It has been clear for some time that New Jersey has been spending way beyond its means. And the Governor ("I didn't take this job to be Scrooge') continues to ignore the fiscal calamity facing the state. But with all of his fiscal scams, I thought he was intelligent enough to either change the rules or come up with a technicality around New Jersey's leaky laws regarding public funding and spending. Apparently not.
Governor Corzine has failed to respond to an open records act request from Senate Republicans regarding the states budget. From Politicker:
The complaint notes that there is a constitutional requirement that the expenditures of the State not exceed its revenues and that Governor Corzine has acknowledged drops in revenue that meet or exceed the planned surplus for the current fiscal year. At the same time, the Governor has continued to sign new appropriations into law, without indicating how those appropriations will be funded.
Could it be that our Governor knows that the state is spending far outside the revenue it is taking in right now? I would bet on it. Otherwise, why would the governor refuse the request which would put him squarely in violation of the state constitution.
At his end-of-the-year press conference today, Governor Corzine gave a pessimistic view of the next year in New Jersey and committed to cutting spending. This is gonna hurt. We've been gluttons for too long, and as we tighten our belts we will be in more pain because of it.
(Fortunately, for most of us, this is just a metaphor; that said, please remember the "We Can't Let This Bank Fail" food drive.)
It's a shame that it will hurt this much. Some of this was avoidable, even with the financial sector's plummeting fortunes.
Think about one aspect of the pain: cutting the government's budget will mean lost public-sector jobs. Transitioning from a government job to a private-sector job is hard -- and it's made even harder when private-sector unemployment is high. People with "safe" government jobs will feel more pain than if we had reduced our budget earlier, increased private employment in the state, and thereby encouraged them to get private-sector jobs.
Don't get me wrong: a bad economy always hurts. But this one will hurt more because of our dependence on the Nanny State.
And we will only be making this particular dependency (government jobs) worse if we pretend that feeding the government is an economic stimulus. Go to war with Connecticut? Maybe that would stimulate the economy. Pour more money into government contracts for road building? Not so much.
I don't only blame Governor Corzine. As WBGO reports, "His most recent plan to delay pension payments floundered in the Senate." But I do worry about him; he needs to follow through on this promise:
Let’s actually get in front of the curve as opposed to staying with it and waiting for some other shoe to fall, to drop, to get to a conclusion. I feel very strongly about that. It’s not exactly a love fest with regard to those issues.
We should have done that already. We shouldn't have a 33-plus-billion-dollar budget. Yes, we should have encouraged municipalities to merge or share services -- something I heard Corzine claim on WBGO this morning, but that isn't included in their write-up -- but we also should have made them less dependent on the state in the first place.
Governor Corzine, State Assemblymen, State Senators, now is the time. Yes, this is going to hurt, but the time will not come again in which people are this willing to regain control on spending. Tightening the belt will hurt, yes, but you have to do that anyway. Ratchet it tighter than you feel comfortable with, because normally the ratchet works only one way, and you can't tighten it at all. Get ahead of the curve.
Don't play games: don't claim that you've made deep cuts when you're only going back to 2006 funding levels, don't claim that you're only borrowing for "required expenditures" when every penny borrowed or spent represents a choice to go further into debt, don't posture as a deficit hawk while promising bailouts and stimulus packages for big government projects.
There was a headline on the Drudge report yesterday referring to Joe Biden telling George Stephanopoulus that the economy was tanking. From ABC news:
Vice President-Elect Joe Biden said the U.S. economy is in danger of "absolutely tanking" and will need a second stimulus package in the $600-billion to $700-billion range.
"The economy is in much worse shape than we thought it was in," Biden told me during an exclusive interview -- his first since becoming vice president-elect-- to air this Sunday on "This Week with George Stephanopoulos."
"There is no short run other than keeping the economy from absolutely tanking. That's the only short run," Biden told me.
The interesting thing about Biden's comment is that there is no interesting thing. His analysis is based on nothing and contains no reference to anything intellectual as the basis for his line of reasoning. Try this quote:
Every single person I've spoken to agrees with every major economist. There is going to be real significant investment, whether it's $600 billion or more, or $700 billion, the clear notion is, it's a number no one thought about a year ago," he said.
"Every single person" agrees with "every major economist". This statement is the classic Joe Biden rubbish. Doesn't he remember that a child he told his mother that "everybody" was doing it, and she probably responded with "name three". And his sweeping generalization wouldn't be as bad if this were not so important and his statements so obviously wrong.
The Volokh Conspiracy refers in this post to a summary of economists and their opinion of the original congressional bailout. As you will clearly note in this article and this document from the leading economists, there is no clear agreement. And that was in October. I guarantee you that the "agreement" has severely deteriorated since then.
