Robert Whitcomb: Rhode work; profits without prosperity

  Rhode Island Gov. Gina Raimondo is focusing on long-term projects that would help most people in the state, rather than “government by deal’’ wherein powerful groups seek taxpayer help for their special projects.

Improve public education and physical infrastructure and good stuff will follow. After all, Rhode Island already has a highly strategic location, ports, some famed educational and cultural institutions and considerable natural and manmade beauty.

“Our infrastructure is intertwined with economic development,’’ notes Rhode Island Transportation Director Peter Alviti.

So the governor wants commercial truck tolls on many bridges to help pay to fix roads and bridges. The plan is to issue $700 million in state revenue bonds, to be repaid from tolls on big trucks using bridges on Interstate Highways 95, 195 and 295 and state Routes 146, 6 and 10.

That many of Rhode Island’s bridges and roads are falling apart is obvious. Bad roads and bridges of course damage the vehicles driven on them -- a far better reason to avoid the tiny state than new user fees would be. Such disrepair shouts out that the state has been badly run. Bad PR!

That the Ocean State, part of which is an archipelago, ranks last in the nation in overall bridge condition seems suicidal. Big trucks do most of the damage to the state’s bridges and roads, by one estimate 90 percent.

Meanwhile, vehicles are becoming much more energy-efficient, many young people now don’t drive nearly as much as young people did a couple of decades ago and the huge cohort of aging Baby Boomers won’t be driving as much either. This means lower gasoline-tax revenues to pay for infrastructure.

Rhode Island and Connecticut are the only states on the Northeast Corridor between Maryland and Maine with no broad-based commercial truck user fees! Rhode Island does have the Pell Bridge, whose truck tolls help maintain it and the Mt. Hope Bridge. That leaves hundreds of badly maintained bridges. (Connecticut is considering re-imposing tolls; it had them for years for all vehicles on Route 95.)

The governor also wants to boost rail and bus service, including an express bus lane for the Routes 6 and 10 interchange reconstruction, and seeks $400 million in federal funds for public transit. With the GOP Congress, that will be hard, but demographics are on her side.

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Anger grows over many cash-rich companies’ paucity of long-term investment in research, job training and pay raises for employees below the senior-executive level. Rather, increasingly selfish execs and their boards take more and more corporate earnings to buy back company shares to boost their prices to enrich themselves at accelerating rates; much of their compensation is in stock.

Many senior execs are less embarrassed than their predecessors were 50 years ago about paying themselves so much at the expense of other employees and the communities where they do business. That’s one reason for the widening income gap. Some of the here-today-gone-tomorrow execs later repair their PR by creating foundations to give away a bit of the money they have taken. But that doesn’t help those they have blithely laid off and communities they have hollowed out.

Some call this stock-price “manipulation’’ and want to ban it. But this shouldn’t be illegal in a free market, however selfish it may be. Still, out-of-control greed and short-termism are eroding the long-term competitiveness of U.S. companies. Even some on Wall Street are speaking out against it. Lawrence Fink, chairman of BlackRock, the huge asset manager, told the chief executives of the 500 biggest U.S. public companies that this “discouraging underinvesting’’ undermines “long-term growth.’’

Economist William Lazonick calls buybacks "profits without prosperity.’’

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I spend more time these days visiting old sick people, as I prepare to join them myself. I always learn something. Not only do these people tend to be more honest than younger folks because they have little to lose in telling the truth, but they have better stories. And visiting them tends to put one’s own life in clearer perspective, including its brevity.

Robert Whitcomb (rwhitcomb51@gmail.com) oversees New England Diary.