Sen. Kane Spotlights Gov. Malloy’s “Magic Savings Account” (Danbury News Times Op-Ed)

January 9, 2015

Op-Ed as it appeared in the Danbury News Times

Here’s a hypothetical situation:

Your friend informs you that he or she has created a new savings account.

“Great,” you say. “Saving money is good.”

But then you learn that your friend created the savings account by taking out a loan.

“Wait a second,” you reply, “I think it’s time for us to have a serious conversation about your finances.”

That scenario is happening right now in your state government. Our governor, Dannel P. Malloy, is borrowing money to create a savings account. He can use this borrowed savings to fix budget problems down the road.

The process is complex, but the takeaway for taxpayers is this: It’s not free money.

When the governor borrows tens of millions of dollars and sets it aside to balance the budget, that’s not the end of the story. Those loans must be paid off — with interest — by you and me.

But it’s not just you that will be paying off the bills. That added debt will likely impact your children and grandchildren in the form of higher taxes, fees, “revenue enhancements” or whatever trendy tax hike euphemism you prefer.

In other words, the governor is selling out the taxpayers of the future to get operating income today. Just keep borrowing, and if you max out the credit card, simply apply for a new one.

If businesses did that, they would be out of business. If families did this, they would go broke.

Many taxpayers ask me how Gov. Malloy can look into the TV cameras and say there will be no deficits, there will be no tax hikes and all will be well. They remember all too well how Gov. Malloy raised our taxes by record amounts just four years ago.

Well, taxpayers, now you know his secret.

Gov. Malloy can say these things because he is employing the foolish borrowing technique that your friend used in the hypothetical conversation above.

Our problems in this state are not “de minimus,” as the governor says. They are enormous, multi-billion dollar challenges. We can either continue to turn a blind eye to Gov. Malloy’s magic savings account, or we can contact him to tell him we know what he’s doing.

But please, be courteous when you call or email the governor. Simply start by saying, “I think it’s time for us to have a serious conversation about our finances.”

State Sen. Rob Kane is a Republican who represents the 32nd District, which includes Bridgewater, Roxbury and Southbury. He is a ranking member of the legislature’s Appropriations Committee, which oversees state government spending.