Nearly 25% of N.J. Residents Lived in Poverty in 2010

This report is more realistic than the federal standard for measuring poverty – which I believe is outright ridiculous no matter where you live in the U.S. – N.J. defines being poor as making less than $36,620 for a family of three — twice the federal poverty rate. New Jersey has a higher cost of living than most other states particularly because our exorbitant property taxes, which also reflect on rental costs.

Nearly a quarter of N.J. residents lived in poverty in 2010, study shows | NJ.com.

There are a number of factors which have contributed to this imbalance in one of the richest states in the nation. But all the factors, fundamentally, find their roots in the complicity of the two dominant political parties in holding wages stagnant and fleecing the public. In other words: A lot of people, even those not comprised in the low 25%, are making too little money and paying too much to the political octopus that rules New Jersey.

Note that the 2000 or so government entities of New Jersey devour more than 10% of the state GDP of about $650 billion. And we do not even have defense expending!

This reality has had two major consequences after two decades or so:

1. A lot of people borrowed beyond their means to maintain the illusion of prosperity.

2. Disposable income plummeted and with it went aggregate demand, thus pushing the economy into an endless period of anemic performance.

Since government – and all its local subdivisions –  also borrowed left and right, New Jersey has entered a period when the high degree of leverage has the effect of quasi paralyzing both the public and private sectors. There are budgetary problems and people are taxed out. Even if millionaires are taxed, as the democrats call for, that additional revenue would amount to considerably less than $1 billion.

The millionaire surtax has become more like a political football to keep the masses distracted and pretend that there is a major difference between the two dominant political parties. It is theatre.

The democrat-proposed increase in the minimum wage – possibly to blunt my message because I am the first who has mentioned minimum wage in the last decade – would be the first in I-don’t-know-how-many-years and it is clearly insufficient to have any economic impact.

Both parties have proposed tax reductions: Christie his ubiquitous income tax across-the-board cut, which of course favors his political base, and the democrats their property tax cut. Both plans are better than nothing; the democrat plan slightly better. But the grand problem is that the state is not in a sound enough fiscal position to – responsibly – adopt either plan.

If a tax cut – any of them – is implemented, it will amount to a tax deferment rather than a tax cut. When such tax becomes due, 10, 20 years from now, it will also come with accrued interest so we will end paying more for this meaningless relief today.

While both political parties endeavor in buttering up the voters in back-to-back election years, I am presenting  – in this website – my program of reforms, which I believe are the minimum essential to save New Jersey.

Citizens of New Jersey beware: Our problems are complex. Any politician that presents a simple solution to a complex problem is eminently dishonest.

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Did Christie’s “New Jersey Comeback” Ever Occur – Outside of His Mind?

New Jersey lost 11600 private sector jobs and added 3000 public positions in March. That is the opposite of the image Christie has been bragging about ad nauseam at every town-hall meeting and radio show since January this year. The March figures, even though reflecting a single month, are egg on his face.

Loss of 8,600 NJ jobs clouds economic picture : page all – NorthJersey.com.

Christie’s office referred questions on the job figures to New Jersey’s top economist at the Treasury Department, Charles Steindel, who admitted that there is a definite correlation between between employment and revenue. He did not say it but there are other correlations – sometimes I wonder if they understand them – such as that of employment and economic growth and with aggregate demand. Some are functions of the others.

Steindel said it is a long term relationship, and one month of bad job figures is not enough to redraw the state’s budgeting plan. Again, I must add, one month of good figures is no reason to open the champagne either.

“Data is volatile from month to month, it jumps up and down,” Steindel went on. “I think it’s a little hard to pin too much on the fact that you had a month where things seemed to go in the opposite direction.”

Mr. Steindel is assuming that the natural direction is forward. But there is no natural direction. The economy will move according to a given set of conditions. Those conditions, in New Jersey, do not favor growth. Steindel’s sentence should be corrected and say that we really do not know where the state economy is heading and should include the word stagnation. 

Although an economic failure of the Christie administration would facilitate my election, I do wish the New Jersey economy to improve. The problem is that I do not see real basis for optimism on such an expansion: Not with the current tax and government structures in New Jersey.

The stubbornly high unemployment rate – remains at 9% – betrays the governor’s portrayal of the state under his stewardship as an example of how to rebound the economy.