While Biden's childish reasoning may be acceptable in a debate of global warming "everyone believes it and if you don't you are a neanderthal" among his ultra liberal social circuit, it doesn't cut it as a Vice President-elect. He better figure out soon that while he can make up stories when debating a Republican Vice Presidential candidate who the press hates and get away with it, he can't do it in the real world.
My creativity has been a bit off lately with too much going on at work to really think about the political and financial tsunami around us. Or maybe it is more about avoidance. Either way, it's time for some randomness....
The NJ Governor signed legislation today that has been reported(here) as a business inducing change in the state's taxation rule. What strikes me as strange is that while we have had a stampede of business unfriendly legislation (increased taxes, paid family leave, increased rules and regulations etc) that have had an absolutely direct impact on revenues and/or costs, this legislation represents some esoteric rules changes that will frankly only do something for the companies who apparently lobbied someone. You want to stimulate business in New Jersey? Give a three year tax holiday for any company that hires more than 250 people in the next three months. Stop with the lame pretend improvements.
The state Minnesota has spent millions to get to a foregone conclusion. That a clownish Democrat will somehow procedurally be declared a senator. The same team(read here) that accomplished a similar overturn of an election in Washington state is on the job. And Minnesota will only begin to be embarassed should Franken get away with it.
New York woke up recently to the announcement of their Governor's plan to tax everything that moves. I commented on the Patterson's plan here at njtaxrevolution. Then I read this opinion piece in the Inquirer. And main thrust of the argument is that at least NJ and PA are not in New York's situation. The joke of that argument is that when the economy was much better, New Jersey already enacted the same pack of clownish legislation taxing everything that moved. And look where it has gotten us. We still have outrageous deficits and the only reason it isn't more obvious in the news is that New York already knows that they are in trouble. Our state leaders haven't done the math yet.
New York's weakest Governor of all time who is still whining about his Saturday Night Live depiction has presented a budget that is absolutely underwhelming in every way after promising something grand.
I will give him minor credit. Patterson made an attempt at getting the out of control pension costs under control by exercising some restraint on new employees. But event that does not go far enough.
The real issue is the 88 new taxes and fees he has proposed on virtually everything. Corzine did it in NJ two years ago and gave birth to this site. And I hope someone in NY does the same thing there. 88 new taxes and no spending cuts. Not only is the governor blind, he is deaf (pc police can insert there bile here).
Based on the vagueness of the complaints against Mr. Madoff, his confession, as detailed in court filings, seems to have taken the F.B.I. and S.E.C. by surprise. Investigators have not explained when they believe the fraud began, how much money was ultimately lost and whether Mr. Madoff lost investors’ money in the markets, spent it, or both....
[T]he S.E.C. had already investigated Mr. Madoff and two accountants who raised money for him in 1992, believing they might have found a Ponzi scheme. “We went into this thing just thinking it might be a huge catastrophe,” an S.E.C. official told The Wall Street Journal in December 1992.
Instead, Mr. Madoff turned out to have delivered the returns that the investment advisers had promised their clients. It is not clear whether the results of the 1992 inquiry discouraged the S.E.C. from examining Mr. Madoff again, even when new red flags surfaced.
According to an S.E.C. statement released on Friday night, the agency looked at Mr. Madoff’s operations twice in recent years — in 2005 and 2007. The 2005 review found only three technical violations of trading rules. The 2007 inquiry found nothing that prompted the regional enforcement staff to take further action by referring the matter to Washington, the statement said.
Ponzi schemes are already illegal, so for additional regulation to have helped it would have needed to be in the form of additional auditing, disclosures, etc. But having one of the most powerful organizations in Washington look into the firm -- three times -- didn't stop Mr. Madoff from making off with other people's money.
So if you want more government oversight to prevent these kinds of problems, ask yourself: What specific kinds of additional oversight would have prevented this? And are you willing to pay for the drag that it would have on the economy as a whole to have that level of oversight required of every institution of reasonable size in America?
Here's the deal. With everything that has gone on in the past few months, the people that get hurt the most are those who depend on others generosity through food banks around the state. As more and more of us become preoccupied with surviving this mess of an economy ourselves, we often forget those that aren't as fortunate.
