Well, the other shoe has finally dropped. It’ll be a miracle if the state can ever claw itself out of this hole.
Our politicians’ penchant for spending paired with their inability to balance a budget has passed the point of no return. What I mean is, our state is now technically toxic to investors.
So, Wall Street is now offering commentary on our sad state of affairs. A not-so-nice memo is out from Moody’s Investors Service, which is basically warning its investors to stay away. A death knell? Well, maybe.
Hate to be the bearer of bad news, but the unbelievably awful budget cycles are pretty much here to stay. And it’s all thanks to our weak economy and rising retirement costs. Kinda. So, no, shifting those costs to individual municipalities are pretty much only going to exacerbate the problem on a local level.
Think about it, what options do our municipalities have now that the government is tacking a portion of pension costs onto them? Yeah, they’re talking restructuring and layoffs. Which means that the state is going to lose even more jobs.
That, along with more people, since that will also cause municipalities to raise taxes to cover those unprecedented costs.
All because our politicians couldn’t keep their sticky fingers out of the pension fund to begin with. Yeah, it wasn’t their money to take and, yet…
So, yeah, makes total sense. For years, the government raided funds it shouldn’t have had access to and is now making the little people pay for it. Nice.
Anyways, back to Wall Street.
Marcia Van Wagner, a vice president and senior credit officer at Moody’s, said CT’s future is pretty bleak:
“Connecticut’s fixed costs command roughly 30 percent of the state’s $18.9 billion non-federal governmental revenues (next fiscal year,) which is the highest percentage of all 50 states.”
To put it simply: our state’s general fund is getting annihilated. Our state’s sluggish economy and dwindling jobs isn’t doing that any favors, either. Plus, state income levels have stagnated, so there’s also that.
Moody’s also made note that our state has some of the “most poorly funded public-sector pension and retiree health care programs in the nation.”
So, that explains why people are fleeing the state in droves. Also, our birthrate is at a historic low. So, it means that these funds will continue to dry up as we continually lose our future taxpayers.
Also, Connecticut has lost people every year since 2013. It’s a goal only three other states have achieved, too. Who wants to bet CT goes 5 for 5 this year?
Pretty much the only thing we have going for us is our “wealth.” Meaning, our reputation that only rich people live in Connecticut is somehow a silver lining. Yeah, Moody’s even called it a “paramount credit strength.”
Yeah, and what will happen when they all leave, too? Because they are.
Moody’s said that we’ll be dealing with horrible budgets for years. So, no matter who replaces Malloy, we’re going to be dealing with the damage of his administration for a good long time.
So, It looks like it’s only going to get worse from here on out unless our politicians pull their heads out of the sand and get their act together. Which means putting an end to enacting new taxes that they can raid for their pet projects.
You know, actually represent the people instead of themselves, right? Hey, it’s you guys who keep voting them in. Now, we have to deal with the consequences.
Also, here’s some advice for you if you are planning on leaving the state. Don’t vote the same type of people into office wherever you move to. Because the same thing will happen. You know, definition of insanity and all.
Story from Hartford Business.