We know that it will not do to overlook recent history,
because recent history is armed and dangerous. It might be instructive to
approach Connecticut’s economic problems from a “can’t do” perspective. What
are the reigning “can’t-do’s” in Connecticut just now?
Bob Stefanowski, we are told, cannot eliminate the state income tax, first imposed in 1991 by then independent Governor Lowell Weicker. This is can’t-do number 1. The income tax provides nearly half the revenue of Connecticut. Republican leader in the state House Themis Klarides is on record as saying the proposal, put forward in the Republican primaries by two gubernatorial contestants, Danbury Mayor Mark Boughton and Stefanowski, is “silly,” her expression. Well, one is not obliged to suffer sillies gladly.
Once he had won the primary, Stefanowski described his proposal
to eliminate Connecticut’s income tax as an “aspirational goal.” Not without
reason, Stefanowski is convinced it is important to distinguish his aspirations
from those of his Democrat opponent Ned Lamont. Stefanowski wants to reduce
taxes, institute zero-based budgeting, and wring cost savings from state
workers, which brings us to “can’t-do” number 2.
The agreements concluded between Malloy and SEBAC have been
written in contractual stone. Thanks to Malloy’s efforts on behalf of unions, current
contracts, very favorable to state employees, are locked in until
2022. So then, neither Lamont nor Stefanowski may unilaterally void these
contracts, and – very important – the contracts are enforceable by courts. Even
if observing the contracts were to bring Connecticut to the brink of bankruptcy,
the General Assembly cannot void or adjust the contracts, Lamont says, without the assent of
SEBAC.
Politics is the art of the possible, but Malloy and union
bosses have made remediation of these court enforceable contracts impossible.
One clause in the contracts makes it impossible for future governors – even if a Governor Lamont should wish to do so – to use layoffs as a negotiating point in
future contract negotiations with unions. This is can’t-do it number 3.
The Malloy/SEBAC agreement provides salary increases after three years until the contractual expiration date. The solution to this number 4 s “can’t-do” seems self-evident. If the legislature, constitutionally
responsible for taxing and spending, is ever to regain control of its
budgets, it must wrest budget control from unions allied with governors. Union
salaries and pensions should be set through legislative provisions rather than
contractual arrangements.
It may surprise taxpayers to discover that the General
Assembly controls only “discretionary spending,” a relatively small part of
biennial spending, which brings us to “can’t do” number 5: “Fix costs” cannot
be reduced. The indispensable Yankee Institute tells us that nearly half the costs of Connecticut government are fixed. These
are costs associated with “pension payments, retiree healthcare, Medicaid, debt
service and adjudicated claims.”
Can the costs be unfixed?
Theoretically, they
can. Government is the art of the possible, not the impossible. And it is essential that state government recover control over nearly one half of its
budget.
The chief concern of Connecticut's bean counters has been balancing
the state budget for the next biennium. But if they are not at all concerned how
state government may regain control of its continuing budget shortfalls by controlling spending, they are having the wrong conversation among themselves.
Everyone, even Malloy, knows how to discharge a state budget
deficit – you raise taxes. Malloy, who may go down in Connecticut history as the least popular governor, raised taxes twice, imposing on the state the largest
and the second largest tax increases in Connecticut’s history. But budget deficits
continue to recur, in large part because Connecticut’s government is firmly
attached to the “can’t-do” principle. These seeming intractable problems, we
know from bitter experience, are not solved by making large portions of the
budget untouchable. Still less are the problems solved when traditional tools such
as layoffs are removed from the gubernatorial tool box, or when contracts favorable
to unions are pushed far into the future.
Nothing Lamont has said so far should give anyone reason to
suppose he has a firm grasp of the state’s most exacerbating problem – which is that the
General Assembly has, over a long period of time, invested governors, and derivatively
court justices, with deciding issues that constitutionally fall in the
legislative domain. The legislature ought not to be permitted to rent out its
constitutional prerogatives to another branch of government – not to mention
extra-governmental entities such as unions.
No one in Connecticut is making much ado about this, likely for reasons noted by
Orwell – the most difficult thing for a government to do is to see the difficult “can do” solution that lies right under its nose.
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