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Connecticut GOP Candidates for Governor: State’s Economy ‘a Disgrace,’ ‘Financial State of Emergency’

Candidate for governor Steve Obsitnik talks with his daughters at the State Republican Convention, Saturday, May 12, 2018, in Mashantucket, Conn. Connecticut Republicans are gathering for a second consecutive day to finish endorsing their slate of candidates for the November elections, including the hotly contested race for governor. (AP Photo/Jessica …
AP/Jessica Hill
DR. SUSAN BERRY

The Republican candidates for governor of Connecticut agree the state is in dire economic condition, and each is putting forth his own plan to change its course as the primary approaches August 14.

The campaigns of four of the five GOP gubernatorial candidates – Tim Herbst, Bob Stefanowski, Steve Obsitnik (pictured), and David Stemerman – responded immediately to Breitbart News’ request for interviews.

Tim Herbst, a former First Selectman in Trumbull, Connecticut, summed up the major crises facing the state.

“It’s the high taxes; the lack of growth in the real estate market since the 2007 levels; it’s the high utility costs; it’s the fact that jobs and businesses are fleeing our state in record numbers,” he told Breitbart News. “It’s this malaise that’s been created by this governor.”

The current governor – Democrat Dannel Malloy – has decided not to run for a third term after having been ranked one of the most unpopular governors in the country. Malloy’s cozy relationship with the unions has been a hallmark of his tenure and is considered to be a major part of the state’s current acute financial distress.

“I think when you’re staring down the barrel of a five-billion-dollar budget deficit, $86 billion in unfunded pension and healthcare liabilities, and a state transportation fund that is on the brink of insolvency, we are in a financial state of emergency!” Herbst asserted. “We’ve got to be brave and bold to fix this problem.”

Bob Stefanowski, former chief financial officer of UBS Investment Bank, provided more of the litany of serious issues facing the Constitution state. A former senior executive with General Electric, his approach to fixing Connecticut is to get rid of the state’s income tax which, he said, is “choking” the state.

“I worked with Art Laffer for about 15 years, and we sat down with Larry Kudlow and Steve Moore,” he told Breitbart News.” Connecticut is probably the perfect example of the Laffer curve, where we’re taxing people to the point where they’re leaving the state. We have to turn it around.”

“We’re the only state that has both a gift tax and an estate tax,” Stefanowski added. “We’ve got a higher corporate tax relative to our neighbors. So, my plan calls for getting rid of the estate tax – Day One – phasing down the corporate income tax to make us more competitive and getting rid of the state income tax.”

Stefanowski is one of three GOP candidates with a business background who aim to apply some business principles to turn the state around.

David Stemerman– who launched his own investment firm in 2008 – also told Breitbart News that, when it comes to unfunded pension and healthcare liabilities, Connecticut is “a disgrace.”

“Our state employees are funded at below 30 percent,” he explained. “And to give you the context, in the private sector, if you’re funded at below 80 percent, you’re sent to the Pension Fund Guarantee Corporation to be restructured because there is no way you can pay for those benefits.”

“Our state employees have been given benefits that are two or three times as great as what’s available for the comparable private sector worker, and we’ve never put aside the money for it,” Stemerman continued. “And the current set-up is unfair to everybody – our state employees and retirees who have been promised benefits that there is no way we can ever pay for; our taxpayers who are being forced to pay taxes and guaranteed benefits they can’t earn themselves in the private sector; and to our children, whose education we’re cutting to try to fill an unfillable hole in pensions.”

Steve Obsitnik, a Navy veteran who has been an entrepreneur of technology companies, told Breitbart News the dire situation in Connecticut can be summed up by looking at the state as “makers vs. takers.”

“For 40 years, this state has been led by takers,” he explained to Breitbart News. “I’m a job maker. But what takers do is take money from your pocket, put it in their pocket, and redistribute monies.”

“This state has created only 5,600 total, net new jobs since I graduated college, and growing government has been our jobs project to replace that growth,” Obsitnik said.

Stemerman emphasized as well that Connecticut has “effectively had one-party rule by one branch of the legislature for the last 40 years.”

“Connecticut is one of only four states in the country where the collective bargaining includes benefits in addition to wages, and it is one where the speaker of the state House is also a full-time, paid employee of the union, and he controls legislation,” he explained. “That’s a conflict of interest that would never be allowed in the private sector.”

