Sunday, July 1, 2007
The Left Marches On Part III: Governor Jon Corzine’s Core Principles on Asset Monetization. As interpreted by Steven Lonegan
by Steve Lonegan
WARNING: TRANSLATION of Governor Jon Corzine’s complex statement of June 28 from Governmentaleeze to English. This document could cause taxpayer’s nausea and vomiting. Consult your physician if side effects continue.
CORZINE STATEMENT: “In countless ways, New Jersey is the best state in America. But we need to invest in our future if we’re going to stay on top. As a result of decisions made across administrations and across party lines over the past 20 years, New Jersey has amassed over $30 billion in debt and staggering unfunded pension and healthcare liabilities.
TRANSLATION: The strength of this state has been drawn from its people, not the government. This was once a bastion of free market capitalism. Not any more. New Jersey leads the nation with the most destructive progressive income tax and advanced social engineering schemes. We have the highest sales tax, highest property tax, and third highest debt in the nation. Rather than reduce the size of government and make it affordable to taxpayers, we will raise taxes to fund lucrative employee salaries and benefits handed out to political cronies. Wake up, New Jersey taxpayers - you work for the government, it doesn’t work for you.
CORZINE: “I have a vision for a brighter New Jersey, but today we cannot afford the investments to make that vision a reality. I fundamentally believe we need new resources and renewed political courage to make those investments.”
TRANSLATION: Grab on to your wallets. “New resources” means higher taxes and more massive debt. “Courage to invest?” Liberal buzz phrase for more spending on expanded government entitlement programs funded by job destroying taxes and massive debt issued without voter approval. The “vision” is that of a Utopian society where the government provides cradle to grave service, rendering the self sufficient American spirit a waste.
CORZINE: “My administration has been developing a new vehicle to achieve that goal.”
TRANSLATION: To reach that Utopian Society and fulfill my childhood hero Dag Hammarksjold’s vision of Socialism, the administration has been plotting and scheming the biggest and most convoluted borrowing plan in state history, the pawning off of our toll road revenue to fund a massive expansion of state government never before seen in U.S. history.
CORZINE: “Any asset monetization proposal put forth by my administration will adhere to the following core principles:”
TRANSLATION: Here comes the double talk.
CORZINE: “New Jersey’s roadways will not be sold; and they will not be leased to a for-profit or foreign operator.“
TRANSLATION: The New Jersey Pension system will buy the Toll Road Bonds and lock in a risk free return funded by constantly increasing tolls. This makes tolls a tax for the purpose of shoring up the failing pension system.
CORZINE: Allowable uses of proceeds (reducing State debt and capital investments) will be identified upfront and subject to public and/or legislative approval with safeguards against diversions to other uses.
TRANSLATION: The debt reduced is the payoff of the existing Turnpike debt (less than $5 billion) and cashing out on about $15 to $20 billion of new debt secured by the next 75 years of toll revenue. The investor’s return will be guaranteed, at taxpayer expense by annual toll increases. “Investments” means expanding Universal Pre-K, Universal Health Care, and Low Income Housing with a few billion thrown in for a new version of the corrupt School Construction Corporation. Public/legislative approval means shoving these social engineering schemes through the legislature during the lame duck session.
CORZINE: New Jersey citizens will retain ownership and the benefits from both initial proceeds and ongoing operations.
TRANSLATION: The unions will keep every job and any vendor working on these toll roads will be required to pay Prevailing Wage to all employees. This guarantees the highest possible cost of operation before funding the massive new debt. All future improvements, such as rebuilding bridges or widening congested areas, will be funded by the Transportation Trust, which gets almost all its revenue from the gas tax. This will require a 20 cent per gallon gasoline tax hike.
CORZINE: Safety, maintenance and operating standards will be provided at current or improved levels.
TRANSLATION: Toll road conditions will deteriorate as revenue is squeezed by the loss of cash flow from tolls to debt payments. High cost repairs and improvements caused by costly prevailing wage rules and increasing difficulty borrowing new debt to fund improvements will accelerate over the next few years.
CORZINE: Sufficient funding to meet the long-term capital needs required to improve our roadways and reduce congestion will be provided
TRANSLATION: Last year, the Governor signed an $8 billion Transportation Trust Fund bond issue without voter approval. This new debt provided funding for necessary road maintenance/improvements so toll revenue can all be diverted to new debt payments. This shell game is commonly called “Robbing Peter to pay Paul.” In this case, Peter is the taxpayer and Paul is the bond consultants who stand to make billions on the back of over worked taxpayers.
CORZINE: Terms and conditions of employment for current employees and contractors will remain unchanged with prevailing wage and competitive contracting procedures retained.
TRANSLATION: Lavish union contracts providing outrageous salaries and the best pension and benefit packages available anywhere in the country will remain in place while motorists pick up an even bigger tab.
CORZINE: Toll schedules will be open, predictable and available to the public
TRANSLATION: Predictably, tolls will increase like never before, hurting businesses that rely on trucking and tourism. Toll increases will be open to the public when you roll up to the toll booth and need a second mortgage to make the payment. And without a doubt, investors will have a right to raise tolls beyond scheduled increases if (and when) revenues don’t match expenses.
CORZINE: There will be a substantial, open and public discussion in advance of any transaction. I will hold 21 town hall meetings in 21 counties.”
TRANSLATION: Corzine inserted an open ended line item in the budget to fund this scheme. These meetings will be stacked with political operatives organized by union bosses and advocates of the left wing social engineering experiments this scam will finance. It’s up to taxpayers to show up in force at these meetings to outnumber those political hacks who will be lining their pockets if this scheme passes.
Steve Lonegan is the Mayor of Bogota, NJ, and Executive Director of Americans for Prosperity - New Jersey. Americans for Prosperity (AFP) and Americans for Prosperity Foundation (AFP Foundation) are committed to educating citizens about economic policy and mobilizing those citizens as advocates in the public policy process. He is a prolific writer, having been published in newspapers and blogs. He currently has a book in pre-publication on the impact of New Jersey state government on the well being of the taxpayers of the state, where he offers solid and workable solutions.
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