NY to NJ: FAILURE

By Michael Patrick Carroll | August 19th, 2008 - 3:41pm

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A recent column in the New York Post points out the dismal state of affairs at New Jersey’s leading newspapers, attributing the layoffs, buyouts, and cutbacks to the similarly sclerotic state of New Jersey’s economy. The author accurately blames the pathetic economy on the State’s insane fiscal policies.

When New Yorkers start favorably comparing their own State budget and tax policies with those of New Jersey, things are really in the tank.

The author failed to mention the delicious irony: the Ledger owes its precarious financial condition to the State’s adoption of the policies its editorial board endorses – the purveyors of Politically Correct opinion hoist high upon their own petards. Who says the political gods lack a sense of humor? (Robespierre, call your office.)

Liberal policies inevitably destroy economies. It’s not a tough call: PA is essentially an economic basket case, except along its border with NJ, where our idiotic tax, borrow, spend, and regulate policies make it look good by comparison. If productive folk can escape the reach of a government which treats their capital and labor as community assets, they will. And they have. That’s why the left favors national ... everything, because they figure escaping a country is much more difficult than abandoning a state. People fleeing California’s nonsensical fiscal policies make Nevada the fastest growing state in the nation; it’s more difficult to leave the USA for freer pastures, like Ireland or Singapore.

Just listen to Obama; the top 1% of all federal taxpayers already pay 40% of all taxes; the top 10% pay 71%. But, to liberals, that’s not enough; they’re not paying their "fair share". (The two most dangerous phrases in the liberal lexicon are "fair share" and "reform"; both translate as "more". Governmental "reform" always means more government; whatever you’re paying now, your "fair share" is always more.) Obama proposes to do for the entire country that which McGreevey/Codey/Corzine have done for NJ. Should he win this election, we can only hope those promises are, like so many of his other campaign statements, mere empty rhetoric for his leftist base.

While it may be difficult for people to escape an increasingly confiscatory state, not so capital. It will flow to where it secures the greatest rate of return. Tax it and it will leave. Again, using NJ as an example, McGreevey and the Democrats doubled the tax on businesses. Unsurprisingly, that annihilated economic growth; NJ boasts fewer private sector jobs than it did when he took office. And, yet, true to the old Reagan observation about liberalism – "if it moves, tax it. If it keeps moving, regulate it. If it stops moving, subsidize it." – NJ pols embarked on a Japan Inc-style industrial policy, attempting to pick "winners" – like stem cell research centers – and offer them massive tax subsidies to locate here. Through taxpayer subsidy programs, like BEIP, they reward a few high profile entities, while driving countless, nameless others from the state. This makes sense ... why?

And this is "progressive"? Toward what destination are we "progressing", other than bankruptcy?

As the Post column observes, an unholy alliance of people who profit from the taxpayers’ misery combines to reelect the architects of that distress. Urban residents and public employee unions, obviously, refuse to elect people who threaten their boodle. And the Democrats expressly promise to make things "progressively" worse. On top of a huge new unfunded mandate for "affordable" housing, they promise to heap a mandate for "affordable", universal health insurance, costing billions more. And the program will be hugely popular among beneficiaries – who vote – while those to whom government sends the bills increasingly seek economic asylum across state lines.

Rich liberals, like the Corzines of the world, don’t care. (He might, if we imposed a requirement that all investments held by sitting governors be in New Jersey companies.) But folks Obama considers "wealthy" – those making $250K or so – often disagree with that descriptive, and stubbornly wish to put their own kids’ needs ahead of the desires of strangers. Since taxes constitute a first claim on income and assets, the effect of liberalism is to place the desires of those strangers ahead of the needs of the person earning the income. And that’s just plain backwards.

Already, here in NJ, the system shows the indisputable signs of collapse. When the only segment of the economy growing is government, that’s simply unsustainable. The problem cannot be solved by early retirements or modest curtailment of governmental programs (assuming that Corzine, or any leftist, would accept even such a modest curtailment, instead of seeking massive further expansion). Only a fundamental rethinking of the appropriate mission of government – consistent with basic human nature – can produce economic prosperity.

Simply put, prosperity requires the wholesale repudiation of the leftism.

