Making Connecticut More Business Friendly

As the economy struggles along, people are asking how to help make Connecticut more ‘Business Friendly’, yet it seems as if few people are really exploring what a more business friendly state is. The standard definition seems to be less regulations and less taxes, but the consequences of this seem at best, not considered.

One example of this ill thought out position came when Republicans immediately attacked Attorney General Richard Blumenthal when he suggested that enforcing the laws of the state makes for a better business environment, or in other words, helps make the state more Business Friendly. Apparently, they believe that being business friendly does not include making sure people obey the law.

Likewise, the Connecticut Business and Industry Association worked hard for deregulation of the electricity market here in Connecticut, arguing that increased competition would lower the price of electricity. However, we have ended up with one of the highest electricity rates in the country, hurting businesses and making Connecticut less business friendly.

Where did this go wrong? Perhaps some of it is this unfounded belief that increased competition is always beneficial. It appears as if what we have gotten are electricity supplier to compete with one another on how to get highest profit from consumers as opposed to driving down prices.

The issue is that competition is too often a zero sum game. It is one business competing with another and as one wins, others lose. Instead of competing to affect the distribution of profits and control which regulations protects which businesses or consumers, competition needs to be promoting innovation.

We see something similar in the opposition to Paid Sick Days. Businesses don’t want to be responsible for maintaining a safe work environment for their employees. That is unnecessary regulation they claim, it is unfunded mandates. Yet these regulations protect not only the employees of companies, but also customers of these companies. As an example, employees often eat at local restaurants during their lunches. To the extent that companies are not required to provide paid sick days to their employees, restaurants are more likely to have sick employees handling food and spreading sickness to the employees of other companies. This is not business friendly.

It also reflects another mindset that seems to be damaging businesses in Connecticut, as well as across our country, the focus on short term profits as opposed to long term health of a company. I know that there are several restaurants that my wife and I will not go to because we have gotten sick after eating food from those restaurants. It is not clear if the restaurants had lax preparation guidelines, or we simply got sick from a stomach bug spread by a worker that could not take a paid sick day off. The short term focus on reducing costs of employee benefits is penny wise and pound foolish as companies drive away customers.

As a final point, the reduction of taxes results in a reduction of governmental services. Retail oriented businesses understand that they need good roads coming their stores. They understand that they need protection in case of theft or fire. The wise business people even realize that they need an Attorney General who will protect honest business people from those that are out to take unfair advantage over others.

So, how do we make Connecticut a little more business friendly? Perhaps the first step is to stop and think a little more seriously about what really makes a state more business friendly instead of reiterating the tired old platitudes about less regulation and less taxes.

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