Diagnosis: State Finances Holding Back Economy
How can Connecticut get out of the constant fixing-the-budget mode and back into a driving-our-economy mode?
As the debate over the budget played out at the Capitol, the state received a diagnostic report on the health of Connecticut’s economy that caused fresh waves of concern.
As have many national studies and rankings (CNBC, Forbes, et. al.), the report specifically pointed out how the state’s uncertain fiscal condition is “feeding the perception of a “negative business climate” in Connecticut.
Yes, said the report, Connecticut has some powerful advantages.
While the Great Recession threw the state’s economy off-kilter, Connecticut is still among the nation’s leading states in gross domestic product, worker productivity, and household income.
But we’re also facing some major tectonic changes in the U.S. and world.
Our progress has slowed—and in some cases deteriorated—in some of our traditional areas of strength.
Competitor states, particularly our neighbors in the Northeast, have caught up or are catching up to us.
Connecticut is adding low-income jobs rather than higher-paying financial services and manufacturing jobs.
And more young and educated people are leaving the state, putting our hallmark highly skilled workforce at risk.
Underpinning everything is the state’s shaky fiscal foundation.
Right now, our fiscal condition, and economy, are a little weak. (This week, another report ranked Connecticut’s economic outlook at #47 in the nation.)
So first things first is getting Connecticut’s fiscal house in order.
That’s the toehold from which Connecticut’s economy can stop the decline and get back on track.
People and businesses need the confidence that this is the state in which they can put down stakes and build a future.
Right now, Connecticut state lawmakers can make the first move to rebuilding business and economic confidence by approving a plan to solve the immediate $930 million budget gap—ideally, with a plan that also gets things started on the next, $2.1 billion deficit.
There’s no time to waste—the end of this fiscal year is rapidly approaching.
It’s time to act; time to fix our finances and fix our economy.
The diagnostic report was a little painful, but offers hope for Connecticut’s people and future.
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