A View into the Future: Post Script to June-November 2012

Using the previous 4 years experience as guide we may expect:

The national economy will continue to languish with low growth and high unemployment. I do not believe we will enter another recession during the next four years but we will be becalmed. Some states – New Jersey under Christie/Sweeney among them – will continue to apply the brakes on the nations’s economic growth. Neither Obama nor Romney, and certainly not the U.S. Congress, will address the factors in the U.S. tax code which encourage capital export.  Accordingly, regardless of who wins, Wall Street will remain disconnected from Main Street.

Needless to say, the national debt will continue to grow with either one.

Even if president Obama wins in November 2012, we already know his capability for abdicating postulates made while campaigning. We should expect that there will be negative effects on Social Security and Medicare, two social programs which candidate Romney has on his hit list, even if Obama is victorious. Obama will adopt some of Romney’s proposals. Such effects would most likely be cuts in both programs, perhaps somewhat smaller under Obama than those which would be implemented by a hypothetical President Romney.

We should also expect a re-elected President Obama to slightly reduce other social programs that he is now, during the campaign, defending with vigor. Either Obama or Romney will sweeten draconian cuts by phasing them onto the younger generations.

I would also expect that a re-elected President Obama would abandon at least some of his tax positions in support of the lower and middle classes, all for the sake of compromise. Similarly, there will be retreats in issues such as the environment and Wall Street regulatory statutes.

As a rule of thumb, President Obama will cede ground wherever big money is involved. He will hold out better in social issues such as birth control and same sex marriage.

President Romney would be very negative on the social issues mentioned above and similarly or even more accommodating toward big money.

Income gap would grow more under Romney than under Obama although the difference between the two will not be large.

We should expect that either President Obama or Romney will continue making inroads into our civil liberties using terrorism as excuse, even after Al Qaeda is wiped out.

A President Romney would be more likely to get the United States involved in another major foreign war.

With either president, New Jersey should expect very little help from Washington and that is why our own gubernatorial election of 2013 is so important: We will be basically on our own. We can hardly afford irresponsibility, demagoguery, and incompetence any longer.

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New Jersey Public Education Caught in Christie’s Maelstrom

For a year that governor Christie called “The Year of Education” his achievements so far are for the most part on the side of disruption and confusion. Needless to say. the children who are in NJ schools today will be the ones affected. Lost learning opportunities are not recuperable. Time is inexorable.

What began as an election fight with the NJEA and subsequently turned into a relentless campaign against teachers and their union has evolved into the most destructive process that has affected public education in New Jersey, possibly since the turn of the XX Century.

Governor Christie disguised his assault as an “education reform” after his first year in office, knowing fairly well that the best way to attack the NJEA was by attacking their membership. Along that change in tactics, he has connected with the national current of school privatization where big money is out for gain. For most of the reformers, education is a for-profit business and profit is the primary objective. Students are products.

New Jersey public education K-12 is facing teacher testing, merit pay, tenure reform, the loss of income by teachers due to pension and benefits reforms, reduced state funding, and as of late, a new system of testing for graduation beginning in the ninth grade. The latter is ultimately intended to replace the current High School Proficiency Assessment (HSPA), given for the last 10 years or so in 11th and 12th grades as a broader measure of language arts and math skills.

Of all of the above, I found that the pension reform was a must because of the dismal fiscal condition of the public pension system – caused by the irresponsibility of both political parties over the last 15 years.

I also believe that the replacement of the HSPA is a step in the right direction although such change all by itself will not achieve the desired results. The administration’s plan, although a good idea, is for the time being nothing but an empty box.

NJ Spotlight | Christie, Rewriting Rules for Graduation, Will Fill in Blanks Later.

The rest of the objectives mentioned above are the framing introduced by the administration to weaken the teachers’ union and carry out the gradual privatization of public education.

There are a qualitative and a quantitative dimensions in education.

My point of view – and this is a general guideline – is that the qualitative aspect is best addressed through a uniform statewide curricula with tests which are not by multiple choice but in the old fashion way where students must show their work step by step. This is particularly important in the sciences and mathematics. However, testing or how we test are not at the heart of education but how we teach and how much we teach are. When I learn something, I know it regardless of whether I am tested or not.

