Governor Murphy, Economic Opportunity for All
GSI’s Egea: Phil Murphy Economic Plan is the Start of a Conversation
The following opinion piece was published on NorthJersey.com on October 5, 2018 and in the print edition of the Bergen Record on Sunday, October 7, 2018.
Though unusual in these bitter partisan times, there is bipartisan agreement that New Jersey’s economy is in turmoil and that taxpayers – both homeowners and corporations — are growing tired of the burden they face here. Changing the way we do things in New Jersey must be a focused objective for state leaders.
So, let’s start with the premise that having an economic plan is better than not. Gov. Phil Murphy has now put forward a plan he believes will build a more broad-based economy in New Jersey. Like any proposal, there are ideas that should garner broad consensus and others that will be challenged.
While the governor’s proposal is light on details in contrast to State Senate President Steve Sweeney’s proposal to reform how New Jersey’s government goes about its business, it does contain a number of positive ideas. Each, if implemented thoughtfully, can have a meaningful impact on our economy.
First is the governor’s NJ Forward tax credit proposal. By prioritizing seven industries where New Jersey has strategic advantages and the job potential is both high growth and high wage is a smart move. New Jersey enjoys geographic and infrastructure advantages along with incumbent firms in these industries that have room to grow if nurtured. The governor has recognized these are very competitive industries and claims to have the will and funding to gain market share as measured by jobs.
Second is his proposed NJ Talent, which is a much-needed focus on driving education curricula, particularly in higher education, to deliver the skill sets required by our employers. Matching job training to employment needs is a wise approach but can only be truly successful by engaging the business community as partners in this effort to ensure this initiative achieves its purpose. The NJ Apprenticeship Network is a good move as well and will address the investments already being made in community colleges and other specialized trade skills development.
Third is the governor’s comprehensive approach to the WIND Institute. No doubt wind is New Jersey’s oil patch without the harmful environmental risks and the fact it’s a forever resource. But, as with other areas of the plan, the business case is not thoroughly stated and the public support for deploying wind terminals off the coast of the Jersey Shore is overlooked. This sector was highlighted presumably due to its potential to have a sizeable impact on the economy though the details are to be determined. New Jersey has the potential to be a leader in harnessing the wind as a resource where others have failed — if the will exists.
So, if the governor’s plan is a real path forward for New Jersey, we need to see more policies of the type that drove his successful business career. The goals of his plan are laudable: 300,000 jobs and 4 percent wage growth. But the plan’s long-term goals stated for 2025, have absolutely no indication of the level of taxpayer investment nor business case to justify the financial commitment that appears necessary to enact many of the programs. Moreover, for a 7-year plan, it has no interim milestones to determine if sufficient progress is being made.
For example, New Jersey currently employs 4.4 million people according to the latest jobs reports. So adding 300,000 new jobs translates into less than a one percent increase to that base by 2025. Is the growth worth the investment? Possibly, if the jobs are the high wage ones as promised, but again the report is short on details.
What’s more, advice from the communities the plan is addressing (business owners, experienced government leaders or investors) seems limited. Making Government Work Better is a headline devoid of any specific reforms or statement of savings such as those that were so plentiful in Sweeney’s task force report. Creating a Small Business division in the EDA and “reviewing our processes” for improvements is just rhetoric to small business owners. These entrepreneurs could have told the governor where government is an obstacle and when it can be part of the solution.
No doubt, this plan joins a sorely needed conversation. Now with two plans on the table – one from the governor and the other from the Senate president, let’s get a real debate started about how to get New Jersey’s fiscal practices on the right path.
Regina Egea is President of the Garden State Initiative, an independent, free-market research and educational organization dedicated to making New Jersey once again a place where families and businesses can thrive.