Gov. Christie Declares "NJ on Edge of Bankruptcy" Christie to freeze $1.6 bil. in NJ spending.

MISH'S Global Economic Trend Analysis ^ | 021110 | Mike Shedlock

[Girlene]

From the article:

............."The total unfunded pension and medical benefit costs are $90 billion. We would have to pay $7 billion per year to make them current. We don’t have that money—you know it and I know it. What has been done to our citizens by offering a pension system we cannot afford and health benefits that are 41% more expensive than the average fortune 500 company’s costs is the truly unfair part of this equation.".............

WOW. Unfunded pensions/medical at $90 billion??!!!! That's a huge hole to dig out of.

[wiggen]

I didn’t say theres no solution to the pension problem but rather that there are no solutions without dealing with pensions first. They’re a huge pyramid scheme dependent on an ever growing tax base. This is an issue for all 50 (57?) states. The federal government too. They may have rescued GM but who will rescue them?

[kittykat77]

The NJ state government does not assess property taxes; the towns and municipalities do. The state does have an income tax and a sales tax. Usually, when state aid to towns and municipalities decreases, the property taxes increase in order to make up most of the difference. So if Gov Christie cut state taxes by 75%, property taxes would skyrocket.

NJ is a population dense, high tax, high service state. There’s just no way around it. Geography and the NJ Turnpike are destiny.

If you don’t have a really good reason for living in NJ — like a really high-paying job in a field limited only to population dense, high tax, high service states — there’s no reason to live here. You’ll never get ahead financially. Suburban kids will get a fairly decent education, but that’s about it.

[tom h]

Well, you did a fine job rationalizing but I’ll bet if you really looked at the numbers you would find a bloated government at all levels (state, city, county) and incredibly fat and worthless public employee unions doing work that could be done at 1/2 the cost by industry — e.g., IT administration, sanitation, etc.

I am one of those fellows who believes that property taxes are inherently socialistic if not communistic; because you can own your house outright — have the deed in your hand — yet if you can’t pay the property tax the Government can legally seize the house. We Freepers tend to overlook low property taxes but at confiscatory levels in New Jersey (5% annually) it is criminal. If you live in the same house for 40 years, your entire adult lifetime, you pay the equivalent of the house value to the government in taxes twice.

That is the stuff from which revolutions come. It happened in California with the Prop 13 citizen’s revolt in 1978. Maybe someday in New Jersey.

Slash taxes 50%, do some reasonable outsourcing to private industry, and the state will do just fine after a year or so of disruption.

Better yet, have all the taxpayers and businesses move to other states.

[kittykat77]

I don’t know why you think I’m disagreeing with you: I’m not. I’ve lived in NJ all my life (gee, I can even remember the days when we didn’t have a sales tax!). New Jersey has never been a cheap place to live and never will be, even if Gov Christie devises the most streamlined and cost-effective state government in the country.

There are benefits and drawbacks to living in NJ. Still, at some point in your economic life — unless you’re reasonably well off, it’s probably better to move to a less densely populated state with a much lighter tax burden.

[Freedom4US]

Nice thought, but the statists are waaay ahead of you.

Some states, unbeknown to most, have entered into quasi-legal “compacts” with different states. So stiffing some two-bit burg out of their shakedown speed trap fine in one state might mean your home state pulls your drivers license. Doubt that’s the case here, but they really try to think of everything.

[tom h]

"New Jersey has never been a cheap place to live and never will be"

Kitty,

You are resigned to the status of NJ but I would also say that NJ is ripe for some Sarah Palin-type populism to take back their state, meaning taking on the government employee unions and scaling back taxes to a level that is not confiscatory.

To wit: I expect that property taxes creep up 0.1% every year or so, as the county government officials "decide" that more services are required, or more servicing of bond debt, or better pension benefits for their gov't employees. Do you think this is any worse than corporate fatcats voting themselves larger salaries while the workers on the line are cut?

The key issue here is that the county employees work for YOU. But they merrily go along raising your property taxes to 5% levels -- why? Because the citizens let them, in resignation, I suppose because they think they can do nothing about it.

That's why you need a health dose of Palin-mania. Take back your state. Don't bend over and take it in the rear from the same politicians and union bosses who have been shafting state taxpayers for years.

I'm not disagreeing with you, by the way, but trying to encourage you.