This video explains why I am blogging about this now:
Here are some facts to consider(from the Community Food Bank of NJ):
Statistics on Hunger • More than 35 million Americans, including 12 million children, either live with or are on the verge of hunger. - USDA, Household Food Security in the United States, 2006
• The number of families coming to churches and food banks trying to get help to feed their families has increased approximately 20 percent. - National Anti-Hunger Organizations, 2008 Blueprint to End Hunger
• According to a recent survey, 6 percent of Americans said they or someone in their immediate family has gone to bed hungry in the past month because they could not afford enough food. - 2008 Hormel Hunger Survey
• One out of every five New Jersey families does not earn enough to afford the basic necessities – housing, food and child care – although 85 percent of these households have at least one family member who is working. – Poverty Research Institute, June 2008
• In New Jersey alone, an estimated 250,000 new clients will be seeking sustenance this year from the state’s food banks. – “No Food on the table,” By Judy Peet, The Star-Ledger, Oct. 23, 2008
Statistics on the Plight of the CFBNJ • At the Community FoodBank of New Jersey (CFBNJ), requests for food have gone up 30 percent, but donations are down by 25 percent. - CFBNJ
• Warehouse shelves that are typically stocked with food are bare and supplies have gotten so low that, for the first time in its 25 year history, the food bank is developing a rationing mechanism. - CFBNJ
History of the CFBNJ • What was to become the Community FoodBank of New Jersey began when founder and Executive Director, Kathleen DiChiara, began distributing groceries out of the trunk of her car in 1976.
• The Community FoodBank of New Jersey (CFBNJ), a member of Feeding America, fights hunger and poverty by the distribution of food and grocery products, by education and training, by creating new programs to meet the needs of low-income people, and by involving all sectors of society in this battle.
• In 1982, the FoodBank was incorporated.
• CFBNJ annually assists charities serving approximately 500,000 people in need in 18 of New Jersey’s 21 counties.
• CFBNJ has distributed, since its incorporation, more than 300 million pounds of food and groceries valued at more than half-a-billion dollars.
• Today, the FoodBank distributes over 21 million pounds of food and groceries a year, ultimately serving nearly 1,700 non-profits including 436 programs served by its Partner Distribution Organizations (PDOs).
So, what do you do? If you want to donate, you can follow this link to see where in your area you can drop off food and what exactly they accept. You can also go the Community Food Bank we site here to find out where you can donate your time, your skills or your money to this very worth cause.
And in case you are looking for some good blogs in NJ? These are the bloggers participating in this event.
Participating Bloggers for “We Can’t Let This Bank Fail” campaign
1) JerseyBites.com 2) RedBankGreen.com 3) Jersey Girl Cooks 4) Simply Sable 5) John and Lisa are eating in South Jersey 6) Padma's Kitchen 7) Chefdruck 8) Life Lightly Salted 9) My Italian Grandmother 10) Cook Appeal 11) Crotchety Old Man Yells at Cars 12) Mommy Vents 13) This Full House 14) Paper Bridges 15) Motherhood Avenue 16) The Kamienski Chronicles 17) Down the Shore with Jen 18) Fits and Giggles 19) House Hubbies Home Cooking 20) Nourish Ourselves 21) Partybluprints.com 22) Tommyeats.com 23) Off the broiler 24) Mrs. Mo’s New Jersey Baby 25) IamNotaChef.com 26) SimplyBeer.com 27) HistoryGeek.com 28) Savy Source Newark 29) Momlogic New Jersey 30) SurvivingNJ.com/blog 31) SurvivingNJ.blogspot.com 32) JerseyGirlGuide.com 33) Best of Roxy 34) Citizen Mom.net 35) Lynetteradio.com 36) Jersey Beat 37) Pop Vulture Phil 38) JerseySmarts.com 39) LongBeachIslandSummers.com 40) WildwoodSummers.com 41) Mike Halfacres Blog 42) Somerset08873 43) Family, Friends and Food 44) KateSpot.com 45) NewJerseyMomsBlog.com 46) JCRegister.com 47) New Jersey Real Estate Report 48) Riverviewobserver.com 49) More Monmouth Musings 50) Man of Infirmity 51) Another Delco Guy in South Jersey 52) SweetNicks.com 53) Average Noone 54) Cleary’s Notebook 55) Welcome to my Planet 56) The Center of New Jersey Life 57) Sharon’s Food Blog 58) Morristown, Chatham, Summit, and Madison NJ Real Estate 59) Midtown Direct Real Estate News 60) New Jersey Real Estate 61) BlowUpRadio.com 62) LazlosDen.com 63) The Ridgewood Blog 64) Book a Week with Jen 65) Banannie 66) Cartoongoddess.com 67) Matawan Advocate 68) Take Back the Kitchen 69) The Joy of Toast 70) Route 55 71) Montclair Kids.com 72) SaveJersey 73) Stompbox 74) Joe the Blogger 75) Environmental Republican 76) Stacey Snacks 77) Subversive Garden 78) New Jersey Pathfinder 79) Cooking With Friends Blog 80) Triple Venti 81) Read All About It 82) Rich Lee on Media 83) Likelihood of Success 84) Cape Cuisine 85) The Business At Hand 86) NewJerseyTaxRevolution 87) Figmentations 88) MiddletownMike 89) Caviar and Codfish 90) A Day in the Life 91) Mack’s Journey Through Life 92) Alice’s Restaurant 93) Tiger Hawk 94)Politics Patrol, The Bob Ingle Blog 95) The Food Chain 96) Henson’s Hell 97) Cranbury Conservative 98) Baristanet 99) New Jersey: Politics Unusual 100) Jersey Shore Blog 101) Plainfield Today 102) Beacon Bulletin 103) Journal Square Jersey City 07306
Illinois corruption coverage still mentions New Jersey
This week as the story of Illinois Governor Rod Blagojevich looking to sell Barack Obama's senate seat to the highest bidder broke, I expected to see plenty of coverage of the history of political corruption in Chicago. I have always thought that the Chicago political machine represented the worst political corruption of all the 50 states (or 57 if you are Barack Obama). But I was wrong.
