The year of the COVID-19 pandemic has been a strange one for our body politic. We all went into lockdown and social distancing as lots of people in the service sector got laid off. Meanwhile, Wall Street boomed, and Connecticut and the northeast enjoyed a real estate boom while essential workers struggled to stay safe. In the short term, our state built a one-year budget surplus built on an infusion from capital gains and the wealthy.
Going into our biennium budget, we face a looming $2.6 billion deficit as state and community services are under strain and few dollars to fix our transit mess. Community social services are underfunded by nearly $500 million dollars as there are big lines for food aid and COVID tests. Our State House is not in order as our great inequality crisis was exposed during the last year. Connecticut is the third highest state in inequality as well as being a wealthy state. According to a recent report by Connecticut Voices for Children, the top 1 percent of state residents makes 40 times in pre-tax income as the average household. Yet, working class families pays an effective tax rate three times of the richest 1 percent.
It is time our State legislators fix our unfair regressive tax system. We simply have to look to New Jersey which recently raised the top rate on millionaires and raised the surtax on the biggest corporations. Connecticut could fix the budget gap by raising the income tax rate on millionaires closer to tops rates in New York and New Jersey. We should also put a new surtax on capital gains and unearned income for people making over $500,000 a year. Moreover, the State legislature must provide tax relief for working families by expanding the current state Earned Income Tax Credit and creating a child tax credit.
The State budget is about a lot more than dollars and cents. It is a moral compass on our community and what our priorities are in easing suffering from the pandemic. We must start correcting our stark inequality in Connecticut, the land of steady habits. It’s time to rebalance the scales of inequality and racism. State Democrats have a strong majority in Hartford and should not be afraid to push an agenda of progressive taxation. It should provide the resources we need for our state and push our state back in the direction of justice and the beloved community as Martin Luther King taught us. It is time for the General Assembly and Gov. Ned Lamont to stake a stand.