Stating the Obvious

The editorial boards at the Star-Ledger and Asbury Park Press both chose today to write about New Jersey's sagging business climate, and call on the Governor and legislature to change it.

The Ledger cites a Rutgers University Study, which we first mentioned here at NJ Business Matters two weeks ago. The study found that in 2007, New Jersey's private-sector employment base grew by only 0.1%. That put New Jersey 41st in the nation and we ranked behind every bordering state.

The Press editorial does the better job of directly stating the problem,

But even [streamlining econmic development agencies] will not succeed unless the state revamps its tax system, which makes it so expensive to live here, and its regulatory structure, which businesses find cumbersome and overly restrictive.

Taxes and regulation are intertwined with economic development.

The last sentence says it all. Legislators and administrations routinely introduce pro-business initatives. All of them would help create jobs within certain niches, but most suffer from the same fatal flaw: they require companies to send money to Trenton, only to have some of it sent back with strings attached. Every business climate ranking, even those that do not put New Jersey near the bottom, acknowledge that this is one of the most expensive states to do business. Changing that undeniable fact should be job number one in assisting an economy in trouble.

Among the areas in which NJ ranks near the bottom, according to the Tax Foundation, are corporate and individual income tax rates, and property taxes. Those all sound like a good place to start.