By STEVEN MALANGA
Posted: 3:50 am
August 19, 2008
IN the latest sign of New Jersey's rapid deteriora tion, its newspapers, which rely heavily on the local economy, are in dire straits. The state's biggest newspaper, The Star-Ledger, is losing some $30 million annually and cutting 20 percent of its work force, while The Bergen Record is closing its headquarters and sending most of its reporters to work out of their homes. Six Jersey Gannett newspapers are cutting jobs and seeking early retirements.
While (like most papers) they're suffering from the flow of advertising dollars to the Internet, Jersey's papers are also getting hammered by the state's economic woes. The Star-Ledger's owner says the paper is doing far worst than its outlets in other markets. That's not surprising - Jersey never really recovered from the recession of 2002.
From 2003 through 2007, while the nation's private economy soared, only tax-supported government jobs grew robustly in Jersey. Private employment increased a meager 1.8 percent, mostly in low-wage service jobs. In 2006, when the country was in the midst of an economic boom that produced government surpluses everywhere, Jersey faced a crushing $4.5 billion budget shortfall that prompted an embarrassing shutdown of state government.
Jersey's decline has been rapid and astonishing. In the '60s, one study judged it to be among the most business-friendly states because of its light tax burden. That helped attract a steady stream of businesses and residents from New York and produced robust economic growth.
Although there were occasionally signs of trouble over the years (like the pension shenanigans of Gov. Christie Whitman, in which government shirked its long-term obligations), the state's real decline started with the election of Gov. Jim McGreevey and a Democratic-controlled Legislature in 2001.
McGreevey, aided by the Legislature, raised taxes and fees an astonishing 33 times, totaling $3.6 billion, amid a recession. The state also passed a heap of new labor-friendly, anti-business laws that rapidly worsened conditions.
When an executive at one of the state's biggest employers, Federated Department Stores, said the company would re-evaluate future growth plans in Jersey, critics hammered him. But now, as an advertising executive noted, one reason the state's papers are suffering is because of retrenchment among local department stores, which used to be big advertisers. Jersey's pols see no connection, of course.