The quantitative aspect is best addressed by diminishing ancillary activities, and teaching longer periods, days, and school years.

To add to the confusion, the federal government has changed the way it calculates graduation rates

N.J. high school graduation rates decrease under new federally mandated calculation method | NJ.com.

However, in the end, what really counts is not how we measure knowledge but the amount of knowledge students graduate with. We are spending all these resources and building a huge bureaucracy to measure teaching at the expense of teaching itself. We are drowning in statistics but can high school graduates solve a quadratic equation?

Of course governor Christie and some of his democratic accomplices could not leave alone higher education:

NJ Spotlight | Rutgers Trustees Refuse to Surrender Camden Campus.

Perhaps governor Christie is not old enough to worry about his legacy as governor. Or perhaps he does not care as long as he can satisfy his ambitious appetites.

There will be a great deal of damage to be undone when I am elected governor in 2013.

Christie, Norcross, Sweeney Plunge Ahead with Rutgers/Rowan Merger

Not many people have the fortune of being told the future. In this case, it is one possible future; only if I am elected governor of New Jersey in 2013.

To all the promoters of this shotgun marriage between Rutgers and Rowan I say this: If I win in 2013, there will be a new sheriff in town and the merger better be clean. Because the first marching orders that my new AG will receive are to thoroughly investigate the role of everyone involved with this deal. I mean everyone.

No stone will be left un-turned.

That is the possible future.

Stile: Christie sticking to education merger’s tight deadline : page all – NorthJersey.com.

Taxation in New Jersey

We do not have a budget for FY 2012 yet (which runs from July 2012 through June 2013.) For FY 2012, governor Christie has proposed a higher budget of about $32 billion and also a 10% income tax cut. He expects that the New Jersey economy will grow as much as China’s. That is above 7%.

The budget which was approved by the Legislature for FY 2011 was about $29 billion and you can see the sources of that revenue and how it was spent in the pies below. The bottom-right pie shows legislature and Judiciary together but the Legislature takes about 2/3 of that amount – that is about $500 million. The Governor’s office consumes a bit below $ 100 million but that I know from a different source and it is not specified here.

I find both Legislature and Governor Office expenditures exorbitant.

If we add to that about $25 billion in property taxes we arrive at the sub-total amount of $55 billion that we New Jersey residents pay in taxes. About 10% of that goes to the counties. But we are not done yet.

Senator Sweeney has just introduced a bill which would include user fees charged by municipalities under the 2% property tax cap which became law last year. The bill is an attention seeker. Why? Because what municipalities will do is to drop those services which are most needed and residents will have to pay directly to the service providers – garbage collection for instance: Either people will have to hire their own private garbage collectors at higher cost and/or there will be more illegal garbage dumping everywhere.  Sweeney may be planning  to run for some higher office.

The total amount of user fees that New Jersey residents pay is near $10 billion per year. Therefore, the total amount of money that we all are forced to give the many governments of New Jersey is the eye-popping figure of almost $65 billion  yearly.

Bottom line: Government – or rather the political class benefiting from it – is financially suffocating the economy and people of New Jersey.

That is what I intend to correct if elected governor in 2013.

Of Home Rule in New Jersey

Home Rule is as old as New Jersey and the concept was borrowed from mother England and perhaps Holland. England had the counties and their respective counts which probably dated back to the Norman invasion of 1066. The system in turn was copied from the French who were the inventors of feudalism. In New Jersey, a colony with its vastness only sparsely populated by natives and even fewer colonists, small towns surged from the first settlements and by the time independence was gained from Great Britain in 1783, most of the system we have today was already in place.

Jump to 1947 and the Framers of the last State Constitution chose to maintain what we call Home Rule.

Jump to 2010 and I introduce my program which among other things, calls for the elimination of county governments, transferring all the taxing authority from the municipalities to the State (thus eliminating property taxes), consolidation of police forces and boards of education.

A few months later, governor Christie floated the idea of municipalities sharing services. He might not have been the first one who proposed this but he probably was the loudest. Nonetheless, with minor exceptions, his call fell on deaf ears and his tool-kit aiming to facilitate the process was for the most part ignored by the N.J. Legislature However he managed to pass a property tax cap of 2% although such cap caps nothing: It has a number of exceptions – the expensive ones – so it is pretty much meaningless as homeowners have discovered to their chagrin.

