How can the State "cut spending" and still need to raise taxes?

I think the readers should be aware of the biggest lie in State of Connecticut budgeting.  It is the term ‘to cut spending’ and it really means increased spending, yes ‘double speak’.  To you and me a cut means to reduce the last budget by the amount to be cut.  They spend $20B and they will cut spending by $1B, so the amount to be spent is $19B, right!  Not in Connecticut.  It means they may spend $20.5B and they will proclaim it is a cut from the “current services budget”.  You must be scratching your head.  A cut in your world is different than in the Governor’s world.  I know you want to live in his world, and we all DO, except we are on the paying (taxpayer) side of this equation.

As we know a few too many zeroes intimidates almost everyone.  So let me adjust this discussion in terms we all can understand. 

The way the State budgets in household terms is to take the costs, what you paid for insurance, food, clothes, utilities, gas, oil or natural gas, car payments, mortgage payments, life insurance, taxes, fees, repairs and maintenance, that trip to Disney World (Disney you owe me some $ for advertising ), and the Dunkin Donuts you bought yesterday (they owe me to), and every penny you spent in your household; The State then says it will cost more in the next year.  Some of these changes you know in advance, like your cable bill will rise because you had a lower rate the first year, or your electric bill will go up, and so forth, some may decline, car taxes might go down, and you want to go to Disney World and you don’t need to replace the water heater again this year.  Whatever the new amount of expenses becomes the “current services budget” in State speak.    Then when they talk of savings they talk of reducing the “current services budget”.  Remember it is an INCREASE from the “current budget”.  Notice the difference, because most do not catch that very important difference.

You spent last year $63,000 to live, not counting income or payroll taxes and employer sponsored benefits.  You expect your expenses this year the “current services budget” to increase to $67,000, an increase of $4,000.  Your boss tells you business is down, the State and Government mandates, the sick pay law, and some other things, causing higher payroll costs that do not directly benefit you, and to avoid layoffs, unfortunately, he can’t give you a raise this year.

You immediately realize you spent all last year’s money, AND your “current services budget” is up. You figure you can scrimp and cut expenses by $1,500 you would think like most that would mean you can only spend $61,500 ($63,000 (last year’s budget)minus $1,500) to run the house.  But in State speak it is $65,500 ($67,000 (current services budget) minus $1,500 cut).  To most of us that is an increase of $2,500 ($63,000 to $65,500), not in State Speak, its a cut.  Now go to your employer and say I spent all my income last year to live covering all my expenses, and based upon my “current services budget” I have cut $1,500 and you need to give me a $2,500 raise so I can balance my budget.  He would look at you as if you were nuts. Maybe he thinks it’s the new math that has you confused, the school system really failed you, as he thinks about what you said… cut $1,500 in expenses and then need a raise!  You see according to the State you are the employer, your employee the State is telling you that they have cut $1,500 from the budget, and they need a raise of $2,500.  What do you do?  Confusing isn’t it.

Remember as we increase taxes, and that will happen, more people will say enough and leave Connecticut.  You see, according to the State you are the employer, the State will take more out of your pocket, and as those expenses increase we will continue to see working people and retirees leave the State of Connecticut.  We watched hundreds of highly paid UTX employees leave for low cost North Carolina just this past year.  That took not only the direct jobs but hundreds upon hundreds of support jobs, and other businesses were negatively effect. 

Those left will be those that benefit from the system, but they can’t afford to support the system they benefit from by themselves.  That is the problem.  They need everyone else to pay in to be able to suck off the State’s teat.  As long as you are willing to accept higher taxes year in and year out the cycle will not stop.  The hidden problem is that people will continue to vote with their feet.  They will leave CT and those left behind will be stuck with a burden that will force more to leave and the downward spiral starts to pick up speed.  Unfortunately to right this trajectory will take much more effort versus getting our proverbial act together today and cutting the CURRENT budget and living within our means.

So when a State Representative or State Senator or Governor Malloy tells you they are cutting spending and still need to raise taxes on you or anyone, it is you, they are looking to take advantage of, in believing their “State Speak”.  Honesty is what we all should ask for.  Then again, if they were honest, you would realize what is going on and throw the people responsible out of office, and they would not like that!  So it is easier to lie to you.  You can choose to accept the lie or vote for a change in two years if you still live in CT.