Wednesday, March 18, 2009

Corzine's Sacrificial Budget

As Washington pursues its self-destructive drive toward socialism, New Jersey is not to be outdone. On March 10, 2009, Governor Jon Corzine unveiled a state budget that all but assures a continuing decline in the state’s economic fortunes.

His budget would “protect [the] needy…the elderly and the lowest-income earners.”

“[T]he budget emphasizes only education, senior services and programs such as charity care hospital funding that are relied upon by the ‘most vulnerable.’ ” Public education spending is among the highest in the nation here in NJ, yet Corzine calls for an actual increase in state funding.

Municipal aid, too, will be pretty much maintained. It will be “distributed ‘in a manner that's consistent with need’ based on a formula ‘that is reflective of the property tax burdens and the wealth’ of towns…”

By now the picture pretty much becomes clear. Corzine said that “the decisions I have made in laying out this budget reflect a clear ranking of my priorities and core values…”

It’s clear that his priorities are to place need ahead of the producers who will foot the bill for his “shared sacrifice” budget. The “core values” of the Governor are obviously rooted in altruism. Altruism holds self-sacrifice as a moral ideal. Who will do the sacrificing and who will be the profiteers on that sacrifice? For there to be sacrifice, there must be something to sacrifice. Therefor, altruism’s target is anyone who has achieved a level of prosperity, to the extent that he has achieved it. The beneficiaries would necessarily be anyone who, for whatever reason, have achieved less…the “needy”, the “lowest-income earners”, the “vulnerable”, the least “wealthy” towns.

Let’s be clear here. “Need” has and never will produce so much as a single morsel of food. Production of the values human’s need depends on a process of productive work guided by reason. Yet, under the moral inversion that is altruism, the God of Need will be the drain down which the efforts of the productive will be poured. On the national scale, it is called “raising taxes on the top 5%”. On the NJ State level, it is called “raising taxes on the rich and on employers”.

If you think you’re safely below the “top 5%” or the “rich”, think again. The dirty little secret is that there will always be a “top 5%” or economic class called the “rich”. Once the current crop of rich five per-centers is drained, the tax target shifts down the income scale to the next level, then to the next, and so on. It is the well-worn path to national economic suicide. That process is just getting re-charged on the national level, but here in New Jersey it is well under way.

In recent years, taxes on the wealthy have been raised substantially to a top rate of 9%. Yet, Corzine seeks to raise it further. The tax “would affect about five percent of New Jersey's population… those with incomes over $250,000…” Sound familiar?

But the cow may have already been milked dry, as leading members of his own Democrat party apparently fear:

"The president already announced he's going to go after that group. It's a double hit," Senate Majority Leader Stephen Sweeney said.

He pointed out that New Jersey also raised the income tax on those making $500,000 or more in 2004, under Gov. James E. McGreevey's so-called millionaire's tax.

"We've hit that income bracket pretty hard. I'm not one of them, but we've hit them pretty hard," said Sweeney (D-Gloucester).

Sen. Raymond Lesniak (D-Union) said he's not against raising the cigarette tax but views an income tax hike on the wealthy as "a huge mistake." As New Jersey tries to attract businesses, particularly those fleeing Manhattan during the recession, "it would be very counterproductive" to add to the tax burden of top executives, he said.

"I will aggressively oppose it," Lesniak said.

So where else to look for sacrifices? Why, down the income scale, of course. Corzine’s "targeting of the middle class” took “many by surprise”. It shouldn’t have.

“As he promised to protect children, the elderly and the working poor, the governor asked others to sacrifice, proposing tax increases on businesses and the wealthy...

That could translate into a double whammy for non-senior homeowners earning between $75,000 and $150,000. Not only would they lose their rebate, they would miss out on hundreds of dollars in savings from the tax deduction.”

New Jersey’s property tax rebate scheme is widely seen as a scam, with money being drained out of the income tax pocket and returned as property tax “relief”. Now the “relief” part goes up in smoke. On top of that, the tax deduction is lost. Who will this hit affect? The new “higher income households”:

"As family members lose jobs or see their hourly wages fall, the number of taxpayers making less than $75,000 grows," Corzine said. "For these citizens, rebates count."

And here we get to the hideous essence of “shared sacrifice”. Blinded by altruism, the Governor cannot see the connection between the penalizing of achievement and the growing ranks of the “needy”. We see this phenomenon being played out dramatically with regard to the financial crisis. For the sake of the growing “number of taxpayers making less than $75,000”, those just above that threshold will be sacrificed…just as Gov. James E. McGreevey's 2004 so-called millionaire's tax raised taxes on incomes of $500,000+ to fund middle class tax relief…relief that is now gone.

The policies being pursued in Washington are being compounded by similar ones in New Jersey, and they will be very damaging to our economic well-being, long term. Governor Corzine, just like President Obama, has cloaked his plans in a moral blanket…the morality of altruism. My “core values”, as Corzine put it. Here, as on the national level, the lesson is clear. To challenge the direction of state policy, it is the moral foundation that must be challenged. As long as it is deemed moral to sacrifice for the sake of others “less fortunate”, there is no way to effectively counter such schemes as the New Jersey budget. At a time when a drastic easing of the burden on production and trade is desperately needed, that burden will be increased. But it is seen as the moral thing to do.

But altruistic self-sacrifice is not moral. The moral is to achieve and keep values…in other words, to be selfish. If the rational, selfish pursuit of one’s own self-interest was widely accepted as a moral virtue…and the sacrifice of one’s hard-earned values was seen as the vice that it is…New Jersey and America would be embarked on a very different course. The ranks of people making more than $75,000 (or $500,000) would be swelling rather than shrinking.

As for people truly in need, their best interests would be served not by a shrinking, but by a growing, productive class. History has borne this out. America is the richest country the world has ever seen…and the most generous…even under today’s onerous tax burden. Generosity and compassion are corollaries of prosperity. But that generosity depends on the security of knowing that another’s need is no threat to one’s own wealth and earnings. Respect for the right of each individual to his own life and pursuit of happiness is a prerequisite for a prosperous and benevolent society.

Nothing short of a moral revolution enshrining rational self-interest as the highest virtue is needed to make that possible.

No comments: