RHODE
ISLAND
ANALYSIS
Population, 2014
1,055,173
2014 RANK
Share of total U.S. population
43rd
ECONOMIC
0.3%
PERSONAL
OVERALL
Population
ranking
Net migration
rate
43rd
−6.3%
1
20
RANK
10
30
State Taxes, Percent
of Personal Income, FY 2014
40
5.4%
50
2000
2005
2010
2015
YEAR
Local Taxes, Percent
of Personal Income, FY 2012
5.0%
Partisan Lean, 2012
POLICY RECOMMENDATIONS
• Fiscal: Cut state and local governments’ abnormally
high spending on public buildings, housing, public welfare, and employee retirement. The savings could be
applied to reductions in selective sales and individual
income taxes.
232
D +11.9
$
Rhode Island’s fiscal policy is slightly subpar.
Government subsidies and debt and local
taxes are high, while state taxes are about
the national average, and taxes were cut in
2013–14. With four effective competing jurisdictions per 100 square miles, Rhode Island
affords its residents quite a bit of choice
among localities. Government employment
is well below the national average. This pattern is fairly typical for urban, coastal states,
probably reflecting the higher cost per unit of
labor than in the Midwest.
Rhode Island’s regulatory policy has deteriorated somewhat over the past decade
and a half, even ignoring the effects of the
federal health law. Land-use freedom is low
because of exclusionary zoning and eminent
domain abuse, and indications are that it has
worsened since the early 2000s. Renewable
portfolio standards are high. Labor policy is
also anti-employment, with a high minimum
wage, no right-to-work law, a short-term
disability insurance mandate, and, since
2013–14, a paid family leave mandate. We
show a massive increase in health insurance
mandated benefits in 2009–10, up to a premium additional cost for all benefits of plus
Rhode Island has one of the best criminal
justice systems in the country. Incarceration
rates are well below average, as are drug
and nondrug victimless crime arrest rates.
Unfortunately, the state has not sufficiently
reformed civil asset forfeiture, and, although
a big equitable sharing payout somewhat
skews Rhode Island’s scores on that variable,
evidence suggests that local law enforcement participated eagerly in the program
even before that payout. The state has a fairly
extensive medical cannabis law and decriminalized low-level possession of cannabis in
2011–12. However, it is still possible to get life
imprisonment for a single marijuana offense
not involving minors. Rhode Island has a little
legal gambling, but the state is well behind
Connecticut here. A tax credit scholarship law
and repeal of private school teacher licensing
passed in 2011–12, bringing the state’s educational freedom above average. Same-sex
marriage was legalized in 2013. Tobacco freedom is one of the lowest in the country, due
to sky-high cigarette taxes (over $3 a pack)
and comprehensive smoking bans. Gun laws
are extremely restrictive and have become
more so over time.
Real Per Capita Personal
Income, 2013, in 2009 $
• Regulatory: Reform land-use regulations, perhaps
through an Arizona-style regulatory taking compensation requirement combined with eminent domain
reform.
$44,670
• Personal: Legalize cultivation, sale, and possession of
recreational cannabis.
2.36%
F R E E D O M I N T H E 5 0 S TAT E S
Rhode Island is a fairly typical “deep blue”
state in that it is much better on personal
than economic liberties. The Ocean State
compares favorably with its western neighbor
but unfavorably to its neighbor to the north
and east.
54.8 percent. Cable and telecommunications
have, however, been liberalized. Occupational
licensing is about average, but in 2013–14,
nurse practitioner freedom of practice was
expanded. A price-gouging law was enacted
in 2011–12, and the state has long had a general ban on “unfair(ly low) prices.” Freedom
from abusive lawsuits is a bit below average.
Real Personal Income
Growth, CAGR, 2000–13
S TAT E P R O F I L E S
233