Apparently, New Jersey is considered one of the elite for political corruption(from the AP):
If it isn't the most corrupt state in the United States, it's certainly one hell of a competitor," Chicago FBI chief Robert D. Grant said when the charges were announced against Blagojevich.
The top competitors seem to be New Jersey and Louisiana. More than 130 public officials in New Jersey have been found guilty of federal corruption in the past seven years. And Louisiana more than holds its own. A congressman once described the state this way: "Half of Louisiana is under water, and the other half is under indictment."
And this article is not the only one that mentions New Jersey while discussing this scandal. It seems like our state has a lot in common with a series of corruption scandals are the country:
1. While the scandals cut across both parties, they Democrats are the current hands on winners for sheer numbers. In New Jersey, almost all of the 130 corruption convictions the past few years were Democrats.
2. The stupidity associated with this current crop of corrupt politicians is amazing. Selling a senate seat while under investigation for corruption with Tony Rezco(Blagojevich), Cash in the freezer (Jefferson)and tax fraud in at least two states and one foreign country followed by pay to play with donations(Rangel).
3. When the politician in trouble is a Republica, you can count on the media to mention the word Republican over and over again. When a Democrat gets caught, party is rarely if ever mentioned.
4. The media outrage is comical if not pathetic as it concerns the two parties. It wasn't that long ago that the media was in a frenzy over Foley's instant messages (he was never charged with any crime), Tom Delay's airplane rides and Larry Craig's foot tapping. But they can't seem to whip up any interest in William Jefferson's freezer bags of cash, Chris Dodd's sweetheart deal on his mortgage while ignoring his oversight responsibility for the mortgage mess, an army of Democrats running Fannie/Freddie into the ground.
Some day, it will be great when the people have the last word. I know it will happen at the Federal level because it always does. I have a lot less confidence that New Jersey voters will ever wake up and realize the corruption that they accept every day in this state is neither normal nor acceptable in a civilized society.
If you are a New Jersey blogger and haven't seen this link yet, there is still time to join campaign to help the Community Food Bank of NJ. There are a lot of people hurting this year and the food banks around the state are bare. Your blog could make a real difference.
Last night it was reported that talks about the auto bailout in the Senate broke down because the Unite Autoworkers Union refused to make a serious concession toward solving the real problem in Detroit-automaker profitability(from the Washington Post):
The legislation would have provided emergency loans to General Motors and Chrysler, which have said they face imminent collapse without federal help. The high-stakes talks broke down over when the wages of union workers would be slashed to the same level as those paid to nonunion workers at U.S. plants of foreign automakers such as Toyota and Honda.
Sen. Bob Corker (Tenn.), the lead GOP negotiator, said the sides were on the brink of a deal on the amendment he had offered. Representatives from the United Auto Workers -- who were present for most of the negotiations -- would not agree to a specific date, Corker said.
"We offered any day -- any day -- in 2009," Corker said.
The UAW IS THE PROBLEM. While lawmakers keep spewing about hybrid cars and quality, our Detroit automakers are building good cars that people want to buy. The problem is that they lose money on every car, roughly $1,500 on each and every car. No business can operate that way and they won't make it up on volume. And it is frankly about time the Republicans stood up to this continued bailout frenzy by this congress and President.
And now Bush wants to bail them out anyway. Is there anyone left in this country that has any confidence in George Bush anymore? If so, I don't know them.
