State of the State

 This Tuesday, Governor McGreevey will deliver his state of the State speech. As is his wont, the Governor will likely grab the credit for the good things which happened on his watch, while blaming the previous Republican administrations for any difficulties.

According to published reports, Hizonor will claim credit for advancements in three areas: education, employment, and the environment. In each case, the Gov deserves brickbats, not applause.

The easiest subject is employment. In creating new jobs, New Jersey is among the national leaders. The Governor will likely claim that his policies produced this phenomenon.

Balderdash.

Two events underlie New Jersey's better than expected job growth: September 11 and the Bush tax cuts. According to published reports, with the destruction of the Trade Center, a substantial number of businesses relocated to New Jersey. The Bush tax cuts have both resurrected an anemic stock market, increasing employment, and disproportionately benefitted those who pay the most taxes – that is, people who live in New Jersey.

Indeed, if anything, the policies of the McGreevey administration actively undermine our economy. First, his gargantuan tax increases on businesses obviously hurt employment; it's not rocket science to comprehend that increasing taxes on employers reduces their opportunity to hire new employees or better compensate the ones they have.

But, just as importantly, the Administration all but declared war on business. A recent survey shows that New Jersey ranks dead last for "fair and predictable" tax law enforcement. As the article states:

"New Jersey was ranked among the five most aggressive or least fair states in seven of eight (categories); respondents said New Jersey's tax policies were the most likely to dissuade companies from relocating to or expanding in the state. That's a stunning change for a state that didn't make the worst five in a single question in our 2000 tax survey, and is well known for actively courting business."

Businessmen complained – justifiably – that corporations are now subject to a minimum assessment, whether they make a profit or not. New Jersey ranked dead last as a desirable place to locate or expand a business. It's administration of tax laws ranked worst in the nation.

This survey is not "objective"; rather, it measures business' s subjective opinion on how they are treated. This Administration spares no effort to convince businessmen that they are freeloading enemies. Given this hostility – actual and perceived – it is patent that if job growth there has been, it comes in spite of Administrative policies, not as a result thereof.

On education, this Governor continues the policy of beggaring suburban schools while lavishing money on inefficient, wasteful urban schools. The money urban schools pay per child approximates that which would be required to hire individual tutors for each kid. Literally no effort is made to restrain outrageous administrative expenses; a Republican proposal to hold urban districts to the state average administrative spending level met unanimous Democratic opposition.

On the environment, this Administration has resorted to the discredited policy of imposing substantial fines upon "polluters" instead of working together to effect cleanups and ensure against future problems, while encouraging businesses to locate and remain in state. Approaching matters punitively – that is, punishing companies with massive fines for actions which were perfectly legal when taken – is NOT the way to improve the environment. It does, however, contribute to the continuing erosion of manufacturing jobs and the overall impression that New Jersey is actively hostile to business.

Let's be clear: the measure of environmental progress is NOT in the quantum of fines collected. Nor is the environment improved by hiring expensive, out of state tort lawyers to sue New Jersey businesses for "natural resource" damages, as the Administration has done.

Or take sprawl. The best solution requires devoting Green Acres funds to purchase as much open space as possible where it exists. Unfortunately, a large fraction – up to half – of such funding is spent in urban areas to improve existing parks. While that is a desirable goal, park maintenance ought to be funded by the municipalities; we should not divert funds away from preserving disappearing open space. This Administration's emphasis on urban parks might play politically in Democratic municipalities, but it misallocates scarce resources away from their intended purposes.

Hence, on each of the three "E's", this Governor fails. He has done nothing to increase employment and much to undercut New Jersey's previously exemplary reputation as a desirable location for business. His environmental initiatives appear designed more for their symbolism than toward actually effect environmental improvement. And his educational policy continues to undermine successful suburban districts.

Of course, about property tax relief, auto insurance reform, and governmental ethics, this Governor has nothing to say, being a staunch opponent of all three.

Under the previous Republican administrations, we clearly spent too much and borrowed too much. This Governor rightly castigated the GOP for its profligacy and irresponsibility. Unfortunately, he came, he saw, and he raised the ante, massively increasing taxes (breaking an unequivocal campaign promise in the process), massive increasing borrowing (to pay for current operating expenses) and bloating state spending at something like three times the rate of inflation. And this Administation's scandals make the Clintons look almost saintly by comparison.

Simply put, this Administration deserves very little credit for that which is good, and much of the blame for that which is bad. Its decisions are animated more by crass political concerns than by good policy. On virtually every level, the state is worse off from two years of Administrative miscues and incompetence.

Ironically, if the economy continues to improve, McGreevey may owe his brightening reelection prospects to voter amnesia and the polices of George W. Bush. The worst thing which could happen to McGreevey would be a Dean victory, which would clearly send the economy into the crapper, with New Jersey – bearing the brunt of Dean's elephantine tax increases – leading the way.

Fortunately, the prospects of that look fairly dim. But, alas, that may help McGreevey. Ah, well, the prospect of New Jersey's continued suffering under an inept and destructive administration is a small price to pay for continued national prosperity.