I don’t believe for a minute that I invented the idea of government consolidation nor was I the first discovering that the current system is untenable and that it places a tremendous burden on the people of New Jersey and the state economy. But I believe I am the first who has approached the issue with a radical plan which eliminates entire layers of government rather than executing flimsy unions of 2 or more DPW’s, fire or police departments, or some other local functions.

But moving on: The N.J Senate leader, Mr. Sweeney, has gone one step further and proposed an approach more Draconian that Christie’s although bland compared to mine: He has introduced a measure that would force local governments to share services or face a loss of state aid equal to the amount of the consolidation savings they passed up.

Sweeney has been pushing the shared-services agenda for some time. In October 2010, Sweeney spoke on the subject at a press conference with Assembly Speaker Sheila Oliver about arbitration reform, hammering away at municipal government. Quite simply, he said, there was too much of it. And he was ready to turn towns “upside down” to bring about some changes.

Such unions, where they have occurred, have clearly shown that they do not save much if anything at all.

But from Sweeney’s – or any other member of the political establishment – point of view, that is the ideal diversion because it places all the onus on the taxpayers, focuses on the lowest workers rather than on the political hacks, and maintains the huge mantle of government layers intact. No one; Not Sweeney, or Christie, or anybody else talks about doing away with the medieval relics of county governments. They know that the more government layers, the more opportunities to place political appointees in public jobs. For the two political parties, their ability to dole public jobs is the very essence and foundation of wealth and power.

What I propose is the only plan which would yield significant results rapidly: A constitutional amendment that would not touch the independence or identity of municipalities except for the fact that they would not collect property taxes any longer and their police stations would be manned by Police of New Jersey rather that the local police department, although the officers will be the same individuals.

I would propose the unification of all boards of education into a New Jersey BOE. If New York City can do it, so can we.

I would propose the elimination of county governments and the takeover by the State of New Jersey of county schools and hospitals. The county DPW’s would go under the NJ-DOT. The counties divisions of Taxation would remain as state agencies of the Department of the Treasury to collect some property taxes which would remain (Example: property owners who are not New Jersey taxpayers.)

With the abolition of property taxes and a tax credit for renters, inevitably, income tax would increase and so would be the tax on dividend that does not originate in economic activity in New Jersey. For more information please refer to my pages relevant to this topic in my website.

The typical property tax pie is roughly 25% for the town, 25% for the county, and 50% for the local board of education. If we want to achieve big relief, we must be willing to take big steps. For the political class, that is rocking the boat. But there is no choice: We must cast at least part of the political ballast over the side.

The Rutgers-Rowan Affair

The second set of hearings on the shotgun marriage of Rutgers with Rowan  began at Rowan University yesterday, in front of the Legislature’s higher education committee. The balance of speakers was essentially the same as in the first set of hearings with opponents of the merger exhibiting much more reason and asking many more questions that the supporters had answers.

The cost of this concoction of a plan will be enormous, in terms of money, for all of us. For Rutgers, it could bring irreparable harm. No one can create a great research university – as governor Christie is claiming he will – just by changing the name at the entrance gate and on the stationary.  Both medical and scientific researches are expensive, require state-of-the-art laboratories, and above all they require researchers who do not come cheap. Frankly, when I hear the governor explain this plan, I always get the impression that he does not know what he is talking about.

That has not always been the case: He knew what he was talking about when he called for pension reform. In fact, I supported the plan although it affected me personally (freezing COA) but my position was and still is that we can not stop there but must go on to reform the entire State of New Jersey. Otherwise, what the pension reform accomplished will be reduced to gain a few years before fiscal meltdown. All the sacrifice will be in vain.

Christie gained the support of numerous democrats led by senator Sweeney in the pension and benefit haircut. Was that support for the good of New Jersey or was there a price attached to it? Is Rutgers-Camden that price? It seems I am not the first to think that way.

NJ Spotlight | Rowan Replay: Criticism Continues at Second Hearing on Rutgers Restructuring.

The entire merger plan is a house of cards and the cards are blank. Apparently, the only written records of the UMDNJ Advisory Committee are its preliminary and final reports. There are no notes, no minutes of the meetings!!! And 21 of the final report’s 57 pages are the preliminary report, with six of those pages repeated twice.