Anh "Joseph" Chao beat Louisiana's William Jefferson yesterday to finally remove this corrupt Democrat from office(from the Times Picayune):
Indicted U.S. Rep. William Jefferson suffered what may be the final blow of his storied political career in the most improbable way Saturday, when an untested Republican opponent took advantage of Louisiana's new federal voting rules -- and an election delay caused by Hurricane Gustav -- to unseat the nine-term Democrat.
Jefferson was caught with bundles of cash in his freezer. He was known to be corrupt and has been under investigation for some time. He has also been under indictment for some time as well. And Nancy Pelosi, who claimed that she was going to run the most ethical congress in history, looked the other way. Just like she is looking the other way on Charlie Rangel's tax evasion.
Leadership according to the Democratic party is that anything goes as long as it keeps Pelosi in power. At least this time, the voters had a different opinion.
An Asbury Park Press editorial calls Governor Corzine out in regard to an out of court settlement to the brother-in-law of his former girlfriend, who also happens to be the target of ethics complaints against the Governor.
Rocco Riccio, brother-in-law of union leader and former Corzine girlfriend Carla Katz, accused Corzine of reneging on a promise to find him a private-sector job after Corzine's staff asked him to leave his state post amid controversies involving Katz.
Riccio had worked in state government since 1994, but resigned from the Treasury Department in 2006 after someone accused him of improperly looking up tax records of Corzine's enemies. He resurfaced — with the help of Corzine's office — at the New Jersey Turnpike Authority, but was asked to resign within weeks by the governor's staff amid the controversy over the relationship between Corzine and Katz.
The newspaper didn't mince words when passing judgement on the settlement:
The whole episode stinks. Aside from Corzine's handling of the situation, which smacks of typical New Jersey politics — throw money at any and all problems to make them go away — there are too many unanswered questions about the Corzine-Katz-Riccio soap opera. Chief among them are the payout and a $15,000 gift Corzine gave Riccio in early 2007, the multimillion-dollar "settlement" Corzine gave Katz when their relationship ended and Corzine's overzealous efforts to block public disclosure of his e-mail exchanges with Katz during union negotiations.
This ongoing saga continues to bubble under the surface and not one chapter of the story passes the blink test. As Corzine keeps fighting to keep emails between himself and Katz private (even though in addition to being his girlfriend she was negotiating for a major public employees union), this really reads like the Governor fighting to silence someone who could be called upon in a criminal investigation. If at some point it is determined that Corzine did something wrong with Katz, would this not qualify for a conspiracy count or two?
I remember one other Governor of New Jersey who put an unqualified on the public payroll of a key state agency. I don't think that one turned out very well.
The New York Post once again featured the war of words between the Mayor and City Council regarding rebate checks and when they will be mailed out. The debate seems to be posturing with the Mayor on one side wanting an increased property tax and the council looking to tell their constituents they provided goodies. From the NY Post:
"We're continuing to work with the City Council on the issue of the rebate and all of the other budgetary challenges created by the financial crisis," Bloomberg spokesman Marc LaVorgna said when asked whether the checks will go out this month.
Also on the table is a 7 percent property-tax increase, which would raise $1.2 billion annually. The real issue here has nothing to do with rebates(because they aren't actually rebates). In the past 5 years, municipalities and states have used "rebates" as a way to circumvent the tax system to provide election year goodies in return for the politician to return to office. The system has gotten so bizarre that in New Jersey, if you actually pay taxes, you have a much higher chance of NOT qualifying for the rebate than if you don't pay taxes (apartment dwellers ALL get the rebate but homeowners generally don't).
With the city in such dire budgetary straits, this should be a no-brainer. But it don't be. Because the council has to pay the bribe it promised. And THAT is why politics in the Northeast is such a joke. There isn't one brave politician who can do the right thing anywhere.
Fox News has projected that Saxby Chambliss will win the Senate runoff in Georgia handily. That to me seemed like an obvious conclusion to this story. Why? Because the media was not drooling like mad dogs in Atlanta predicting the end of Republicans in Georgia. The facts on the ground never supported this liberal invasion and Georgia was no different.
And give the President-elect some credit. His apparently very qualified team knew this was a no-win and didn't bother to make a big push for a candidate that wasn't going to win no matter what they did. And the photo op with the rappers was a loser as well.
And the big loser? Al Franken. Coleman has won fair and square in Minnesota. The General election showed him as a winner. The recount has shown him as a winner. But Senate majority leader Harry Reid suggested that they may intervene? Not a change. Minnesota is decided and unless Reid wants to find himself in a maelstrom of negative protests for no benefit to himself, he will back off. Why you ask? Because President-elect Obama will tell him so.
NJ Tax Revolution
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