New Report Confirms What Jerseyans Suspect: The Recession Ain’t Over
Today’s release of a report from the State Budget Crisis Task Force confirms what has been clear in New Jersey for months: the effects of the Great Recession persist, and it’s not likely to get better anytime soon.
The report makes a number of key findings and analyzes the full impact of the recession on New Jersey and five other large states (California, New York, Texas, Illinois, and Virginia). The takeaway is distressing: state governments – that build the highways, ensure public safety, educate 90 percent of students in the K-12 grades and 70 percent of all college students, oversee health care for the poor, aged, and disabled, and protect the environment — are in danger of not being able to sustain essential services.
Two findings in particular should interest New Jersey citizens and policy makers:
• New Jersey stands to benefit from full implementation of the Medicaid expansion in three ways: Medicaid will pay for the full cost of medical assistance for some groups that are now partially funded by the state, the number of uninsured New Jerseyans who will be covered by health insurance will be increased dramatically, and state charity care payments to hospitals will decline. Gov. Christie can help the state’s fragile financial condition by agreeing to the Medicaid expansion.
• Proposals calling for deep cuts in federal assistance to states would be disastrous for New Jersey. Today’s report tracks the impact of a ten percent cut in federal grants, which would add about $1.6 billion to the state’s growing deficit. This relatively modest cut is nothing compared to cuts included in the Ryan Budget, which would attempt to balance the federal budget by exclusive reliance on eliminating discretionary federal spending.
Given Gov. Christie’s national prominence and influence in the Republican Party, he could do much to help stabilize New Jersey’s finances by proposing a more balanced approach to the federal deficit than the one proposed by Congressman Ryan.
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