Malloy Bungles Connecticut's Finances

In late May, liberals rallied around Connecticut Governor Dan Malloy as the “anti-Christie” (Malloy’s expression). Malloy sought to balance Connecticut’s budget through careful negotiations with public sector unions, rather than more forceful methods employed by Governors like Scott Walker or Chris Christie. When the tentative deal was announced, I wrote that it was “nothing more than a wasted opportunity for substantial change towards fiscal responsibility” and solidified “the underlying problems of Connecticut’s long-term fiscal crisis.”

However, due to recent developments, a previously insufficient deal has become no deal at all. Malloy’s attempt to have his cake and eat it too, by placating his union supporters while trying to cut their benefits, culminated in disaster. The tentative agreement was not approved by enough in the public union coalition and the deal, including the $1.6 billion in concessions that Malloy depended on for a balanced budget, collapsed.

Malloy now needs to scramble, enacting widespread layoffs and spending cuts. Malloy’s new budget includes firing roughly one-third of the Department of Transportation. The Department of Transportation layoffs are just a portion of the 6,000 state employees Malloy now promises he needs to fire. Furthermore, this is coupled with the largest state tax hike in twenty years from his original budget.

Malloy’s failure of leadership is a lesson for other governors. In the same week as Malloy’s deal was falling apart, Governor Chris Christie of New Jersey signed landmark pension reform, saving taxpayers $132 billion dollars over thirty years and he steers the state onto a path of fiscal responsibility.

Dan Malloy’s attempt to be the “anti-Christie” – the sensible Governor guided by both compassion and realism – was nothing more than benevolent naiveté. Malloy’s misplaced trust in public sector unions reveals their fundamental unreliability and irrational stubbornness. Genuine reform of this sort requires strength, not weakness. Connecticut will suffer due to their Governor’s reliance on the latter. But, as Connecticut falters, New Jersey, in the words of Christie, will be “waiting at the border to take [their] jobs.”