NY should take a page out of NJ’s playbook – By George J. Marlin

The following appears in the September 10-16 issue of the Long Island Business News:

If the day comes when Albany’s power brokers get serious about dealing with New York’s huge structural budget deficit, they should look to New Jersey’s Gov. Christopher Christie for guidance.

Christie, born in Newark’s ironbound district to an Irish father and a Sicilian mother, is one tough guy. As New Jersey’s U.S. attorney (2002-2008) he fearlessly took on the political establishment and successfully prosecuted more than 100 corrupt politicians including Democratic Newark Mayor Sharpe James and Republican Essex County Executive James Treffinger.

As a candidate for governor, he had the grit to beat back the well-financed machines of multimillionaire incumbent Jon Corzine and the public employees unions. And since he was sworn in, he has ruthlessly tackled the purveyors of fiscal mismanagement.

Christie inherited a state on the verge of bankruptcy. New Jersey spending has increased over the last 20 years by 322 percent – an average of 16 percent a year. Taxes and fees have been raised 115 times in the past eight years. Reckless spending explains why New Jersey has the nation’s highest property taxes and the second-biggest state budget shortfall: 29.9 percent. (In contrast, New York’s $9 billion deficit is about 7 percent.) Also, the state pension fund, which has been raided over the years, is unfunded to the tune of $46 billion.

New Jersey was hit hard by the recession because, like New York, it is heavily dependent on the financial sector. So far, the Garden State has lost about 120,000 jobs and has experienced a 16 percent decline in tax revenue.

New Jersey ranks 46th out of the 50 states in the Tax Foundation’s economic freedom index and its business climate is rated worst in the nation. This explains why $70 billion in wealth moved to friendlier tax and regulatory regions between 2004 and 2008.

Reacting to these dreary conditions, Christie took the offensive, declaring in February a state of fiscal emergency and impounding $2.2 billion in approved spending to close the budget deficit for the fiscal year ending June 30, 2010.

To close this year’s budget gap of $10.7 billion, Christie called for “a smaller government that lives within its means.” He stumped the state making his case and withstood $6 million in attack ads funded by the teachers union. At Christie’s urging, voters went to the polls in droves and rejected 58 percent of local school district budgets.

Fearing a taxpayer revolt, the Democratic-controlled state Legislature blinked and Christie got 95 percent of his budget loaf. To plug the deficit, deep cuts were approved including $820 million in school aid and $500 million in aid to cities. The school tax rebate, that’s been funded with long-term debt, was converted into a tax credit. Scores of dubious programs were eliminated and numerous services were privatized. Pension reform included 401(k)s for future state employees; public employees must now contribute 1.5 percent of their salaries toward their health care costs.

While the final budget wasn’t perfect – it included $2.1 billion in deferred pension contributions – to eliminate so huge a gap without resorting to tax increases is an incredible feat.

And while Christie was on a roll, 48 hours after the budget was passed he called the Legislature into a July 4 session to deal with his proposed constitutional amendment to cap property increases to 2.5 percent annually. On July 13, he signed into law a compromise statute that limits increases to 2 percent.

Christie has proven that political will and hard work can produce incredible results even in a state as blue as New Jersey.

The day after Election Day, New York’s governor-elect should send a strong message to Albany’s special interests by calling Christie, who is establishing a national reputation, and arranging a sit-down to discuss his roadmap to success.

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One Comment on “NY should take a page out of NJ’s playbook – By George J. Marlin”


  1. I admire the valuable information you offer in your articles. Thx sir


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