Jersey’s Other Scandal

Back in the days when Chris Christie was a legitimate presidential candidate in waiting—remember those days?—folks in the national media seemed to believe it was morning again in New Jersey. You might remember the narrative: Feisty governor brings fiscal sanity to spendthrift state, restores order where there was only irresponsible chaos.

As the Christie era continues to disintegrate with each new Bridgegate subpoena, the narrative surely has changed. But one thing hasn’t: New Jersey’s finances. They were lousy when Mr. Christie took office, and they remain lousy now, despite all the hype about the governor’s supposed reforms and no-nonsense approach to budgeting.

For all his braggadocio, Chris Christie clearly has failed to deliver the kind of structural reform New Jersey desperately needs.

This may come as news to the paratroopers who have dropped into Trenton during the Christie years but not to those who have been paying closer attention. Last week, Fitch Ratings lowered its outlook on New Jersey’s debt to negative after Mr. Christie submitted a $34.4 billion budget that did little to address the state’s long-term debt problems.

Fitch’s move comes just three months after Moody’s Investors Service also lowered its outlook on New Jersey debt to negative and for the same reasons. Mr. Christie, like his predecessors, simply has not gotten a handle on New Jersey’s long-term debt, which amounts to $78.4 billion. Again, like his predecessors, Mr. Christie has relied on short-term gimmicks and other sleight-of-hand tricks to give the appearance of balanced budgets. 

Mr. Christie was elected on a promise to clean up Trenton and make the tough decisions that other governors, especially Jon Corzine, refused to make. It all sounded so good in 2009, but as two ratings agencies now tell us, those promises have amounted to nothing more than business as usual. “The governor has strong powers to complement expenditure reductions to balance the budget, and Fitch expects those powers to be exercised as necessary,” the analysts noted, adding, “but options have become more limited.”

Indeed they have, because the notion that Mr. Christie has imposed fiscal discipline on Trenton is not so much fiction as it is a joke. True, the governor worked with Senate President Stephen Sweeney to bring about needed reforms in pensions and benefits for some state workers. But for all his braggadocio, Mr. Christie clearly has failed to deliver the kind of structural reform New Jersey desperately needs.

In the unsparing, unsentimental judgment of Wall Street, New Jersey merits a negative outlook.

The Bridgegate scandal certainly has captured the attention of the national press corps. But it could be that the real scandal in New Jersey has nothing to do with access lanes to a bridge and everything to do with Mr. Christie’s lack of political will.

The state remains addicted to debt. Mr. Christie has only fed that addiction. That, in essence, is what Moody’s and Fitch have concluded. And they’re right.  Jersey’s Other Scandal