Friday, July 31, 2009

Job Growth Vital to NJ Economy

Unemployment in New Jersey is at its highest level in 32 years, the past 6 months of job losses have exceeded anything we've experienced and the number of long-term unemployed is at an all-time high since World War II. Once the recovery begins, many unemployed looking for jobs will realize that jobs as good as the ones they lost are almost impossible to find since layoffs in this recession are permanent and not temporary.

Taking into consideration the current 9.5 % unemployment, plus another 8% that are no longer collecting and off the statistical radar screen we are looking at 18% to 20% unemployment. I expect unemployment to reach somewhere around 11 to 12% before it stabilizes. Even when this recession is over, the amount of job losses have exceeded job creation. The road to recovery will be a long one before anyone realizes the recession is over.

Many of our residents are finding their benefits coming to an end, and left with nowhere else to turn.

Many of the unemployed will find that their previous jobs have been eliminated; new wages will not come close to prior earnings.

Since 2001, New Jersey has had a 23 percent decline in manufacturing, losing 96,200 jobs. The increased corporation business tax liability imposed in 2002, requiring a business to pay a surcharge equal to 4% of the amount of the corporation’s tax liability. Since the recession began in December 2007, New Jersey had shed 155,000 jobs. By the end of 2008, more than thirty-one corporations moved to Pennsylvania taking 21,000 jobs with them, along with $13 billion in income and wealth. Due to the increase in business tax 100,000 jobs were lost.

New Jersey needs to put an end to its stifling business practices. We need to eliminate the 4% corporate tax, rollback the 25% tax on wine and spirits, and find ways to help small business owners with affordable healthcare for their families and workers.

Since 2003 until now our legislation has put forth and implemented the payroll tax for paid family leave, the sales tax increase along with the sales tax expansion. There was the corporation business tax, increases on the realty transfer tax, casino taxes, hotel/motel bed and breakfast occupancy tax, the elimination of disallowance of depreciation deduction, elimination of deductibility of net operating expenses, taking away ability of a business to deduct from their taxes an amount for the depreciation of equipment and machinery. Also, the Corporation Business Tax and Gross Income Tax from the Federal Deduction of Qualified Production Activities Income, which increases taxes for certain New Jersey businesses by decoupling New Jersey’s Corporation Business Tax (CBT) and Gross Income Tax (GIT) from the federal manufacturer tax deduction.

The above mentioned taxes are only a few out of many penalties that have been detrimental to the decline of business in New Jersey since 2002. Is it any wonder jobs are leaving the state for greener pastures?

Revenue that would have gone to the business owners to expand and create jobs, raises, payroll, and hiring is being swallowed up by state greed to replace the fiscal mismanagement of years gone by. Trenton needs top take a step back and take a look as what must be done to reverse the trend and replace lost revenue. Raising taxes in a recession is not the answer, having an adverse affect.

Trenton must find a solution to encourage business growth, so we are in a position as the effects of the recession diminish, business growth will be able to outpace job demand. Lacking jobs, the market can only perpetuate more of the same.

Corruption in NJ Government, a license to steal?

Public confidence has been shaken in current NJ administration, with more arrests said to be made very soon.

A ten year investigation, is this organized crime in state government?

Money laundering, body parts, bribes, and a list of more to come. Is it any wonder the citizen’s of this state are cynical about politicians.

Is this what Corzine's rebirth of ethic standards meant? Guilt by association has been taken to a new level.

However, on the bright side the citizen’s of NJ will be able to rest a little easier knowing a settlement was reached on Springsteen tickets.

Would this be a good time to start considering term limits?

Joe Sinagra

Thursday, July 23, 2009

Healthcare, The Sky is not Falling

We do need healthcare reform, but it should be looked into at a slower pace. This is a start to what could be good for all of America. There is no crisis, no immediate danger of the health care system collapsing.

We cannot pass increased costs on to the business owners and corporations. Government cannot tell citizens they must carry health care insurance or they will be penalized. America’s 47 million uninsured people would be required to purchase a health policy or face financial penalties. To ask citizens to make another choice in what bill to pay at the end of the month would be creating an undo hardship on them.

All Americans deserve access to affordable health care, but to increase taxes during an economic recession, especially on small businesses, is not the right way to accomplish that goal. To mandate that individuals face penalties during hard times is a bitter pill to swallow.

The American Recovery and Reinvestment Act of 2009 H.R. 1 will increase the number of those dependent on the Federal Government for health care by about 8.2 million. By creating a panic, insisting that it must be done now or else, is throwing good money after bad, making a bad situation worse.

