Diary

A Little Taste of Obamonomics in Jersey

Yesterday, the “esteemed” Governor of New Jersey, Jon Corzine, delivered his annual budget address.  This speech was replete with phrases we have heard from St. Barry regarding the financial “crisis.”  In fact, I don’t have an exact word count on the word “crisis” in Corzine’s speech, but it is there- repeatedly.  There is also the obligatory laying of blame on previous administrations in Trenton.  By that, he is referring to the budget “gimmicks” of Republican Governors.  Of course, twelve of the past twenty years, there were Democratic governors running this state.  Apparently, all this “damage” was done in the period from 1994-2001 when Christine Todd Whitman was Governor because since then there has been a succession of Democrats and “acting Governors” running the show.  He failed to mention that since 2002, Democrats have controlled the purse strings in Trenton, just as they have in Washington since 2006.  He fails to mention that under his watch and actually starting with Democrat Jim Florio, New Jersey has the “honor” of being in the top 5 states for tax burden every year.  In fact, under Corzine, we have held the honor of being #1 for three consecutive years now.  And doesn’t this sound like the now-boring soundbites coming from Democratic talking head strategists in Washington?  How many times will Obama and his army of Obamatrons repeat the line about “the failed Bush policies of the last eight years?”  How many times will the citizens of New Jersey be force fed lines about “budget gimmicks of previous Governors?”

Besides not being able to count the times he slapped his administration on its back for “a job well done” over the previous four years of his reign- of “remaining true to the core values”- he offered vague solutions to the budgetary problems facing the state.  He mentioned that through the porkulus package, the State will get about $2 billion to help with health care and education.  But, one of the reasons Jersey ranks highest in the nation in tax burden is the property tax.  To “ease the burden,” New Jersey developed a rebate program years ago.  These checks were delivered apart rom income tax refund checks.  Corzine’s suggestion?  He is “temporarily” restricting property tax rebates to senior citizens and those making $75,000 or less.  In short, he is shifting the tax burden disproportionately to higher income families in the state.  Sounds sort of like Obama’s “wealth redistribution” plans.  But, here is the kicker.  For one year only, he claims, he is eliminating the property tax deduction/credit on state income tax returns.  Again, he claims this is only a 1-year deal.  However, given the state’s chronic budgetary problems, does anyone truly believe this will be for only one year?  The alleged $400 million saved will be spent.  That is the history in New Jersey.  So if you are unlucky enough to make more than $75,000 in New Jersey, you will continue to pay the highest property taxes in the nation with no relief from the state.  In fact, you will get doubly screwed by not deducting those taxes on your return next year.

Corzine talked a lot about the imaginary family sitting around the table looking for places to cut their spending.  He claims his administration did the same thing- several times.  This sounds suspiciously like Obama’s mantra that he will cut spending and waste- but give me the money now with the promise that the spending cuts will come later.  They never do especially when the same party controls the legislative and the executive branches of government.  In fact, on at least two occasions, Corzine has turned his back on the express wishes of the people and results of referendums- school construction and stem cell research.  Corzine can complain all he wants about previous administrations, but this much is true: New Jersey ranks #1 in property tax burden, has the #2 highest income tax, the sixth highest corporate tax rates and the ninth highest sales tax in the nation (yes, we have that many taxes- and then some). 

In 2006, Corzine and his “economics czar” (and, incidentally, Obama has these “czars” also), stated they had a plan to attract 70,000 jobs a year to New Jersey.  They then downplayed that number to 40,000 as being more realistic.  In fact, in 2007, New Jersey attracted 4,700 new jobs and in the first eight months of 2008, LOST 16,000 jobs.  And didn’t we hear about bigger numbers being involved in job creation from Obama’s stimulus plan?  And like Corzine’s face-to-face meeting with reality and downgrading the numbers, Obama and his team now say: “Not necessarily create, but save up to 4 million jobs.”  As Corzine’s policies failed, so shall Obama’s.  Like New Jersey being left with heavy debt and huge budget deficits annually, those experienced at the national level will be even worse.

 From 2000-2007, New Jersey’s rate of job growth was 0.59% while the national average was 3.99%.  By contrast, Florida’s rate was 14% in the same period.  Why?  Businesses create jobs and in that area, New Jersey has been decidedly lacking in attracting businesses.  In fact, one study showed that among business leader’s, in 2008, New Jersey ranked #46 in popularity in moving to the state.  Corzine can decry previous administrations all he wants, but in 2006, the state ranked #26.  And interestingly, the state ranks #11 in the nation in terms of employment base.  It is not for lack of qualified workers; it is for lack of qualified businesses to provide the jobs because they view the state as anti-business.  At one point, New Jersey was among the leaders in the nation in terms of manufacturing jobs, yet through 2006, it lost over 98,000 manufacturing jobs.  Why?  Because of the anti-business environment, state regulations, high housing costs, and taxes.  Why would any business want to locate in a state like New Jersey and bring jobs to the people?  Why, on a national level, would any company be subjected to regulations and taxes when they can create the same product overseas?  The anti-business climate of both Corzine and Obama will not create the private sector jobs that they envision unless they decrease taxes and ease the regulatory burden.  In fact, like the national government, the only area of job growth in New Jersey is among the public sector.

Recent studies indicate that 70,000 citizens leave New Jersey annually.  Corzine, stealing a page from the Obamatron dictionary of double-speak, said that is because of the prosperity in the state that allows for the mobility of citizens.  That would be true if not for the fact that those leaving the state are those in the higher economic strata avoiding the tax burden in New Jersey.  It is also true because of the flight of businesses relocating to more business-friendly states than New Jersey.  This flight of capital will also occur at the national level with businesses and jobs unless Obama addresses the tax and regulatory concerns of businesses.  Unfortunately, he, like Corzine, have their head in the sand and are steadfast in their march towards creating a welfare state.

As with the Obama-Pelosi-Reid porkulus package, we are told that we need to be patient for results.  We are told that we cannot undo the “wrong policies of the past eight years” in a few short months.  Corzine: “You can’t correct 15 or 20 years of bad decisions in 38 months.”  Yes, Obama, you were elected in 2008 and your policies are now given the chance.  But, the national government need look no further than New Jersey for an example of what these policies will bring about.  New Jersey need look only slightly south to see how a state friendly to business can succeed- Delaware.  In that state, there is a low income tax.  In that state, there is no sales tax.  In that state, there are rarely the budgetary “crises” we read about annually in New Jersey.  How can Obama and his minions stand before the public and the television cameras and claim that these “failed policies” fail?  Luckily, the tide can begin turning on this flirtation with “wealth redistribution” through the tax code and this anti-business rhetoric and environment and this flirtation with socialist ideas and creation of a welfare state by voting Corzine out of office this November.  On the national level, it is not as if we have not given Obama’s policies enough time.  We can admit to that much.  But, we have seen in microcosm what those policies result in by looking no further than New Jersey.  So Corzine, like Obama, can congratulate himself all he wants about the “strides” they have made in meeting financial “crises” head on, but in the end, they create more damage than good.