News Column

NJ Leaders in Stalemate Over Best Path for Job Creation

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To stimulate New Jersey's struggling economy, Democratic and Republican legislators joined together to send a dozen jobs bills to Gov. Christie in his first year in office.

But in 2010 and early 2011, the new Republican governor took his pen and vetoed every one, even those that came with unanimous support.

Later, when Democrats tried to override his vetoes, Republicans switched their votes to join Christie. Sen. Diane Allen (R., Burlington) changed her vote four times.

With the state's current 9.8 percent unemployment rate the fourth-worst in the country, the Democrats who control the Legislature now are reintroducing half of these economic-stimulus bills.

And they still have little chance of becoming law.

Christie says a bill that offers a tax credit, as most of these do, must come with spending reductions. He would rather help the economy with income tax credits, paid through a projected budget surplus. Democrats say the state can't afford that.

Where does that leave New Jersey? In a stalemate over how to get people working.

Democrats say Christie has rejected job-creation bills, some based on GOP-backed programs in other states and endorsed by business, just because they didn't come from him. Two bills on taxation were vetoed by Christie only to be incorporated into his budget, they note.

And they have slammed him for campaigning for Republican candidates around the country instead of addressing job woes at home.

He "panders too much to this national, tea party, right-wing movement for his own national ambitions," said Assemblyman Louis Greenwald (D., Camden), a frequent Christie target. "You can't solve New Jersey's unique set of problems with an eye on some other sort of prize."

Christie, in turn, tells town-hall audiences that Democrats spend their time passing superfluous bills instead of his job-creating income tax credits. Things aren't as bad as they would have you believe, he says: 85,000 private-sector jobs have been created since his first full month in office.

He brought up the Democrats' jobs legislation at a town-hall meeting last week: "Every one was another spending program. It wasn't the private sector creating jobs; it was the government creating jobs."

Christie has long said he would not approve measures that cost money if they were proposed outside of the budget negotiations. Republicans say Democrats send him bills they know he'll reject to try to show him up by attempting a veto override.

There have been more override attempts -- 41 -- in Christie's term than during any other gubernatorial term in modern New Jersey history, according to the Office of Legislative Services.

Not one worked. That's because Republican legislators fell in line with their leader, denying the two-thirds vote an override requires.

"They are forgetting their constitutional obligation that they're an equal branch of government," Greenwald said.

Allen, a centrist Republican from Burlington County, approved several bills that were vetoed by Christie, then switched her votes for the override. Those bills were:

Angel investor tax credits: Supported by Republican-friendly business groups including the state Chamber of Commerce, the tax credits would have gone toward technology businesses and cost up to $8.1 million. The bill, passed unanimously in the Senate, has been reintroduced.

Media tax credits: This would have increased film-production tax credits fivefold, to $50 million. The bill, cosponsored by a Republican, has been reintroduced.

Business loans: Female and minority small-business owners in some regions would be eligible for state loans under the bill. It has been reintroduced and passed out of an Assembly committee with one Republican vote.

Retirement tax exemptions: This bill would have exempted some retirement income from taxation for certain payers, costing $127 million.

Allen said she voted for the bills because she thought Democrats had identified funding sources -- an unused account that could be tapped, for example.

"But we dig into it and find that money had been spent or shifted," she said.

That is either a lie or an indication that Republicans "have not taken time to understand how the bills work," Greenwald said.

The Republicans' arguments reflect Christie's veto messages, which said that Democrats "acted prematurely, irresponsibly and in a pattern consistent with the reckless conduct of the past which got us in the current fiscal mess."

Why, then, did Democrats pass bills the state couldn't afford?

"Some have very cynically said these were done to embarrass the governor," Allen said.

Another Republican legislator, Sen. Jennifer Beck, of Monmouth County, sponsored two bills vetoed by the governor, including a $7,500 tax credit for homebuyers. It had six Republican cosponsors and would have created more than 18,000 jobs, bringing in more than $1 billion in tax revenue, supporters said.

Christie vetoed it, citing the immediate loss of $100 million in tax revenue amid a $11 billion deficit.

Despite her support for the bill, Beck is angry at Democrats' attempt to make political hay out of it. It "has nothing to do with their system of beliefs or their sense that this is a good policy initiative," she said. "This is more about trying to back the governor in a corner."

Her bills were "good ideas," but there are other good ideas in the Legislature, she said. Christie has the privilege of choosing those that work in the overall budget.

Democrats need "to get serious" instead of trying to create a campaign issue for next year, when Christie and all 120 legislators are up for election, Beck said.

Asked what bills Democrats should support to address the economy, her only suggestion was Christie's proposed income tax credit, which she said would attract jobs and keep residents in the state. The plan would be paid through a budgeted spike in tax revenues that Democrats are skeptical will happen.

Greenwald rejects the idea that the homebuyers tax credit would cost money. It would stimulate home construction and consumer spending, he said, leading to new revenue from income, sales, and real estate transfer taxes. By the time homeowners claimed a credit on their tax returns, the state would already have gotten a windfall in new revenue, he said.

"So really, again, are the Republicans just not smart enough to understand the legislation?" Greenwald asked. "Are they too lazy to do the research before they vote?"

Does their support for measures, followed by a refusal to override Christie, mean they were "deceiving the public because they don't want to work on bipartisan legislation?"

It hasn't been total deadlock. While a Democratic list showed that the governor vetoed 22 job-creation bills and signed just three, he did make changes -- known as conditional vetoes -- to nine bills that ultimately were enacted. And Democrats have supported his plans to control property and business taxes in an effort to improve the economy.

The most significant disagreement may be the most basic. How bad is the economy doing?

Christie says a "New Jersey comeback" has begun, with private-sector jobs added in 10 of the last 13 months, and income levels, car sales, and homebuilding on the uptick.

"I choose optimism about New Jersey and its people," Christie said in June. "Instead of, like Assembly Democrats, rooting for failure."