June 1, 2009

What Employers Should Be Thinking About When They Vote Tomorrow

By Scott Goldstein

With the gubernatorial primaries tomorrow, Chamber members should consider what kind of governor they want to lead New Jersey out of the recession and into a new economy.

For registered Republicans, the choice is one of three candidates - former U.S. Prosecutor Chris Christie, former Bogota Mayor Steve Lonegan and state Assemblyman Richard Merkt of Morris County - all of whom pledge to cut taxes and improve the business climate. For Democrats, there is little suspense: Gov. Jon Corzine, running essentially unopposed in tomorrow’s Democratic primary, says his business experience and connection to President Obama uniquely qualifies him to steer New Jersey through the crisis.

New Jersey Chamber members with extensive knowledge of state government and politics sounded off on the primaries – mostly on the hotly contested Republican side – and the impact candidates would have on the business climate.

"The goal for business is a stable prosperity-driven economy and candidates have to spell out what polices are going to get us to that point," said former Gov. James Florio, a Democrat and Chamber member who founded the law firm Florio Perrucci Steinhardt & Fader. However, he added, "It’s unusual for primary contests to get into specifics. Voters go on basic philosophy and philosophical differences."

Here’s what we know:

Corzine, not yet in full campaign mode, has so far touted his response to the national recession. It has included reducing state spending, taking steps to improve the state’s business climate by streamlining regulations and offering tax credits to business that either create new jobs or make capital expenditures.

On the Republican side, Christie says he wants to reduce income tax across the board and reduce the corporation business tax rate. He’s also calling for additional tax cuts or credits to New Jersey companies that purchase the goods and services of other New Jersey businesses – a move his campaign says will increase the state’s private-sector job growth.

Lonegan pledges to push for a never-before-tried flat income tax, revitalize the state’s economy and bring jobs and people back to New Jersey. He said he will lower corporate income taxes, reduce regulations that slow economic development and cut the size of government by at least 20 percent.

And Merkt - the only Republican candidate with state government experience – says neither of his opponents’ plans would win approval from the Democrat-controlled Legislature. Instead, he says he would work to block anti-business legislation and untangle red tape for businesses by creating a single agency to issue all licenses and permits. He also would like to reduce the number of permits and licenses a business needs.

Nicholas Acocella, editor and publisher of Politifax, has been impressed by the GOP race.

"It’s been remarkable how much these guys have stuck to the issues and have drawn clear lines," Acocella said. "Lonegan has anchored his campaign to the flat tax idea. Christie has said it won’t work and that it will raise taxes for many people. Merkt says neither of them would be able to get anything done because they don’t know how to deal with the Legislature."

Christie appears to have a solid lead. A Quinnipiac University poll last month showed Christie ahead of Lonegan, 56 percent to 33 percent, among likely Republican primary voters. A Monmouth University/Gannett New Jersey poll found Christie leading, 50 percent to 32 percent. Merkt, who hasn’t raised nearly as much money as his opponents, has been a distant third.

But Acocella isn’t making assumptions. He called New Jersey Republicans "a totally unpredictable species."

Can the Republican candidates’ plans for income and business tax cuts work?

"The only way to find out is once the guy we elect gets an opportunity to try," Acocella says. For now, he said, "It all comes down to who you believe. Do you believe that Lonegan’s flat tax will do what he says it would? It would be intriguing to try it. It can ruin the entire state or it can be salvation."

Hazel Gluck, a Republican and partner at the Trenton-based lobbying firm MBI-GluckShaw, says business would benefit from any of the GOP’s candidates in the governor’s office. "Republicans tend to have more sympathy towards business in general than do Democrats," Gluck said.

Florio asserted it is unfair to suggest Corzine is not sympathetic toward businesses. "When Governor Corzine came in, he was saddled with fiscal instability that developed over a ten-year period and is responsible for the difficulties we have today. And it has been compounded by the economic stress we are saddled with."

Florio recommends that business owners cut through election-time rhetoric and demand to know how candidates will handle controversial issues. "The general population is not enthusiastic about service reductions and tax increases. And they are not enthusiastic about taking on difficult issues," Florio said. "But there are no easy decisions. Someone has to be able to give a little to achieve the goals of balancing the budget and forging sustainable prosperity."

Ingreed Reed, director of Rutgers’ Eagleton Institute of Politics’ New Jersey Project, said the Republicans need to talk about more than taxes. "Republicans want a leaner government and want to reduce taxes to free up money that they think business can invest better," she said. "But there is another side: What do they want government to do, particularly on education, transportation and health issues? The economy and private sector depend on a citizenry being well – educated, mobile and healthy. Business would be in sorry shape if we didn’t pay attention to these issues."

Chamber members should be sure to vote tomorrow, says Jim Leonard, senior vice president, government relations for the Chamber. "Turnout in primaries is usually low, which means every vote counts," Leonard said. "An engaged business community, regardless of political affiliation, is the only way to make sure the voice of employers are heard."

Scott Goldstein is the communications manager for the New Jersey Chamber of Commerce. Scott can be reached at scott@njchamber.com.