Is the R.I. economy headed for a rude awakening?

By Ian Donnis
Posted 3/21/23

STORY OF THE WEEK: If you want to feel a chill down your back, watch PBS Frontline’s report on the recent era of “easy money” – super-low interest rates …

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Is the R.I. economy headed for a rude awakening?


STORY OF THE WEEK: If you want to feel a chill down your back, watch PBS Frontline’s report on the recent era of “easy money” – super-low interest rates promulgated by the Federal Reserve. The thinking is that the Fed let the economy run too hot, for too long – with a reckoning still to come. Under the best outlook, a soft landing would put the poor stock market performance of the last year in the rear mirror with a possible spike in unemployment.

The finance experts interviewed by Frontline, however, hold out the possibility of a bigger economic shock, with massive job losses and an ongoing bear market. The documentary aired on television this week, incorporating news about the possible fallout from the collapse of Silicon Valley Bank. As it stands, Rhode Island remains an economic work in progress. Sure, unemployment has been at a historic low, but total nonfarm employment remains below the most recent high set in 2020, according to the St. Louis Fed. The Ocean State lacks well-defined engines of growth and it doesn’t have the diversified tech-sector that fuels the Massachusetts economy.

URI economics professor Leonard Lardaro points to what he calls “compelling evidence that RI’s economy continues to slow,” possibly revisiting the Ocean State’s dubious FI distinction (First In to an economic downturn, half of FILO -- first in, last out). For now, state government is enjoying a rare run of budget surpluses, helped in part by federal pandemic aid, and public officials can cherry-pick indicators to contend that the economic glass is half-full. But Rhode Islanders and state government alike could be poised for a rude awakening if the national economy takes a sharp turn for the worse.

SHEKARCHI’S DECISION: Occam’s Razor is the idea that the simplest explanation is often the one closest to the mark. That’s a good prism for the decision by House Speaker Joe Shekarchi – whose office is often called the most powerful post in Rhode Island – to not run in CD1. While he would have had a good shot at winning, giving up his perch on Smith Hill to be the lowest-ranking member of the U.S. House, in the minority party, was not ultimately inviting. Shekarchi tells me a conversation with U.S. Sen. Jack Reed at the IHOP in Warwick helped drive home that point. There’s also how the speaker has a busy private law practice, and regular travel to DC, if he were to win, would take him away from his 97-year-old father.

For now, the CD1 race remains wide open. Lt. Gov. Sabina Matos is the only prominent Democrat running so far, Helena Foulkes is set to reveal her decision - expected to be a “no” — early next week, and a host of other Democrats may jump in.

ANOTHER CD1 PROSPECT: Could a first-time candidate emerge from the business sector to become the next congressman from Rhode Island? Don Carlson, a renewable energy investor who lives in Jamestown, is seriously considering running for the CD1 seat and tells me he hopes to make his decision in early April. Carlson, a 62-year-old Democrat, checks a lot of boxes: he grew up in Warwick, worked at Newport Creamery as a youth, went to Williams and Harvard Law, worked as a trial lawyer and on Wall Street, served as legislative director for former U.S. Rep. Joe Kennedy II of Massachusetts, and ran the 2008 campaign for U.S. Rep. Jim Himes of Connecticut. Carlson said he believes he’d do well with fundraising. In Jamestown, he is a volunteer EMT and an assistant scoutmaster, he said.

Carlson began investing in renewable energy about 23 years ago, starting with one outfit that consisted, he said, of five guys and a station wagon. In an alumni talk at Williams a few years back, “Carlson emphasized the need to ‘blow up’ false assumptions about environmentalism. To him, the most harmful environmental myth is that sustainability precludes profit. According to Carlson, environmentalists ‘don’t have to make that tradeoff between doing well and doing good. Sustainability and profit can be joined through impact investing, which actively targets projects that benefit society.”

As far as a possible CD1 run, he tells me, “I’ve been given some amazing opportunities in my life, starting with an amazing scholarship that allowed me to get a world-class education. I’d like to make this next chapter about creating opportunities for every young person in America. From my prior experience in government, I believe Congress is the best place to accomplish that.”

GINAWORLD: U.S. Sen. Jack Reed – long since known as “the E.F. Hutton senator” – was out front this week in heralding some good news for Newport. The National Oceanic Atmospheric Administration plans to open an office in the city with a few hundred jobs. Close observers of government know that NOAA is part of the broad portfolio of … wait for it … U.S. Commerce Secretary Gina Raimondo. In related news, the increasingly ubiquitous former RI governor quizzed people on their knowledge of Chips in the first episode of “Gina’s Guessing Game” and she remains front and center in the policy debate about TikTok.

