California is not the only state with a budget crisis. The swamplands, aka New Jersey, face a projected $3 billion deficit for the next fiscal year according to this story.
Governor Jim Corzine (D) has asked his administration to find $3 billion to cut. Interestingly, New Jersey instituted one of the largest state tax increases ever in 2006. New Jersey is considered by the Tax Foundation to have the third worst tax climate for business (even surpassing California).
Governor Corzine has complained about debt (presumably bond interest) that costs New Jersey about $3 billion annually. But who has proposed that debt, and signed the laws allowing that debt to be borrowed? New Jersey’s legislature is controlled by Democrats, and its governor is a Democrat.
This summer is going to be very interesting for state budgets throughout the United States. Special interest groups will say, ‘Cut them, not us.’ The problem is that today almost everyone considers themselves a special interest group. Will governors actually cut programs? Will they increase taxes? Or will they try to balance their budgets with smoke and mirrors?
If you’re a New Jersey resident, make your views known with your local representatives. It’s an election year, and they ought to listen.
As to what will happen, given New Jersey’s past I suspect smoke and mirrors will win out.