A Disconnect in Planning Horizons
There is a real disconnect between the planning horizons of some policymakers and most businesspeople, to the extreme detriment of job creation.
Successful business leaders plan several years out. They have to.
Companies engaged in heavy R&D, exporting, bioscience, or the acquisition of expensive equipment or specialized facilities are looking out at least 20 years. Even smaller manufacturers and service firms are usually planning over a five-year horizon.
On the other hand, the political process can make long-term planning difficult and can lead to short-term thinking on budgets rather than structural solutions and significant changes that require some upfront investment.
The thinking becomes: Where is the revenue now?
For businesses, long-term investments are based on projections for a decade, two decades from now, and they take into account a whole host of factors.
These variables include taxes and other business costs, available workforce, and customer base.
Policymaking is an important part of the calculation: Are state and local governments working on easing or stabilizing the cost of doing business, or are they considering legislation that threatens to drive up those costs?
When policymakers succumb to expedience and kick the can down the road, business owners have to try to anticipate where and when that can will land. And what’s in it.
What our elected officials need to know is that decisions impacting their tax base for decades to come are being made today.
The message businesses are hearing right now does not encourage investment in Connecticut.
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