In other words. There is no paper trail of the discussions and the final product of such discussion was exactly what they started with. This is the plan that governor Christie is pushing down the throat of New Jersey. The governor is trying to coerce this one through. Do I believe that he cares about education at all? Certainly not: He uses education like like he may use an elevator.

To say the least: This is a very goofy way of breaking up the best public university of New Jersey: They created a doctrine and plastered some  quasi-justifications onto it. It seems it was all a political deal between Christie, Sweeney, and Norcross (the democrat political boss of South Jersey) which involved the swap of pension reform for Rutgers-Camden.

NJ Spotlight | Who Decided to Give Away Rutgers-Camden?.

An appellate court ruling this month, barring the governor from eliminating the state Council on Affordable Housing, applies directly to the state’s higher education system. So he may be trying to scare the Legislature into folding. However, if the governor still has the power to do this with an executive order or if the legislature goes along with the merger, I believe the Rutgers trustees have the ability – and perhaps the moral responsibility – to take all the original Rutgers facilities and revert them to be the  private university that it once was. Rutgers-Camden is part of the original Rutgers – before it became state university.

Perhaps previewing this, the governor has proposed a 6% increase in aid to higher education in his proposed budget of 2012-13. That is the bait in the hook.

I would support the secession of Rutgers as s stop-gap measure until Christie is out of office and till such moment when Rutgers can return to its public status safely.  If the State University is going to be downgraded and such a disaster is going to additionally cost a tremendous amount of money (taxpayers’ money) I would support Rutgers to move into the private field and them welcome the university back into the State higher education system if I am elected governor in 2013. The escape for Rutgers may ultimately be to self-privatize and stay so until there is a governor with common sense in New Jersey. It would be better for New Jersey to a have a great private Rutgers than a diminished public Rutgers.

Summer Wave of Foreclosures?

They are like two weather fronts approaching which may create a perfect storm in New Jersey: The courts have lifted the restrictions on foreclosures and more than 14% of all homes in several central counties of New Jersey have underwater mortgages (more is owned on them than they are worth.) That is a whopping 79,000 houses and the counties mentioned are Somerset, Middlesex, Monmouth and Ocean. Although I do not have the data at this moment, it is safe to reckon that the rest of the counties have at least a fraction of the numbers quoted above. New Jersey could have as many as 150,000 homes in danger of being foreclosed this year.

Central Jersey homes face rising tide of mortgage defaults | MyCentralJersey.com | MyCentralJersey.com.

The magnitude of the crisis is accentuated by the high property taxes in New Jersey. The combination of underwater mortgages and high taxes make  people default, even those who can afford their payments. For some it is a business decision. How bitter may that be! Property taxes can be like a second mortgage.

Abolishing property taxes as I propose would eliminate that latter factor.

Perhaps the facts that I am campaigning on a program of rationalising the government structure in New Jersey and that November 2013 is not too far are awakening politicians to “consolidate” and “sharing services” in an effort to salvage their monopoly on power.

Donovan says home rule is costing Bergen too much : page all – NorthJersey.com.

Bergen County Executive Donovan is not the first one of course. Christie did it. So has Sweeney. Ironically, no politician calls for “consolidating” his/her own position. It is always somebody else who is sacrificed. However, the most important fact that we must keep in mind is that all these calls are not genuine or rather are not bound to produce any results of sufficient magnitude to benefit the people of New Jersey. It is all theatrics, propaganda, and throwing a few crumbs to appease the popular anger and to blunt my message of reform.

They are scared because reform can happen. Other states, where the political machinery is not as entrenched as it is in New Jersey and where some politicians put the public good above partisan privilege are showing the way as you all can see below; the case of Maryland.

Md. budget would tip balance of power, giving state more say in education – The Washington Post.

Maryland is taking the tax money that goes to counties and distributing it directly to schools. Maryland may not have the same system of home rule that New Jersey has. We may have to do this through a constitutional amendment, But we certainly can do it here and save our own future and that of our children. The two selfish political bureaucracies have absolutely no right to ruin the lives and well-being of 8 million New Jersians.

Expect a formidable resistance to reform here too.