in the first place. Most of these mandates were ushered into law during a period when many original assumptions, which have since proven to be false, were the mainstream thinking. Almost a decade later, there is a new energy reality that we must consider.

FALSE ENERGY ASSUMPTIONS that were a basis of RI’s renewable energy mandate laws:
  • Global warming would be great danger to our Earth: Whether global warming exists or whether the contribution of human beings to climate change and the ability of tolerable behavioral changes to make a decisive difference are now in open dispute, with conflicting data recently surfacing and increasing questions about original data.
  • Fossil fuel sources would become scarce in the near future: New natural gas, shale, and crude discoveries throughout the world have debunked this concern for the foreseeable future.
  • Fossil fuels would become increasingly expensive: Coal and natural gas continue to be the least expensive sources of electricity and will continue to be the most cost-efficient sources of energy in the coming decades.
  • Renewable energy would be abundantly plentiful: The inconsistency of wind and solar sources means that additional fossil-fuel plants must often be built as a “backup” systems.
  • Renewable energy would be more cost-efficient: Renewable energy costs remain significantly higher than conventional sources, and there are few near-term expectations that this will change.
  • Renewable energy would spur a boom in green jobs: There has been no such boom; many once-promising green companies have gone out of business because of low market demand. Some European countries that invested heavily in the green revolution suffered through more job losses than gains.
  • Renewable energy is better for the environment: Maybe not. The need for backup power plants decreases environmental efficiency. Better air quality can be achieved via natural gas, which is significantly cleaner than coal.  “Energy sprawl” is a popular term among environmentalists to describe the massive amount of land or sea area required for wind or solar farms, considered eye-pollution, and the miles of transmission lines required that often cut through pristine landscapes. Further, windmills are a danger to birds and bats.


 Reform or repeal of these mandates would save money for every family and business and would no longer be a drag on our state’s economy.

Specific Recommendations:

In light of the new energy reality, our state must enact reforms that would allow utilities, and thereby consumers, to better adapt to next-generation energy technologies:

  1. Review all renewable energy mandate laws to determine their viability
  2. Repeal the most unreasonable mandates
  3. Broaden the standards in some laws to include all next-generation energy technologies including nuclear, combined cycle natural gas, geothermal, etc.
  4. Adjust the compliance schedule to provide greater flexibility through altering deadlines or percentage targets
  5. Make the program voluntary and waive all noncompliance penalties

Policy Brief by the Center to be posted in the near future …

Related Studies:

Manhattan Institute study demonstrates that Renewable Power Mandates Drives Up Electricity Prices

New survey disputes “consensus” claims about man-made climate changes

North Kingstown Employees Strike to Maintain Public-Sector Premium

One question lost in the heat of this school year’s example of the annual opening-day labor dispute is: Why should school children pay more for janitorial services than anybody else would?  The practical answer is that parents are very sensitive to the treatment of their children, and that’s just one of the points of leverage that public-sector unions have.

According to the North East Independent, writing in July, janitors in North Kingstown used to make $19.47 per hour. Since the school committee voted to switch from the in-house union to the private GCA Services Group, while keeping the same workers, that hourly rate has fallen to $15.17. That’s a substantial drop of 22%, and it comes with greatly inferior benefits.  But in Rhode Island’s continuing jobs recession and apparent economic decline,  it isn’t clear that public-sector jobs, especially in schools, ought to be notably inviolable.

Data from the U.S. Bureau of Labor Statistics, last compiled in May 2011, shows the median hourly wage for “janitors and cleaners, except maids and housekeeping cleaners” in Rhode Island at $11.82. The average wage is $13.03, indicating that a small number of janitors make much more than that.  Despite the substantial cut, the North Kingstown crew is still among those high-wage outliers.

In this regard, the North Kingstown School Department is merely providing the latest example of a fact that the RI Center for Freedom & Prosperity highlighted in January: public-sector unions drive labor costs well above the market rate. The Center cited a study by the Goldwater Institute finding that a ban on collective bargaining and contracts in the public sector could save the state $252 million.  Keep in mind that this total is state workers only.

