Tag: Cato Institute

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Cato Institute Fiscal Policy Report Card Gives New Jersey Governor Phil Murphy a Failing Grade

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the staff of the Ridgewood blog

Trenton NJ, Cato Institute Fiscal Policy Report Card on America’s Governors 2020. Governors receiving an A are those who have cut taxes and spending the most, whereas governors receiving an F have raised taxes and spending the most.

Four governors were awarded an A on this report: Chris Sununu of New Hampshire, Kim Reynolds of Iowa, Pete Ricketts of Nebraska, and Mark Gordon of Wyoming. Seven governors were awarded an F: Ralph (Black Face) Northam of Virginia, Andrew Cuomo of New York, Gretchen Whitmer of Michigan, Phil Murphy of New Jersey, J. B. Pritzker of Illinois, Kate Brown of Oregon, and Jay Inslee of Washington.

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CATO Institute Ranks New Jersey 47th in Overall freedom

Trenton_New_Jersey
August 20,2016
the staff of the Ridgewood blog

The overall freedom ranking is a combination of personal and economic freedoms. This year the Cato Institute ranks New Jersey 47th and here is the analysis :

About 50 years ago, New Jersey was considered a tax haven. It grew wealthy under that regime, but over the past two decades it has competed with California for the position as the second-worst state for economic freedom. As long as it is better than New York, it will probably continue to get tax refugees from that state, but more New Yorkers now move to Florida than to New Jersey.

New Jersey’s state-level taxes are slightly higher than average (5.7 percent of income), while local taxes are much higher than average (5.5 percent). New Jerseyans have more choice of local government than any other state, with 6.2 effective competing jurisdictions per 100 square miles. Government subsidies and debt are above average, but state and local employment is a little below average. We show a small improvement in each of those three areas between 2010 and 2014.

Land-use freedom is quite limited in New Jersey. The state lets cities adopt rent control, and local zoning rules are often highly exclusionary, even though the state has been losing population for years. Renewable portfolio standards are among the highest in the country, raising electricity rates. In 2013–14, the state adopted a minimum wage. Labor-market freedom was already bad because of strict workers’ compensation rules, mandated short-term disability insurance, mandated family leave, no right-to-work law, and a stricter-than-federal anti-discrimination law. Occupational freedom is, perhaps surprisingly for such a corrupt state, close to average. However, in 2013–14, nurse practitioner freedom of independent practice was abolished. Insurance regulation is fairly strict, and there is a price-gouging law, which Governor Christie deployed after Hurricane Sandy to devastating effect. The civil liability system is somewhat better than average.

New Jersey has improved over time on personal freedom and is now better than average. Incarceration and victimless crime arrest rates, drug and nondrug, have all fallen since 2000. Asset forfeiture, however, has not been reformed much. New Jersey is a bad state for tobacco freedom, travel freedom, and gun rights, but it is a good state for gambling and same-sex marriage. The picture on educational freedom is mixed. Homeschools and private schools are barely regulated, but there are no public or private school choice programs. Cannabis freedom is similarly mixed. The state has a limited medical cannabis law, but otherwise it has done nothing to reduce penalties. Alcohol freedom is a bit above average, but the state interferes here too. Direct wine shipment is tightly regulated, and the rules on when a grocery store may sell wine are complicated—perhaps to create a “tollbooth” where state politicians can extract rents.

Policy Recommendations

Fiscal: Cut spending on parking lots; New Jersey spends almost three times as much as New York. It also spends more than average in the “miscellaneous” category and on employee retirement. Income, utilities, and property taxes are abnormally high and could be cut.
Regulatory: End rent control. This move would have raised New Jersey four places on regulatory policy.
Personal: Decriminalize low-level cannabis possession, and make high-level possession a misdemeanor. These reforms would have raised New Jersey two places on personal freedom.

https://www.freedominthe50states.org/overall/new-jersey

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Four Reasons NOT to Raise the Minimum Wage

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Four Reasons NOT to Raise the Minimum Wage
The Cato Institute
June 21, 2014

The debate over minimum wage continues to rage across the country. But, would raising the minimum wage actually harm the very people it is purportedly designed to help?

Research shows that businesses would respond to the increased costs by reducing employment, particularly for low-skilled workers. Some businesses may even pass the higher costs on to consumers. Despite the hope of proponents, raising the minimum wage would do little, if anything, to decrease poverty.

Here are four reasons NOT to raise the minimum wage….

It Would Result In Job Loss

Evidence of job losses have been found since the earliest imposition of the minimum wage

The first 25-cent minimum wage in 1938 resulted in significant job losses.
Minimum wage increases recently imposed in American Samoa resulted in economic effects so pronounced that President Obama signed into law a bill postponing them.
A 2006 review of more than 100 minimum wage studies by David Neumark and William Wascher found that about two-thirds found negative employment effects.
In 2010, Joseph Sabia and Richard Burkhauser estimated: “nearly 1.3 million jobs will be lost if the federal minimum wage is increased to $9.50 per hour.”

It Would Hurt Low-Skilled Workers

Evidence shows minimum wage increases disproportionately hurt the people they’re supposed to help

The 2006 Neumark and Wascher review found the literature “as largely solidifying the conventional view that minimum wages reduce employment among low-skilled workers.”
A 2012 analysis of the New York State minimum wage increase from $5.15 to $6.75 per hour found a “20.2 to 21.8 percent reduction in the employment of younger less-educated individuals.”
A 2010 analysis by Michael J. Hicks found: “the latest round of minimum wage increases” account “for roughly 550,000 fewer part-time jobs,” including “roughly 310,000 fewer teenagers working part-time.”

It Would Have Little Effect On Reducing Poverty

Evidence suggests that minimum wage increases don’t reduce poverty

In the previous federal minimum wage increase from $5.15 to $7.25, only 15 percent of the workers who were expected to gain from it lived in poor households, according to a 2012 review by Mark Wilson. If the minimum were today raised to $9.50, only 11 percent of workers who would gain live in poor households.
The 2012 Wilson review noted: “Since 1995, eight studies have examined the income and poverty effects of minimum wage increases, and all but one have found that past minimum wage hikes had no effect on poverty.”
The 2012 Wilson review noted: “One recent academic study found that both state and federal minimum wage increases between 2003 and 2007 had no effect on state poverty rates.”

It May Result In Higher Prices For Consumers

The costs of minimum wage increases must be paid by someone

The 2012 Wilson review noted: A 2004 “review of more than 20 minimum wage studies looking at price effects found that a 10 percent increase in the U.S. minimum wage raises food prices by up to 4 percent.”
A 2007 study from the Federal Reserve Bank of Chicago found that restaurant prices increase in response to minimum wage increases