On some bread-and-butter economic issues, it's hard to distinguish the approaches of the Democratic and Republican contenders.
The two major candidates for Connecticut governor have clashed repeatedly in their debates over economic policy and jobs. But how far apart are they really in how they would tackle the pocketbook issues? Maybe not so far.
If there’s a single term that’s come to define the economic debate in this election cycle, it’s Tom Foley's charge of "corporate welfare."
Republican Foley says if he were governor, the tax breaks and multi-million dollar loans for large corporations would come to an end. He told an audience in Hartford recently, "If you just stop scaring businesses away from the state and be more accommodating and supportive of employers and particularly small business which are the biggest job creators, we wouldn’t have to be paying these millions and millions of dollars to corporations to save jobs."
"If you're not at the table, you're falling way behind the rest of the country."
Joe Brennan
Fred Carstensen said neither candidate gets good marks on the looming budget deficit.
The trouble is, say economic commentators from both ends of the political spectrum, that approach of ignoring the tax incentive merry-go-round altogether has been tried before in Connecticut.
“If you’re not in the game; if you’re not at the table, trying to put together some type of strategy to keep those companies here, or to be able to bring new companies in, you’re really falling way behind the rest of the country,” said Joe Brennan, executive vice president of the Connecticut Business and Industry Association.
In his Plan for Restoring Pride and Prosperity in Connecticut, Foley identified seven key industries he wants to support: health care services, highly engineered manufacturing, financial services, medical devices, alternative energy, pharmaceuticals, and biotechnology. In his plan, he says, "I will reach out personally to targeted companies and dedicate a significant portion of my time to convincing them that Connecticut is the place they should be."
For Professor Fred Carstensen of UConn, that raises a question. "He says we should be adding more value added high paying jobs," he said. "Well, that’s exactly what United Technologies' initiative is, and that’s exactly what Jackson Labs is, and that’s exactly what ESPN is, so where is he differentiating himself?"
Certainly, Governor Dannel Malloy is hoping that some of the more popular of his deals with big name companies can help burnish his economic credentials. But while he’s garnered praise for the UTC and JAX deals, he’s also had some high profile failures -- think Bridgewater and TicketNetwork -- that have had ordinary taxpayers scratching their heads.
Just this week, Malloy appeared to concede that a deal to keep jobs at banking giant UBS in Stamford might be a bust, showing how fragile such agreements can prove.
Corporate tax breaks are the issues that have been dominating the campaign rhetoric so far, but in the end, economic development giveaways may be just a distraction as far as the business community is concerned.
"The top thing that we hear from our members consistently is fiscal policy," said Brennan. CBIA surveys show that what really makes businesses sit up and take notice is a state that keeps its own finances in order, closely followed by a number of other fundamentals. "Great quality workforce, a great infrastructure, costs that are at least competitive and a government that is welcoming," according to Brennan.
Brennan would like to see a much more robust debate around how to make those things happen, and he said for Foley, that might raise another difficult question. "Certainly, his rhetoric is very favorable when it comes to making Connecticut a better state to do business," he said, "but how do you get there, particularly when you have a heavily Democratic legislature?"
On some of these bread-and-butter economic issues, it gets much harder to distinguish the approaches of the Democratic and Republican contenders. Foley’s Pride and Prosperity plan says his administration would crack down on excessive regulation, expedite permits, consult employers about transportation needs, and simplify the tax code — all issues the Malloy administration has also taken on.
Both talk about continuing to build out transportation and higher education. According to Fred Carstensen, those are indeed key issues, but they come with a price tag. "On the one hand, we have to sustain the kinds of investments that we have been making -- and they are investments -- and on the other hand, we’ve got at least in the short run some pretty severe fiscal challenges."
Neither candidate, Carstensen said, gets good marks on the looming budget deficit. "Both gubernatorial candidates are trying to avoid talking about that in much detail," he said, "because that’s going to be a very, very difficult challenge."
