Chris Christie, NJ Gov since 2010, can give a speech. He had me all wound up last night. Maybe this was the most inspiring speech from a politician I have heard in years. He proclaimed he took a state that had raised taxes 115 times in the eight years before he took office and was hopelessly in debt and miraculously balanced the budget every year he has been in office.
I was ready to sign up. Maybe a lot of people were. I was thinking Romney had better be glad Christie didn’t run, because we all would have gotten behind him.
Well, maybe. His assertion is dubious and rated by Politifact check as half-true. It is semantics permitted by the meanings of words, which I am not going to go into, but can be read here.
What he did the first year was skip a $3.1 billion pension payment (see article here), didn’t fully fund the school aid formula or fully fund the state’s property tax rebate program.
“I haven’t raised taxes in the time I’ve been the governor of New Jersey and I didn’t need to sign a pledge not to,” Christie said at an Aug. 20 news conference in Asbury. Maybe he didn’t raise the rates, but what he did do was to eliminate tax credits—the earned income credit was cut by 20% ($200 per family, which netted the state about $100 million) and cut the Homestead rebate by a total of $850 million, an average increase of about $800 per household. It is obvious which economic demographic was most affected by this.
After giving out $1.5 billion in tax incentives to businesses since he took office, he is now proposing almost $2.5 billion in tax relief and incentives over the next five years, among them:
- Double the State Research and Development Tax credit to encourage tech and biotech entrepreneurs and related jobs.
- Allow loss-netting and loss carry-forward relief to be phased in over five years. “Our current policy of restricting loss carry-forwards hurts small business, hurts entrepreneurship, and hurts New Jersey,” Christie says.
- Use a single sales factor to “stop penalizing corporations for adding jobs and investing in New Jersey.”
- Cut the minimum S-corp business tax by 25%.
- Exempt high-tech business software from sales taxes.
All this might be well and good except that the poor and middle class pay for this in the form of reduced credits as seen above, and because of other cuts made in the state.
Camden, among the 10 most dangerous cities in the U.S., is losing its police department in an attempt to shave millions of dollars from its budget, which has been funded by the state for years. But, the city is not becoming a completely lawless land. It will be under the jurisdiction of a new, non-union division of the Camden County Police. The Camden Fraternal Order of Police calls this a form of union busting. Fewer than half of the 460 officers of the Camden Police Department will transfer to the new county division. Laid-off officers will be training their county “Metro Division” replacements. Newark is in a similar situation, and is expected to have to lay off a significant portion of its fire fighters.
He—and almost all Republican Politicians—detest unions. Christie said as much last night. This is acceptable if the voters go along with it, but he has gone over the top by not funding nearly $3 billion a year for two years—nearly $6 billion—of the retirement fund for state employees. This is a promise made to them by the state and by the voters that, he cavalierly broke.
If things were so dire, why give all the breaks to businesses? Oh yeah: tax cuts create jobs. About that: Campbell Soup was given $42 million to create jobs in Camden. When the company proceeded to cut 100 jobs, Christie merely slapped it on the wrist, reducing its tax credit to $34 million, with the stipulation that the company andd five jobs per year over a decade after it regains its previous employment total. For those keeping score, that’s $34 million for 50 jobs.
This is what we want? Is this an indication of what the new Republican Party will do if it gets control of the national budget? (I have on my list of things to read the Ryan Budget.) Yes, we have a budget issue, taxes are too low and spending is too high, but I pass on Chris Christie’s model.