Monday, August 25, 2008

Over the Cliff?

New Jersey (the state I grew up in, and escaped from over 30 years ago) is a political and economic disaster. For well over 100 years, New Jersey has been a leader within the U.S. – a leader in corruption, taxation, and leeching the life out of legitimate businesses, that is. I had several jobs there while a teenager, and even as an entry-level employee the pervasive corruption those businesses operated in was evident.

My parents and one brother still live there, for reasons I've never been able to fathom.

Stephen Malanga, writing in City Journal, has an excellent piece about the most recent shenanigans in New Jersey. The lead:
The state’s leaders seem determined to drive it off a cliff.

Adam Smith once wrote that there’s a “great deal of ruin in a nation,” by which he meant that it takes an awful lot of bungling by political leaders to bring down a powerful and prosperous state. Today, New Jersey pols are giving Smith’s thesis quite a test drive. They are steering the Garden State toward ruin at an astonishing pace, and no amount of bad economic news seems capable of deterring them.

The latest indication of the state’s decline is the rapid deterioration of its newspapers, which rely heavily on the local economy and thus are good barometers of a community’s conditions. New Jersey’s biggest newspaper, the Star-Ledger, once one of America’s most profitable papers, is cutting 20 percent of its workforce because it’s losing more than $30 million annually, while the Bergen Record, to stay viable, is closing its headquarters and sending most of its reporters to work out of their homes. Six Gannett newspapers in the state are cutting jobs and planning early retirements for their employees.

Though Jersey’s papers are to an extent suffering the afflictions—like the flow of advertising dollars to the Internet—that plague the newspaper industry generally, they are also being hammered by the state’s considerable economic woes. The Star-Ledger’s owner, Advance Publications, says that the paper is doing far worse than the company’s papers in other markets. That’s not surprising, because Jersey never recovered as did the rest of the nation (New York included) from the recession of 2002. Only government employment soared in the state from 2003 through 2007, while private job rolls grew a meager 1.8 percent, mostly through the addition of low-wage service employment. In 2006, when the country was in the middle of an economic boom, New Jersey, virtually alone among the states, faced a crushing budget deficit of $4.5 billion that prompted an embarrassing shutdown of state government.

There's much more. Read the whole thing.