Christie’s strategy of corporate subsidies & tax cuts for richest one percent has failed New Jersey’s economy
By Analilia Mejia
Ever since Gov. Chris Christie’s April revenue projections came up embarrassingly short, he has toured the state saying he has no choice but to eliminate property tax relief for the calendar year and break his pledge to fund the state pension.
He claimed his hands were tied, even though the plan would mean real pain for middle class families and further hurt our standing with credit agencies.
But the governor’s claim that “there is no Plan B” was disingenuous at best. For the past four years, Christie has ignored the advice of economists by giving massive tax cuts and subsidies to big corporations while protecting tax cuts for New Jersey’s richest residents. It’s a terrible strategy that has failed to jump-start New Jersey’s economy and cost us billions in revenue. His hands have never been tied. He’s simply prioritized the rich over the rest of us.
Last week the Senate and Assembly leaderships both offered plans that responsibly close the budget gap while protecting New Jersey’s middle class. The proposals on the table include raising taxes on the state’s richest one percent, asking corporations to pay a surcharge on their corporate business taxes, and suspending wasteful corporate subsidies to financial giants such as Citigroup and Goldman Sachs.
The decision by legislators to ask corporations and the wealthy to pay their fair share is a repudiation of four years of trickle-down policies that never actually trickled down to the vast majority of New Jerseyans. All of the income gains since the start of the recession have gone to the state’s richest 5 percent. Meanwhile the rest of us are paying more in property taxes, getting less in services, and looking for jobs that are nowhere to be found. For all the $4 billion in corporate subsidies doled out by Christie over the past four years, our job growth is a dismal 48th.
In response to the Democratic plan, Republican lawmakers seem to have doubled down on the governor’s failed strategy. Their own proposal consists of slashing estate taxes for the wealthy and throwing even more money at corporations in hope they will someday create jobs. But we have tried the governor’s approach, and all we have to show for it is a weak economy, big deficits and sinking credit ratings.
Christie’s hands have never been tied. He’s prioritized the rich over the rest of us.
If we really want to create jobs and attract employers, we should focus on smart investments in the things that make New Jersey a great place to live and do business. We have to address our crumbling roads and bridges, reverse a troubling trend of disinvestment in higher education and invest in a highly trained workforce that has always been New Jersey’s biggest draw for employers.
None of this can happen overnight. Preliminary reports suggest that the revenues offered by the Legislature are only temporary. Even if this year’s budget crisis is resolved, our schools and communities remain grossly underfunded after years of budget cuts. Any comprehensive fix for New Jersey’s fiscal woes must include new, sustainable sources of revenue. It also requires seeking out federal dollars more aggressively, decreasing our reliance on regressive property taxes and looking beyond the year-to-year budgets so that we can plan with a long view.
A broad-based and diverse coalition, Better Choices for New Jersey, came together at the start of the Great Recession to promote policy solutions that could right New Jersey’s finances and foster a shared economic recovery. This year more than 40 of our partner organizations, including labor unions, environmental organizations, student groups and communities of faith, came together and issued a joint letter calling on the Legislature to put together just the kind of plan that now seems to be taking shape.
We commend legislative leadership for its bold stand for the middle class and we look forward to working with Trenton on more proposals that will deliver the comeback New Jersey deserves.
Analilia Mejia is director of New Jersey Working Families, which organized the statewide Better Choices for New Jersey campaign.
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