Connecticut Resistance

Connecticut State Budget
Connecticut is in huge financial trouble. As usual, both parties have withheld the whole story.
The first thing is we have a huge spending problem. No surprise here. This state is run by leftists who have no concept what free markets are like. The Republicans have been the party of caving in for years. Governor Rell is a politician, not a leader. She has repeatedly shown she will not make tough decisions.
Current Budget Situation
In 2007, CT had almost $1 billion in surplus. Governor Rell decided that since the cash flow was good, she would increase the income tax and spend away. The Republicans in the Assembly eventually got the budget down to only spending the surplus (which was in fact a tax increase). The GOP touted this as a victory. In reality, it was punting the problem a few years down. The losers again were the productive taxpayers of Connecticut.
The Connecticut budget has been a redistribution scheme that would make Karl Marx proud. The Democrats have run the Assembly for 36 out 0f 40 years. Republicans won the Senate in 1984 and 1994. In 1991, CT implemented the state income tax. Since then, the wealthy and affluent have been subsidizing the inner cities. Hartford, New Haven, and Bridgeport get over 28% of the State Aid, pay about 3% of the income tax bill, and are about 12% of the population.
The income tax has been over 40% of the entire state tax revenue. Of this, about the same 40% comes from Fairfield County. With Obama’s war on capitalism, companies in New York City, who a lot of their employees live in Fairfield County, that money will be significantly less.
The other problem for Connecticut is the lack of sufficient private sector. CT is the only state with net private sector job loss over the past 20 years (though this may change). CT is consistently voted one of the worst states to do business in.
To make matters worse, State Senator Toni Harp, co-chair of the Appropriations Committee stated publicly that “it is a fallacy that Connecticut is overtaxed.” This is the co-chair of the committee where spending comes from. I can honestly say the Democrats who run this state are oblivious to how the world works.
With a dwindling private sector, a huge constituency that feeds off the system and manipulates it for personal gain, and a cash cow that that is not, Connecticut has a problem.

FY 2009 ($ Billion) FY 2010 FY 2011 FY 2012
Revenue $15.375 $14.430 $14.853 $15.762
Spending $16.980 $18.539 $19.520 $20.500
Deficit ($1.605) ($4.109) ($4.667) ($4.738)
% of Budget 9% 22% 24% 23%

FY 2009 Budget
The Republicans in the Assembly have once again come out with their own budget proposal. It is once again the cream of the crap. It is a balanced budget, but at what cost? The answer is more borrowing, taking federal stimulus money (and the strings attached which will certainly cost more in the long run), and once again spending more than the state takes in. Remember, this is the best plan.
The Republicans will cry how afoul the state budget is. Just remember, two years ago, every single one voted for the compromise budget that spent the surplus, with one exception, State Senator Sam Caligiuri.
In order to balance the budget, the Republicans propose using a portion of the rainy day fund, in addition to federal money. Take these two out of the equation because they are onetime items and I suspect we are near the $4 billion in the hole that is expected for the 2010-2012.
Compounding the problem, Governor Rell cut a deal with the state employee unions to where there will be no layoffs. This will make this all but impossible to cut the needed spending. If CT fired every state employee, their salary savings would not cover the deficit. We spend just under $3.2 billion a year on salaries. Include benefits and pensions and you get closer.
Since the Democrat controlled legislature cannot balance a budget without borrowing and CT spends 10.7% of its budget on debt service, when will we not be able to borrow anymore? Then what? That is the real key issue. This issue is coming. The economy will not rebound anytime soon. Everything done at the federal and state level will only compound problems.