Lamont Goes After Stefanowski’s Tax Proposal

HARTFORD, CT — The Democratic Party and its gubernatorial nominee, Ned Lamont, were in attack mode Tuesday. A week after the election they were anxious to get into a pitched battle over the state’s economy and taxes with Bob Stefanowski, the Republican Party’s nominee.

Lamont penned an editorial titled: “Why Bob Stefanowski’s Plan is Radical and Wrong.”

Lamont pointed out that the economist who Stefanowski paid to write his plan to eliminate Connecticut’s state income tax over the next eight years is the same economist who advised Kansas Gov. Sam Brownback.

In Kansas, the extreme tax cutting measures recommended by the economist — Arthur Laffer — and carried out by Brownback beginning in 2013 led to deficits, which were followed by an emergency tax increase to restore funding.

In December 2017, when Laffer came to Hartford to help Stefanowski promote his plan, he said Brownback cut more than he recommended too quickly.

The spending reductions Kansas made to pay for the tax cuts led a Kansas judge to order the legislature to boost school funding by $64 million and put $350 million in the rainy day fund, but “all of that notwithstanding Kansas still did fairly well. It didn’t do great that’s for sure,” Laffer said in December.

Laffer said the falling agricultural and oil prices impacted that state’s economy.

Laffer said Brownback proposed a $90 million tax cut from a $5 billion budget and the Republican-controlled legislature sent him a budget that cut $290 million and essentially dared him to sign it, and he did.

“It was a much different bill than Sam had done,” Laffer insisted.

But even three of Stefanowski’s Republican opponents in the primary called his proposal unrealistic.

David Stemerman, the former hedge fund founder from Greenwich, said the idea that Connecticut is going to eliminate the income tax is a “fantasy.”

In his editorial on the blogging platform Medium, Lamont said, “Tax cuts don’t pay for themselves, and politicians who say they do aren’t telling you the truth.”

The Connecticut Democratic Party then proceeded to send six emails throughout the day from local elected officials and a teacher explaining what would happen if the income tax, which accounts for 51 percent of the revenue for the state budget, is eliminated.

Hartford Mayor Luke Bronin said if Stefanowski succeeds in eliminating the income tax, “forget about vibrant communities, modern infrastructure, or strong schools, Stefanowski would decimate school funding, let roads and bridges decay, cripple services for seniors and the most vulnerable — and still leave Connecticut with a fiscal crisis.”

Angie Parkinson, a teacher, said Stefanowski’s plan is “code for one thing: decimating education funding. While leaving a giant hole in our state’s budget, Bob’s irresponsible economic plan will come at a huge cost to our students and teachers.”

The parade of awful things that would follow included an increase in property taxes, a decrease in state support for local schools, and layoffs of state police troopers and public college professors.

Stefanowski has declined to say where he would cut spending in order to pay for the elimination of the income tax, which has opened the door for his Democratic opponent to fill in the blank. He’s only said he would “rip” the costs out of the state budget and promote a practice called “zero-based budgeting” for state agencies.

Patrick Trueman, Stefanowski’s campaign manager, said that it takes “serious chutzpah to attack Bob’s plan to lower taxes and bring jobs back the same day another business announces plans to flee Connecticut.”

Trueman was referring to Edible Arrangements, a Wallingford-based company, which just got a new CEO last month who lives in Atlanta. In a press release the company announced it would keep 20 employees in Connecticut, and move the rest of the operation to Georgia.

Republican Party Chairman JR Romano said that at the end of the day the Democratic Party can’t be taken seriously.

“Democrats have no solution other than to raise your taxes,” Romano said. “If the average voter wants to see businesses flee and taxes rise then they should vote for Ned Lamont.”

Stefanowski will be limited in his ability to cut spending to pay for any tax cuts.

Since about 40 percent of the state budget is personnel costs and the current labor agreement won’t allow him to lay off any state employees in the first year, he’ll have to turn to the remaining portion of the budget, which also doesn’t allow for obvious answers.

Another 40 percent of the budget is debt service, Medicaid (a federal, state partnership), and municipal aid, including education funding. About three percent goes to public colleges and 13 percent goes to community-based social services.

Tuesday was the first time Stefanowski was able to meet with Romano and all the other Republican candidates for state office to discuss a strategy for November. His campaign has been a little slower in transitioning from the primary to the general election.

Lamont easily defeated Bridgeport Mayor Joe Ganim last week and has been actively holding press conferences and campaigning. Lamont has been focused on November for months.

Below is the December 2017 press conference Stefanowski held with Laffer at the Society Room in Hartford.