BOSTON GLOBE: GE MOVING TO BOSTON, BOMBSHELL: GE EXEC CALL BAKER, WALSH. And several sub stories were listed:
FLASHBACK: Looney: 'I think they doth protest too much'...FLASHBACK: Sharkey accuses GE of 'fear-mongering'...FLASHBACK: Aresimowicz tells GE suits 'take a weekend off from the yacht'...
Speaker of the State House Senate Brendan Sharkey several weeks ago announced that General Electric's much publicized tax complaints were needless whining because “GE pays no taxes.” His complement in the Senate, President Pro Tem Martin Looney, had added that GE’s CEO Jeff Immelt, like Lady Macbeth “doth protest too much.” Governor Dannel Malloy claimed to have had conversations with Mr. Immelt, but he had no comment on GE’s possible move from its large campus in Fairfield. Pressed by reporters just before the newly appointed Chairman of the Democratic Governors Association was due to arrive in Washington, there to receive plaudits from fellow progressive President Barack Obama, Mr. Malloy whined, with a shrug, “GE will do what GE will do.” Upon his return home from his Washington DC petting, Mr. Malloy was told that GE was moving to Boston. Early tremors had been signaling that earthquake for months; even much dazzled Connecticut reporters were not surprised by the announcement. Mr. Malloy noted, phlegmatically, “You win some, you lose some.”
But of course – If GE pays no taxes, how could Mr. Malloy induce GE to remain in the state by slathering the company with tax abatements?
Days before the leak, it was rumored that Mr. Immelt, perhaps stung by Mr. Looney’s Lady Macbeth reference, was considering deeding the Fairfield campus to Sacred Heart University and so removing the property from Connecticut tax rolls.
No taxes, eh?
The GE move -- along with major Connecticut insurance company consolidations with other major out-of-state companies, the sale of Sikorsky, the out-migration of some United Technology operations, the out-migration of the state’s most promising entrepreneurial talent to other states, Connecticut’s seemingly endless budget deficits and rescissions, and the drip, drip, drip of Connecticut’s prospective tax revenue to other low tax, low regulatory states – long ago should have convinced Connecticut’s progressive governor and progressives within the Democrat dominated General Assembly that progressivism itself contains the seeds of its own destruction.
Progressive President Pro Tem of the state Senate Martin Looney admitted as much when he was asked by Dennis House of WFSB Channel 3's Face the State whether recurring deficits would be a permanent feature of Connecticut’s budget making. Connecticut’s economy is volatile, Mr. Looney answered “but one other trend that we do have to recognize is that, while unemployment in our state is down and actual employment is up, we are to some extent victimized by the progressivity of our own tax structure. Because of an array of credits and deductions that we have, most people earning under $40,000 a year or so wind up not having income tax liability. A lot of the jobs that have been created are in the service economy. So, while we are seeing an increase in employment, we are not seeing an increase in tax revenues. But I think that’s why both the Governor and the General Assembly are committed to advance the interest of high tech businesses and others that will, in fact, pay high wages, so that people will then be able to support the state.”
The volatility in Connecticut’s economy may be traced to the inability on the part of Mr. Looney’s Democratic cohort in the General Assembly to make meaningful cuts in spending, a hard political road to travel. The easy road is to boost revenue through tax increases and then soothe preferred impacted companies by awarding credits and deductions, a process that shifts the tax load from large to small businesses. Companies play the game, reap temporary benefits and then move on to less punishing quarters elsewhere. GE will not be the last in-state company to game the political system before shaking the dust of Connecticut from its feet.
Fortunately for the state of Connecticut, progressivism is a self-limiting disease. At some point short of bankruptcy, thoughtful governments begin to regulate government rather than the governed. We can only imagine what Connecticut might look like if it had as governor a chief-executive intent on regulating governmental greed and a modest General Assembly pledged to return the state to normalcy.