Yesterday, Governor Christie held his first town hall meeting of 2012 in my hometown of Voorhees. The speech, while more conversational in form to be sure, would have read quite a bit like Tuesday’s ‘State of the State’ speech. Christie reviewed all of the key accomplishments of his first two years in office:
- Cap 2.0
- Arbitration reform
- Pension and benefit reform
- Shrinking the size of the public payroll
- Lowest property tax increases in the last 10 years
- Passing balanced budgets with no tax or fee increases
There are more but hey, you get the point. Anyway, he proceeded to discuss where he saw the state is going, and he gave somewhat of a hint to what the upcoming battles are going to be.
For example, all of the headlines today were about his proposed 10% income tax cut for all New Jerseyans. This cut will take place gradually over three years, and is already built in to his upcoming budget that will be introduced in four weeks. In fact, the Governor has said that he expects the tax reform to be sent from the legislature to his desk before the FY2013 budget is passed.
Yeah, you read that right.
We know how this goes; just as last year when pension and benefit reform was the key to the budget battle, this year it will be a tax cut for all New Jerseyans and, as per usual, the Democrats will not be so quick to cooperate.
The Democrat majorities in both houses have already laid out their plans for the new year. First was gay marriage, and second was a hike in the minimum wage equating to a 17% increase in the cost of doing business. They are catering to two obvious constituencies they feel they need when the Governor comes up for reelection in 2013: the working poor and LGBT’s, particularly the latter.
Both are shallow attempts at political pandering. The Democrats know that Christie will not sign a gay marriage bill even if it makes it through with bipartisan support. Christie wants to run for President, and signing a gay marriage bill would immediately destroy much of his national GOP appeal, and it would also sour any chances of seeking the nomination in 2016 or 2020. Most of the South Jersey Democrat delegation abstained or voted against the bill the last time it emerged in the Senate. This time they will all likely be voting for it in order to earn points with a constituency that was never going to vote against them in the first place.
The futility of the situation is part of their plan. You can bet that President Sweeney and Speaker Oliver fully intend to tie any cooperation to the marriage bill, the job-killing wage hike, or possibly even a millionaires tax (again). However, it does put the Democrats in an interestingly precarious position. While direct polling on the issue of gay marriage might show a favorable disposition among the New Jersey electorate, I wonder how the results would change if you asked whether they would prefer gay marriage or a 10% income tax cut.
Finally, look for the Democrat caucus to tow a particular line over the next four weeks while we wait for the budget to be introduced: that the Governor’s tax reforms will jeopardize our school funding and will be devastating to our state’s children. Don’t buy it. The Governor actually addressed this directly at the town hall. Funding the schools and giving tax relief to all New Jerseyans are not mutually exclusive goals. By making the difficult spending decisions that have been made over the last few years, we have earned the right to have both. I, like you, do not have the revenue projections in front of me, but we will have them soon enough, and so far the Governor’s team has been right on the money with their numbers. There is no reason to doubt them this year either.
So my prediction? The Democrats will eventually cave and give the Governor almost everything that he wants on tax reform. Democrats will hold on to most of their chips for the coming education battle and attempt to hold on to another important constituency (NJEA supporters) who… you guessed it… would never support the GOP in the first place.