The Wire

Downgraded: Christie's Record on the Economy

New Jersey’s economy has hit a major traffic jam under Christie’s leadership, and this afternoon the scandal-tainted governor will attempt to save face in the face of this year’s $800M budget shortfall. One major credit rating agency after the next has downgraded New Jersey’s debt, with Moody’s becoming the latest just last week. Add to that a state unemployment rate well above the national average and a record of private job growth that ranks near the bottom in the country since he took office, and Garden State taxpayers aren’t just stuck with Christie’s self-exoneration bills–they’re stuck with his sluggish economy too.

Watch American Bridge’s new video above and see how bad things have gotten in New Jersey under Christie.

Background

April 2014: Standard & Poor’s Downgrade

Standard & Poor’s Downgraded New Jersey’s Debt Rating, Citing Christie’s Budgeting Practices. According to the Star-Ledger, “Financial analysts at Standard & Poor’s downgraded New Jersey’s debt rating today, flagging Gov. Chris Christie’s budget practices as something that should give pause to investors.” [Star-Ledger, 4/9/14]

  • Debt Rating Was Downgraded One Level From AA- To A+. According to the Star-Ledger, “S&P downgraded New Jersey’s debt by one notch, from AA- to A+. The agency previously downgraded the state’s bond rating in 2011.” [Star-Ledger, 4/9/14]
  • The Lower Debt Rating Meant It Would Cost More For The State To Barrow Money For Major Projects. According to the Star-Ledger, “Each time it goes lower, it drives up the cost of borrowing for major projects such as schools and roads.” [Star-Ledger, 4/9/14]
  • New Jersey Now Had “Upper Medium Grade” Credit. According to the Star-Ledger, “John Sugden, an analyst at S&P who studies New Jersey, said the ‘measures used by the state state to balance the budget will contribute to future budgetary pressures.’ The new rating is the fifth-highest S&P assigns. The shift means New Jersey’s debt has gone from what is considered to be high grade to an upper medium grade.” [Star-Ledger, 4/9/14]

May 2014: Fitch Downgrade

New Jersey’s Credit Rating Was Lowered To A+ By Fitch Ratings Because Of An $807 Million Shortfall In Revenue And The Likelihood That Christie Would Use One-Time Cuts To Fix The Budget Gap. According to Bloomberg Businessweek, “New Jersey’s credit rating was lowered one step to A+ by Fitch Ratings, which cited an $807 million revenue shortfall and Governor Chris Christie’s likely use of one-time measures to plug the gap.” [Bloomberg Businessweek, 5/1/14]

  • Fitch Said New Jersey’s Revenue Forecasts Were “Overly Optimistic” And Said They Were Concerned Over “Both The Scale And Belatedness” Of The Budget Shortfall. According to Bloomberg Businessweek, “The company cut the state’s general-obligation debt to the fifth-highest investment grade, saying revenue forecasts were ‘overly optimistic.’ Fitch also expressed concern over ‘both the scale and belatedness’ of the shortfall, with two months left in the fiscal year. ” [Bloomberg Businessweek, 5/1/14]
  • Fitch Maintained A Negative Outlook On New Jersey’s Credit, Meaning The State Could Face Another Downgrade. According to Bloomberg Businessweek, “Fitch maintained a negative outlook on the state’s credit, meaning it may face a further downgrade.” [Bloomberg Businessweek, 5/1/14]

Jobs

As Of May 2014, New Jersey Had Only Recovered 37% Of Jobs Lost In The Recession. According to the Star-Ledger, “The past year was especially anemic, with 2,200 private-sector jobs created from March 2013 to March 2014, according to the latest data from the federal Bureau of Labor Statistics. New Jersey has recovered 37 percent of the jobs it lost during the recession, while New York is at 122 percent and Pennsylvania at 81 percent, the data show. The United States is at close to 100 percent.” [Star-Ledger, 5/4/14]

  • The United States Had Recovered Nearly 100% Of Its Lost Jobs, And New York Had Recovered 122%. According to the Star-Ledger, “The past year was especially anemic, with 2,200 private-sector jobs created from March 2013 to March 2014, according to the latest data from the federal Bureau of Labor Statistics. New Jersey has recovered 37 percent of the jobs it lost during the recession, while New York is at 122 percent and Pennsylvania at 81 percent, the data show. The United States is at close to 100 percent.” [Star-Ledger, 5/4/14]

As Of May 2014, New Jersey Was Tied For 48th In The Country In Its Pace Of Private Sector Job Creation During Christie’s Administration. According to the Star-Ledger, “Take one of Christie’s biggest talking points: New Jersey has generated more than 130,000 private-sector jobs during his time in office. Those numbers don’t look so good compared with other states. During Christie’s governorship, only New Mexico has generated private-sector jobs at a slower pace than New Jersey. With a labor growth rate in the private sector of 3.8 percent from February 2010 to March 2014, the Garden State is tied with Mississippi for 48th in the nation, the review found.” [Star-Ledger, 5/4/14]

As Of January 2014, New Jersey’s Unemployment Rate Was Almost 3 Percent Higher Than The National Average. According to the Herald News, “The jobless rate, which began the year at 9.5 percent, remains above the national rate of 6.7 percent.” [Herald News, 1/24/14]