Corzine Economy Is Tanking
featured in Carnival of the New Jersey Bloggers # 47
The AP reported today that New Jersey’s economy is slowing.
New Jersey remains in the slowest expansion since World War II, said James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University.
“Our conclusion is that all the national statistics show that high-end corporate America is expanding quite briskly, but it is doing that expansion almost exclusively outside New Jersey,” Hughes said. “New Jersey has secured a reputation over the last four years of being a hostile place to do business.”
This is not surprising. Last month The Tax Foundation reported that the business climate in New Jersey is ranked 49th in the nation.
There does not appear to be relief in sight. Governor Corzine has proposed raising the state sales tax from six to seven percent. This will surely drive purchases across the bridges. Fewer purchases means less business in the state. The “revenue raisers” the governor looked at to prepare his budget were all about raising taxes and fees. Instead he should have been concentrating on re-defining the business climate. When business grows, so does state revenue. That should be done through tax volume increases, not tax percentage increases. Everyone wins when the economy is healthy. This is Economics 101, sir.
Look no further than sin taxes. Corzine has proposed big increases in cigarette taxes (whispers are it is not as large as he wanted). Yet, revenue collected from cigarettes will decrease (thanks, Enlighten). That is the nature of sin taxes. Governments keep raising taxes on these products to balance budgets for the public good and eventually the public stops using the product. Then the cash cow is gone.
There is not much promise in doing business in New Jersey (unless you sell insurance). Wasn’t Corzine touted as a man who would bring a businessman’s approach to Drumthwacket?
By Enlighten-NewJersey on Apr 4, 2006
Great post. Now if we could get the people of New Jersey to understand that taxes matter we’d be making some progress. The FDU poll results published today indicate our work is cut out for us. The vast majority of people are against tax increases if they believe they will have to personally pay them, if others will be hit with tax increases, a minority opposes them.