Stemerman’s reference was to state Rep. Joe Aresimowicz, a Democrat who became speaker of the state House at the same time he has been a longtime employee and official of Council 4 of the American Federation of State, County, and Municipal Employees Union (AFSCME).

Though many dismiss Connecticut’s state legislature as firmly under the control of the Democrats,  New York Magazine observed “Connecticut’s is by far the most vulnerable” and could flip in 2018. The state Senate is currently evenly tied at 18 Republicans and Democrats – requiring only one more Republican to flip it.

“What we have now in the state of Connecticut is essentially a fourth branch of government, which is for the state employee unions,” Stemerman added. “And they have engineered a system of electoral laws and a legislative process that have entrenched themselves to the benefit of themselves and their leaders and to the detriment of the rest of the state.”

Each of the four GOP candidates has a different plan to bring Connecticut back from its near economic death.

Herbst said Connecticut’s dire economic state must be dealt with fast.

“I’ve been the only candidate to say in the course of this campaign that, in my first 45 days as governor, I will send a budget repair bill to the Connecticut general assembly that deals with this very issue, that recognizes that, if we’re going to truly balance our budget and restore fiscal sanity to our state, this is where we must start,” he said. “We’re not going to be able to reduce the tax burden until we get out of the hole. And I’m committed to digging out of this hole in my first 45 days.”

Herbst said that, in order to accomplish this feat, the next governor must “change the culture.”

“I’m the only candidate on the Republican side that has demonstrated the chops to take on the Hartford insiders, that has been unabashed and unafraid in calling out people in both parties when necessary, and who has said he is completely committed to dismantling the status quo – that’s what sets me apart from the rest,” he explained.

But Stefanowski, who said Herbst and his other GOP rivals are simply “tinkering around the edges” of Connecticut’s problems, insisted he wants to go bold with the state income tax.

“They want to reduce it from seven to six percent,” he explained. “I just think we’ve got to get rid of it. If you look at what President Trump’s tax plan has done for the national economy – three, four percent GDP growth, that shows you what effective tax policy can do in a relatively quick time.”

“I have absolutely not written off Connecticut, but we need to start with getting more money in the pockets of these taxpayers,” he asserted.

Obsitnik, however, has a different approach.

“As much as I love the idea of getting rid of the state income tax, it is 50 percent of our revenues and there are people out there who like paying income tax,” he told Breitbart News. “There will be resistance by our legislature on that. But, I believe in turning around a state you need a big vision to get everyone focused on the highest mountain top to go together. My focus is five steps to build 300,000 jobs over the next eight years.”

“The next governor has to do two things: walk and chew gum at the same time,” he said. “The walking is addressing the fiscal mess we have here in our state, but the chewing gum is how do we inspire people to stay here and build an economy here.”

As part of his plan, Obsitnik proposes targeting tax reforms of about $400 million on seniors to keep them in Connecticut rather than lose them to income tax-free states.

“Then, get rid of the estate tax and gift tax, no tax on pensions and social security,” he added. “People who make $100,000 or less, cut their marginal tax rates from 5.5 to 4 percent. And, third, phase out the corporate business tax over three years. So, I want to hug seniors, working people, and retirees and say, ‘You can stay in Connecticut.’”

Stemerman observed that his plan takes into consideration the Supreme Court’s ruling in Janus, which prohibits unions from compelling agency fees from nonmembers.

“We’re going to strengthen our conflict of interest rules, so that no legislator – including the speaker of the state House, a full-time, paid employee of the union – is able to vote on legislation,” he said. “We’re going to bar collective bargaining for our benefits.”

“The other key thing we’re going to do is – our state has very stringent rules and campaign finance laws restricting state contractors’ financial contributions and political activity,” Stemerman continued. “And that’s because they can influence the governor and legislators that are directly affecting their finances. That is true of state employee unions as well, and we’re going to be making a major proposal that they should be subject to the same conflict of interest rules as our state contractors.”

One of the five GOP candidates will likely run in the general election against lead Democratic candidate Ned Lamont, who is running for governor for the second time. Lamont’s rival in the primary is Bridgeport mayor Joe Ganim, a Democrat who spent seven years in federal prison for political-corruption crimes, including racketeering and extortion.

The campaign of GOP candidate and Danbury mayor Mark Boughton was not immediately available for interview.

 

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