Oh, to have been a fly on the wall.
Gov. M. Jodi Rell told capitol reporters last week about a meeting she’d had with Louis Chenevert, CEO of United Technologies Corp.
There are never threats in such polite conversations but, between the lines, the captain of a Fortune 100 company was clearly delivering a sharp message to the state’s top executive: The cost of doing business in this state is too high and, unless something is done, expect UTC to move work elsewhere.
As Rell recounted the conversation, Chenevert spoke of pressure to cut costs in connection with securing federal contracts. For example, he told Rell, UTC was pointedly reminded that it could cut costs by manufacturing engines in Georgia rather than in Connecticut.
It’s a familiar refrain from businesses of all sizes, Rell reminded her listeners. And she did the right thing in reminding Chenevert that the quality of life here in Connecticut is worth a little extra and helps in retaining top talent.
Then she dropped the magic phrase to categorize his thinking: “anywhere but Connecticut.”
It’s an echo of a rallying cry voiced by tech companies fleeing high costs in California a decade ago. That state didn’t listen and look where it is today.
Even the superhero-turned-governor, Arnold Schwarzenegger, can’t save the Golden State from a budget meltdown that’s approaching bankruptcy, both for the state and its municipalities. Today, there are precious few silicon chips made in California, those new fabs having been built in Ireland and Israel, New Mexico and even Old Mexico. Anywhere but California. And the high paying jobs are gone too, never to return.
If Connecticut continues to turn a deaf ear to the Cheneverts of the world, there’s every reason to believe high-paying jobs will continue to flow out of state. In this global economy, it’s just too easy for work to flow to the places where costs are low.
Certainly, the sour economy has left legislators in a tough predicament. The budget hole is all too real. Yet it’s a hole largely of the legislature’s own making. The business climate of Connecticut has been a concern for years, through good times and bad. And taking a short-sighted view in the face of budget problems is a recipe for long-term disaster.
As the legislators ponder such ideas as a hotel tax, a “unitary” business levy and variable local-option sales tax schemes, the big picture should be top-of-mind. A healthy economy with lots of tax-paying workers and profitable corporations will do more to provide cash for the engines of government than nickel-and-dime fixes.
Think jobs, not job killers. Focus on ways to stimulate the economy, to encourage investment, to aid struggling sectors, to boost retail sales.
Rell said she’s eager to arrange a meeting between Chenevert and state leaders, although acknowledging similar meetings in the past haven’t been all that productive. This time legislators and bureaucrats need to pay attention.
Chenevert is doing the state a favor in providing sage counsel. Only the road he advocates leads toward changing that “anywhere but Connecticut” thinking before it sucks us all into an economic black hole.