Reforming Medicare and Medicaid would be a good start. In 2007, 32.7 billion dollars was spent on improper Medicaid payments. Instead of reforming the program, there is a formula that actually rewards states for driving up their health care costs. Senior citizens would be asked to pay higher premiums for Medicare drug coverage.

Government is going to spend $634 billion on health care, half of that will be paid by new taxes. Experts predict the costs would be closer to $1 trillion dollars.

Republicans are not blocking the healthcare plan. If all the GOP Congressman voted against it, there are enough Democrats to vote in the affirmative to push this bill through.

I believe by pushing this plan through before it is ready, will lengthen the recession.

If the recession is to improve as some are predicting by the middle of 2010, there is plenty of time to put together a health plan without being hasty. To ratify a rushed healthcare plan before all aspects and resulting consequences are looked at, will certainly cost us much more than we bargained for.

This is one plan that must be read from cover to cover before it is voted on. A haphazard decision would be catastrophic.

Sunday, July 12, 2009

Jobs necessary for the survival New Jersey

It is costing us $100 million a day in stimulus interest. Unemployment has gone from 8.5% to over 10%.

The $29 million budget the Governor signed will not bring relief to an already suffering working class.

Unfunded pensions, health care benefits for retirees are costing every man women and child left in the state about $3800. With the new budget, we are using new debt to pay down the old debt.

A year from now, we will be looking to another increased budget, because the current budget does nothing to prepare for New Jersey’s future. How in the world, during a recession can you justify raising taxes on an already struggling working middle class?

New Jersey is already unaffordable to many of its citizens, and has caused many of them to flee the state. Friends, neighbors, relatives with the hope of something better across the state line.

The exodus from New Jersey began in 2002. At that time 23,000 more people moved out of the state than moved into it, increasing in 2006 72,000, escalating to 196,000 by the end of 2008. The dampening of the housing market in recent months, however, could lead some people to stay.

To some of the families I’ve talked to in the district, this budget will devastate them.

This recession had nothing to do with NJ’s economy; it's due to eight years of overspending that has brought us to where we are. Revenues averaged about 3%, but spending continued at an average of 7 to 9%.

Many jobs continue to leave New Jersey, taking residents with them. Thousands of jobs in the telecommunications industry are gone; New Jersey lost 8,400 high technology jobs between 1990 and 2005. Since 2003 the pharmaceutical industries have been relocating, and less than 14 percent of the country’s pharmaceutical jobs remain in New Jersey.

The loss of state resources, families, jobs are a direct results that contributed to the loss in the states economy, reducing consumer expenditures, employment, and state taxes.

To create jobs, as a state we need to lead if we want this economy brought back to an enviable status.

Let’s use some of that the $18 billion dollar stimulus not included in the budget to create permanent jobs.

I propose as a start, the elimination of the 4% corporate tax, as an incentive to bring business back into New Jersey.

Throughout the state there are warehouses, buildings, industrial parks that are run down and abandoned, in areas such as Camden, Trenton, Newark, and South Plainfield.

Let’s tell business that we want them back, asking them to invest in these areas rather than building new facilities, give them a 20 year tax renewal option. The first 5 years there would be no property tax payments, ten years 35%, fifteen years 75%, and at the twentieth year it is open for renegotiation. Or a possible tax rotation plan where at year twenty it would go to 100%, and the following year would start at 25, 50, 75, and 100%.

They would not be penalized for property improvements; they would be given tax incentives for going “green”. The recycling of water, solar energy, generation of electricity are some areas business could be rewarded for their innovativeness.

Any corporations relocating to these areas would be required to hire at least 30% of their workforce from within their respective area, thereby helping local employment. Any employee hires over 500, corporations would receive tax incentives or credits.

By relocating to these areas, it would create construction jobs, help the housing market, and bring revenue into surrounding towns from the money that will be spent by the ensuing labor force.

By reducing unemployment, creating employer incentives, eliminating bureaucratic red tape for business owners, all will have an immediate effect on increased revenue to New Jersey.

Although not perfect as specifics would be worked out, and unless critics have a better plan, it is a start. We need a plan to invite business back to New Jersey and give them a reason not to leave.

Increasing taxes to make up for lost revenue is detrimental to New Jersey’s economy. Cutting needed programs, and giving the working class less pocket money weakens our economy even more.

As good as they are intended to be, we can no longer afford to throw money away on open space, park projects, the study of cranberry bogs, when the people of this state don’t have the funds or the means to take advantage of them.

We will never balance a budget without financial prudence, jobs are essential to New Jersey’ future.

Joe Sinagra

NJ 18th District Assembly Candidate