The departure of General Electric hangs over this legislative session like a cloud. And the public debate over what it really means for Connecticut is still no clearer.
In leaving sleepy, suburban Fairfield, GE spoke of moving to Boston for its urban excitement and vibrant academic environment. But all the same, it didn’t neglect to collect $145 million in incentives from its new hosts.
Urbanist Richard Florida said he wants to scold Beantown for giving in.
“What in God’s name, I mean I thought to myself, are you giving $145 million to one of the biggest and most profitable companies in the world, when you could use that money to build better schools, better playgrounds, support families, and what not?” Florida told WNPR’s Where We Live.
Florida, who teaches at the University of Toronto, believes that the current arms race over economic incentives is diverting public funds from their real purpose.
But not everyone wants to see Connecticut get out of the game. “We’ve really missed out on a generation of providing economic incentives,” said tax attorney Dan Gottfried at Hinckley Allen in Hartford. He works with many middle market global companies who would like to set up shop in Connecticut, but can often get better deals from other places.
Gottfried believes the Nutmeg State should not abandon its incentives programs, but rethink them.
“Many of our state’s economic incentives are still tied to how many machines are you going to buy, and how many people are you going to hire?” Gottfried said. “Well, the new economy is not about machines and it’s not about head count. We need to get a little bit more creative and modern in the way we provide those incentives.”
It would be an unusual leap of faith to decouple tax incentives from guaranteed job creation, but Gottfried said it would allow officials to make smarter decisions about which companies have to potential to grow in the future, and contribute to a vibrant business ecosystem here.
He said that after the departure of GE, and with the rise of the millennial workforce, we should begin to question if the future of Connecticut’s economy — like its past — lies in bedroom communities and suburban corporate headquarters.
“We may also see that the family lifestyle that Connecticut prides itself on is becoming something of a relic, as people aren’t so interested anymore in the white picket fence and the short commute in a car,” Gottfried said. “They’re more interested in these urban lives.”
Both Gottfried and Florida agree investments in public education and transportation are critical, as is getting a handle on the state’s massive unfunded liabilities which are creating such uncertainty in its tax structure.
Florida said the visible discontent of the corporate giants should change the conversation, but maybe not in the way that some legislators think. “It’s a conversation now about building startups and focusing on new businesses, and building a creative and innovative economy,” he said. “That’s the conversation Connecticut is having, I think, and needs to have more of.”
With the governor’s latest budget proposal conceding that the state’s economic recovery is based largely on the growth of low-wage jobs, there’s clearly more talking, and thinking, to be done.
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