B: NJ Democratic Leadership's Budget Plan Flawed but Reality-Based, Unlike Governor Christie's

Pass the Democratic Leadership Budget Plan  

Once again the New Jersey Democratic Legislature is in a tough spot. Our very, very smart and very, very Republican, and very, very GroverNorquistianLetGovernmentDrowninTheBathtub Governor figured out how to put them on the spot, yet again.  Here's what he did.  He certified budget numbers that assume that the State is going to have over 8.4% growth in income taxes and 6% growth in other taxes, and he inflated by $100 million+ money that will come from the foreclosure settlement and he is pretending that doing a switch with the Transportation Trust Fund is not borrowing more money - not for growth or to rebuild the infrastructure - but so that he can claim that there is enough money to provide for a ridiculous income tax cut for rich people.

The Governor knows that there will not be this level of aggressive growth, but when it doesn't happen, the tax cut will be in place, and in the first year he'll make some cuts and by the time it all rolls in, he will have cut aid to local government by more, he will have gotten his Supreme Court and created a flat school aid formula, and  by then, it will be too late.  Proposition 13 in New  Jersey and worse.

For a short while it looked as if it was going to work, and if the smart people don't prevail it could still.

Deliberate false budget projections should be illegal - but in New Jersey - playing fast and loose with monetary facts dates back to our last Governor who had Christie in her name. (Remember the 30% income tax cut and the Pension Bond?  The two greatest causes of the mess we are in now!)  What exactly should the Democrats do?  Should they say you are lying about the amount of money and make cuts to services themselves?  That would be insane.  Should they buy into a bargain with him and turn his income tax into a property tax cut and leave the budget in shambles?

The Democratic Leadership has thankfully decided that pointing out that the Emperor has no clothes is a better strategy.Here's what they are doing (we hope).  They are going to accept the Governor's ridiculous numbers, but they are going to put at least a portion of it into surplus and say if the money comes in, you will get a property - not an income tax.  And they are going to pass the Millionaires' Tax again.  No tax cut until the money is there.  

It is an imperfect proposal.  The reliance on foreclosure money, the energy tax, and the fact that a mere 2/7ths of the Pension payment is paid in this Budget make this a budget that does not yet move New Jersey forward.  In Christie's first Budget, however,  a minority of the Democrats just gave in and  voted for his budget and that was horrible,  and in the second Christie budget they tried to write their own without using any leverage and he line itemed vetoed even things he put in himself.  At least with this Plan that are making a real effort to box Governor  One Percent in enough so that he can't have an unpaid for tax cut for the megarich that will literally cripple government within a few years.  

It's a plan.  Not a perfect plan but a plan none the less.  It's not a capitulation.  It's strategic, and it forces the Governor to cope with the Legislature.  The Governor is reverting to form right now - terrorizing the workforce with threats of shut down and calling people who don't agree with him skunks and murderers, but that will soon stop.  He is very, very smart.  He's shown that he can outthink his adversaries and he's done very well with his Bully Pulpit and that frightens me.  Progressive democrats and not so progressive democrats will struggle with this plan because it is a stop gap and it is less than perfect.   As it gets tougher there will be some who will argue that there are people who like the Governor's fantasy suit of clothing, and others who will argue that the plan itself gives him some coverage.  

All true. The Governor has the power to certify the budget numbers and to propose a budget and to veto out line items in the budget.  Without a real push back, he defines the terms of the debate before, during and after the budget cycle.  But if the Democratic Leadership continues to insist upon the Millionaires Tax and the Minimum Wage bill, and they hold strong on not giving a tax cut based upon fantasy income growth, the Democratic Legislature will have created a more progressive frame to the debate and they will ultimately be seen as the responsible parties in this fight. Even more importantly,  they will have exposed the Governor, who is campaigning all over the country as a fiscal conservative, while he cooks the books at home. That exposure will put everyone who opposes the complete dismantling of the social safety net and the social contract in a better position to fight together this November and next year.

Do it.  Hold fast for a responsible budget.  

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