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What’s the matter with Connecticut?

PETER O’CONNOR
Staff Columnist
oconnor@lbknews.com

A piece in the weekend EWSJ is of interest – to this ex Connecticut resident anyway.  I grew up in New York, with relatives in Connecticut.

I served at the Submarine Base in Groton and for the rest of my Naval career was a Connecticut resident even while serving afar.  When I retired from the Navy (in 1978) I actually turned in my Blue license plates and moved officially to Massachusetts (bucking  the trend described here).

(Wall Street Journal, Saturday / Sunday, April 8 – 9, 2017)

“Connecticut’s progressive tax experiment has hit a wall.  Tens of thousands of residents are fleeing for lower tax  climes, which has prompted Democrats to propose  -  get this paying new college grads a thousand bucks to stick around.  Maybe they’re afraid an exodus of young people will turn the state Republican.”

“The Journal continues editorially:  Hard to believe, but a mere 25 years ago  -  a lifetime for millennials  -  Connecticut was a low-tax haven for Northeasterners.  The state enacted  an income tax in 1991 (I had already fled to Massachusetts and then Florida.)  that was initially a flat 4.5% but was later made steeply progressive.  In 2009 Republican Gov.J Jodi Rell raised the top rate on individuals earning  $500,000 or more to 6.5% which Democratic Gov. Dannel Malloy has lifted to 6.99%.

Connecticut’s top tax rate rate is now higher than the 5.1% flat rate in the state formerly known as as Taxachusetts.  In 2012  the Tax Foundation ranked Connecticut’s state  and local tax burden second highest in the country behind New York.  Due to recent property and income tax hikes, the Nutmeg State may now be in the lead.  A net 30,000 residents moved to other states last year.  In the last five years 27,400 Connecticut residents have moved to Florida.  Florida Governor Rick Scott should pay Mr. Malloy a broker’s fee.

More than 3,000 Connecticut residents have moved to rero income tax New Hampshire in the last two years

After losing General Electric to Boston last year, (That’s in Massachusetts remember.)  Mr Malloy bribed the hedge funds Bridgewater and AQR Capital with $57 million in taxpayer subsidies not to leave the state.  Other beneficiaries of the Governor’s corporate  welfare include Cigna, NBC Sports, ESPN and Charter Communications.”

More from the WSJ (a bit acid but maybe accurate)”  Democratic legislators have now taken the subsidy idea one step further by proposing a tax credit averaging $1,200 for grads of Connecticut  colleges who live in the state as well as those of out-of-state schools

Who move to the state within two years of earning their degree.  Democrats say the tax credit would cost the state $6million  each year assuming only 10% of eligible grads sign on.

Yet the main reason young people are escaping is the lack of job opportunities.  Since 2010 employment in Connecticut has grown at half the rate of Massachusetts and more slowly than in  Rhode Island, New Jersey or Kansas.

(I recall that as a younger lad during two tours of duty in Connecticut – we had almost vibrant industrial activities in the State.  Submarines were built here, also were helicopters young tradesmen were trained in solid tradesmen programs, naval personnel were trained here in several specialties.  We traded these activities for gambling and entertainment, sad)

The Journal piece finishes:  “Meanwhile, Democrats are wrangling with a projected $1.7 billion budget deficit next year because tax revenues keep trailing projections. The state’s teacher pension bill is projected to grow by a third over the next two years, and some Democrats want to impose a 19% tax on hedge funds’ carried interest.

Certainly, Something is the matter with Connecticut.

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