Does Trump’s budget reallyspell doom for Connecticut?

According to Governor Lamont, the federal budget just enacted by the Republican majority in Congress and President Trump is nearly the end of the world.

The governor says the budget will have “devastating impact on millions of Americans for years to come and was passed for the sole purpose of giving tax cuts to millionaires and billionaires. It will amount to a massive income transfer from the poorest and most vulnerable Americans to the wealthiest.”

But Dan Haar of the Hearst Connecticut newspapers reports that, by quadrupling to $40,000 the federal income tax deductibility of state and local taxes — the “SALT” deduction, which Democratic leaders in Connecticut and other high-tax states long have supported — the new budget will substantially reduce federal income taxes for hundreds of thousands of middle- and upper-middle class Connecticut households.

As for the “massive income transfer from the poorest and most vulnerable Americans to the wealthiest,” the poor don’t pay federal income taxes, nor, in Connecticut, state income taxes. The “income” for the poor about which the governor is worried is actually what in a less politically correct era was called welfare.

The governor says the new budget will “bankrupt” the federal government by running a deficit in the trillions of dollars, requiring borrowing to cover the gap. But the federal government long has run huge deficits under Democratic administrations as well, which never bothered Democrats in Connecticut. Besides, since the government can create money out of nothing, it can never go bankrupt; it can only continue to devalue the dollar — something else that has never bothered Connecticut Democrats.

The new budget, the governor says, “slashes critical safety-net programs, particularly Medicaid and SNAP” — food subsidies — “that so many hard-working American families need for their health and survival.”

Will the cuts be so compelling as to cause the governor to reconsider the pledge he made to the state employee unions in April? “Every year that I’ve been here you’ve gotten a raise,” he told the unions, “and every year I’m here, you’re going to get a raise.”

Yet in recent days there have been reports from all around the country about massive fraud in the Medicaid, Medicare, and SNAP programs — some involving providers in Connecticut.

Indeed, a few months ago the governor’s own public health and social services commissioner retired after it was disclosed that she had countenanced the termination of an audit of Medicaid fraud in which the governor’s former deputy budget director and a former Democratic state representative have been indicted and a Bristol doctor has pleaded guilty.

Just last week state prosecutors charged an acupuncturist from Milford with defrauding Medicaid of $123,000.

All this fraud doesn’t mean that the Republican administration in Washington or the Democratic administration in Connecticut will be competent and determined enough to substantially reduce fraud in Medicaid, Medicare, and food subsidies. But maybe a reduction in those appropriations is necessary to provide some incentive to look harder.

“With a federal administration insistent on eliminating critical safety nets,” the governor said, “it is going to be nearly impossible for any state to backfill the billions in federal cuts we are going to face. …We will be meeting with our colleagues in the General Assembly to discuss next steps.”

Those next steps may be interesting.

Will the federal cuts in Medicaid and food subsidies be so compelling as to cause the governor and legislators to cancel any of the grants they grandly announce practically every week for all sorts of inessential projects around the state?

Will the cuts be so compelling as to cause the governor to reconsider the blank check his administration has issued for illegal immigration?

Will the cuts be so compelling as to cause the governor to reconsider the pledge he made to the state employee unions in April? “Every year that I’ve been here you’ve gotten a raise,” he told the unions, “and every year I’m here, you’re going to get a raise.”

Raises despite the cuts in the safety net? Despite natural disasters? Despite plague? Despite nuclear war?

Or will the cuts prompt the governor to call the legislature into special session, proclaim that state government simply can’t economize, and propose to raise taxes going into an election year?

Chris Powell has written about Connecticut government and politics for many years.