🔒Democrat Malloy plays the role of conservative governor

Gov. Dannel P. Malloy, Connecticut's leading Democrat, is sounding more like a Republican these days.

In the weeks leading up to the release of his much-anticipated two-year budget, the progressive Democrat has advocated for spending reductions, a tax break for insurers and fewer mandates on cities and towns. He's also criticized members of his own party for lobbying for higher taxes on hedge funds.

In a vacuum, it might seem as if Malloy has been brainwashed by the state's increasingly powerful GOP, which has been highly critical for years of the policies backed by the governor and Democratic majorities in the House and Senate.

That, of course, is not the case. Malloy, however, continues to come to grips with the state's new economic reality, in which rising long-term debts and lackluster economic growth have mired Connecticut in a vicious cycle of budget deficits with no end in sight — even after legislators approved two of the largest tax increases in state history since 2011.

Malloy's recent policy stances indicate that he realizes economic growth — not further tax hikes — is the only way Connecticut can reverse course. We fully support that point of view. It's a theme we have been pushing for years.

Connecticut's business climate — fairly or unfairly, depending on to whom you talk — has come under intense criticism in recent years by Republicans, business leaders, economists and others, who have said the state's slow recovery from the Great Recession is a direct result of the high costs of doing business and overzealous regulations.

Others have blamed Connecticut's poor economic performance (the state shed 2,000 jobs in 2016 and has failed to recover all the jobs lost during the Great Recession) on a lack of investment in transportation infrastructure, IT and workforce development, among other areas.

All of those factors have certainly played a role in Connecticut's lackluster growth. Combine that with the state's overspending and a long-term debt crisis caused by decades of irresponsible fiscal stewardship, and you see why Connecticut faces billion-dollar deficits in the years ahead.

Malloy has little choice but to take a more conservative approach with the state budget.

The stakes couldn't be higher. Employers from across the state will be watching closely as Malloy unveils his spending plan Feb. 8. They want to see a commitment to improve the business climate, meaning no more tax increases or new regulations.

The state already received a major black eye in 2016 when General Electric announced it was moving its corporate headquarters to Boston. Now Hartford health insurer Aetna, one of the region's and state's largest employers, is quietly considering its own move to the Bay State.

Connecticut can no longer afford more of the same. Early indications are that Malloy understands this fact. He has slowly unveiled parts of his budget we find attractive.

That includes a proposal to reduce the state's insurance-premium tax rate from 1.75 percent to 1.5 percent. He also wants to ease municipal mandates by tightening wage standards on construction projects, eliminating the controversial local spending cap and changing binding arbitration rules, among other proposals.

He also lashed out against fellow Democrats for proposing a new tax on hedge funds that would raise more than $500 million in new revenues.

Many questions still remain, however, on how Malloy plans to close $1.5 billion budget gaps.

We hope the rest of his budget follows the conservative tone he has set so far, but the devil will be in the details.