With a June 30 budget deadline looming, it looks like negotiations between the Democratically controlled Legislature and Governor Christie will go down to the wire to finalize a spending plan that may top $30 billion if Democrats have their way.
Governor Christie refuses to certify that the state will have an additional $800 million in income tax revenue that the Democrats assert should be included in revenue projections, which would allow them to hike spending to fund a laundry list of items, from more money for urban schools to higher property tax rebates. Democrats want to hike the income tax on New Jerseyans who earn more than one million dollars in order to provide more aid for suburban school districts.
Hiking taxes in the midst of a weak economy will bring in more revenue temporarily but will hasten the exodus of the wealthy to states that are more hospitable to upper income earners and send a signal to business decision makers that New Jersey’s mandarins are intent on milking them to pay for an expanding welfare state.
If Trenton politicians want to raise tax revenue to pay for more spending and tax rebates, then all New Jerseyans should pay higher taxes. Singling out one group to pay higher taxes is discriminatory and unfair. If the Democrats want the people of New Jersey to receive all the “goodies” they will send their way, then they should raise taxes on everyone, even low-income residents.
Every June the annual kabuki dance between the Democrats and Republicans reveals why there should be term limits and a massive downsizing of state government if the public wants to have low cost and quality services that are now funded by their tax dollars. In addition, the annual budget “negotiations” reveals why government cannot deliver services to the people in a cost effective manner. Unless both urban and suburban residents shed their belief that the “public sector” is about serving the public, then the politicians will mismanage their hard-earned money until the end of time.
The public sector is about serving the needs first and foremost of the politicians who in New Jersey get to spend nearly $30 billion of the public’s income for so-called public goods. If the public value the services state, county and municipal governments provide, then the public should pay for them voluntarily just as the public pays for goods and services out of their pockets without having to be taxed, e.g., food, clothing, shelter, cable, cell phone, gasoline, vacations, etc. From a practical perspective, think of all the money that would be saved by eliminating state, county and local tax departments!
Instead, individuals across the political spectrum, editorial writers, third-rate economists, and a whole array of “social scientists” have a romantic notion that elected officials really care about the public. If this were true, then why do politicians have to stay in office 10, 20, 30 years or more to “serve” the public? Politicians are not indispensable. Surely, there are thousands of concerned citizens throughout the state that would gladly serve a few years in Trenton.
Moreover, why does the public have to be bombarded almost daily with the inane rantings of self-serving politicians and are not competent to run your local grocery store but decide how to spend nearly $30 billion annually? What is wrong with this picture? In a word, “democracy.”
As H.L. Mencken observed decades ago: The state — or, to make matters more concrete, the government — consists of a gang of men exactly like you and me. They have, taking one with another, no special talent for the business of government; they have only a talent for getting and holding office. Their principal device to that end is to search out groups who pant and pine for something they can’t get, and to promise to give it to them. Nine times out of ten that promise is worth nothing. The tenth time it is made good by looting ‘A’ to satisfy ‘B’. In other words, government is a broker in pillage, and every election is a sort of advanced auction on stolen goods.
H.L. Mencken’s must have had New Jersey in mind when he wrote his analysis about the reality of the political process early in the 20th century.
Murray Sabrin is professor of finance at Ramapo College and blogs at http://www.MurraySabrin.com