Surprise! New Jersey Deficit Balloons To $1.2 Billion

That's just the start. The budget hole is going to continue growing exponentially as the state continues spending like a drunken sailor and the taxpayers who support the government by paying all those taxes see their jobs disappear or move out of state, or that the costs of living suck all the disposable income out of their wallets.

The state has spent more than it can afford for years, and this year was no exception. Now, Governor Jon Corzine, a Democrat, thinks that the solution is what precisely? Another bailout by the federal government of states that couldn't control spending for years on end and have serious debt ratios?

No, there is only one solution to this mess, and it doesn't involve bailouts.

It requires the painful and necessary cuts to the state budget. I'm not just talking about superficial cuts. I'm talking about cutting the serious fat and featherbedding of jobs as a result of union contracts. I'm talking about eliminating programs that are of dubious merit that the state could hardly afford when first proposed, and certainly can't afford now.

The Governor is proposing $600 million in cuts out of a $32 billion budget, which is peanuts given that the budget hole is going to be $1.2 billion. How exactly is the governor going to plug that budget hole unless he's going to raise taxes. That's how the state got into the mess it's in. It's never had to live within its means as it could simply count on the state raising taxes to cover any shortfalls in its profligate spending.

Tax revenues are plunging now, and raising taxes isn't going to stem the tide either. It's only going to accelerate the decline in tax revenues. The state can't afford things as they stand, and putting still more debt on the books isn't going to make things more affordable. Corzine, his predecessors, and the legislature have played a shell game on financing the state for years, and it's now coming back to bite the state's taxpayers in a big way.

Trenton must get the state's spending under control, and raising taxes is an easy outlet. After all, this is a state where they put billions of dollars into an education construction fund meant to build hundreds of schools, and only a few dozen were ever built. A second construction fund was proffered, and that too has managed to complete far fewer buildings than expected. The state wastes money at an enormous rate, and expecting the state spending to keep the economy afloat is a recipe for disaster. The state has to get out of the way to get the economy going again, and that means making cuts to all those programs that simply don't work.

UPDATE:
New Jersey localities are pushing to raise the 4% cap on property tax increases. They're facing higher costs, and want to push the costs on to taxpayers.

State lawmakers in 2007 imposed a 4 percent limit on the growth of any municipality's property tax collections, in an attempt to rein in fast-growing local tax bills. Since municipal property taxes bring in about $6 billion annually, the 4 percent limit allows for another $240 million in taxes this year.

The cap includes several exceptions, including one that that exempts $112 million in increased public employee pension costs from the levy cap. Adding the police and fire pension exemption Dressel is seeking would raise the total pension exemption to almost $170 million, effectively changing the 4 percent growth limit to almost 7 percent.

Local pension costs have skyrocketed, from $53 million in 2004 to about $1.2 billion due in April 2009, as the result of rising benefit costs, soured investments and a state decision to suspend payments into the pension funds for several years.

So much for the idea of the caps actually forcing austerity from these municipalities.

$53 million to $1.2 billion? That's either a misprint, or someone is criminally negligent in their accounting practices. If anything, it once again highlights just how unaffordable the gold plated state and local municipal workforce has become. It's an anchor drowning New Jersey taxpayers and it's only going to get worse.