Goldwater found that, overall, the nationwide premium that taxpayers pay for the workers under their employ is 44% over the private sector.  Before the North Kingstown School Committee’s action, this summer, the janitors on its payroll were well above even that.

Policy Reform: Eliminate Corporate Welfare



View our “End Corporate Welfare” policy brief here … 


38 Studios-style cronyism is not capitalism … and it must end!

When political insiders secure special funding or bailouts for themselves, funded by your taxpayer dollars, it creates an unfair playing field, upsetting the competitive landscape. Wasteful spending by incompetent bureaucrats and legislators and flat-out special-interest favoritism are parts of the corruption that must be curtailed in the Ocean State.

Specific Recommendations:

 A) Formally end the practice of corporate welfare in Rhode Island government.

 B) Defund the capacity of the Economic Development Corp. (EDC) to put taxpayer dollars at risk by financially supporting private business endeavors.

View our “End Corporate Welfare” policy brief here … 








Policy Reform: School Choice, Special-Needs Scholarships, and School Grading System


Closing The Gap

“Bright Today” education reforms

Every child deserves not just a bright future, but also a bright today. Students will only be young once and cannot wait for long-term education reforms to take hold. Families must have choices in education, and we must close educational gaps now!

Options and Accountability

The State of Florida has blazed a new path for education reform, and Rhode Island should pay attention. Increasing parental choice as well as administrative and teacher accountability in multiple ways has rocketed the Sunshine State closer or beyond the Ocean State by multiple metrics. Florida’s gains among minorities, the disadvantaged, and the disabled cannot be ignored.

Go to our “Closing The Gap” education study home page here …


“Bright Today” Scholarship Program for Special-Needs Students:

No student should be condemned to attend a failed school, especially the most vulnerable among us. The best way to serve the needs of a diverse population is to give families the freedom to choose the schools — public, private, or charter — that best fit their children’s needs.

Our Center’s school voucher recommendation for special-needs students is a good place to start in providing choice to Rhode Island families.

Read about our “Bright Today Scholarship Program” here …


Straightforward Grading of Schools:

However extensive their access to options, parents need a straightforward grading system to determine how their schools compare with others. This increased level of transparency will provide educators, legislators, and families with greater insight into school performance.


Related Information:

Does the RI Dep’t of Education’s School Report Card process give extra credit to schools that don’t have significant minority or special needs student subgroups?  See The Ocean State Current blog here … 

Dept. of Education School Report Cards Should Be Reviewed in Context

As part of its accountability initiative — ultimately relating back to President George W. Bush’s No Child Left Behind Act — the Rhode Island Department of Education (RIDE) has compiled report cards for every public school in Rhode Island. In the spring, the department released its scores and rankings for schools teaching different grade levels, and the public is in the process of figuring out how to apply them to the civic debate.

According to RIDE’s fact sheet for its accountability system, elementary and middle schools achieve their scores based on the following categories:

  • 30 points for proficiency: Averaging reading and math scores, what percentage of students are “proficient” on the New England Common Assessment Program (NECAP) tests?
  • 5 points for distinction: Averaging reading and math, what percentage of students are “proficient with distinction” (i.e., highly proficient) on the NECAPs?
  • 30 points for gap-closing: Combining ethnic and economic categories into one group and special education and English-language learners into another, how much of a gap is there between such students’ scores and those of students not in either?
  • 10 points for progress: Does the school appear to be on track for targets set by RIDE for 2017?
  • 25 points for growth: Are students progressing from one year to the next compared with their academic peers? This measure also breaks students into three groups: “all students” and the groups described in “gap-closing.”

A conspicuous shortcoming of this methodology is that it effectively gives extra credit to schools that don’t have subgroups to compare for gap-closing purposes.  If a school doesn’t have a certain number of minority, English-language learner, special education, or economically disadvantaged students, those categories simply don’t count in the average, and the school gets 30 points toward its total.  That’s potentially the difference between “commended” and “typical.”

A review of the report cards for the 17 commended schools shows that nearly one in four has no subgroups at all — four of them, or 23.5%. Another 10 (58.8%) only have enough students in the “economically disadvantaged” category to count, and just three (17.6%) have data in the disability category.  (See here for all schools’ scores.)