Christie is a lawyer who has decided to micromanage both education and the economy in New Jersey: That is a recipe for disaster because he is not qualified to do either. But he is not alone. Democrats are not far behind. In fact, he could not do many of the things he is doing without the complicity of at least some of the democrats in the NJ Legislature.

The loss of jobs is always deplorable. Even more deplorable is the rigidity and selfishness of the two political parties which rather see the state decay that give up their power and perks. We are governed by leeches. Significant structural changes in government and the tax system are desperately needed.

My entire economic revival program rests on the premise of increasing aggregate demand in New Jersey. Demand generates supply and increasing supply creates both jobs and wealth.

Washington Liquidating Private Sector Labor Unions Through the Back Door

Crippling the Right to Organize – NYTimes.com.

The National Labor Relations Board, NLRB,  was created by FDR in 1935 and is for the private sector what the Public Employment Relations Commission, PERC, is for public employees in New Jersey. The NLRB covers the entire nation and it is indispensable in arbitrating contract disputes, violation of labor laws by both employers and unions, organizing,  etc.

U.S. Supreme Court ruled last year that the NLRB can not function without a quorum.  As of January 2012 it will lack a quorum.

We are not eliminating labor unions by decree like fascists states did or putting puppets at the head of unions like the communists do. We are pulling the legal platform from under the unions. The  methods may be a bit more refined but the end-result is the same

As the writer notes, the republicans have the bulk of responsibility in this situation but then president Obama shares a great deal of that responsibility as well. In what I perceive as a Machiavellic move, he has proposed two very pro-union candidates for the board, most likely knowing full well that those nominations are going nowhere. So he can tell the unions he tried to place their friends in the board and at the same time renders the board inoperable by default – which is the ultimate goal of the other side. But of course, that is only if there is other side. Perhaps there is only one side.

The NLRB, like PERC, should be populated by civil service professionals, and not political appointments. Healthy labor relations are fundamental for the revival the this nation’s economy.

If the NLRB falls, and if elected governor of New Jersey in 2013, I will propose to the legislature to create a NJLRB or PERC doubling for both public and private sectors. We must never forget that the worker is also the consumer and that without consumer demand there is no economic growth.

Year 1: New Jersey Saves Little After Christie’s Reform of Public Health Plans

N.J. saves little on reform of health benefits – NorthJersey.com.

First evidence that surfaces which shows that a much more comprehensive reform of healthcare in New Jersey is a must. And it can not be on the backs of the workers alone again.

Healthcare costs are like an albatross not only for the public sector but for the private one as well.

As I have said before, I claim no expertise in the field (never trust anybody who knows everything) and if elected governor of New Jersey in 2013 I will assemble the best team possible to come up with the best healthcare system possible. However, I have one or two ethical/moral pillars from which I can build knowledge.

Elements that I can predict are tort reform, that the state government will be thoroughly involved, and the New Jersey’s Healthcare Exchange (to be created) will have a public option.

Regarding the public pension reform, although it will reap significant savings for the state during the next 30 years, the compounding void created by the state not-contributing will bring New Jersey back to the fiscal hole it was in prior to the reform. I calculate that such a deficit – around $60 billion – will be reached in about 8 years. The bottom line is that the state must contribute its share.

In other words, without the reform – which I supported as a painful but necessary step – New Jersey would be in an even deeper hole but by not contributing, New Jersey will be buried in as much red ink in 2020 as it was in 2010. This is a very serious matter: Christie just kicked the can down the road for a few years.

U.S. Private sector job gains may be illusory – an opinion

http://www.bloomberg.com/news/2011-07-06/u-s-job-gains-in-private-sector-are-illusory-commentary-by-alan-tonelson.html

The writer here looks at some industries, such as health care, as not quite private but subsidized by government, to make his point that we are in worst situation than what we are told.

But that would also be the case of defense industries. These are the companies that make tanks, aircraft, missiles, rifles, etc. Some of them at least would not survive without government contracts and although a few others could be able to transition to the civilian products market, success is much less than guaranteed due to foreign competition. It is there where supply and demand apply. Let’s not forget that China, and perhaps other countries, unabashedly subsidize many of their civilian industries.

My conclusion is that the subject is open to argument and interpretation. The lines between government and private industry in the U.S. are at times blurried. But dissecting a precise separation is not, other than for the purpose of debate, paramount.

Nonetheless, I do not disagree with the writer’s view of “the race to the bottom.”