Well-off folks – even modestly well-off folks – should help their neighbor. And, indeed, they do. But a fundamental distinction exists between a moral obligation and a legal command. Jon Shure would make a wonderful priest, imploring his flock to assist the downtrodden. But what works well in church – in which the audience is free to disregard the priest, and determines for itself how much it can afford – fails miserably as governmental policy. The asserted needs of the supplicants always far outweigh the willingness of even the most selfless congregation to sacrifice. And the priest, when elevated to tax collector, refuses to take "I can’t afford it" for an answer.

Leftists refuses to admit of a need to which government should not attend. And, of course, such needs are filled by highly paid, well-benefitted, civil-service-protected, politically active public employees, who, too often, conflate their own material well-being with the public interest. In consequence, the public sector bloats, taxes mushroom, and those selfish "rich" folks with kids of their own to raise, find any refuge they can. Our government keeps trying to "help" those in the water by handing anchors to those in the boats. Perversely, this pleases the left, which doesn’t object to drowning, provided that everyone drowns together, and which doesn’t trust the folks in the boats to voluntarily assist those in the water.

For the poor, the best possible state of affairs rests in residing in a dynamic, prosperous society, with few guarantees but much opportunity. Economic evidence demonstrates conclusively that the freest societies are the most prosperous. We can emulate Sweden – in which everyone enjoys modest prosperity, but from which the most talented folks flee – or Singapore. Singapore, among the freest economies in the world, grew at 6.6%, 7.9%, and 7.7% over the last three years. Sweden grew at 2.7% last year. Singapore’s average tax rate: 14.9%; maximum 20%; Sweden imposes the highest income taxes in the world. Which model best serves the needs of ALL the people?

The US government lists Singapore’s natural resources as "none". Phooey. They possess the most important economic resource of all: freedom. The results speak for themselves, and NJ would do well to emulate that example, so that we can once again be a beacon to the people of NY.

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Thanks, but...

Submitted by jonshure on August 20, 2008 - 9:46am.

MICHAEL: Thanks so much for including me in your analysis. However, I can think of at least a couple of reasons why I definitely would NOT make a good priest. JON SHURE

Jon your right ....

Submitted by mrb on August 20, 2008 - 5:38pm.

advising people should most certainly not be your line of business ...maby something with a wrench and plunger ..

Carroll

Submitted by nbrefugee on August 20, 2008 - 7:17pm.

Carroll is a typical NJ Republican He loves telling you what you already know. The only one worse than him is Bill "BS Bill" Baroni. Nowhere does he offer a real remedy to anything. How about I and R - Calif style. With I and R the citizens could then impose tort reform on the legal community. We could copy the British and have a "loser pays" system in torts. I wonder what Mikey thinks about that.

To chickens@#t mrb:

Submitted by jonshure on August 21, 2008 - 8:26am.

I respect people whose livelihood involves working with wrenches and plungers but I don't suppose your elitist comment was meant as a compliment.

Don't you think that instead of hiding behind the anonymity of the Internet your attempt at an insult would have more impact if you had the guts to attach your name?

Jon Shure

Carroll, naysayer extraordinaire

Submitted by MartinOne on August 21, 2008 - 11:48am.

Where Assm. Carroll is right is in his excoriation of high taxes in the state and the benefits of tax relief to residents and the business community. But his analysis is otherwise dead wrong as his furthering of the failed Reaganonomics policies that have left this country in massive debt through Reagan's progeny, Bush 43, and the further division between lower and upper class Americans, furthered by failing conservative economics which disproportionately assist the highest 1% of Americans.

Blaming New Jersey's problems on some nebulous "Left" is intellectually dishonest, and Carroll, who is incendiary but not intellectually feeble, knows better. Hundreds of school districts, the patronage system, and more, (in short, what adds to the high property taxes in the state), were put in place long ago, before the Dem/Republican divide, perhaps even closer to the Whig days. And, of course, Carroll became an Assemblyman in 1996 and probably supported the boondoggle Whitman budgets, which exacerbated state debt and borrowed from one fund to another to pay for current budget requirements. Carroll voted against the Corzine budget for the upcoming fiscal year, and this reduced state expenditures by $600 million, if not more. It seems that the problem is a "Democratic" one, only when the criteria is shifted to the majority party.

Unions are not the problem, though pension reform is necessary. Surely, Carroll doesn't disagree with the right to collective bargaining, the most fundamental way for workers to have a basic say in their working conditions. One can make government more affordable and efficient without declaring war on the lower and middle class; unions are necessary for evening the economic playing field in this country.