A closer look at “economic disadvantage” is justified. That category is defined by participation in the National School Lunch Program, by which the federal government subsidizes meals for school children.  All students can participate, but those from households above 185% of the federal poverty level (FPL) pay a “regular price.”  In Rhode Island, 60% of participants receive reduced prices or free lunches.

For RIDE’s assessment purposes, however, the wide range in circumstances covered by this program should be acknowledged.  For a family of two parents and one child, 185% of FPL is income of $35,316.50. The same family with another child could make up to $42,642.50, and a two-parent, three-child household could earn up to $49,968.50 and still count as “economically disadvantaged.”

It doesn’t detract from the difficulty that such families can face to suggest that there’s quite a difference between growing up at the top of that scale and growing up in the grinding poverty more common in urban areas.

For context, consider the 17 schools at the bottom of RIDE’s ranking: all but one have scores for either black or Hispanic students; 11 count both. Fourteen schools (82.4%)  have enough students with disabilities to count.  Seven (41.2%) count English-language learners.  And every single one of them (100.0%) has economically disadvantaged students.

Click here for elaboration and context.

Policy Reform: add market-based reforms to Health Benefits Exchange

Highly Burdensome Federal Healthcare Regulations

Provide more options for more people for affordable, quality, healthcare services!

The expansion of complex government and special-interest control over our highly personal healthcare decisions will not give Americans what they want. Rhode Islanders want access to quality care and the freedom to choose the best plans for their families!
As part of the Affordable Care Act and its Health Benefits Exchange, the state of Rhode Island, its health care providers, civic and community groups, and private citizens should embrace market- and patient-driven solutions to these challenges as part of a “Health Care Freedom Act“, including:
  1. Increase the availability of care for both newly insured and the remaining uninsured by eliminating regulatory obstacles to new, innovative providers of health care services including the “Certificate of Need” law that blocks competition for medical facilities and regulations that stifle ‘retail health clinics’ such as MinuteClinic.
  2. Expand the availability of health care financing to those left out of the Affordable Care Act by allowing consumers to purchase low-cost ‘mandate-free’ policies and insurance regulated in other states, as well as promoting the availability of non-insurance alternatives such as ‘Health Sharing Ministries’ and critical-illness policies.
  3. Build on the Affordable Care Act’s pricing and transparency reforms by adopting and utilizing ‘bundled’ or ‘packaged’ prices for episodes of care and embracing real ‘cash’ prices for consumers purchasing their own health care services from physicians and hospitals.
  4. Transform health care for government workers by embracing consumer-driven plans that lower costs while continuing to deliver high-quality, accessible care.
  5. Renew the state’s innovative Medicaid waiver and modernize it to provide beneficiaries with health care funding mechanisms similar to Health Savings Account for appropriate populations.
  6. Prohibit automatic enrollment in other social service programs via the health benefits portal

The result of embracing these and other market- and consumer-driven policies in health care can make Rhode Island the national leader in delivering high-quality, accessible, and affordable care to its people, helping to create prosperity by relieving the taxpayers and the private sector of the high burden of health care costs.

Read about the Center’s “Healthcare Freedom Act” here …

Go to our Healthcare home page here … 

Read how gov’t bureaucrats are planning to transform the “health benefits portal” into a DEPENDENCY PORTAL …

How RI is creating an Expressway to Dependency



Policy Reform: Give Rhode Islanders a “Right to Work”

Right To Work = Worker Freedom

Right to Work = FREEDOM for Ocean State workers!

All workers want full freedom to pursue a career of their choice.  Freedom of Association is a core American liberty that should be extended to all Rhode Islanders looking to negotiate their own workplace rules, have full incentives to perform at a high level, and determine whether or not pay union dues is in their best interests.

Enacting Right-To-Work (RTW) policies would give Rhode Island a major advantage over its neighbors by making it the only New England state with RTW protections for its workers — without costing the state a dime in budget expense.

Read our Center’s Right-To-Work policy brief here …



Policy Reform: Eliminate the Sales Tax

Rhode Islanders want more financial security and control over their own lives. Increased job opportunities, higher wages, and enhanced job security can all be achieved in a robust economy.

