Governor Malloy’s man in Hartford, Mayor Luke Bronin, is close, we are told by a Hartford paper, “to signing a deal that would require the state to assume Hartford's annual debt payments.”
Malloy, who has proven himself more adept at deal making with his political cronies than balancing budgets and warding off debt, previously has made deals with state employee unions that carry debt forward much beyond his term in office. The SEBAC deal Malloy struck with lean and hungry union honchos, ratified by progressive Democrats in the General Assembly, push union favorable contracts forward to 2027 and prevent future governors from deploying layoffs to reduce debt until the contracts elapse. During his first two terms, Malloy has used the threat of layoffs to persuade hard boiled union negotiators to cough up what Malloy has been pleased to call “concessions,” an option the SEBAC-Malloy deal will not provide to Malloy’s successor. Union concessions generally have not involved long-term, permanent savings, which is why the state keeps stumbling from budget deficit to budget deficit.
Malloy, who has proven himself more adept at deal making with his political cronies than balancing budgets and warding off debt, previously has made deals with state employee unions that carry debt forward much beyond his term in office. The SEBAC deal Malloy struck with lean and hungry union honchos, ratified by progressive Democrats in the General Assembly, push union favorable contracts forward to 2027 and prevent future governors from deploying layoffs to reduce debt until the contracts elapse. During his first two terms, Malloy has used the threat of layoffs to persuade hard boiled union negotiators to cough up what Malloy has been pleased to call “concessions,” an option the SEBAC-Malloy deal will not provide to Malloy’s successor. Union concessions generally have not involved long-term, permanent savings, which is why the state keeps stumbling from budget deficit to budget deficit.
Malloy’s deal with Bronin, who hopes to replace his padron as Connecticut’s next governor, is a sweet deal for Bronin, but not for
Hartford. Bailouts will not break the cycle of spending and debt that hangs
over the Capital City’s head like a Damoclean Sword.
A bankruptcy proceeding and a consequent reordering of
financing by a bankruptcy court might have helped balance Hartford’s books in
the future, because a court would have attacked head-on the causes of
Hartford’s penury. But a bailout simply postpones the day of reckoning and, if
Bronin is successful in his bid for governor, someone other than Bronin will
fall victim to the pending Damoclean Sword. Just as Malloy will be leaving the
problems he has failed to solve to his successor, so Bronin, after two years and a few months into a four year term as Mayor, will be deeding Hartford’s problems to his successor.
The terms of the Malloy-Bronin deal are what one might
expect: The state – i.e. state taxpayers besieged by billion dollar increases
in taxes during Malloy’s failed tenure as Governor, which has contributed to
tax-payer flight – would cover Hartford’s immediate debt by June 20, ponying up
$12 million. State taxpayers will surrender another $24 million to close
Hartford’s budget deficit. In the future, state taxpayers will cover Hartford’s
full debt payment – which, of course, will spur additional spending – and
Hartford may receive an addition subsidy. Hartford already receives $270
million in extra aid from state taxpayers each year.
Every playboy living off his daddy’s wallet knows that
financial “help” of this kind induces future uncontrolled spending. In a
bankruptcy proceeding, debt and expenditures are both reduced. The fine print
on the Malloy-Bronin deal promises non-political oversight. The Malloy-Bronin
deal provides that an “oversight board” will restrict how Hartford will spend
its money. “Budgets, contracts and other documents,” according to the Hartford
paper, “must be run by the panel, and the board has final say over new labor
agreements. Hartford can’t issue new debt without the group’s permission.”
So then, let us
reason together. Hartford, like the state of Connecticut, has been overspending
for decades, and it is largely future salaries and benefits that are driving
debt. Salaries and benefits are set by chief administrators -- governors,
mayors and town councils -- who concoct deals with union negotiators.
State-Union deals may be rejected by the General Assembly, which is
constitutionally authorized to appropriate money and disburse expenditures. But
it has not often happened during negotiations between Malloy and SEBAC that a
deal struck by Malloy and union chiefs has been rejected by the General
Assembly. Far from rejecting deals that set in stone extravagant spending and
ordering deals to be reconstructed so that spending may be brought under
control, the Democrat dominated General Assembly has nodded sleepy assent to
Malloy-SEBAC union favorable deals. Malloy is a progressive Democrat who has a
warm spot in his heart for unions. Indeed, the Governor has expressed his
solidarity with unions – which had contributed generously to his campaigns – by
marching in strike lines with unions.
In fact, the Malloy-Bronin deal sets in concrete the present
level of spending in Hartford and then uses this marker as a standard for
future spending. The deal is a permit to continue a ruinous level of spending
and a promise that spending excess, which is the cause of Hartford’s debt, will
be assumed by state taxpayers.
Like his political patron Malloy, Bronin has not fallen far
from the Malloy’s progressive tree. For those in Connecticut who mistakenly
believe that Malloy’s stewardship of the state has led to uncontrollable bursts
of economic activity, an influx of entrepreneurs and entrepreneurial capital
and a reduction of future debt, Bronin is a perfect gubernatorial choice to
replace his political padroni, who has chosen to flee Connecticut’s burning
house with his pants on fire.
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