Connecticut is America writ small. They ramped up spending through the roof, borrowed as much as they could, and instituted an extremely progressive tax system that shifts the burden heavily to the "rich." But Connecticut learned what a lot of other states have learned (and the US too). If you rely on the "rich" for taxes, you have an extremely unreliable tax base because the income of the "rich", in general, fluctuates to a much larger degree than taxes on the middle class. In a recession, there aren't many taxes from the "rich." So what are they going to do? A big Middle Class tax increase to pay for the high spending and debt service? Good luck. This is how the Welfare State ends.
The “rich” also can more easily just leave and take their income with them.