Speaking at a chamber of commerce breakfast Wednesday, Gov. Dannel P. Malloy listened as a businessman suggested that targeted tax breaks might persuade more citizens to retire full-time in Connecticut, rather than moving with the money made here to warmer and tax-friendlier climes.

“Sure, there’s a way to do that. You got a way to pay for it?” responded the governor. He and the legislature had to make tough cuts this year just to keep tax levels flat, said Malloy.

Following that exchange came a comment from someone in the social services field, decrying budget cuts that are adversely affecting programs for people with mental illness.

“See what I mean?” Malloy asked his audience gathered at the Holiday Inn, New London for the Chamber of Commerce of Eastern Connecticut event.

That is the dilemma facing the governor and partially explains his dismal approval numbers. Push for service and labor cuts and anger one constituency, or boost taxes and spending and anger another.

It was heartening to hear the governor state how he views that difficult equation as he enters the last two years in his second and, likely, last term.

“We will continue to have to downsize government,” Malloy told the business gathering. “We have to realign our spending habits at the same time we address our long-term deficits to make sure that we live within our means.”

The words came from a Democratic governor, but those sentiments would be right at home in any fiscal conservative’s stump speech. A strong economic recovery requires a stable state budget.

As for the economy, the embattled governor told his audience he is trying. His administration has used state incentives to grow Connecticut’s bioscience field, launched a transportation renewal effort, supported the state’s defense industries, boosted tourism with aggressive marketing efforts, and better aligned community college and tech school curriculums with the job market.

Targeted investment combined with fiscal stability is the right formula to promote growth, if short-term political expediency does not get in the way.

“It’s about finding the right balance, not doing things overnight, because you can’t, but over time and having a goal in place,” Malloy said. “And I think the in the next five, 10 years, we are going to have a more robust economy.”

If indeed he chooses not to run again, Malloy may well find himself in a better a position to take the tough stances on spending necessary to sustain his long-term growth the goal. It may not help his approval numbers, but it could polish his legacy.