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BY PATRICK MURRAY
COMMENTARY
Numbers matter. Poll results, budget deficits, health statistics. Attach a number to any issue and it becomes reality. But sometimes a reality check is in order.
When this year's budget was first unveiled, the administration touted the closure of a nearly $11 billion structural budget gap. There was some debate over that claim because it involved spending that had not been appropriated for years. The front office switched gears later in the budget process and focused on the their reduction of state expenditures by $3 billion from the prior year — a widely accepted fact that is certainly worth crowing about.
The grander claim of an $11 billion deficit solution continued to surface, though, driven perhaps by the national media's interest in New Jersey's Republican governor. I believe such a claim is basically "untrue," because it implies that the structural issues contributing to this gap have been solved. They haven't.
Indeed, a recent analysis by the non-partisan — and well-regarded — Office of Legislative Services estimates that next year's budget deficit could top $10 billion. They arrive at that conclusion by looking at the same "on-the-books" programs and obligations that were used to estimate the current year's $11 billion gap. So, it was more than a little interesting when Governor Christie said the OLS numbers were "completely fake."
State treasurer Andrew Sidamon-Eristoff clarified the administration position. He said the OLS figures were "wildly inflated" because they assume "that New Jersey is going to return to its spending habits of 2008 and 2009. Those spending commitments were frankly unsustainable and out of control."
The treasurer added that all parties "need to come to terms with the fact that fiscal '11, the budget plan that we just adopted, represents a new baseline for New Jersey." Fair enough.
The problem is that OLS includes those commitments in its fiscal analysis because the programs are still on the books, a fact that the treasurer implicitly conceded in a later interview.
The OLS numbers are a reality check. Those statutory obligations still exist, which the governor was asked about in his first national Sunday morning television appearance on ABC's This Week. Specifically, host Jake Tapper asked Governor Christie whether he wiped these programs off the books via "executive fiat."
Regarding the pensions, the governor said that he was "going to go after current employees" this fall. Ah — a new reality.
It is no secret that the pension obligation will continue to grow, even after a required $500 million contribution is included in next year's budget. Furthermore, there is mounting evidence that the state will never be able to meet its retirement obligations for current employees. [Jason Method's piece on this is a must read.]
The governor has signaled that he is going to tackle this head on before the next budget. The fight is not going to be easy, but win it and the OLS deficit estimates will almost certainly come down. Until then, the numbers are anything but "fake," especially to the workers who expect to receive these benefits and to the generations of taxpayers who would have to foot that bill.
Patrick Murray, Camden County native, is the director of the Monmouth University Polling Institute.
ALSO BY PATRICK MURRAY
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Anger over property taxes goes way back in N.J.
Analysis of the primaries: N.J. Republicans have advantage heading to the fall
Why do fans of MTV's ‘Jersey Shore' like the Garden State?
Interpreting New Jersey's school budget vote
Polls on school aid cuts and NJEA not really conflicting
NJEA wins round 1 against Christie
Is Christie selling gimmicks in his ‘no gimmicks' budget?
Patrick Murray: Chris Christie making all the right moves before pain hits home in New Jersey
Christie and Obama: Who can fix government for middle class?
New Jersey gay marriage not likely to get voters up in arms
Change without hope doesn't work for Chris Christie
More going on with New Jersey voters than Christie supporters shifting to Daggett
Campaign review: Corzine, Christie stuck to their plans
Independent Chris Daggett gets some credit for his plan to reduce New Jersey's property tax
New Jersey's problems are too serious right now to entertain any more of this campaign nonsense
Corzine's path to a victory over Christie is to win ugly
And I would ask you Helen, did you ever stop to think? (end of sentence).
I'm about to become even more unpopular with this group, as I now believe the likelihood of this happening (soon enough and with sufficient formula reductions) is so low (because our politicians are WAY too beholden to the Unions) that a much better direction, and perhaps the ONLY way to avoid the financial disaster bearing down on communities throughout the nation is to OUTSOURCE 90+%of all Civil Servant positions.
The CRITICAL CRITICAL CRITICAL need is to STOP the further growth of the pension liability from the excessive pension formulas granted EXISTING employees, and the ONLY way to do this quickly and VERY effectively is OUTSOURCING.
And guess what … it's ALREADY been tested … and the sky didn’t fall in … and the residents of Maywood, CA seem very pleased with the results of outsourcing 100% of their employees. Read all about it here:
http://www.nytimes.com/2010/07/20/business/20maywood.html?pagewanted=2