Monday, August 27, 2012

Malloy’s Hobgoblins

Connecticut Governor Dannel Malloy was in a frightful and frightening mood when he visited the Hampton Democratic Committee's picnic, an affair held at the home of Toni and Jim Trotzer in Hampton, New Hampshire.

Speaking on behalf of President Barack Obama and reading pretty much from his campaign playbook, Mr. Malloy held up to the people of Hampton several hobgoblins.

Should Republican presidential nominee Mitt Romney and vice presidential nominee Paul Ryan be elected to the White House, Mr. Malloy told the assembled Democrats, the two would “take apart America as we know it,” according to the New Hampshire publication seacoastonline. And later, after he had arrived home, the mood still being upon him, Mr. Malloy said Romney-Ryan wanted to “force senior citizens into poverty.”

America’s national debt, as most of us know, presently is hovering around $16 trillion in round numbers. Extrapolating future debt at current advancement rates, the national debt should hit about $24 trillion by 2015. But this is only the tip of a much larger iceberg: Total U.S. unfunded liabilities are estimated at $144 trillion, roughly $1.2 million per taxpayer.

However, Mr. Malloy, the author of the largest tax increase in Connecticut history, did not travel all the way to New Hampshire to lay before his Hampton audience data that might give pause to Democrats anxious about the spending that had produced such alarming figures.

No, Mr. Malloy was there to roll out the Democratic narrative for the coming campaign – which is: A vote for Romney- Ryan is a vote for the dissolution and death of the Republic.

Fortunately for the citizens of New Hampshire, their prospects are less frightening than those of their neighbor to the south, and their state is better situated to take advantage of a recovery from the Bush-Obama recession, when or if the recovery occurs. That recovery is less likely to occur if the spending addiction of Congress and Connecticut’s General Assembly is not effectively addressed. In politics, you cannot own the solution if you do not own the problem. And the problem both in Washington and Connecticut is that the state, national and local, is consuming too much of the nation’s wealth and burdening wealth creators with an incubus of over-regulation, the natural born enemy of creative innovation and wealth production.

To vary a line made famous by Franklin Roosevelt, all we have to fear is spending itself.

The citizens of New Hampshire have less to fear in this regard than their counterparts in Connecticut. In New Hampshire, the increase in the rate of state spending is slowed by several speed bumps. While municipalities in the state collect property taxes that increase or decrease in accordance with frequent evaluations and the state levies a dividends and interest tax on resident individuals, partnerships, limited liability companies and fiduciaries with nontransferable shares earning more than $2,400 annually ($4,800 for joint filers) from their investments -- there is in New Hampshire no state sales tax.

And New Hampshire has no income tax, unlike Connecticut, which removed its own spending speed bump more than 20 years ago when Republican maverick Lowell Weicker, rudely tossed from the U.S. Senate by much abused Republicans, ran as governor on a campaign plank that eschewed an income tax, won office in a three way race against Republican John Rowland and Democrat Bruce Morrison, and proceeded to throw gas on the spending fires by instituting an income tax. Since that memorable event, spending in Connecticut has trebled. Every so often, Mr. Weicker pops up to remind everyone in Connecticut that, while there has been much grousing over the Weicker Income Tax, no one seems inclined to repeal it.

The New Hampshire legislature and governor cut general fund spending for fiscal year 2010-11 by 4 percent over the previous fiscal year, according to one report, because a shortfall in the biennium  “forced lawmakers and the Governor to cut spending mid-budget, yielding a 4 percent reduction from 2008-09 general fund spending,” bringing the state’s new budget to “its lowest level since 2002-03.”   

Mr. Weicker’s sympathies flow tenderly towards Mr. Malloy, the first Democratic governor in the state since Governor William O’Neill, under pressure within his own party to institute an income tax following years of profligate spending, bowed out of office, opening the door to Mr. Weicker. The Malloy solution to state debt is the same as Mr. Weicker’s. Once in office, Mr. Malloy imposed upon Democrats and Republicans alike the largest tax increase in state history, earning him a place in the warm cockles of Mr. Weicker’s heart, where self-regard breeds like salp, reputedly the fastest reproducing animal on earth.

At the New Hampshire event, Mr. Malloy was pleased to meet a young girl who was “disturbed” by the Republican national ticket of Romney-Ryan. Mr. Malloy commiserated: They were "worse than Barry Goldwater's would have been for the United States." Good old Barry, who once said that if you lop off California and New England – “you got a pretty good country.”

Republicans, Mr. Malloy told the prospective journalism student, “don't care about our middle class. There's no end to what they want to end. And there's no beginning to what they want to do for us unless you have more than a million dollars in income" … like… like… newly elected U.S. Senator Dick Blumenthal, the eighth richest  congressperson in the land; two other members of Connecticut all Democratic congressional delegation, U.S. Representatives Rosa DeLauro and Jim Himes, are also millionaires.

If the young lady had been a redundantly wealthy corporation interested in moving in or about Connecticut such as Cigna in Bloomfield, ESPN in Bristol, NBC Sports in Stamford, Alexion Pharmaceuticals in New Haven, CareCentrix in Hartford, Sustainable Building Solutions in North Haven, Deloitte in Stamford and most recently Bridgewater Associates -- whose chief investment officer, Ray Dalio, is the highest paid hedge fund manager in the world at $3.9 billion per annum -- Mr. Malloy would have been happy to shower her with crony capitalist tax bucks, the blood sweat and tears mopped by Mr. Malloy and Mr. Weicker from the fevered brows of those still employed in Connecticut.

Fortunately for her, the lady gave no indication that she planned to move away from tax free New Hampshire to tax sodden Connecticut, a prudent choice. She will, however, leave herself open to corruption when she attends college at American University in Washington, D.C, which over the years has provided a steady stream of staff members for congressmen such as Mr. Weicker and, as some people seem to think, a future congressman or president Malloy.
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