August 27, 2009

NJ Jewish News is inviting community leaders and our readers to write short essays suggesting issues they regard as critical to the state and the state of the Jewish community ahead of November’s election for NJ governor.

To offer your own ideas on “What’s at Stake,” send your thoughts (no longer than 300 words) to editorial@njjewishnews.com and write “Stake” in the subject line.

Jared Silverman

Economic integrity

In the upcoming gubernatorial election, there is one main issue: economic integrity. All other issues, while they may be important, are subordinate. Without state economic integrity, financing of meritorious programs will be impossible.

“Economic integrity” is the ability of the state to finance its operations and obligations without overly burdening the taxpayers and giving them incentive to leave the state. This means better control over expenditures, and reducing them in some areas, without increasing existing taxes or getting creative with new taxes.

There is a limited source of income to finance federal, state, and local governments. The federal government, in particular, is in the process of increasing the financial burden on future generations without regard to sources of funds. “Soak the rich” only goes so far, because eventually the rich will either leave by migration or be taxed out of existence. This will leave the “average” taxpayer to pick up the burden.

New Jersey, because of its level of taxation and its burdensome laws and regulations, is considered unfriendly to business. Thus, enterprises looking to start up, expand, or relocate avoid the state. This reduces the potential for state revenue and for private-sector employment.

The tax structure is also unfriendly to retired residents looking to remain in the state. For decades, there has been an outward migration of NJ residents. While there has been an influx of foreign immigrants, it is not clear whether they have the same skill sets and income levels as the residents leaving the state. If they don’t, there will be a net loss of income to the treasury, with a higher demand for state services.

To avoid New Jersey becoming another California, the next governor has to create a more positive climate for economic growth. This means ending the state’s reliance on debt financing, curtailing government expenditures, easing the citizens’ tax burden, and making New Jersey more business friendly. This is no small task.

I await the competing revitalization plans of the candidates.

Jared Silverman chairs the government affairs committee of the MetroWest Community Relations Committee. The opinions he expresses here are his own. An attorney in private practice specializing in dealing with entrepreneurs and technology-based companies, he also was a Republican candidate for State Senate and for Congress.

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