DEEP BLUE: New Bedford ranks as one of the most lucrative fishing ports in the U.S., so is the city threatening its golden goose by embracing wind power, an industry generally seen as a negative by the fishing community? Mayor Jon Mitchell rejects that possibility. “What I've told folks in the fishing industry is that I've got your back, but I also want everybody to know that it's good for New Bedford that the offshore wind industry is setting up shop in our older industrial city," he said during a Political Roundtable interview. "We don't have opportunities to attract large amounts of capital to our city as we do with the offshore wind industry. And we've seen it play out in Europe a number of times. So what we're trying to do is to get everybody to understand New Bedford's needs, which is to succeed in both of those industries. And insofar as the two industries conflict, we will work to work out those conflicts.” Pressed, Mitchell conceded some displacement is likely, although he said not much, and that mitigation programs to help the fishing industry still need work.

WHALING CITY: Mitchell was first elected mayor of New Bedford in 2011, and with fewer than eight months until the next election, he hasn’t specified his plans. He tells me he hasn’t sought a job with the Biden administration or with Massachusetts Gov. Maura Healey, a Harvard classmate, who was in New Bedford on Thursday. “I'm just gonna take things as they come,” Mitchell said. We've got a lot on our plate right now. And so the political decisions can wait for their time.”

HEALTHCARE: Three years after a little-known state advisory panel recommended approval, an Alabama-based publicly traded company, Encompass Health, is building an inpatient rehab hospital in Johnston. The proposal was sharply opposed by lobbying groups for nursing homes and hospitals, who said it would cannibalize services and increase costs. Johnston Mayor Joseph Polisena Jr., like his father before him, is a booster of the project and said it will spur competition. Here’s my story tracing the long approval process and ongoing questions about the new rehab hospital.

HEALTHCARE, PART II: The initial recommendation for the Emcompass’ Johnston proposal came from the state Health Services Council, on a 3-2 vote. As I subsequently reported, that was not the only time when the HSC decided a significant issue with less than half its membership. And the council approved a change in ownership for the owner of Fatima Hospital and Roger Williams Medical Center despite financial concerns about the buyer.

State Sen. Dawn Euer (D-Newport) tells me her bill to eliminate the Health Services Council is based on the importance of public health in Rhode Island. Attorney General Peter Neronha also has concerns about how healthcare approvals are determined in the state. “Based on my experience with Prospect Medical Holdings in 2021 and the proposed Lifespan/Care New England merger last year, it was plain to me that there had been underinvestment in the regulatory side of the Department of Health,” he said. Neronha points to the HSC’s vote when a private equity firm was trying to sell its stake in Roger Williams and Fatima. “In the end, it required intervention by my office to obtain $80 million in necessary financial security for those hospitals,” he said. “Similarly, the Department of Health never issued an opinion or decision regarding the proposed Lifespan/Care New England merger, though they, like my office, were charged with regulating that transaction. There are outstanding public servants in that agency, and I am proud to work alongside them in areas like opioid abatement, recovery and treatment. But no one can seriously argue that the regulatory side of the agency would not benefit from an additional investment of resources. Properly resourced and led, that agency should be making the health care regulatory decisions for the state, in conjunction with my office where authorized by statute.”

TWITTER: I joined Twitter not long after starting at The Public’s Radio in 2009, and it’s such an intrinsic aspect of my work as a reporter that it’s hard to imagine it fading into oblivion. Yet Elon Musk’s rule of Twitter has been marked by disruptions and questionable moves. Dave Karpf lays out a plausible case for why Twitter may just have months before heading into bankruptcy. For now, though, reporters like Ted Nesi and me are hanging in with Twitter – because it remain a valuable information source – so here’s hoping for the best.

Takes of the Week: Various views from a mix of Rhode Islanders.

RI House GOP Leader MIKE CHIPPENDALE of Foster: “This baseball purist is torn. The pitch clock is a departure from the beautiful, poetic and traditionally self-governing pace of play of the greatest game on earth. It’s offensive by its very existence. Or is it? I grew up watching two-and-a-half hour games in the ’70s and ’80s. Pitch, bat, play, repeat. Then, batting gloves starting to get adjusted -- repeatedly. Pitchers began to kill time seemingly to catch their breath or out-psych batters. It had become a bit laborious, with that I cannot argue.

“As I’ve been watching spring training and World Baseball Classic games for the past week, I cannot help but notice the huge difference in the pace of play. While the WBC offers the opportunity to watch talented ball players from across the world, I like the pace in spring training games much more and it pains me to state that publicly. I’ve decided that I will simply enjoy the flashback to my youth with brisk games and ignore the fact that there is a clock governing my beloved game. That is until the clock, rather than a player, ends a game -- then the purist will surely reemerge, and he’ll be salty.”

Blogfather, lawyer and lobbyist MATT JERZYK: “We have rightly been talking about the importance of modernizing school buildings for the 21st-century and providing diverse and career-oriented classrooms for our students. We also talk about raising test scores to prove increased proficiency in the basics such as reading and math. However, it is critically important to also focus on the fact that so many of our students in our city school districts are not fluent in the language that these tests are written. How can we raise standardized test scores if students can't even read and write in the language of the test (and not to mention evaluate teachers on this same model)!?

