A fiscal game of chicken and scapegoats

The legislature’s Republican minority won’t propose an alternative budget this year for the first time in six years, a political shift that the GOP and Democrats are now racing to define in the minds of voters.

The GOP spin is that Democrats have irreparably ruined the state’s finances, at least for the short term. The Democratic spin is that the minority is playing the easy role of critics, but it can’t hack the hard work of governing.

The top Republicans in the Senate and House, John P. McKinney of Fairfield and Lawrence F. Cafero of Norwalk confirmed their decision against crafting a budget alternative in interviews with The Mirror. Despite the lack of a minority budget, though, they said Republicans would not shrink from the budget debate, offering suggestions in press conferences or as amendments to various bills.

Democrats said the GOP leaders, both of whom are weighing bids for governor, are focused on the 2014 elections, and not the state’s fiscal health. The Republicans say the exercise has changed little in previous years.

“We have offered budgets since 2007,” McKinney said, adding that Democratic leaders have “criticized them, dismissed them and not adopted them.”

“They are desperate for us to do a budget,” Cafero said, adding that Democrats want to share the blame for the current deficit. “They are embarrassed by the situation they put the state of Connecticut in and they are looking for a scapegoat.”

House Speaker J. Brendan Sharkey, D-Hamden, called Cafero and McKinney’s decision “disappointing.”

“In difficult times, politicians have a natural tendency to run away from difficult budgets,” he said. “The minority leaders are choosing to follow that route. I had hoped for more. I had hoped they would step up.”

“I wish I could say this was a surprise, but it’s not,” Andrew Doba, Gov. Dannel P. Malloy’s spokesman, said. “The Republicans have shown time and again that they lack substance and leadership.  Representative Cafero and Senator McKinney say they want a seat at the table, but all they do is lob attacks that are inaccurate at best. 

“Leadership is about setting priorities and getting them done,” Doba said. Governor Malloy’s priorities are clear – a balanced budget that continues investing in public education and job creation without raising taxes.   

The challenge before both parties is to close a potential shortfall approaching $1.5 billion, or 6 percent of annual operating costs, in the budget that begins July 1.

Nonpartisan analysts had pegged that deficit back in February at more than $1.2 billion. And just last week a revised revenue forecast worsened the outlook by another $259 million.

Malloy and his fellow Democrats in the Legislature’s majority have offered several controversial ideas – extending some expiring tax increases, borrowing, raiding the transportation fund – to help close that gap.

Just two years removed from a major tax increase used to close a historic shortfall, Democrats are trying to steer clear of that option. And a union concession plan used to cut costs in 2011 now mandates raises and prohibits layoffs for two more years –limiting options to cut personnel costs.

Rank-and-file Republicans aren’t expected to back more taxes or borrowing. Both parties traditionally are reluctant to impose deep cuts to municipal aid. Debt service is an obligation that can be reduced steadily over time, but not dramatically in one year.

And while Republicans have suggested further reductions to the state’s social services, nothing has been proposed that would come close to erasing a $1.5 billion hole.

So what’s left?

McKinney and Cafero insist there are other options, but they won’t fix the budget in just one year.

The Senate GOP leader has argued for years that Connecticut could save hundreds of millions of dollars annually by privatizing all of the social services it offers.

But that would involve complex negotiations with state employee unions.

Cafero noted that the $901 million savings the administration estimated the 2011 concessions deal would achieve had been whittled down by about 30 percent when the current budget was adopted.

But while Cafero said “the governor and the union should be talking right now about how they can achieve those unrealized savings,” he added that without the ability to impose layoffs for two more years, the state has no leverage with labor right now.

“There are a lot of restrictions” anyone trying to balance the next budget must deal with,” McKinney said. “Many of those were caused by the governor, most caused by budgets adopted by the Democrats.”

But Senate President Pro Tem Donald E. Williams Jr., D-Brooklyn, said the Republican leaders complaints about the current budget challenges ring hollow.

“We have to be equal partners,” Williams said. “That means not holding your cards back.”

Williams also said Malloy’s concessions plan achieved savings that far surpassed those of his predecessors, including the 2009 deal then-Gov. M. Jodi Rell reached with unions. The administration also has reduced the workforce through attrition by about 1,200 jobs since Malloy took office.

Republicans rolled their eyes whenever Malloy reminded voters of the record-setting, $3.7 billion deficit – nearly one-fifth of all operating costs – he inherited upon taking office in January 2011.

And Williams noted that Republicans even offered a plan two years ago to close a deficit much larger than the current one.

“That’s a significant change on their part,” Williams said. “What are we to attribute that change to? Is it pure politics?”

Political consultant Roy Occhiogrosso, who ran Malloy’s 2010 campaign and served as the administration’s senior policy adviser during its first two years, was more direct.

“People criticize Governor Malloy sometimes because he has to make tough budget decisions,” Occhiogrosso said. “If you want his job, guess what? You have to make tough decisions too.”

Occhiogrosso also rejected GOP arguments that the Democratic legislative majority was more to blame for the deficit Malloy inherited than was former Gov. M. Jodi Rell, a Republican who served from 2006 through 2010.

Malloy inherited “a disastrous economy and structural problems that had been built in the last 20 years, most of the time in budgets that were proposed and signed by Republican governors, he said. “These are all facts that may be inconvenient for Larry and John given their aspirations.”

Cafero insisted Wednesday that “I won’t be baited” into helping the Democrats distract from the tax hikes and gimmicks they are using to prop up state finances until after the next election. “I’ll propose a fully-vetted, gimmick-free budget when they do.”

But the state Democratic Party offered a little bit of bait Wednesday afternoon on its Twitter page, tweeting a link to a clucking chicken sound effect.