So now the most ridiculous and irresponsible decision of former Gov. Donald Carcieri’s tenure has come home to roost. That, of course, would be the decision to gamble $100 million or so of the taxpayers’ money on Curt Schilling’s ill-fated 38 Studios video game company.
The company is now bankrupt. As ProJo State House veteran Katherine Gregg reports, the budget proposal from Governor Lincoln Chafee, the most vocal opponent of this fiasco during the 2010 governor’s race, has proposed making the initial $2.5 million payment to bondholders.
This foolish investment by Carcieri and his enablers at the state EDC and in the General Assembly is slated to cost RI taxpayers $12.5 million a year for seven years, money that would obviously be much better spent on roads, schools and creating a better business climate.
This is a sad case for taxpayers and Rhode Island’s economic future. Carcieri did this as he was waving goodbye at the end of his second term, which was an unmitigated disaster in terms of economic stewardship of the state. It is interesting to see Gary Sasse, onetime top aide to Carcieri (although not when the Schilling deal was done; he was gone by then), lecture the Assenbly now on how to proceed. Sasse is right; lawmakers ought to ``undertake a rigorous analysis’’ of the cost and benefits of various options for cleaning up the mess. It is only too bad that pillars of the R.I. business establishment as Sasse and former Hasbro honcho Al Verecchia (who actually went along with this one as an EDC board member) weren’t yelling from the top of the State House back in August of 2010 about absolutely dumb was this investment.
Lawmakers should think long and hard about their role in this miasma. Remember just one legislator, former House Republican Leader Robert Watson of East Greenwich, voted against the enabling legislation that allowed the $75 million in taxpayer loan guarantees to go to 38 Studios. The media, with a few exceptions (such as RIPR), didn’t cover itself in glory on this one by vetting the deal and questioning why the rush?
This deal obviously should have waited for a new gubernatorial administration. It should have not been coaxed through three months before the election. There was no urgency; no other state was vying to hand out this sum of money to a retired pitcher with a tin cup out.
Democrat Deval Patrick may be a liberal Democrat to Carcieri’s conservative Republican regime. But Patrick wasn’t foolish enough to give this scheme a blank check from the taxpayers.
Chafee is now suing some of the major players who put this mess together. Let’s hope his legal thrust harvests some significant money to mitigate the crushing blow on RI taxpayers.