No matter who is governor of Connecticut, the problem of projected state budget deficits likely will never be addressed in the long term. This problem is mainly an institutional one because a governor has more to gain politically by using budget gimmicks to address short-term deficits than by making the tough decisions that are necessary to address the problem in the long term.
Part of the problem is the fact that governors make certain campaign promises to get elected, which often tie their hands in any efforts to meaningfully address major budget issues.
When Gov. Dannel P. Malloy, a Democrat, ran for governor in 2010, he would often criticize his predecessor, Republican Gov. M. Jodi Rell, for agreeing to use budget gimmicks to take care of projected deficits. However, when Gov. Malloy faced a projected deficit earlier this year, he agreed to use some of the same budget gimmicks that he criticized his predecessor for using.
Last month, Gov. Malloy’s budget staff reported that the state faces a $100 million deficit in the current fiscal year and a $1.3 billion deficit in the next fiscal year. It is likely that the Governor will use similar gimmicks to address this large deficit.
Throughout this year’s gubernatorial campaign, Gov. Malloy kept insisting that there was not going to be a deficit for the current fiscal year. At one point, he even projected that the state would have a surplus for the current fiscal year. Less than a week after winning the election, Gov. Malloy’s budget staff announced that the state actually faces a deficit of $100 million for the current fiscal year.
If the timing for this announcement seems awfully convenient, there is a reason why. In 2012, the Democrat-controlled General Assembly passed a bill that pushed the due date for consensus revenue estimates from Oct. 15 to Nov. 10, which conveniently falls after Election Day.
Although the budget is typically proposed by the governor’s administration and ultimately changed and approved by the General Assembly, most of the blame for any issues, such as a deficit, is placed on the governor because he or she is the one official who represents the entire state. The General Assembly is made up of 187 members, who each represent a different portion of the state, so it is easy to pass the blame around.
In order to fix the problem of future deficits in the long term, Connecticut needs leaders with the political courage to fix the state’s fundamental budgetary issues without worrying about the political consequences. We need leaders like Rhode Island’s Governor-elect Gina Raimondo, a Democrat, who made tough but necessary choices during her tenure as state treasurer. In 2011, as treasurer, she proposed to the state legislature a sweeping pension reform plan that would raise the retirement age and put a freeze on cost-of-living adjustments until the health of the fund improved. The Rhode Island legislature implemented her plan, saving the state an estimated $4 billion.
Raimondo faced stiff criticism from public employee unions, who claimed that workers who had paid into the system for years would not receive the retirement they expected. She said she did not make her decision on an ideological basis, but rather realized that the pension system for public employees was simply unsustainable in the current economic climate. This type of change will not be easy to accomplish in Connecticut, where even Republican gubernatorial candidate Tom Foley tried to pander to public employees, promising not to institute layoffs.
In order to accomplish the real change that is needed to effectively tackle the deficit, tough decisions are going to need to be made. These decisions likely will upset a major block of voters, but are going to be necessary to guarantee the fiscal health of the state. The crop of candidates in the recent election definitely did not seem to be up to the challenge. The only thing we can do is hope for a better choice of candidates in the next statewide election.
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