MIXED MESSAGES ON THE NEW STATE BUDGET

by David P. Rebovich Governor Jon Corzine will be on the road this week hosting budget “dialogues” at universities in the northern, central and southern parts of the state. These dialogues will be on the heels of a budget summit held by Corzine at Rutgers that will “…draw together New Jersey’s leaders, policy-makers and experts in an effort to foster discussion, dialogue, and understanding about the state’s multi-billion budget crisis.” The dialogues at Montclair State, Monmouth and Rowan universities are geared more to the general public. Citizens are invited to not only listen to various matters pertaining to the budget crisis but “…to voice (their) thoughts on how we restructure New Jersey’s future.” Let’s hope this summit and these dialogues bring some straight talk on the state’s budget situation and what should be done about it. The last few weeks there have been mixed messages coming out of the State House on the size of the budget deficit, what exactly the Governor is considering in terms of spending cuts and revenue raisers, and on his management style and commitment to changing the way Trenton does business. Of course, New Jerseyans will learn what Corzine’s assumptions, goals and plans really are on March 21st when he makes his first Budget Address. But maybe we will have a better idea of what to expect after this week’s events. The Governor’s grand tour has both an elitist and populist side. At the Rutgers summit Corzine will elicit input from “leaders, policy-makers and experts.” Don’t be surprised if these experienced, bright folks talk about several familiar topics. Such as the structural deficit, mandated spending, high levels of spending but scads of needs that have been overlooked, and tax inequities but concerns about scaring business away with high taxes on them and the well-off. They are also likely to encourage Corzine to think about the big picture, the long-run, and the need for fiscal stability and integrity, for property tax reform, for taking care of the truly needy, and for creating a favorable climate for business. Good advice? Sure, except that it contains contradictions. In any case, for decades governors from both parties have heard these same recommendations, respected them, and even claimed to support many of them. But with the exception of Jim Florio, New Jersey’s governors have usually ended up patching together annual spending and revenue-raising plans to get through tough years. To Corzine’s credit, he is willing to have these ambitious ideas put on the record just a few weeks before he has to make his Budget Address. Perhaps this Governor is planning to make some bold moves and wants the advice of experts to provide him with some justification for his proposals and with some political cover. But what is the Governor likely to hear at the three budget dialogues he is hosting? Well, those typical New Jerseyans who make comments will probably not talk about broad budget policy but about specific needs and wants. These may be serious matters, like aid to school districts, municipalities and colleges and universities, funding for programs for needy seniors, kids and the disabled, affordable housing, environmental cleanup and open space. There may also be calls for more money for port, surface transit and hometown security, for crime fighting, and for fighting substance abuse. And let’s not forget economic development issues, including incentives for high technology firms, for investment in urban areas and for job training programs. Legitimate needs and concerns? Certainly. And if Corzine did not hold these budget dialogues throughout the state, he would hear calls for action on these matters made on the steps of the State House by advocacy, interest and grassroots groups. In fact, those groups will no doubt be in Trenton after the Governor does make his Budget Address to demonstrate and to testify at hearings held by the legislature. As such, Corzine will receive input on spending wants and needs whether he wants such input or not. Since it is likely that many of the people calling for more government support see themselves as Democrats, it makes good political sense for the Governor to reach out to them. But Corzine has to be careful that these dialogues don’t devolve into “demand-fests” at a time when the state does not have the money to provide more help to many people or groups. In fact the Governor’s purpose in holding a budget summit and dialogues is not, it seems, it elicit input about what the state should spend more money on. Rather, these events are aimed at improving citizens’ understanding of the seriousness of the budget crisis and to generate ideas about “restructuring” the state’s future, not necessarily increasing funding for that future. The focus of these events then seems to be how to deal with the state’s deficit. Therefore, the Governor may use them to explain the state’s fiscal challenges, to educate the public about issue priorities, and perhaps to lay out some alternatives for addressing the short-term budget crisis and the need for long term fiscal stability. Will attendees of the budget dialogues expect or appreciate this? Well, it will be interesting to see if anyone at the three budget dialogues has suggestions about what state and local governments and school districts can cut to help the budget-balancing cause. Don’t hold your breadth on that one. Those in the Garden State who advocate cuts in spending are often drowned out by people calling for more government support. As Corzine embarks on his tour of the state to discuss budget issues, the question is whether he has done enough to convince people that “shared sacrifice” is necessary? Or, has he sent mixed messages to the state’s political classes, his party’s own constituent groups, and.New Jerseyans in general about how serious the state’s financial problems are and what needs to be done? The last few weeks it’s been mixed messages. After insisting on the need for fiscal integrity, the Governor opted to avoid increasing the state gas tax and instead has forwarded a borrowing and refinancing plan to provide money for the Transportation Trust Fund. Then he directed his commissioners to prepare department budget proposals that contained 5 percent, 10 percent and 15 percent cuts. The commissioners were told that they should put everything on the chopping block, from state aid programs to jobs held by unionized workers. Then after state worker union leaders squawked about not tolerating “this budget being balanced on the backs of hardworking public workers,” the Governor backed off. He said, “Layoffs are not my intent. My intent is to reduce the size of government through attrition on an extended basis.” However, he will leave open the possibility of tax increases to balance the budget. What this may suggest to New Jerseyans is that Corzine is willing to balance the budget on the backs of hardworking taxpayers before cutting low priority programs and the government workers staffing them. This is an issue the Governor should be prepared to discuss at the budget dialogues this week. He will need a convincing explanation as to why protecting state workers’ jobs is more important than keeping taxes down or than providing more funds for state aid and a wide variety of programs. David P. Rebovich, Ph.D., is Managing Director of the Rider University Institute for New Jersey Politics (www.rider.edu/institute). He also writes a regular column, “On Politics,” for NEW JERSEY LAWYER and writes monthly reports on New Jersey for CAMPAIGNS AND ELECTIONS Magazine.

MIXED MESSAGES ON THE NEW STATE BUDGET