Phase out or immediately eliminate the sales tax. This tax reform policy will produce an immediate boost to the RI economy and will produce more jobs than any other solution on the table, creating 20,000+ new jobs in the Ocean State!

Imagine the renewed sense of security you and your children will feel, knowing that there are more career opportunities to choose from and knowing that your employer is more likely to remain in business, as well as the opportunity to earn higher wages in a more competitive economy.

View the Zero.Zero report here …

Visit the Zero.Zero home page here …

75-38-400  or  68-0.0-5000 ?

Consider the $75 million the state wasted on 38 Studios, chasing after just 400 jobs. Compare that with first year budget cuts of $68 million to pay for Zero.Zero, producing 5,000 jobs that year alone!













Rhode Island Employment Snapshot, July 2012

Rhode Island’s unemployment rate fell a tenth of a point in July, to 10.8%, still second only to Nevada.  But the results are far from positive; they aren’t even “mixed.”  More people lost their jobs, and even more gave up looking for work.

The first chart below shows the trends in labor force (employed and looking for work) and employment since the beginning of the recession in January 2007.  The second chart shows the labor force and employment pictures for Rhode Island, Massachusetts, and Connecticut as each state’s current percentage of January 2007.

Rhode Island Labor Force and Employment, January 2007 to July 2012



RI, MA, and CT Labor Force and Employment, July 2012 Percentage of January 2007

R.I. Creating an Expressway to Dependency

The Issue. Rhode Island is leading the nation in the advancement of a larger entitlement culture via its planned expansion of social services through a health benefits exchange, a component of the controversial federal healthcare law. When collecting detailed personal financial and household information from individuals seeking health insurance support, the state intends to proactively enroll participants in other state programs for which they are eligible. Will this create and expanded culture of dependency?

Statement from CEO, Mike Stenhouse. “This is an extreme case of misguided public policy. The expansion of government and special interest control over our personal healthcare decisions, along with the culture of dependency being freely advocated by this administration, should be viewed as an assault on our deeply held American value of self-reliance.

“Imagine turning to the RI health benefits portal because your employer cancelled your insurance and finding yourself on a government-created expressway to a life of dependency. Wouldn’t we all be better off, instead, if the state encouraged residents to become independent, productive members of society?”

Related LinksMike Stenhouse discusses the ‘Dependency Portal’ on the Helen Glover radio show … click hereDependency Portal Pieces in Place;

What the Center is calling a “dependency portal.”  The dependency portal is a not-so-hidden goal of Rhode Island’s version of the health benefits exchanges described in the Patient Protection and Affordable Care Act (PPACA, commonly known as ObamaCare).

Although the final design has not been developed in specific detail, the idea of the exchanges is to enable healthcare consumers to use a government Web site to review their available options for insurance and to determine their eligibility for public subsidies.  Most likely, a series of Web-based forms will ask the user for a variety of highly personal information regarding health, income, and family circumstances in order to determine what health plans and public assistance amounts he or she is eligible for.

Whether such information will be requested of all residents who seek to use the site or only of those explicitly seeking subsidies remains an open question.

The exchange will become a dependency portal when other forms of public assistance — from food stamps to cash-payment welfare to child-care subsidies — are integrated into the system and promoted to the exchange user based on information that he or she provides while seeking health coverage — perhaps automatically enrolling people with the merest expression of consent.

At a recent press conference, Rhode Island Health and Human Services Secretary Steven Costantino referred to this “hidden element” of the exchanges as “one-stop shopping.”

Why is that bad? As a free market think tank, the Center is certainly not opposed to practices that encourage efficiency and the use of technology to improve the access that customers and clients have to services. Information technology, in particular, has empowered individuals to accomplish easily and inexpensively tasks that once required expert consultants.

From a business perspective, the Internet and the proliferating technologies that use it, now including smartphones and tablets, smooth the path from a potential customer’s initial interest all the way to final purchase.  Technology enhances businesses’ ability to market and sell their products and services, and they seek to accomplish those ends in order to grow their revenue and expand their market share.

