New Jersey Jewish News
Commentary

Steve Landfield’s column appears twice a month in New Jersey Jewish News.

This week, New Jersey Gov. Jon Corzine may have the distinction of winning a dubious race — the fastest time between taking office and hiking taxes.

Unfortunately for him — and for the rest of us — with a $4 billion budget hole to close, he really doesn’t have much choice. Necessary or not, the sad fact is that although we already pay some of the highest taxes in the nation, the pain is only going to get worse.

Corzine intends to try to cut half the budget deficit by freezing and reducing spending. That can only go so far toward filling such a huge hole. For those in Trenton, it will mean significant budget cuts, layoffs of state employees, and a freeze in state aid to education.

The problem is what to do about the rest of the deficit. The solution is a new round of what have euphemistically been called “revenue raisers.” But let’s face it: That’s just a nice way to say “increased taxes.”

First on the block will be a likely increase in the state sales tax from 6 to 7 percent. You could argue that this is a good way to increase revenues, as the sales and income taxes are considered “progressive” taxes, meaning the more you spend the more you pay, unlike the regressive property tax, which is so heavily relied upon in the state.

Add to taxes on goods and services that have traditionally been exempt, like tanning salons and video rentals, and the result is not just higher taxes, but more items being taxed.

Wisely, there is no talk of taxes on professional services, like your doctor visits, or on clothing, which brings thousands of New Yorkers over the borders into our state for tax-free clothing purchases. New Yorkers also buy our gasoline, which is also less taxed and lower priced than the same product in New York. That is good for the economy of the counties bordering New York, and hence good for all of us as well.

Looking deeper into state fiscal issues is a troubling journey.

The governor claims he does not intend to use financial gimmicks to balance the budget, but that is exactly what he is doing in the case of the Transportation Trust Fund, which will go bankrupt without an infusion of new funding. Corzine’s proposal? More public debt. Rather than increasing the gasoline tax to pay for roads and transit improvements, his solution is a borrowing plan that will carry the fund for the next five years. However, the debt will burden NJ taxpayers for 30 years, which is 10 years longer than the existing 20-year debt of the fund. And it still won’t provide enough, leaving the problems of repayment to a future governor. Sound familiar? If that isn’t gimmickry and fiscally irresponsible behavior, what is?

There are many other areas where cronyism and inefficiency still prevail despite the fiscal emergency — areas in which state legislators and the governor himself seem afraid to change the established order of business in Trenton.

For example, a large part of the budget deficit is due to money owed to the state public pension plan system. Despite this, politicians have chronically underfunded the system and raided it with pension-padding tactics, which cost all of us. So we are being asked to pay higher taxes, while legislators refuse reforms and allow fiscally reckless behavior to be rewarded.

Or take the widely reported patronage mill known as the Victims of Crime Compensation Board. According to the Bergen Record, the board is run by three grossly overpaid and chronically absent commissioners. Proposed legislation would cut spending by almost half a million dollars by getting rid of the political hacks that milk the board. But the real question is: Why has such a board been allowed to continue operating that way in the first place?

A discussion of reform of educational spending would take up a column of its own. It would take several pages to address spending by the Abbott Districts, which has resulted in 80 percent of the state’s students receiving only 40 percent of state educational funding, while the underprivileged districts spend exorbitantly with little measurable academic gain. Or we could look at the state’s ineptly run, inefficient, and possibly corrupt Schools Construction Corporation, which has taken $6 billion and turned it into — well, we’re not sure what. We still don’t even know how many schools need to be constructed.

Finally, we should examine the wasteful inefficiency of the state’s 615 school districts, some of which don’t even have students. Why can’t administrative functions be consolidated, as they have been in other states? Why not institute a program of sharing such costs as administration, payroll, and purchasing?

Maybe the only answer is, because that is how things are done in New Jersey. But that excuse no longer suffices, especially when we are being asked to dig deep into our pockets to keep the system afloat.

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