Desperate states try desperate measures, so the governors of Illinois and New Jersey are feuding over whose battered economy deserves more jobs.
Illinois Gov. Pat Quinn, whose hard-pressed state just increased its income and business taxes, is irate about ads placed by New Jersey promoting Gov. Chris Christie and seeking to lure jobs from the Land of Lincoln.
"Had enough of outrageous tax increases?" says an ad placed in the State Journal-Register of Springfield, Ill. In it, Christie urges businesses to relocate to New Jersey, stating his commitment to "fiscal responsibility and lower taxes."
But Quinn said Christie has no reason to brag. In a televised press conference, chronicled New Jersey's budget and jobs woes.
"New Jersey's way of balancing the budget is not to pay their pension payment, not to deliver on property tax relief that was promised, to fire teachers, to take an infrastructure project – building a tunnel that had already been started – and end it and have to pay money back to the federal government," Quinn said.An excerpt from Quinn's press conference is available on the Huffington Post.
Although they are pillars of the American economy, Illinois and New Jersey are suffering many of the same problems. During the Great Recession, a number of studies rated Illinois among the most distressed states because of its high unemployment and budget deficits.
The Illinois job picture has improved slightly in recent months, according to the latest estimates from the U.S. Bureau of Labor Statistics. They showed the state's unemployment rate dropping a full percentage point, to 9.3 percent, from July through December 2010.
But the problem in those numbers is highlighted by the New Jersey findings. While unemployment here dropped to 9.1 percent from 9.7 percent, New Jersey actually lost about 11,000 jobs during the period, according to the BLS.
Declines in the official unemployment rate stem in part from people dropping out of the workforce. While Illinois added about 57,000 potential workers during the last six months, New Jersey's workforce contracted by about 42,600, the BLS reported. Even some government economists now concede that real national unemployment is higher than the reported rates.
Much of the New Jersey loss has occurred in the public sector, where employment was down about 4.5 percent over the previous year, according to the BLS. While that includes layoffs of teachers and other public employees, it does not include recent cuts of police forces in hard-pressed New Jersey cities.
In going after Illinois, Christie is simply joining his Republican counterparts in some Midwestern states. Wisconsin Gov. Scott Walker and Indiana Gov. Mitch Daniels have made similar comments. Indiana is planning its own ad campaign, according to a report on northjersey.com.
But Quinn said that even with the hikes, which increased the top personal rate to 5 percent from 3 percent, Illinois has lower taxes than New Jersey and other would-be job poachers. "We don't need advice from some guy from Jersey," he told the Chicago Sun-Times.
"I don't think governors should be kicking each other in the shins," Quinn said at the press conference after signing a bill to curb Illinois' $15 billion Medicaid program.
He defended the Illinois tax increases, saying that because of his state's fiscal problems, "I as governor had to take action and I did.
Meanwhile, Christie took action to reap a windfall from his cancellation of the Access to the Region's Core rail tunnel project to New York. In an appearance Tuesday on New Jersey 101.5 radio, he reiterated New Jersey's intention to keep $271 million in federal funds from the project.
"We are not paying the money back" to the Federal Transportation Administration, Christie said Tuesday during an appearance on New Jersey 101.5 radio.
Not everyone applauded. The New York Post, normally reliably Republican, described Christie's move as "stiffing" the federal government. If built, the newspaper noted, the $8.7 billion project would have doubled the capacity for trains traveling between New Jersey and New York City.