Comptroller Sean Scanlon (opinion): We will overcome this fiscal crisis by working together

CT Post – Sunday, April 13, 2025
By Comptroller Sean Scanlon

As the chief fiscal officer of the state, I like to visit large and small businesses as often as I can to hear what’s on their mind and learn how we can help them do what they do.

Everywhere I go — business or not — all anyone wants to talk about is tariffs.

On Wednesday, I visited a large and iconic Connecticut business. Unprompted, the person giving me the tour of the factory floor gestured toward a group of quiet machines in one corner of the warehouse. “Last week, all of those were running,” he said. “This week, we’ve scaled back production by 50% due to uncertainty.” I asked why, but I knew the answer.

The company’s main product is made here in Connecticut, but components of it come from overseas, specifically China. And though the retaliatory tariffs that had gone into effect the night before had already been walked back, the tariffs on China keep going up.

“There is only so much a customer is willing to pay for what we make,” he said.

He’s, of course, right. And he’s not alone among Connecticut business leaders who are caught in the crossfire of a man-made and unproductive trade war that is already hurting our local, state, and national economies.

Much of the $22.7 billion worth of goods the state imported last year are inputs for Connecticut manufacturing. Materials and parts for the state’s aerospace and defense industries account for the largest part of that, but Connecticut has a wide array of advanced manufacturing businesses that depend on sourcing their materials and components from abroad.

Many of those manufacturers are also exporters that will face retaliation on their goods abroad. For example, China has instituted 125% tariffs (as of Friday) on U.S. goods being brought into China. Connecticut has 5,300 exporters, 87% of which are small and medium-sized businesses. Lower sales for those businesses could result in fewer jobs in the state, rather than more manufacturing jobs.

But this goes beyond just business owners. This is impacting everyone in our state. The president ran for office to lower prices and make America more affordable, but his policies are actually increasing prices, hurting retirement accounts, and pushing the country toward a recession.

Since the White House announced the largest proposed tariffs in a hundred years on April 2, the stock market has been in turmoil. Over the following 48 hours, the Dow lost nearly 4,000 points. In just over a week, Wall Street has suffered its greatest losses since the onset of the COVID pandemic.

That drop — and the market’s weak performance — has had an immediate impact on the wallets of the people of this state. According to the Federal Reserve’s 2022 study of Consumer Finances, half of all American families reported having either a 401k or IRA account. As comptroller, I run a retirement plan for more than 7,000 Connecticut small businesses named MyCTSavings. And in the last week, people with both public and private retirement accounts have taken a big hit.

These tariffs, and the market’s reaction to them, are not just bad for household and business budgets — they are also bad for the state budget.

It’s my job to monitor and report on what’s happening with the budget. In the last few years, I’ve had good news to report. After a decade of fiscal crisis in the 2010s following the last recession, Connecticut has gotten its fiscal house in order. Starting with the passage of a bipartisan budget in 2017 that changed the way we budget, we have had seven consecutive years of budget surpluses, built up a $4.1 billion Rainy Day Fund, and paid down $8.5 billion of pension debt. Bolstering our reserves and chipping away at our debt will enable us to protect critical services and weather the impacts of the recession many experts are predicting.

When I would visit businesses a few years ago, the number one thing I’d hear about was Connecticut’s bad business climate and concerns about uncertainty at the state level. By getting our fiscal house in order, we’ve provided certainty that strengthened both our business climate and people’s perception of it.

How do I know? Just look at the Connecticut Business and Industry Association (CBIA) annual poll. In 2016, 71% of surveyed businesses said uncertainty and unpredictability around the economy and legislative decision-making was a major source of concern. Last year, that number was 8%.

The uncertainty people and businesses feel today is now coming from Washington, not Hartford. But we overcame Connecticut’s fiscal crisis by working together, and we will overcome this crisis by doing the same.

We can’t control Washington, but we can — and I will — keep fighting for fiscal stability and economic growth here in Connecticut. We’ve come too far to let President Donald Trump’s short-sighted and chaotic policies threaten our state’s progress and future.

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