Dismiss the empty rhetoric, there is no easy fix to state's problems
In a campaign ad he has been running, Republican gubernatorial candidate Bob Stefanowski opens with the statement that, “Eight years of Malloy have devastated Connecticut’s economy.”
In the same ad, Stefanowski pledges to get Connecticut turned in the right direction by eliminating the estate tax and phasing out the income tax. And how will he eliminate all that revenue and balance a budget that confronts massive projected deficits?
By “slashing government waste,” of course. It is, says the commercial, “smart, conservative reform.”
It’s bogus, is what it is. Connecticut confronts a $2 billion deficit in the 2019-20 fiscal year, the first budget the next governor and legislature must deal with. The projected fiscal hole rises to $2.6 billion in 2020-21. It would be a monumental achievement to avoid a net tax increase, never mind cutting taxes. And there is not enough waste, not by a long shot, to close a funding gap that large.
It will take deep cuts and/or higher taxes, things candidates don’t like to talk about.
Stefanowski, who is trying to petition his way onto the primary ballot, skipped the first post-convention Republican gubernatorial debate last Monday. Participating were Danbury Mayor Mark Boughton, who received the convention nomination, former Trumbull First Selectman Tim Herbst, businessman Steve Obsitnik — they both qualified for the primary at the convention — and David Stemerman, another petitioning candidate.
Debate participants were united in their criticism of the current governor and in their unwillingness to get into budget-balancing specifics.
Gov. Dannel P. Malloy, though he is not seeking re-election, will be a constant target for state Republicans in the 2018 election, and with good reason. The incumbent’s approval rating is around 25 percent. His eight years in office have been marked by economic stagnation and perpetual budget crises.
Who wouldn’t want to be measured against that guy?
The reality, however, is that the devastation of Connecticut’s economy and, more particularly, its budget problems began long before Malloy. Prior Republican governors and Democratic legislatures did not fund state and teacher pensions or invest in infrastructure when they had the money to do so. Instead, these elected leaders grew the size of government, borrowed to pay for pork barrel projects, and avoided tax increases.
In large measure, they left Malloy holding the bag. But, hey, he wanted the job. And if you think his administration oversaw some vast expansion of government, leaving plenty of waste to cut, you’re wrong.
When Malloy took office, 29,576 full-time employees worked in the executive branch. Today that number is 25,667, a 13.2 percent reduction. After peaking at 10 employees per 100,000 residents in 1987-88, state government per capita is now at its lowest point since 1960 — with 7.2 employees per 100,000 residents.
Despite these deep labor cuts, Connecticut is fiscally struggling because of its debt service requirements and the past failure to set aside money to meet contractual state employee and teacher pension obligations. In the first budget signed by Malloy, debt service and pension payments accounted for 18 percent of general fund appropriations. In the latest budget Malloy signed, these obligations account for one-quarter of appropriations.
The first budget Malloy signed was $20.1 billion, the last $20.9 billion, hardly explosive government growth over an eight-year period.
Granted, the figures look better because of a change in the way Connecticut accounts for federal Medicaid funds passing through the budget. Still, even considering that change, average annual expenditure growth during the Malloy years has been only 2.3 percent. During the administration of Gov. John G. Rowland the annual expenditures grew at an average of 5 percent — including a shocking 9.3 percent in 2000-2001 — and 4.3 percent during the administration of Gov. M. Jodi Rell, both Republicans.
And the state wasn’t funding its pensions.
During Rell’s last year, the Democratic legislature borrowed $923.8 million just to keep the state operating, an obligation, paid off during the Malloy administration, which cost the state $1.1 billion with interest.
Presenting these facts is not meant to relieve Malloy and the Democratic legislatures he worked with of blame for failing to fix things. Rather, it is meant to suggest that the Republican candidates are not being candid when they say they can get the job done without inflicting some serious pain on someone. It seems equally unlikely the endorsed Democratic candidate, Ned Lamont, can avoid seeking more labor concessions, which he has promised.
Perhaps if the candidates were more honest about the challenge the next governor faces, fewer of them would be running.
Paul Choiniere is the editorial page editor.