By Matthew J. Brouillette.
Four years ago, political newcomer Tom Wolf crisscrossed Pennsylvania in his trademark blue jeep, campaigning for governor on promises of “jobs that pay, schools that teach, and government that works.” Now, he’s back on the road, claiming the state is heading in the right direction and he wants four more years to keep it on track.
But there’s a big problem. Wolf’s GPS is set for Connecticut.
Thirty years ago, Connecticut was a destination state for entrepreneurs and investors. Today, Nutmeggers are charting a course away from the state to greener pastures.
What went wrong? In 1991, faced with a budget stalemate, lawmakers gave in to Gov. Lowell Weicker, Jr.’s demand to institute a state income tax. His promise? The added tax revenue would right Connecticut’s fiscal ship and be spent responsibly.
Of course, tax increases have an abysmal record of inspiring responsible spending. Instead, as the ensuing years would prove, Connecticut’s choice to raid working families’ budgets rather than exercise fiscal self-control inspired cycles of recurring budget deficits and additional major tax increases.
Today, Connecticut residents have the second-highest state and local tax burden in the nation, amounting to 12.6% of total collective income or nearly $8,000 per person, according to the non-partisan Tax Foundation. Far from celebrating their near-first-place ranking, Nutmeggers are fleeing the state.
From 1992 to 2016, Connecticut lost more than $16.3 billion in adjusted gross income from population outmigration to other states, as reported by HowMoneyWalks.com.
Tax increases alone aren’t to blame for Connecticut’s woes. Decades of government overpromising on public pensions have left the state with more than $37 billion in unfunded pensions liabilities—or more than $10,000 per state resident, according to a recent Wall Street Journal report.
Unfortunately, Gov. Wolf wants to hitch Pennsylvania to his jeep and take the Connecticut road to higher state spending and an onerous tax burden on working families. If imitation is flattery, Connecticut should be proud.
But Connecticut’s example is not the roadmap Pennsylvania should follow. Instead, it’s time for a U-turn in the governor’s office that programs the state GPS west, to Wisconsin.
Like Connecticut, the Badger State has had its share of tough times. In 2009 facing a budget shortfall of more than $6 billion, Gov. Jim Doyle (D) and the Democrat-controlled legislature passed a $2 billion tax-hike package. Not surprisingly, two years later when Gov. Scott Walker took office, the state’s finances were in disarray, with the budget shortfall standing at $3.6 billion.
But instead of following Connecticut’s path, Walker charted a new course. Under his leadership, the state cut billions of dollars in taxes, including income and property taxes.
Wisconsin’s Act 10 of 2011 reformed the state’s public sector collective bargaining process, required government workers to contribute to their health insurance and retirement savings (just as most private-sector employees do), and gave workers the choice of whether to join (and fund) a union. In the first five years of Act 10, the state saved more than $5 billion, or more than $900 for every Wisconsin resident, according to a study from the MacIver Institute. Wisconsin closed the 2016-17 fiscal year with a $579 million surplus, per the Wisconsin State Journal.
Unfortunately, since taking office, far from displaying leadership that benefits state taxpayers, Gov. Tom Wolf has failed to sign a single state budget. Instead, he’s let three budgets become law without his signature while triggering two budget impasses by refusing to consider budgets lacking his desired tax increases. He also spent hundreds of millions dollars above what the state legislature authorized and ran a $1.5 billion deficit last fiscal year.
Beyond this, he’s proposed or backed 11 tax increases, including introducing an astounding $4.6 billion tax increase in 2015. Pennsylvanians already bear the 15th-highest state and local tax burden in the nation, collectively amounting to more than $4,500 per person.
Additionally, in the face of a $53 billion unfunded pension liability, Wolf actually vetoed comprehensive pension reform in 2015—only to sign a scaled back version two years later under political pressure.
Wolf wants four more years, but voters should ask themselves, “Four more years of what?”
As much as Wolf may seek to make Pennsylvania’s gubernatorial election a referendum on the current presidential administration, November’s choice won’t be “Trump” vs. “not Trump.” It won’t even be Wolf vs. GOP nominee Scott Wagner. Instead, it will be Connecticut vs. Wisconsin. With Wolf’s roadmap, Pennsylvanians should make sure he doesn’t stay in the driver’s seat.
# # #
Matthew Brouillette is president and CEO of Commonwealth Partners Chamber of Entrepreneurs. For more information, visit www.thecommonwealthpartners.com.