The economy of New Jersey is in bad shape. The state pension plans are badly underfunded, and unemployment is high. Garden State governor Chris Christie is waging a battle to reform the state's finances on many fronts, wanting to cut back the public sector and canceling a big transportation project that might have created many jobs. But at the same time he's asking the state's workers to economize, Governor Christie is giving away hundreds of millions to real estate developers on a chronically failed shopping mall. Who pay those taxes, anyway? Governor Christie, and his comrades of reforming state politicians all over, need to stay sensible, proportionate and fair.
From the start of his term about a year ago, Governor Christie has been saying he wants to cut, cut, cut -- that government is too big and taxes too high.
For instance, he's been in an acrimonious battle with New Jersey's schoolteachers -- trying to eliminate tenure, among other things. He calls the largest union a "political thuggery operation." Personally I don't have a lot of empathy for this sort of view; my parents and grandparents were schoolteachers. I imagine the end goal is to reduce the number of teachers.
Governor Christie also canceled a big transportation project, to build a huge tunnel to supplement the century-old tunnels that deliver commuter trains to New York. Funds were coming in from the federal government, and the Port Authority, but the comprehensive state new site NJ.com tells us:
Chris Christie says the new ARC rail tunnel into New York City is "not a bad idea" but is already way over budget and talks about how his middle class upbringing: "I have said 'no' because I don't have the money."
But Christie has been emphatic that he wants more money from other sources - like the federal government - and, without that, he would have no reason to change his original plan.
Washington transportation planners have been "aggressive" in trying to convince the governor to reinstate the tunnel project and have offered alternate financing and the possibility of scaling back parts of the mammoth trans-Hudson undertaking, the officials said.But the Governor says no.
As a result of canceling the project, the state may also have to give back $271 million in funding already received:
After months of wrangling, U.S. Transportation Secretary Ray LaHood said in a letter Friday rebuking Christie that the law could not be clearer: New Jersey only got the $271 million because it committed to finish the tunnel, known as ARC for Access to the Region's Core.
LaHood, a former Republican congressman from Illinois, laid out two options for Christie: We can do this the nice way, working out a payment schedule, or I can take the money by withholding federal funds.Oops.
But Governor Christie's middle class values aren't keeping him from giving up $200 million in tax breaks on a failed shopping mall project:
Xanadu, a planned $2 billion retail, sports and entertainment center located alongside the New Jersey Turnpike in East Rutherford, has already been through several owners and changing visions. While privately built, it has been overseen by the New Jersey Sports and Exposition Authority, which saw Xanadu as a future anchor for the Meadowlands Sports Complex. The authority received $160 million for a 15-year lease for the 2.3 million-square-foot complex.
The complex, as it finally evolved, was to incorporate an 18-screen movie house, the country's tallest Ferris wheel, skydiving wind tunnels, a theater and an indoor ski slope, as well as hundreds of retail shops. But the much-ballyhooed project, which was to open more than two years ago, collapsed under the weight of its costs and an economy that saw many of its proposed tenants looking for the exits.To his credit, Governor Christie says he wants the state to own a piece if any tax benefits are granted. The governor himself has called it "godawful ugly." You be the judge:
Meanwhile, the Garden State generated the largest increase in unemployment claims in the country.
In New Jersey, a hiring trend is proving particularly elusive. The state... saw a 52 percent increase in weekly jobless claims for the week ending April 23, to 16,165...
That is not a small number, considering 165,000 claimants have already exhausted their benefits since the recession began in December 2007. To qualify for a new round of benefits, individuals must return to work for at least 20 weeks, the state Labor Department said.
Big job losses in the public sector are partly to blame, O'Keefe said. Even though the state added 2,300 government jobs in February and March, it still has a deficit of 22,000 public sector jobs when compared with March of last year, he said.
The state's shrinking manufacturing sector is also a weak point. Nationally, manufacturing has become a surprisingly strong source of job growth in the economic recovery, driven by an increase in foreign demand, O'Keefe said.What's my point? Our governments, state and federal, have enormous jobs ahead -- cutting and reorganizing spending, and reorienting sources of tax revenues. Everyone will have to bear some of the cost. Favoring the real estate interests, or any other special group, as this early point is illogical and out of proportion. Let's get the rebalancing done first, and hand out the benefits later.