“Kudos to state lawmakers for investing tens of millions of dollars in recent years into multilingual learning (MLL) programs, but significantly more must be done. Programs, such as this one recently highlighted in the Boston Globe are the bridge that our students need to address both fluency in the curriculum AND fluency in the language. If we only talk about the former and disregard the latter, test scores are simply not going to go up. As the Dallas Cowboys have shown, getting a beautiful new building is part of the solution, but it doesn't guarantee success and Super Bowl wins!”

Entrepreneur, community leader and ProJo alum ALISHA PINA: “There are so many statistics that show Rhode Island and our country are far away from achieving equity and it’s clear many still don’t want it anyway. As I stated in my spoken word piece at this week’s Equity Campaign launch led by the Economic Progress Institute, elected officials and those seeking office often use hollow statements like ‘I stand for equity’ and ‘I don’t see color.’ But the reality is you should see color, and diversity benefits every level of government as well as every workplace in every sector. There are statistics for that as well that show how different experiences, backgrounds and upbringings result in better opportunities for creativity and problem solving and an increase in profits and productivity.

“The reason I am so passionate is not only because I am a Black woman who has often been passed over, not seen and ignored despite good ideas, but I am also the daughter of a Black mother who moved her way up to a leading director at her organization and a father who sued his Rhode Island hometown to become one of the first Black firefighters. Both were more than qualified, but they had to fight anyway. So we are going to keep fighting for equity, because it is necessary and deserved.”

Strategist and consultant CARA CROMWELL: “Earlier this week, word spread quickly that Bristol’s beloved pub owner, Aidan Graham, had passed away. Many locals mourn a good friend and the town lost its honorary mayor. It’s hard to believe that Aidan’s wasn’t always Aidan’s, but growing up downtown, I remember it as the spot for several short-lived restaurants and a bar called the Hurricane. Then, Aidan’s opened and created a place where locals, college students and visitors all gathered and left with full bellies and warm feelings. Perhaps Aidan’s popularity is even more remarkable in a town we lovingly refer to as the “insulah peninsula” that isn’t always welcoming to newcomers, but he was as much a Bristolian as anyone because we all have an Aidan’s story and a vision of him behind the bar. Many a pint will be raised in honor of the man who gave Bristol a real Irish pub and many happy memories.”

PABLO RODRIGUEZ, physician, community activist and OG of Latino politics: “The truth shall set you free. This Bible quote may have been appropriate in the past, but sadly no more. It seems that today the truth is whatever your favorite media outlet says. Whether it is Twitter, Fox News, MSNBC, your perspective on the same event can be so different as to arguing over the color of the sky. We all saw the events on live television when an armed mob attacked the Capitol with the purpose of changing the results of the election. About 150 police officers were wounded and 5 people died. How is it that a year later we could argue whether they were peaceful, unarmed patriotic Americans exercising their right to free expression? How can an outlet like Fox, in the middle of a trial where incontrovertible evidence shows that hosts like Tucker Carlson were purveying false information on the election, air 30 seconds of video from that day, and convince millions to believe Tucker instead of your lying eyes?

“Some will claim polarization of the press, social media or the isolation created by the pandemic as culprits, but there is one basic element tying them all together. We as a country have accepted lies as proper political speech. There have been no consequences for politicians, media outlets nor government officials for their fallacies. By finding refuge in their money-making media outlets, people like George Santos, a proven and poor serial liar, is still a congressman. All in the name of ratings, in spite of the truth. For these reasons there has never been a better case for public media, and because of it, it is likely to become a target in future budget negotiations. Don’t let it happen! The truth should set you free.”

FOOD: As part of an ongoing series on recent James Beard nominees in Rhode Island, my colleague Alex Nunes spent time in the kitchen with Sherry Pocknett, a member of the Mashpee Wampanoag tribe, who showcases indigenous fare at her Charlestown restaurant, Sly Fox Den Too.

KICKER: Many of us have for decades enjoyed the compelling reporting and lyrical accent of Sylvia Poggioli, the senior European correspondent for NPR’s international desk. After 41 years with NPR (and 51 as a reporter), she’s hanging up her headphones. “I'm often asked what are my favorite interviews—they include a mafia-busting woman magistrate in Sicily, mystery writer Donna Leon in Venice and architect Renzo Piano at his home in Genoa,” Poggioli writes. “But the most moving stories are those of hundreds of refugees I've interviewed –Muslims, Albanians, Croats and Serbs in the Balkans, ethnic Hungarians fleeing Ceausescu's Romania, and Africans, Syrians and Asians fleeing war, hunger and poverty who survived perilous crossings and reached Lampedusa, the door to Europe.” The cherry on the cake is how Poggioli was born in Providence -- proof positive that all roads lead to Rhode Island.

Ian Donnis can be reached at

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