That model is not appropriate to government in dispensing taxpayer-funded services.

In the private sector, bundling of services has become commonplace, and it is easy to understand why companies would pursue the strategy.  Think of the merging technologies of television, Internet, and telephone; it makes sense for a company with an advantage in, say, television, to use various marketing techniques, such as reduced-price packages, cross advertising, and one-stop shopping, to gain an edge in other markets.

However, the public clearly has a sense that these methods can go too far.  Indeed, at the turn of the millennium, the federal government sued Microsoft on the grounds that it was hindering competition by using its operating system dominance (with Windows) to gain an insurmountable advantage in the Web browser market (with Internet Explorer).

In the case of government, all of the same incentives exist for the organization to expand its reach.  The difference is that government has three inherent competitive advantages:

  1. In its ability to simply confiscate money to pay for, or at least subsidize, its services
  2. In the fact that the people whom it entices to its services are not paying their full cost
  3. In its control of the marketplace by means of regulation

Over time, government programs are therefore less and less “public services” that taxpayers agree to support through the people whom they elect and more and more bureaucratic offerings that use the enrollment of some citizens as justification for claiming more authority and confiscating more money from others.

One can see evidence of this intention in the process by which Rhode Island’s exchange was initiated.  In the face of (to be mild) public uncertainty about the PPACA, the Democrat president and Congress pushed it through.  It creates financial incentive for states to build the exchanges (by making taxpayers from other states pay for it), and it hands an astonishing amount of policy discretion to the unelected Secretary of Health and Human Services.

In Rhode Island, Governor Lincoln Chafee broke with common understanding of separation of powers in order to create the exchange by means of executive order, committing the state to pay for the site’s maintenance once it is operational.  Similarly, the state executive branch has simply determined to agree to a related Medicaid waiver, expanding free healthcare services in the state and adding to its expenses.  No legislative input; no public hearings; in short, no public statement of agreement with the programs being developed in the people’s name.

As the government exchanges claim increasing shares of the market nationally, unelected state and federal officers will be authorized to determine everything from minimum benefits to price controls to payment schedules.  The board that Governor Chafee appointed to initiate the exchange illustrates that special interests will have an outsized role, as well.

With the addition of other welfare programs to the mix, it will be even more difficult for the people of the state to change course.

What it means for you. Losing control of activities done in the public’s name may not be the most dire consequence of the dependency portal approach.  Rather, the fatal part of the trap is the fast lane to a culture of universal reliance on government and a pervasive sense of entitlement.

Whenever the topic of welfare arises, conversation turns toward those who “know how to work the system” and thus become the fabled “welfare queens.”  For them, incentives toward good behavior have been reduced or reversed, and democracy has devolved into an exchange of political power for handouts.

The real danger of the dependency portal is that it sets up a chute so that previously self-reliant Rhode Islanders will increasingly fall into an entitlement existence.  Why else would the exchanges offer health care subsidies to a family of four with income of $92,200?

Just as technology has simplified tasks that once required expert consultants, the dependency portal will make “working the system” a simple matter of clicking a few buttons.

Tracing the progress of the portal in Rhode Island. RI Health & Human Services Secretary Steven Costantino, Health Benefits Exchange Director Christine Ferguson, and Lt. Governor Elizabeth Roberts describe Rhode Island’s nation-leading steps toward the dependency portal (June 28, 2012):


Elaboration on why Rhode Island and the United States should resist the pull toward dependency portals:

RI Center for Freedom & Prosperity first identifies the dependency-portal dynamic as one reason to reject the health benefit exchange and the Medicaid expansion:

The pieces needed to turn the exchange into a dependency portal are being put into place:

RI officials acknowledge intention to implement Medicaid expansion, without any indication of legislative or public input:

Documents related to the dependency portal begin to reveal the direct connection between those pushing the concept and those involved with Rhode Island’s health benefits exchange:

The dependency portal in concert with eliminated work requirements for welfare may mark the return of the “welfare queen” and a “majority coalition” for big-government activists:

Documents. The federal government and national non-profits describe the dependency portal and the related “express lane eligibility”: