Tax, Spending Hikes: What the Papers Say

Editorial writers at Connecticut’s daily newspapers are almost universal in their criticism of budget proposals to hike taxes and government spending. Here’s a sampling:
Malloy Should Make It Clear Big Tax Hike Is Unacceptable (New London Day)

Rather than try to control the growth of government, the Democratic leadership in the state General Assembly backs a plan that would increase tax collections over the next two years by $1.9 billion. The total is $2.4 billion if you count the cancellation or delaying of $500 million in tax reductions that were supposed to begin over the next two years.

Senate President Pro Tem Martin M. Looney tried to spin the plan as a way to “make our tax system more progressive.” House Speaker Brendan Sharkey claimed, “The revenue portion (i.e. taxes) of this budget protects hard-working, middle-class families … and asks the rich to pay a little bit more.” However, the bottom line is that a tax hike of that size will hurt family budgets, businesses and the economy.

Though some predict a coming job expansion, economic growth has so far remained slow, and so too the resulting growth in tax revenues. Piling on more tax increases now would prove self-defeating by inhibiting business and job expansion and depressing consumer spending. This is not the path to rebuilding a healthy Connecticut economy and making the state more competitive. Instead, such an approach augments Connecticut’s reputation as unfriendly to business.

The better choice is to enact a budget that lives within the revenues the economy now generates under current tax law.

Try Again: It’s a Bad Time to Raise Taxes (Hartford Courant)

After lagging in the Great Recession, Connecticut’s economy began to register a pulse in 2014, adding more than 25,000 jobs, the best job growth since 1998. Bioscience, aerospace and other sectors were gaining traction. But the job total is still slightly below 2008 levels; the recovery is fragile and in need of nurture.

In short, it is not a good time for a big tax increase. But that is the plan.

…Legislative leaders have got to sharpen the pencil. This is a bad time for a major tax hike. The solons should ask for help from state workers. They must pick off whatever low-hanging fruit is still on the tree, such as the nearly $2 million the state spends to run the fire department at the Southbury Training School for 305 residents.

Budget negotiations will continue over the next month, and must gain final approval from both houses and Gov. Dannel P. Malloy. Hopefully the budget that emerges will take care of those in need and enable economic growth. That is the ladder out of the hole.
Worse Than Illinois (Wall Street Journal)
The Census Bureau says Connecticut was one of six states that lost population in fiscal 2013-2014, and a Gallup poll in the second half of 2013 found that about half of Nutmeg Staters would migrate if they could.

Now the Democrats who run the state want to drive the other half out too.

That’s the best way to explain the frenzy to raise taxes again and blow through a state constitutional spending cap. They’ve been negotiating behind closed-doors over the details of a two-year $40 billion budget that could be revealed this weekend, but it’s already clear that Connecticut residents will pay big time.

…The state economy isn’t growing. According to the federal Bureau of Economic Analysis, the state grew a scant 0.9% in 2013, the last year state data are available. That was tied for tenth worst in the U.S. The state’s average compounded annual growth for the last four years is 0.42%.

Slow growth means less tax revenue but spending never slows down. 

Budgets Are Easy When Rules Aren’t Followed (Norwich Bulletin)
What a wonderful world this would be if all budgets were constructed the same way Connecticut’s latest state budget is being proposed. Can’t afford a new deck for your home? Remove your mortgage costs from your budget, and now that deck is possible. Put the mortgage on the credit card. Someone will pay it later.
The state spending cap was put in in 1991 when the state sales tax was added, in a bid – which now appears to be futile – to limit state spending.
…It’s a serious blow to taxpayers and the state’s credibility. If the rules are able to be changed at will, there are no rules. Eventually, elected leaders are going to have to stop pushing responsibility beyond the next election.
But not this year. Accountability, apparently, is the biggest casualty of this budget season.
A Taxing Challenge (The Bristol Press)
Raising taxes in an economy that is still struggling to become competitive will hurt state businesses and, by extension, their employees, as well as the cities and towns that host them.
…Bottom line: rather than taxing businesses and cutting programs that further the goal of a vibrant, economically strong Connecticut, we should be investing in them and in our people.
In a difficult budget year, we’re asking our leaders to make tough decisions, but with an eye to making our state stronger. If they do, those decisions will get easier in the future.
Getting Most; Giving Least (Waterbury Republican-American)
As the legislative session winds down — it concludes June 3 — private-sector employers and employees should speak out vigorously against Gov. Malloy and legislative Democrats. If the governor and Democratic lawmakers get their preferred budgets, Connecticut will remain a tough place for business, and the state’s economic woes will continue.