Paul Jacob

Let me confess: I really like New Jersey. No joke. My earliest memories are living on Alpha Avenue in Old Bridge, New Jersey.

When I was eight, in the summer of ’68, my family moved. Today I live in Virginia, but just last year I detoured while driving to New York City and darted over to see the old Old Bridge neighborhood.

It was nice. I enjoyed the scenery. And, thankfully, I didn’t have to pay their highest-in-the-nation taxes.

Or contemplate their latest corruption scandal.

I’ve been thinking about New Jersey because, like Virginia, the state holds its governor’s race this year. Further, the gubernatorial race got interesting, since this fellow named Steve Lonegan entered the contest.

I’ve had ample cause to cover Mr. Lonegan in my Common Sense e-letter, because in years past he’s found cause to sue then-Governor Christie Todd Whitman over state government borrowing billions without voter approval. In his hometown, he fought eminent domain abuse, an entrenched problem in the Garden State. And in 2007, Steve beat back two ballot measures — promoted by current Governor Jon Corzine (D) — that would have raised Jersey taxes.

Steve Lonegan is not your average political candidate. He knows what it really takes to create jobs and to run a business, having built and managed retail, homebuilding, and manufacturing businesses. In 1995, fed up with the inability of local government to solve problems, Lonegan challenged the incumbent mayor of Bogota, New Jersey, and won. He served until stepping down voluntarily in 2007.

As mayor, Lonegan proved controversial. He worked to cut spending. He re-organized government by combining city departments. He privatized some municipal services. He took on the public employee unions, even the local police union. He fought outrageous pension benefits and mandated that union contracts exceeding inflation be approved by the voters.

After leaving office, Lonegan didn’t skip a beat, taking the helm of New Jersey’s chapter of Americans for Prosperity, where he continued his battle for low taxes as well as government transparency and accountability.

When Governor Corzine sought to hike the tolls charged on New Jersey roads, Lonegan led a protest at an official public meeting being held at a public high school. Standing outside, he was told he was trespassing on “private property” and would be arrested if he didn’t move. Lonegan refused to be silenced and was arrested.

It’s not so good when public officials are arrested. But Lonegan’s guts and gumption are very welcome attributes — necessary ones for wrestling with big government.

Later, the charges were fully dropped and school officials even apologized.

In the race for the Republican nomination, Lonegan is gaining grown on former U.S. Attorney Chris Christie. Christie has some bona fides fighting corruption (by indicting and convicting lots of crooked New Jersey pols), but his own ethics problems have also come to light.

Worst of all, Christie is the candidate of Jersey’s GOP establishment at a time when New Jersey voters — left, right and in-between — want new blood. Change. Hope.

For real, I mean.

Christie has the money and insider support. Lonegan has the energy and grassroots support. He’s put forth a number of ideas for reform.

A key flash point has been Lonegan’s call for a flat tax. Presently, New Jersey has a very progressive state income tax that starts at 1.4 percent and ends at 8.97. Lonegan would flatten it to 2.9 percent for everyone immediately — then cut it to 2.5 next year and 2.1 percent the third year.

Governor Corzine’s bright idea is to hike the top tax rate to 9.73 percent.

Christie argues that Lonegan’s flat tax will raise taxes for many lower income citizens. Lonegan doesn’t hedge. “In a democracy,” he says, “everyone has to have some skin in the game.”

Lonegan also believes a flat tax, along with cutting business taxes and regulations, will improve the business climate in New Jersey, thus encouraging job growth.

A flat tax might also keep a large number of New Jersey taxpayers in the state. Wealthier citizens can indeed vote with their feet to escape high-tax states. That’s what has happened all over the country, as high tax states lose population and the states without an income tax grow the fastest.

Just recently, billionaire Tom Golisano said he was leaving New York and moving his residence to Florida to save $13,000 a day in state income taxes.

There is another issue to consider when it comes to whom one believes will best keep taxes down: Spending.

Lonegan has pledged to cut state spending by 20 percent. He was asked in a recent debate what precisely he would cut. He responded straightforwardly:

There are currently 16 departments of the state. I would eliminate five of them — the Department of Community Affairs, the Department of the Public Advocate, I would eliminate the Department of Labor and Workforce Development, I would combine Health and Senior Services with Union Services and I would downsize, prioritize, the DEP [Department of Environmental Protection] to a much smaller department. I would also cut a number of state jobs and a number of much smaller line items as well.

When I left New Jersey in 1968, it wasn’t because of high taxes. But if I were to move back, it might have a lot to do with Steve Lonegan


Paul Jacob

Paul Jacob is President of Citizens in Charge Foundation and Citizens in Charge. His daily Common Sense commentary appears on the Web and via e-mail.