A few days ago Governor Malloy unveiled his budget. Reaction has been mixed. At the heart of his plan are two separate proposals: $1.8 billion in new revenue and $2 billion in concessions from state employees. The budget also includes $758 million in spending reductions.
One good thing Gov. Malloy is doing is plugging the exemptions for various special interests in the state sales tax. These “tax expenditures” unfairly subsidize specific products and industries that were lucky enough to have lobbyists fight for them.
Criticisms largely stem from individuals that believe there should be greater revenue increases or greater spending cuts. Gov. Malloy has struck a careful balance by increasing tax rates to be comparable but competitive with neighboring states. Following the suggestion of Jon Olson and others advocating for tax increases may cause the rich to flee the state. This contention is supported by a report from Boston College’s Center on Wealth and Philanthropy. A report from Princeton suggests that the impact of new taxation on migration is negligible. Taxes and money are not the only factor that individuals consider when choosing a place to live but it is reasonable to presume we are competing for individuals in the tri-state area that work in New York City. Rational rich people will choose the locale with the lower taxes and absent conclusive data it is better to be safe than sorry.
Rep. Cafero and other Republicans have criticized the budget for not cutting spending enough. The CT Mirror explains that this is due the structure of Gov. Malloy’s budget cuts:
The biggest cut in the Malloy budget technically involves a "lapse" or relatively undefined savings still to be achieved. The governor announced this week that it would come from state employee wage and benefit concessions as well as other savings tied to rank-and-file labor and management.
The Mirror article does a great job articulating the hurdles faced by the administration in obtaining these concessions and suggests that they may not get it all.
Overall the Malloy budget is a good one but it is not the final budget. We will likely see tweaks especially to deal with an inability to obtain the entire $2 billion in concessions from the unions. Connecticut already runs a fairly lean governmental operation and there is little room to make major structural changes without impacting a safety net or causing local property taxes to rise.
An interesting article and perspective on Citizens’ United from the New York Timesâ€¦
In the year since the Supreme Court handed down its 183-page decision in Citizens United, the liberal objection to it has gradually boiled down to a single sentence: The majority was wrong to grant First Amendment rights to corporations.
via Campaign Finance Debate Continues After Citizens United - NYTimes.com.
I won a gift certificate to one of the local gyms at our law school’s annual Public Interest Law Group auction last November. In college I enjoyed going to the gym on a daily basis but stopped after I moved home. I finally turned in the gift certificate over my winter break and started going. Working out is relaxing but can also get boring so I have been bringing my iPod and exploring podcasts. My current favorite is MSNBC’s Morning Joe. I have a love-hate relationship with news programming and usually prefer reading my news but Mika and Joe do a great job of summarizing the stories of the day and providing witty banter.
Splashed over CT Capitol Report is a headline about the salaries being paid by the Malloy administration to its employees. They link to an article at the conservative Yankee Institute that analyzes the cost of the pension increases for these employees.
However that analysis is misleading. It fails to consider the following:
- The pension system was in place before the Malloy administration came into power. You cannot blame him for the actions of previous administrations.
- The cost of increased pensions must be viewed as an opportunity cost. The legislators were getting pensions anyways. The only way to minimize the pensions under the formula would be to limit the hiring pool to individuals outside state government. Otherwise any person who has served the state for the same number of years would get a similar pension bump . The cost is unavoidable unless the salaries are lowered, or we restrict hires from working in state government after they work in the administration.
- Can the salaries be justified? Are they appropriate for the level of responsibility and work given to the employees, and are they in sync with similar positions and responsibilities elsewhere?
- Many of these legislators took a risk by leaving safe seats to serve in administration jobs that might not be theirs in four years.
It appears the Yankee Institute is happy to grab headlines without considering all angles of the issues it analyzes.
I know people typically post articles and their own analysis but today I have a question to pose to the community. I am working with my town committee to reach out to people in town that may be wandering the internets. We setup a facebook page and we have a website. However these things should not exist in a vacuum. We’re doing this with the goal of getting people involved. We want more members that will participate and we want people that might consider serving as a commissioner or candidate.
What do you think we should be doing to reach out? Where are Connecticut townspeople hanging out online?