By Peter I. Berman
To the Editor
A recent article in Investment News (Feb. 17) highlighted the effects of high taxes to support the public unions — our most politically active class — on wealth concentration. Connecticut, the wealthiest state in the nation, now ranks only fifth in numbers of millionaire households (100,754) or 7.32 percent of its population (the third largest proportion). New York, site of the world’s financial capital, doesn’t even make the nation’s top 10 list.
Millionaires have substantially moved to New Jersey (242,647) — highest number in the nation. Not surprisingly, Virginia, the favored home of highly paid Federal employees has the second highest number of millionaires. And, Maryland, another favored home for Federal employees, has the highest ratio of millionaires to its population anywhere, almost 8 percent or 1 in 12.
These tabulations evidence the great new growth “wealth industry” in America — public employment. Gov. Malloy’s historic tax hikes to reward our public unions have sharply reduced jobs growth in Connecticut to the lowest in the nation. Jobs have declined 22,000 under his term. Even the state’s labor force has declined by 43,000. We see the same effects here in Norwalk. Over the last 20 years per capita income has barely moved — up only 10 percent. But per capita taxes are up 50 percent, financing the highest-paid public unions of any city in the state. One in four city employees earns six-figure salaries — higher than the city’s median household income of about $70,000.
Here in Norwalk we’re seeing one of the great population transformations in modern Connecticut — wealthier residents are moving out, lower income residents moving in mostly to rental housing and the single family housing market stagnating amidst a national housing boom. Even our well-paid city employees have largely moved out of Norwalk to avoid its punitive taxes and high rents. Come the next national recession, Norwalk’s population transformation will likely increase with further declines in its already depressed housing market. Its share of rental housing, now one-third, will only increase. And, the city’s reputation as the most transient community in Fairfield County will only solidify.
Without a determined effort by its citizenry to roll back the onerous costs of local government, the odds are increasing that once proud Norwalk’s future will follow the same spiral into Connecticut’s once great cities of Bridgeport, New Haven and Hartford. After all, who wants to buy a house or condo where onerous property taxes are financing the salaries of the highest paid public servants of any city in the state and where’s there scant chance of any property appreciation? Norwalk’s long-time residents are becoming increasingly scarce. It’s been quite a while since new homes have been built here.
City politicians are forever projecting a “New Norwalk.” Fortunately we have good historical records of the rise and fall of Connecticut’s 169 towns and understand the dynamics of change. Norwalk is unmistakably spending its way to Bridgeport. Changes in housing values, incomes and population speak clearly here. Avoiding this inevitable outcome requires voters who care enough to elect politicians and appoint city officials who have the skills and determination to restrain city spending in keeping with the modest incomes of city residents.
The “smart monies” have been voting with the feet. Finance is not rocket science.
Peter I Berman