“I am deeply concerned for the state’s fiscal condition, which I think we can agree is deteriorating” -- Jim Smith, Webster Bank chairman and CEO
Mr. Smith is not
alone. For years, big spenders in Connecticut have been moving money from the
private economy to state coffers, and the additional funds have only whet the
appetite for spending among cowardly members of the General Assembly.
We now have a
graphic that depicts Connecticut’s unsustainable budget growth:
The
Weicker-Malloy-General Assembly tax increases knee-capped Connecticut’s
economy. It took the state ten years to recover jobs lost during the recession
that accompanied the Weicker income tax and, following Mr. Malloy’s crippling
tax increases, Connecticut even now has not recovered jobs lost during the
George W. Bush-Barack Obama recession. Mr. Obama has added nearly $10
trillion to Mr. Bush’s $10 trillion deficit, even as he inveighs against a
free market from international platforms, implicitly approving the superior
socialist economy of Venezuela, which has long since run out of other
people’s money and whose long suffering people are now forced to cross
borders to obtain necessities such as toilet paper.
Connecticut has
recovered only 81% of the 119,100 seasonally adjusted total
non-farm jobs lost in the state during the national recession that ended in
June 2009. But recessions, job losses and wealth production have not figured
into the calculations of politicians who have increased state spending 201%
since the income tax was implemented in 1991.
Said Mr. Smith, “I
strongly believe that fiscal pressures and related uncertainty regarding
taxes and regulatory rules are largely responsible for the low and waning
confidence expressed by businesses and consumers. You have it within your
power to change the course of events by defining the spending cap, and
especially the exemptions, in a way that sustainably controls total state
spending, lowers the state’s cost of doing business, and improves public
sector productivity.”
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Governor Lowell Weicker’s
income tax, we now know, saved members of the General Assembly, a majority of
whom are Democrats, the political trouble of restraining spending, and the
additional dollars brought in by the income tax fueled unrestrained spending,
as demonstrated in the above graph. No state can long survive a growth in
spending that is 134% above a 67% Consumer Price Index and 137% above
Connecticut’s Median Household Income. It cannot be done. Mr. Weicker – and
after him Governor Dannel Malloy, who imposed on the state the highest and
second highest tax increases – saved state government and ruined the state.
Every dollar
appropriated in taxes by state government is a dollar lost to entrepreneurial
activity in Connecticut, and that is why taxes ought to be modest and
necessary. The imperative necessity of spending restraint has now become a
whispered word on everyone’s lips. But though the spirit may be willing, the
political flesh, as we all know, is exceedingly weak.
Just how weak the
state’s economy really is may be seen by the predictable fate of Connecticut’s
spending cap. The so-called spending cap was NEVER more than a political feint,
rhetorical wadding in Connecticut’s spending blunderbuss. It was introduced by
Mr. Weicker as a political ploy to garner votes in the General Assembly in
favor of his income tax – a tax, it should be noted, that was vigorously
opposed by two previous Democratic Governors, Ella Grasso and Bill O’Neill.
The ceiling on the
spending cap was a fiction, and finally, in November 2015, Attorney
General George Jepsen exposed the fraud in an advisory opinion solicited
by Republican Minority Leader Len Fasano that declared the cap had never been
operative because the General Assembly had never supplied necessary definitions
in the 1991 constitutional legislation that should have triggered its
implementation. The spending cap was a stillborn corpse; Mr. Jepsen’s formal
advisory opinion simply gave it a decent burial.
This reality,
obvious to everyone, has yet to penetrate the sensibilities of House Majority
Leader Joe Aresimowicz, whose reaction to the sizable, apparently imperishable deficits
projected by the legislature's nonpartisan Office of Fiscal Analysis is
paralyzingly stunning. Mr. Aresimowicz, plunging his head ostrich-like into the
sand, predicted that the state's economic future is "brighter than it's
guessed to be right now,” according
to a story in The Hartford Courant. This is a variation of the old Yogi
Berra quip, “The future ain’t what it used to be.” For purposes of the upcoming
General Assembly elections, the future for dominant Democrats in the General
Assembly will be exactly what Mr. Aresimowicz wants it to be. Selling this rosy
product to Connecticut voters whose view of reality is less optimistic than tax
thirsty legislators will be a tough slog, because it involves a denial of
reality that is both comic and dangerous.
The question most
voters will be asking themselves, as they rush to the polls in November to
throw the bums out, will be – who do you serve, yourself, special interests or
me?
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