Driving in to work this morning, New Jersey Governor John Corzine was on the John Gambling Show (710 AM, New York City) discussing his plans for infrastructure projects to provide jobs in New Jersey. It was a cordial conversation, and lost within it was the statement by Governor Corzine that the federal distribution system (via Congressional appropriations committees) to states is broken. Specifically, that the northeastern states in New England are under-represented and get “less back on their dollar” sent to Washington.
Gambling referenced the exodus of New Englanders to the southern states, and Corzine said that one of the primary reasons for this is that the distribution of federal dollars to other states is un-even and unfair, that one of the causes for New Englanders leaving for the south and elsewhere is because the federal government does not give New Jersey enough funds for state projects.
As a resident who has watched people leave in droves, allow me to correct the good governor.
- People are fleeing New England states because of confiscatory tax rates levied by said states in various forms.
- People are fleeing New Jersey in particular because the corporate tax rates in New Jersey are simply massive in comparison to other states. And the industry which was once given special tax considerations to lure it to New Jersey – the dreaded pharmaceutical industry – are seeing the game now change, as they are vilified and the business advantages once given are eroded.
- When businesses are driven out seeking a more friendly tax environment, jobs go with them and many of the people who once held those jobs.
One of the last states in the Union in which a company would want to form is New Jersey. It is not coincidence that geographically next to here are others atop the list, such as Rhode Island, Connecticut, New York and Massachusetts. All New England States, and all hostile to business in relation to southern states with regard to comparative taxation rates. The same applies to individuals and the taxation of their incomes.
It is ironic that a governor, who favors the uneven redistribution of wealth that Barack Obama champions, complains about the redistribution of wealth when it is unfavorable to him and his state.
Governor Corzine, the idea is that “others who are behind you have the same chance.” Get with the program.