Rhode Island lawmakers plan economic forum to discuss state’s financial crisis

RI House holds forum on dire state economy

PROVIDENCE, R.I. — Nearly three years after jobs started vanishing in Rhode Island at an alarming pace, House lawmakers will gather Tuesday for their first forum on one of the worst recessions since the Great Depression.

The meeting comes after unemployment in Rhode Island climbed to 12.9 percent in October, worse than all other states except Michigan and Nevada. Economists expect the jobless rate in Rhode Island to peak near 14 percent next year.

Lawmakers in the General Assembly promised to focus foremost on the state’s economic crisis when their session began in January. Besides overhauling the leadership of the state’s Economic Development Corp. and passing legislation meant to spur the development of a wind farm, their track record has been weak.

“Due to the unprecedented economic challenges we’re facing we felt it would be very beneficial to hear from the experts about what is happening here and around the country, and the ideas that are being tried elsewhere to stimulate the economy,” House Speaker William Murphy, D-West Warwick, said in a written statement this week.

During the meeting, lawmakers will hear from economists, leaders in business and education, and Robert Tannenwald, vice president of the Federal Reserve Bank of Boston.

Brown University economist Peter Howitt, who is scheduled to speak before lawmakers, said Friday it will take a long time for the unemployment rate to come down to levels seen in the past few years. He said the current financial crisis is much larger than Rhode Island.

“At the state level, you can try to deal with the symptoms, but you can’t really reverse the causes,” he said.

Edward Mazze, a retired dean of the University of Rhode Island’s College of Business Administration, said he will attend the forum and urge the state’s leaders to take steps such as giving the small businesses that dominate Rhode Island’s economy tax credits and preference when they compete for contracts from state and local governments.

Republican Gov. Don Carcieri and the Democrats who dominate the General Assembly have not yet announced plans for closing a budget deficit of at least $220 million, brought on by overspending and plummeting tax collections.

Mazze said the state could cut costs by consolidating its 39 city and town governments into a county government system and trimming back the state bureaucracy.

“I think people need to see leadership,” he said. “Without that leadership, people believe that the Legislature here is not only a part-time Legislature, but it’s also not a Legislature that has anybody’s confidence.”