New Jersey’s Long Road Ahead

Taxpayers vs. Politicians and Unions
Tax Cuts for All

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For years, union officials in New Jersey have gotten politicians from both parties to give in to their incessant demands for lavish taxpayer-funded benefits. Today, New Jersey has the highest property taxes in the nation and the highest per-pupil school spending. This has resulted in the largest state population loss in the nation and a massive budget deficit.

Fortunately, the deficit-friendly approach to budgeting is falling out of favor, as state and local governments feel the squeeze from public employee compensation. The spectacle of government employee unions lobbying for expanded benefits, even as private sector workers experience layoffs, has not played well with the voting public. Many now support the effort to rein in public sector compensation. However, New Jersey still has a long way to go on the road to fiscal sustainability and economic competitiveness.

New Jersey’s current situation is not pretty. New Jersey residents pay the highest property taxes in the nation. The state has the highest per-pupil spending per student. The unemployment rate is 9.1 percent and continues to exceed the national average. The state’s long-term debt is one of the highest in the country.

This report, coauthored by Vincent Vernuccio and Kevin Mooney of the Pelican Institute for Public Policy, explains the causes of New Jersey's dire fiscal situation and how to put the state on the path to budget stability and solid economic growth. It explores public employee reforms that properly balance the interests of taxpayers and state workers.