Friday, January 01, 2016

Don Pesci Interviews Himself On The First Day Of The New Year Because Someone Has To

Q: President Pro Tem of the State House of Representatives Martin Looney appeared recently on “Face the State” with Dennis House and seemed – though in politics, appearances may be deceiving – to have repudiated progressivism…

A: I don’t think he’s ready to give up on progressivism just yet. You cannot have strongman government without progressivism. He did point out a major, perhaps fatal, failing.

Q: You quoted what he said in one of your columns.

A:  Yes, Mr. House noted that Ben Barnes, the head of Governor Dannel Malloy’s Office of Policy Management, had said that the state “might be seeing deficits for some time.” Deficits were “the new normal. Do you agree with that?” he asked Mr. Looney. Mr. Looney answered:

“It’s hard to predict what the performance of the economy will be too far in advance, which is why we always wind up in fact adjusting the second year of the biennial budget. We passed a two year budget in the session’s odd years, and we wind up adjusting that second year budget. So, the situation is volatile, 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.”

It was a refreshingly honest mouthful. I should point out that Mr. Barnes was being equally honest when he acknowledged that Connecticut would be facing deficits for some time to come.

Q: Why?

A: For multiple reasons. In no order of importance: The price of gas is down, and with it tax revenues. Connecticut is reliant on an expanding financial sector, which has performed poorly in the Obama recession. Some businesses have fled the state; others, General Electric for instance, are contemplating an exit. After massive tax increases, the price of doing business in Connecticut has become prohibitive. The regulatory apparat is discouraging. And Connecticut’s progressive tax structure, as Mr. Looney pointed out, contains the seeds of its own destruction. If you eliminate taxes for both the rich and the lower middle class, you have emptied the well; the bulk of the tax burden then will fall on Connecticut vanishing middle class. Taken together, Mr. Looney statement and Mr. Barnes’ statement represent a sort of “writing on the wall” that would be dangerous to dismiss out of hand.

Q: Will it be dismissed?

A: Of course.

Q: Why?

A: From cowardice and political hubris. Why did Belshazzar’s father dismiss the many warnings he had been given? We are told “He was driven away from people and given the mind of an animal; he lived with the wild donkeys and ate grass like the ox; and his body was drenched with the dew of heaven, until he acknowledged that the Most High God is sovereign over all kingdoms on earth and sets over them anyone he wishes.” Apparently, these condign punishments were curative; not so for  Belshazzar. Through  arrogance and a lack of humility, he slept soundly, we must suppose, after Daniel had interpreted the mysterious writing on the wall:

“God has numbered the days of your reign and brought it to an end.
 “You have been weighed on the scales and found wanting.
“Your kingdom is divided and given to the Medes and Persians.”

Leaving God out of it – as most legislators and governors are disposed to do -- our present ministers of the public good seem incapable of reading properly the signs of the times, which in Connecticut all point downwards.

Q: What did Mr. Looney mean when he said “the situation is volatile?”

A: He was speaking of past budgets. “Volatile” is perhaps too kind a word. The volatility began, perversely enough, with Lowell Weicker’s income tax. I say “perversely” because the tax was supposed to stabilize Connecticut’s future budgets. It did no such thing – just the opposite. It was a permission to other legislators, most of them incipient progressives, to spend wildly, and they did not disappoint. Within the space of three governors, two of them Republicans, Connecticut’s budget tripled – which meant spending had tripled. The spending multiplier at first created surpluses, which were plowed under, and then deficits. In the meantime, revenue resources were diminishing. At the time Mr. Weicker instituted the income tax, the state deficit was about $1.5 billion. During his first term in office, Mr. Malloy discharged a deficit of $2.5 billion by raising taxes, the largest tax increase in state history. Deficits continued because the General Assembly had not attacked spending. The governor’s second term budget was the second largest tax increase in state history. And so, here we are – at the center of a volatile spending tornado. One would suppose a reasonable governor would have deciphered the writing on the wall – cut spending. But no, in his second term as governor, Mr. Malloy proposed a 30 year $100 billion infrastructure repair program. Transportation problems, Mr. Malloy says, are driving business out of state. Actually, it is Mr. Malloy and progressives like him in the General Assembly who for many years have been driving businesses out of state.

Q: What will it take to make them, as you say, see the writing on the wall?

A: A total collapse of the state, and with it their fanciful and impossibly distended political pretentions. Short of that, a wide-awake media might be helpful.

Q: The media in Connecticut is asleep?

A: Well, what are we to think? It used to be the business of the media to comfort the afflicted and afflict the comfortable. I can’t think of any politician in Connecticut more comfortable than U.S. Senator Dick Blumenthal, unless it is Governor Malloy. Connecticut’s General Assembly has been a Democratic preserve for decades unruffled by serious media criticism.

Q: But we’ve had two Republican Governors, John Rowland and Jodi Rell.

A: Both of whom have offered little resistance to the party in power.

Q: They claimed to be fiscal conservatives – social liberals to be sure, but fiscal conservatives.

A: And firewalls. They were to be a break on spending and tax increases. We’ve seen how that worked out: Spending has increased threefold since the last pre-income tax budget. I reject the distinction between fiscal and social conservatives: Every political issue, including economic ones, is a social issue. That distinction should be replaced by a more lucid one: There are courageous conservatives -- among whom should be numbered conservatives who object to late term abortion, once described by Daniel Patrick Moynihan as too close to infanticide to be tolerated in a merciful society – and cowardly conservatives. The Democrats are winning on social issues. They’ve lost the fiscal argument, which is why Connecticut is in economic turmoil. Events already have spoken loudly here. They are winning votes on social questions, largely because the Republican Party in Connecticut has fled the social conservative battle ground without so much as having fired a shot. Perhaps I should mention that all the Republican “fiscal conservatives” in the state’s U.S. Congressional Delegation -- U.S. Representatives Nancy Johnson, Rob Simmons and Chris Shays – have been replaced by progressive Democrats. Their cowardly silence of social issues cost them their seats in Congress. Here is a syllogism Republicans should seriously consider: 1) One may enact programs only if one is elected to office; 2) Democrats, both in Connecticut and nationally, win office on social rather than economic issues; 3) therefore, if Republicans wish to see their economic programs enacted, they must fasten their courage to the hitching post and speak out on social issues.  

Q: So, the New Year is upon us; what do you see.

A: More spending, higher taxes, more business flight, more strongman politics, the further abandonment among Democrats of legislative prerogatives in the General Assembly, a greater indifference to real problems among Connecticut’s media, more of the same old, same old.

Q: Doesn’t sound good.

A: Happy New Year.

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