 Hi, I'm James. And I'm Anthony. And this is Words and Numbers. Well this week we're talking about a harebrained scheme emerging from the great state of Connecticut, my birth state of all places, whereby the legislature is trying to come to grips with a very deep budget shortfall and in order to fix this problem they're going to, well for lack of a better word, confiscate people's money from their state retirement accounts. Yeah, now are they, they're not confiscating everybody's money? No, no, no, it's only people who have worked for the state who have state accounts but they're looking to give those folks a 30% haircut on their accounts if and only if they've left the state of Connecticut. All right, all right, so get this straight, you putting your career not working in the private sector earning lots of money but working for the state as a public service. Let's not get carried away here, working for the state of Connecticut is actually quite lucrative. Oh, is it? Oh, yes. All right, well, nonetheless, you're working for the state of Connecticut. You decide presumably because of, if not the weather, Connecticut's tax rates, some might call them confiscatory. Yeah, then it's time to go somewhere else. So you leave the state, and the state takes 30% of your pension. Well that's the plan and this is what people do, right, they work their entire lives in Connecticut, they make a very good wage, the cost of living is quite high. And then at the end of their lives when they retire, they say something crazy like we should go somewhere where these dollars will go a little further. And then they move typically down south where things are quite a lot cheaper. Yeah, so what we're seeing is kind of at the political level the same mechanism you see at markets that somebody is offering competitors, offering a better deal in this case, maybe Florida, not only do they have the sun but they have no income tax. It's a better deal in Connecticut, so let's move there. Yeah, that's right. And people obviously shop around when they start doing these things. And you know, old folks, they need to make their dollars go as far as they possibly can. There's no opportunity to make big Connecticut money anymore, so they leave. And Connecticut feels the need to pay out the full amount to people who have remained in the state and who have these pension plans. But people who had the temerity to leave, they're going to get this haircut. And there's some doubt, I think, significant doubt as to whether this can ever happen, whether it's even legal for Connecticut to do this. And oddly, they've reclassified what they're doing not as a tax but as a fee. So you'll pay a 30% fee because it's illegal to attack someone's retirement in a state other than the state in which he lives. So what's interesting here, and I take your word on it that it may well be found unconstitutional or whatever. What's interesting to me is that Connecticut's go-to response when it sees people leaving because its tax rates are too high to confiscate their savings. Now, imagine the analog to that in the private sector that you shop at Walmart and you decide Target has better prices, so you start going to Target. And imagine if Walmart turned around and said, OK, we're going to take one third of your savings in response. What Walmart does is it says, what can we do to make this better so you don't go away? Yeah. And the state of Connecticut has long been wholly uninterested in making things better, right? They've had budget shortfalls year after year after year. The budget's just always a mess there. And, you know, that's that's a monster of Connecticut's own creation. And now Connecticut wants to kill that monster by stealing the money of retirees who leave to get away from the monster. And that, you know, it doesn't pass the laugh test, right? It was ridiculous on its face. And yet there are politicians with straight faces in the state of Connecticut doing exactly this right now. And the kicker here is what's driving this is, of course, the the ridiculous high level pensions that Connecticut's paying out. And when you look around at the other states, you find any number of other states who are similarly in bad straights or deals they've cut with retirees. Pennsylvania among them. Yeah, sure. Any number of states are suffering the exact same kind of problems. And if you think Connecticut's the only one that's going to come looking to confiscate the money that that's been set aside for retirees, you're crazy. They're all going to do it sooner or later, right? Yeah. And I guess there's we should stop and give Connecticut's politicians their due, which is they're in a rough place. What happened was, you know, and as is the case in Pennsylvania, 10, 20, 30, 40 years ago, there were politicians running for office. And they said, if you elect me, I will increase the state worker pension by whatever 20 percent of something. And everybody cheers who works for the state cheers and says, let's elect this guy. They elect the guy. And of course, what happens is that guy doesn't have to pay the price. The price doesn't get paid until 20, 30 years down the road when these people who voted for him are now retiring. And that's what we've gotten. Connecticut is what we've got now in Pennsylvania. Yeah, no. And we've got a very typical set of circumstances here, right? Politicians have overpromised and now they're in the business of under delivering, but all the chickens are coming home right at about the same time. So everybody's going to be angry about it right at the same time. And the thing to remember here, if if people can, is that when a politician is promising to give you something. Probably lying, right? There's no such thing as a free lunch. No, there is no such thing as a free lunch. And and now the retirees of the state of Connecticut are finding out that they can't even go buy their lunch in the Southern United States. They have to stay in Connecticut to buy their lunch. And that's a tough pill to swallow when it comes right down to it. Well, I wish everyone in Connecticut the best. And I'm sure the courts will sort the thing out. And for the rest of the country, the the the lesson here is when your politicians promise you the moon and the stars, check your wallet. Yeah, check your wallet. Your hand should be firmly affixed to your right cheek as these things go. But if you like this sort of thing, feel free to check out all the other offerings at fee.org and be sure to come back next week where we'll have something equally scintillating to talk to you about.