The more Dannel Malloy and Catherine Smith sing about how far the state’s economy has come on their watch, the more it sounds like a tired tune from ‘Annie.’
Those pesky independent facts just keep pointing out that while the sun will come up tomorrow, there are storm clouds on the horizon.
Consumer confidence is up nationally and Connecticut’s unemployment numbers are falling faster than the national average. That’s all good, but how much credit Team Malloy really deserves seems less clear.
Job creation here isn’t enough to produce the vibrant economy Malloy and Smith see through their rose-colored glasses. And Team Malloy didn’t take well to the Connecticut Center for Economic Analysis pointing out that fact in a recent report. The economists from UConn called the investment in a bioscience cluster and the series of programs that seem to be tossing grants and loans at random small businesses “a good beginning.” And we agree.
But what really chaffed Team Malloy was the analysis stoked the simmering coals of Fred Carstensen’s long-standing suggestion (see our front page April 10, 2010) that unleashing stranded research and development tax credits would revitalize the economy. That’s a conversation Team Malloy just doesn’t want to have right now. Faced with a widening budget crater, cutting the state’s flow of tax revenues is a nonstarter, even if there’s a good case it will help the economy longer term.
That’s the same shortsighted logic that is producing a loud whine from the truckers over a July 1 increase in the state tax on diesel fuel. Recall that grandstanding legislators stroked consumers by passing a bill short-circuiting a planned July 1 gasoline tax hike. Truckers got no such break.
As things stand today, truckers will be looking at another five-cents-per-gallon bump July 1. That’s on top of a pair of three-cent hikes over the past 12 months. State budget guru Ben Barnes responded that prices at the pump are falling. While true enough, that only masks the real problem — Connecticut is charging the highest diesel tax in the region. At a state levy of 51.2 cents a gallon, come July 1 Connecticut will be a dime a gallon higher than New York, 20 cents a gallon higher than Rhode Island and 27½ cents higher than Massachusetts. That’s not competitive and that policy is going to come back to bite Connecticut.
The financial margins of most trucking outfits are thin at best. The choice may come down to fuel up on the borders or just skip Connecticut, a classic lose/lose scenario.
Truckers are begging for relief from the special session. They deserve it, just as corporations deserve to be able to use tax credits they earned in good faith. But neither group is likely to get relief anytime soon.
And therein lies the sad truth. Much as Malloy and Smith sing a great duet about how much better the economic climate has gotten, they still haven’t convinced the legislature to take the steps necessary to really make Connecticut ‘open for business.’
Some of the problem lies in the budget. It’s hard to fund programs when there’s no cash. Some is the inability to shift the legislature’s priorities from grand political gestures to substantive changes that will pay dividends over the long haul. Despite Malloy’s repeated statements that creating jobs is the top priority every day, the legislature just doesn’t have that same priority. Malloy has had no luck getting them to focus on the economy for more than 30 days last fall.
But without that kind of almost religious conversion, Malloy and Smith will continue to howl at the moon. And Connecticut won’t get any closer to being ‘open for business.’
