New Jersey has a gambling problem. No matter how much we lose, we keep asking for more money to pay for our failed bets. Our favorite wager is raising taxes, but it’s like betting on the Jets - it never pays off.
What does a degenerate gambler do when they bottom out? They borrow more. That is exactly the plan Jersey Democrats have concocted to get us out of the fiscal damages created by coronavirus lockdowns.
They’ve put forth a $5 billion, short-term borrowing plan to cover budget holes punctured by the loss of revenue from the coronavirus lockdowns. The $5 billion would be paid back through an increase of the sales tax, and if that isn’t enough, then a direct fee to property taxpayers. Because our sales revenues are down significantly, don’t let anyone tell you they’ll be enough to pay this back.
Both houses of the New Jersey Legislature have been run by Democrats for almost 20 years now. In that time, Trenton has consistently turned to taxpayers to bail it out of bloated budgets, severe corruption and the endless expansion of government. It was never fair and never affordable, but this time is different. People are simply stretched too thin to give anymore to the state. Taxing in a situation like this not only offends me as a fiscal conservative; it’s just not possible for the budgets of most Americans.
Even if it was feasible to raise taxes in this situation, it’s still an absurd thought that a state like New Jersey would be allowed to borrow $5 billion with its junk-bond status.
We have the second-worst bond rating in the nation with only Illinois saving us from being in the basement. However, since the pandemic started, the big three credit agencies have signaled dropping the state down to a BBB rating, marking the first time in the state’s history it could fall out of A territory, dumping us into the dredges only occupied by Illinois.
In the real world, anyone who would give a large loan to someone with the credit history of New Jersey would be designated a predatory lender. It’s like we’re watching a scene out of The Big Short play out in real time.
And this all doesn’t mention that borrowing without voter approval is unconstitutional, and this measure could still be shot down by the courts. Assembly Democrats already passed the proposal. Let’s hope the Senate decides to turn it down.
So what should we do? Put forth an austerity budget. Extreme financial times call for extreme tightening of the belt. It’s what every American family has to go through. It should be no different for the state. Most other states in America have called for mandatory budget cuts for every single department. We need to deliver the edict that every state department will have a budget that is 5-10 percent smaller than last year, and let the highly-paid department heads of those departments figure something out.
That’s just a start. What should follow is a two-year hiring freeze and a two-year freeze on salary increases. We can reassess where we are after the two years. If all of that isn’t enough, then we’ll have to look at furloughs.
Ask any small business or any private industry what they’ve had to do to deal with falling revenues and those three things will be the answer. It has to be our answer as well. It’s the least the government could do after months of mandated lockdowns.