At the very least, I would gently suggest to Assm. Carroll to rethink this philosophy of complete economic deregulation. If one doesn't rethink this ideal in the light of Bear Stearns and other financial companies and sectors generally that were in desperate need of regulation, then I would suggest that such a person has an overtly myopic and rigid approach to economics. The people of this country, in light of these economic failures and other such examples of conservative rule, such as the non-response to Katrina, don't want less government; they want government that works and manages well, which is only possible under Democratic leadership, judging from recent presidential tenures and Democratic leadership on the state level.

Martin One

Submitted by mcarroll on August 21, 2008 - 8:29pm.

... needs some history lessons. While I don't normally respond to comments, this one merits a brief riposte.

First, I voted for precisely one of the Whitman-DiFrancesco budgets, and I regret that one vote more than any other (except for voting to support a pension increase based upon what I should have realized was fraudulent evidence). I opposed Whitman's foolish borrowing schemes, including the pension bonds and school bonds. Together with a few of my fellow conservatives, we stopped her proposal to increase gas taxes cold, saving the people of NJ billions.

"Conservative economics" assists everyone by leaving everyone alone to earn what they can and keep what they earn. We call that "freedom". You might consider it.

Corzine's budget, while not as bad as McGreevey's (talk about damning by faint praise) was, nonetheless, a fraud. It reduces spending by not one nickel and continues to lavish unwarranted subsidies upon profligate urban areas. It's akin to his much ballyhooed fraudulent paydown of $650 million in debt. If you're paying down $650 million, but borrowing $6 billion, you're not making progress.

The problem with Bear Stearns was not that it failed, but that the feds didn't let it fail. A taxpayer bailout is wholly unwarranted. And Bear pales in comparison to Freddie and Fannie, magnificent exemplars of governmental incompetence. If the feds can't run their own companies, what makes one believe that they can properly regulate the entire financial services industry? Indeed, given governmental performance running health and benefit programs like Social Security and Medicare, one would think that the case for governmental incompetence to do essentially anything had been so conclusively established as to be utterly beyond dispute.

Indeed, Katrina makes my point: such was not a Republican or a Democratic failure, although the governmental failings were much more obvious from a Democratic Mayor and a Democratic Governor in a dysfunctional Democratic State than from the feds. But, give the devil his due: Katrina WAS a federal governmental disaster, too, because government is simply and inevitably incompetent.

Anyone who believes that "government ... works and manages well ... under Democrats ...", in light of the pathetic history of the past 7 years in NJ, is simply beyond redemption. The problem with NJ is that both parties govern from the Left, with Kean and Whitman pursuing policies that should make Martin grin and conservatives cringe. He, alas, appears blinded by partisan rancor, both to the facts of my record and to reality.

I've reread what I wrote; I don't see that I have EVER defended the indefensible fiscal policies pursued by liberal Republicans, but perhaps Martin will correct me. I object to idiotic economic policies, whether pursued by liberal Republicans or liberal Democrats. Socialism inevitably fails, whether its architect is a Republican or a Democrat.

Finally, a word about unions. I don't see that I disparaged them; I simply pointed out the obvious -- one must not place oneself into a position in which one's narrow self-interest conflicts with the common good. Winning a right at the bargaining table (with the taxpayers on the other side) is one thing; using political muscle to secure those benefits legislatively is quite another.

I commend Martin on his erudite commentary, but I gently suggest that he might profit from reading that which I wrote rather than that which he imagines I wrote.

Two things for MartinOne

Submitted by MiddleClassSqueeze on August 22, 2008 - 9:09pm.

Two things stick out to me in that post. First, there is no "nebulous" left. It's a pretty easily definable left. Seven years of Democratic rule in the executive and legislative (and judicial but that's another post) branches, and it's pretty plain to see who the "left" is. This state has been run by Democrats for almost a decade and we have seen our taxes increase, government increase, and our debt rise. Nothing "nebulous" about what's happening or whose doing it.
Second, don't talk about Corzine cutting the budget by $600 million when a few weeks later add over $3 billion more in debt with funding of the Abbotts. Just because it makes you feel good spending the money, doesn't mean there are no consequences. The road to hell is paved with good intentions. The way this state is going, bankruptcy will be one stop-over on that road.

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