Why The Sudden Panic Attack Over New Jersey’s Bond Debt?
That’s not to say New Jersey’s debt isn’t much higher than it should be. Take a look at the state’s credit card statement as of June 2007. (Click on the graphic to the left) There are things on there you’d expect to see - $7.98 billion for transportation, $1.5 billion for open space and farmland preservation, even the infamous $2.7 billion for pension funding. But some of the other stuff? Who remembers why we charged some of these things or what several of the charges are for?
There’s $616 million left to pay for the Sports and Exposition Authority - was that debt really necessary? Cigarette tax revenue, $1.4 billion – a cash advance, but what the heck did we do with the money? Anybody remember?
Then there are items put on the state’s credit card that only benefit certain municipalities or special interests - $6 billion for school construction in the Abbott districts, $176 million for municipal rehabilitation and $240 million for a business employment incentive program.
Look over the list and you’ll find your own “huh?” items.
Anyway, there’s no sense in crying about it now. We’ve already put this stuff on the credit card and we have to pay it back. But, why the sudden panic attack over the state’s bond debt? We can continue to swing the payments on our current income.
Sure our credit cards are maxed out and we can’t afford to buy new stuff, but why is Governor Corzine running around the state claiming we need to raise $38 billion when our current debt is only $30 billion? Or did Corzine charge up $2 billion more since June and the tab is now up to $32 billion? Either way, we can make the payments without new or increased taxes.
This year, state sales tax revenue will be $8.8 billion, half a billion more than last year and next year, it will be $800 million more than 2007. So, what’s up with all this talk about a financial melt down if we don’t adopt Corzine’s asset monetization plan?
Making our debt payments isn’t causing the state’s financial crisis. Raise road and bridge tolls a little bit and we’d have the money to pay for the expansion and maintenance of our transportation infrastructure. Obviously, the large toll increases Corzine is proposing are for a different purpose, which we explain in our next post.