In his budget address to the Legislature on Tuesday, Governor Christie outlined his paradigm, a “New Normal” to deal with the state’s ongoing fiscal crisis. Instead of proposing a restructuring of state government that would end the annual crisis atmosphere in Trenton, the Governor has come up with a rehash of the old paradigm–tax and spend—with a much needed dose of business tax cuts to boost the economy.
In other words, Christie did not present a strategic vision to the people of New Jersey that would make the state a beacon for job creation and sustainable business expansion and end the redistribution of income that the Governor recently said is unfair to suburban taxpayers.
In short, Governor Christie’s “new normal” leaves much to be desired. He needs to take a page out of his predecessor’s rhetoric and be “bold”—and that means taking on the Supreme Court and every special interest who thinks it is entitled to other people’s money. In other words, we need to bury finally the paradigm that is responsible for the fiscal mess in Trenton and Washington DC, “From each according to his ability to each according to his needs.”
Governor Christie’s “New Normal” consists of the following five propositions.
First, it continues to reduce government spending – below last year’s level in absolute dollar terms, for the second year in a row. (Good)
Second, it makes a down payment on growth by providing $200 million in job creating tax cuts and business incentives. (Very Good)
Third, we can make a contribution to our pension system early and get that money working immediately, if we adopt real reform of our pension system. (Good)
Fourth, we can double the property tax rebates for New Jersey’s hard working middle class and seniors, if we adopt real reforms in health benefits. (Bad)
And fifth, we will increase education aid to every school district in the state. (Very bad)
Let us look at the very good, good, bad and very bad of the Governor’s ‘New Normal.”
Reducing the budget is good because it eliminates the need for higher taxes and reduces the state’s role in the economy.
Cutting taxes is always very good because more money in the hands of business owners will create jobs and increases the output of goods and services the public demands.
Funding the state pension system is imperative. It has been unconscionable that so many governors have abrogated their legal and moral duty to fund adequately what the state and state employees have contracted.
Increasing tax rebates is another gimmick by State to reduce the tax liability on certain segments of the population. An honest property tax reduction would be to end school property taxes and the state income tax for seniors, childless professional couples, parents who send their children to independent and religious schools, homeschoolers and singles who own homes. In other words, parents of children in local public schools should pay for their children’s education.
Fees for services should be the new paradigm in New Jersey. This would end the redistribution of income from the suburbs to urban school districts and force real reform in urban education. As the Governor noted in his address, the cost of educating public school children in Asbury Park and Newark, $33,000 and $23,500, respectively, is outrageous given that only half are proficient in math when they graduate.
So what does Christie propose to do about this incredible waste of money? I cannot find a solution to this massive failure in his budget address. The solution is clear. Local schools should be funded with local resources, and that means no more “trickle down” funding from the State that soaks suburban taxpayers to pay for the greatest failed social experiment in New Jersey—public urban education.
Increasing state aid to all school districts is a farce. The State continues to redistribute suburban tax dollars aid as if they were candy to failed school districts hoping some good would come of the largesse lavished on urban school districts.
In short, it is time for a new education paradigm—separating school from the state. Parents are responsible for raising their children, not the state—or the “village.” We need real choice in education, especially in New Jersey’s cities. How education will be “delivered” to students is up to parents, teachers, community leaders, et. al. who want a better outcome than what we now have at extraordinary costs to everyone.
Murray Sabrin is professor of finance at Ramapo College of New Jersey and blogs at www.MurraySabrin.com.