Among the troubled roots is Connecticut’s inability to sufficiently reduce spending, which has hurt the state’s fiscal health. In the most recent fiscal health analysis put out by some of the nation’s most reliable economic researchers, Connecticut shows vast room for improvement. In the Pew Charitable Trust’s research titled Fiscal 50: State Trends and Analysis, Connecticut did not fare well compared to its neighbors. Of particular note is the state’s depleted reserves; Connecticut’s reserves would allow the state to operate for a projected 8.3 days.
Connecticut is naughty both for energy policy and energy prices. According to the Pacific Research Institute’s most recent 50 State Index of Energy Regulation, Connecticut has a lot of work to do. The state’s regulatory scheme ranks 47 in the country. The Index measures the regulatory burdens placed on consumers and producers of energy by each state, ranking them accordingly.
Numbers released by the U.S. Census Bureau show that Connecticut’s population has declined for the third year in a row. According to its Annual Estimates of the Resident Population for the United States and Puerto Rico, Connecticut has had a net loss of 19,581 residents since the state peaked in 2013.
When Governor Dannel Malloy admitted that the state’s recent trend of raising taxes wasn’t working, and that economic growth was necessary, it signaled a shift in attitude toward the right direction. How to foster economic growth should consistently be a factor and goal in any public policy debate or legislative issue. The state needs revenue, but by chasing revenue through tax increases, it has actually chased people, and revenue, away.
Nice states encourage and reward risk takers, both with policy and general attentiveness to their job creators. Unpredictability, projections to increase taxes, and constant regulatory creep are factors that reduce business confidence and, ultimately, reinvestment in a state. Naughty states disregard the concerns of employers.
In recent years, Connecticut has not been friendly to business or entrepreneurship, particularly start-up activity. In fact, in a new survey of small businesses conducted by the Connecticut Business & Industry Association, more than nine in 10 small businesses indicated that public policy did not “facilitate the efforts of small businesses in the state.” Given this climate, it is no wonder the state does so poorly in 50-state rankings.