Jersey's bleeding jobs; State's economic woes affect business investment
THE news that New Jersey lost 2,200 jobs in October can only be understood in a larger context -- one that includes the fact that total state debt has now reached a record $33 billion and that the latest attempt at property tax reform is already in trouble.
If New Jersey's economy is "treading water," in the words of the chairman of the state's Council of Economic Advisers, it's not just the private sector's fault. For example, a brazen campaign to lure New Jersey biotech companies to Nevada includes a "relocation kit" that suggests employers "think of all the taxes you pay to a state that can't control its budget."
The state's notoriously dysfunctional government finances are blunting its competitive edge. Nevada says it began the recent campaign "in light of New Jersey's recent tax hikes and budget instability."
In addition to our infamous tax burden, including property taxes, the state is facing another huge budget shortfall at a time when many other states have surpluses. That leaves them with money to spend on financial incentives for business, economic development and marketing.
Economic experts are urging New Jersey to spend more on higher education, workforce development and marketing to recruit businesses. Yet higher education was one of the hardest hit areas in Governor Corzine's stringent budget last spring.
Fortunately, the governor is a financial expert. Corzine has promised to be a "marketer-in-chief" to attract businesses and jobs, part of his plan to create an Office of Economic Growth and a business hotline. His $150 million Edison Innovation Fund will support university research and marketable innovations in life sciences, communications and stem cell research. Another fund of $185 million will provide loans and investments to small urban businesses.
The governor has also tried a "tough-love" approach on legislators who can't see beyond the next election. He scolded them last week because they are still up to their old tricks: They can't say how they will pay for the property tax reform they are promising.
Sound familiar? It's exactly that kind of short-term thinking, political self-interest and reliance on borrowing that has driven the state debt to reckless heights. Next year's loan payments -- close to $3 billion -- will be even higher than this year's and will contribute to another budget crisis.
Legislators should live up to Corzine's expectations and look beyond their own political futures to the long-term health of the state -- and its ability to attract new jobs. As long as New Jersey is perceived as fiscally troubled, its competitive edge will be dulled.