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October 19, 2015 Editorial

Economic summit: good idea, but lasting impact unlikely

Connecticut's leading business, union and municipal lobbying groups deserve credit for announcing their intentions to hold a summit next month to discuss ways to combat the fiscal and economic challenges facing the state.

The political rivals' attempt at bipartisan talks on key issues should serve as a lesson to state and federal lawmakers who too often let political gamesmanship get in the way of good governance.

However, those expecting the Connecticut Business & Industry Association, Connecticut Conference of Municipalities (CCM) and state AFL-CIO to agree on anything substantial shouldn't hold their breath. While all three groups share a core mission to improve the state of Connecticut, their views and interests converge on fundamental issues, particularly state finances. Each group represents powerful interests who stand to gain or lose the most with any types of reforms or budget cuts or tax increases.

Municipalities, for example, receive billions of dollars annually in state aid, while unions represent state workers and retirees whose salaries and benefits make up more than 30 percent of the state budget. Businesses, on the other hand, are the state's main revenue generators, either directly through taxes and fees they pay, or indirectly by employing people who pay the state income, property and other personal taxes.

At a time of continuing fiscal crisis, it's hard to see how these three diverging interest groups can come together to shape policy that puts the state on a more stable footing. In the end, it appears someone's ox will need to be gored. Tax increases or funding cuts seem to be the only alternatives for policymakers who lack the political will, or intellect, to reform government in ways that improves services and lowers costs.

The CBIA has been fighting tax increases and increased government spending for years, and lately, have been at the losing end of the debate. After being hit with the largest tax increase in state history in 2011, the legislature approved another significant wave of tax hikes earlier this year.

Meanwhile, CCM has been fighting — largely successfully — to maintain municipal aid spending levels. Unions were forced to make some concessions in 2011, including a two-year wage freeze, but have been able to avoid major layoffs keeping their ranks relatively unscathed.

Businesses, however, may have public sentiment on their side. Last week, a new Quinnipiac Poll found Gov. Dannel P. Malloy's approval rating plummeted to 32 percent, close to the historic 24-percent low hit by former Gov. John G. Rowland, when he was engulfed in a corruption scandal. Voters gave Malloy a thumbs down on key issues related to taxes, the budget, economy and jobs.

Residents' tolerance for further tax increases appears to have run its course and they clearly aren't happy with the way Malloy and the legislature have handled the state budget. What is clear is that there needs to be fundamental changes in how state government operates. Every state dollar allocated must be reviewed and put through a “needs” test. Some funding must be reallocated, while other wasteful or luxury spending must be cut.

And all of this can be done without forcing layoffs down the throat of state unions. State government's workforce, like the rest of Connecticut, is aging, so as employees increasingly head toward retirement we can shrink the state's bureaucratic largesse and move employees to positions most critical for the state to carry out its core mission. This is where state government must take a page out of the private-sector playbook.

The CBIA, CCM and AFL-CIO aren't promising to concoct a blueprint to solve all of Connecticut's ills, but they do think they can find some common ground on issues related to transportation, energy and health care.

We credit all three sides for sitting down and talking about the issues because expanding the marketplace of ideas can only be helpful. We're just a bit skeptical of there being any Kumbuya moment.

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