Roth Report: Scott Walker Succeeds Where Chris Christie Falters
Wisconsin and New Jersey Head in Opposite Directions
The political fortunes of New Jersey Gov. Chris Christie and Wisconsin Gov. Scott Walker are uniquely similar. Both elected to traditionally blue states in 2009 and 2010, Christie and Walker rose to national stardom by passing landmark reforms in 2011 that required public sector employees to contribute to their pension and healthcare.
Gov. Christie’s pension reforms passed a Democratic controlled legislature and were hailed as a model for other states. Christie’s star was born as the brash former prosecutor took on the public sector unions, grabbed hold of the third rail in American politics, and won.
Gov. Scott Walker of course passed collective bargaining reforms in early 2011 amidst massive labor protests and recall threats. What became known as Act 10 passed after a month long standoff with Democratic state senators in Illinois. The recall threats turned into a reality – but the reforms worked to help solve a $3.6 billion budget hole and voters rewarded Walker with a 7 point win in the 2012 recall election.
Despite different styles, the two reform-minded governors were jettisoned on to the national stage and the fires of presidential speculation were sparked.
But nearly three years after the landmark reforms were put in place, Wisconsin and New Jersey appear headed in opposite directions.
Last week, New Jersey Gov. Chris Christie announced that New Jersey would make two large cuts in state payments to the pension fund in order to address a troublesome $2.7 billion budget deficit.
To reduce a large unfunded pension mandate that had existed for years, part of the 2011 deal required that union workers as well as the state would make higher payments to the funds through 2018.
But Christie, who has seen a series of credit downgrades issued to the state since he took office at the start of 2010 — said he will whittle down payments of $1.6 billion this year and $2.25 billion next year to less than $700 million apiece.
The payments will go to pensions of active public employees, not ones who’ve retired.
At a press conference last week, Christie lamented that he would love to focus on tax cuts. “But until we decide to be adults and deal with the problem we know we have, we’re not going to be able to do that.”
In Wisconsin, the story of the Act 10 reforms couldn’t be any different.
With the assistance of the reforms, Gov. Walker’s first budget was able to solve a $3.6 billion budget hole without massive public sector layoffs or tax hikes.
Local governments were able to save nearly $3 billion according to the latest estimates.
Wisconsin fiscal health and economic growth has resulted in two budget surpluses that Gov. Walker and the Republican legislature have turned into property and income tax relief.
Wisconsin’s pension fund remains one of the strongest in the nation.
And the unemployment rate in Wisconsin has fallen below 6% to the lowest it has been since 2008. New Jersey’s unemployment rate sits at 6.9%.
While no two states can be objectively compared without appreciating the nuances of each situation, it is remarkable to observe the incredible success of Wisconsin’s reforms while New Jersey is mired in more fiscal trouble.
With the 2016 chatter accelerating to warp speed – New Jersey’s troubles and Wisconsin’s success could play an outsized role in determining just who is the next Republican nominee for President.
Originally posted at Right Wisconsin