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Posts published in “Connecticut Newspapers”

Once “Sacrosanct,” Fiscal Guardrails Are Not So Holy Now in Lamont World

Governor Lamont is violating the fiscal guardrails, converting them from a regime of budgetary discipline into a slush fund to pay Connecticut state employees higher wages than in 48 other states and, secondarily, to fund a few priorities of progressive Democrats.

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To Preserve the Fiscal Guardrails, Freeze State Employee Wages

The best way to defend Connecticut’s fiscal guardrails is to freeze state employee wages that are 33% higher today after six consecutive annual pay increases under Governor Lamont.

February 3, 2025

The guardrails are under attack by Democrats who want to increase spending. They want to lay their hands on the $6 billion in income tax revenue that the guardrails have diverted from spending and channeled into the state employee retirement fund (SERF) over the last six years.

Yet, cumulative annual dollar increases in state employee wages over the last six years total an aggregate of about $3 billion, according to data in the latest report of SERF’s actuary. In addition, since pensions are based on wages, SERF pension liabilities have increased $9 billion over those six years. That’s $12 billion that has been, or will be, spent on increased pay and benefits for state employees that could have been spent on the Democrats’ priorities.

In the simplest terms, had wage increases been limited to half the actual level, the aggregate wage increase would have been about $1.5 billion and, logically, the increase in pension liabilities only about $4.5 billion, freeing up $6 billion within the guardrails for the additional spending desired by Democrats.

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State Employee Raises, Not Fiscal Guardrails, Put Squeeze on Spending

There’s a fight brewing within the ranks of Democrats in Hartford over what changes to make in state budget policy so they can spend more money.

January 13, 2025

Progressives want to bust the “fiscal guardrails” which both limit spending and redirect billions into the state’s drastically underfunded pension funds. They want to get their hands on the money going into pensions. They want to use that money to spend beyond the guardrails, which are designed to keep spending in line with the state’s economic growth.

January 15, 2025

Progressives have misdiagnosed the problem. Lamont has caused the problem. The obstacle to more spending is not the fiscal guardrails, but rather the 33% increase in wages that Lamont has lavished on state employees.

Under Lamont, unionized state employee wages have grown $1.1 billion from $3.4 billion annually when he first took office in 2019 to $4.5 billion last fiscal year, as catalogued in the latest report of the pension fund actuary.

If progressives want to spend more money, they need to freeze state employee wages. 

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CT Democrats’ Internal Warfare Over Lavish State Employee Pay

Connecticut’s public sector is the most heavily unionized of the 50 states. Under Governor Ned Lamont, public unions have secured state employees six consecutive annual pay raises, cumulating to a stunning 33% compound increase.

December 27, 2024

They are the second highest paid state workers in the 50 states.

Their health care benefits are the most robust by far, according to studies in 2021 and 2023.

January 3, 2025

Their pensions ranked in the top quartile of states in the 2021 study.

But how does the state employee union (SEBAC) maintain its unique power?

December 28, 2024

How does it protect such lavish and unaffordable compensation in a state that is in the worst financial condition of the 50 states?

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Trouble Hiring CT State Employees? Really?

Governor Lamont and the Democrats have increased the wages of Connecticut state employees by a stunning 33%, awarding them six consecutive annual wage increases (two 5.5% raises, then four 4.5% pay bumps).  A 2023 study found Connecticut state employee wages to be the second-highest of the 50 states.

December 5, 2024

Yet, Democrats in Hartford claim the state is having trouble recruiting new employees. How so? The active workforce grew from about 47,000 to 49,000 in the last fiscal year, according to the just-released 2024 Report of the Actuary for the state pension fund.

Why the “trouble?”

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Opposite Day in Hartford

There was much back-patting about pensions in the capitol yesterday, as Governor Lamont congratulated Comptroller Scanlon, who lauded Treasurer Russell, both of whom paid homage to Lamont in turn.

December 3, 2024

Why the celebration? The state employee pension fund (SERS) inched up from 52% to 55% funding of the state’s estimated future pension obligations, according to the just-released report of the pension actuaries. Only in Connecticut would a 3% improvement be a cause for popping champagne corks.

It must have been “opposite day” in Hartford, because the real story is that startlingly little progress has been made on pensions during Lamont’s six years in office.

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Paying Illegal Immigrants to Go to College

So, what's going on now in this state is an effort, in the community college system, to pay illegal immigrants to go to college. In an era when we have a nationwide and legitimate outcry about the cost of college and the burden of student loans, we're now looking to pay illegal immigrants to go to college.

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The Fed’s Interest Rate Cuts Won’t Help Uncle Sam

The Federal Reserve just cut interest rates again, offering more relief to borrowers, except the world’s bigger borrower, Uncle Sam. Federal interest costs are at record highs; they are causing huge federal budget deficits. Yet, deficits and interest costs are poised to escalate further.

November 7, 2024

Such enormous recurring deficits are a grave concern, obviously produced by some combination of insufficient tax revenue and excessive spending. President-Elect Trump and the Republican Congress are almost certain to extend the 2017 Trump tax cuts which are set to expire next year. So, additional tax revenue is unlikely.

While Democrats will scare-monger about extension and insufficient tax revenue, they forget that, before the tax cuts, the U.S. had the highest business tax rates in the developed world. U.S. companies were fleeing to foreign tax jurisdictions, not something we want to happen again. So, spending cuts have to be the main focus. We’ll get to that.

First, the problem. In the federal fiscal year just ended, net interest on the national debt reached $882 billion, surpassing Medicare and National Defense spending for the first time and trailing only Social Security ($1.4 trillion) and Health (excluding Medicare) ($912 billion).

But wait. The Federal Reserve has begun lowering interest rates. Isn’t the problem going away? No...

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There May Be No Free Lunch, But There is Free Health Care for CT State Employees

There may be no such thing as a free lunch, but Connecticut state employees do enjoy virtually free health care. But nothing is free. Someone always pays. In Connecticut, taxpayers pay for free health care for state employees – and, of course, for their own coverage, which has become ever more expensive.

October 24, 2024

A study by Georgetown University’s Center for Health Insurance Reform found that Connecticut state employees pay just 2% of their medical bills. Connecticut state employee health care benefits are the most generous state employee health benefits in the nation. Nationwide, the average state employee pays 14% of his/her medical bills.

November 13, 2024

The health care coverage of Connecticut state employees is the equivalent of a Platinum Plan under ObamaCare – only 1.4% of Connecticut residents purchase (can afford) Platinum Plans on the state exchange.

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The Case for a CT Wage Freeze: Fairness, Budget Relief and Real Pension Progress

Connecticut state employees are enjoying their sixth consecutive annual pay raise, pushing their wages up 33% under Ned Lamont and the Democrats. It is time for a wage freeze such as imposed by Lamont’s predecessor Democrat Dannel Malloy.

September 27, 2024

CT state employee wages are now the second highest in the nation. State employee compensation is ... $10.0 billion, or about $2,775 for every man, woman and child in the Nutmeg State.

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