Dear Governor Murphy, Speaker Coughlin, and President Sweeney:
New Jersey is facing enormous health and economic challenges fighting the COVID-19 pandemic, yet the state has risen to the occasion. The pandemic has caused an unexpected increase in state and local spending at the same time that revenues, especially from income and sales taxes, are falling, making balancing next year’s operating budget exceptionally difficult.
Now is an appropriate time for the federal government to provide relief to states, an important measure Congress took during the Great Recession and more recently—though on too small a scale—in the CARES Act. There is only about $400 million in New Jersey’s rainy-day fund, one of the smallest such funds in the country. We are therefore concerned that the state will pursue counterproductive budget cuts. Large cuts would erode the health and social infrastructure needed to continue combatting COVID-19, increase inequality, and exacerbate the economic downturn. Instead of budget cuts, the state should look to raise revenues to balance its budget.
Cutting spending on housing, public transportation, and healthcare removes spending from New Jersey’s economy when it is most needed and hurts the people who need it the most—those who have been disproportionately affected by COVID-19. Growing evidence indicates that these adverse effects are stratified by gender, race/ethnicity, and disability status, and they come at a time when the nation has pointed a spotlight on the need to eliminate such disparities, especially by race. Cutting local aid to cities and towns for services such as fire protection, park maintenance, and public works erodes public safety, household well-being, and the quality of our infrastructure. Reducing funding for early education, K-12, and higher education reverses our long-standing investment in human capital—including recent new commitments—with long-run consequences for worker productivity and economic growth.
We realize that New Jersey must run a balanced budget. In a recession, balancing the budget by cutting vital spending has a more negative impact on our citizens than balancing the budget by raising taxes. Both the personal income tax and the corporate tax are fair ways to do this. Modest adjustments to income tax rates on those earning $250,000 and more would raise approximately $1.5 billion in new revenue each year while making the overall tax code fairer. Extending the temporary corporate tax surcharge of 2.5 percent on businesses with profits of $1 million or more would provide $425 million in additional annual revenue to invest in critical assets and services.
As the leaders of our state government, you have the responsibility for setting priorities and making the difficult choices that lie ahead. We the undersigned encourage you to raise revenue rather than cut the social and physical infrastructure that will be necessary to protect the health and economic well-being of our people, our communities, and our state.
Signatories
Amy Abruzzi
Associate Teaching Professor
Rutgers University Edward J. Bloustein School of Planning and Public Policy
Nabeela N. Alam
Assistant Professor of International Economics and Development
Seton Hall University
Nahid Aslanbeigui
Professor of Economics
Monmouth University
Roark Atkinson
Associate Professor of History
Ramapo College of New Jersey
Radhika Balakrishnan
Professor
Rutgers University
Jacob Bastian
Assistant Professor of Economics
Rutgers University
Swati Bhatt
Lecturer
Princeton University
Soumitra Bhuyan
Assistant Professor
Rutgers University
Lewis Bivona
Doctoral Student of Public Affairs
Rutgers University
Joseph Blasi
J. Robert Beyster Distinguished Professor
Rutgers University School of Management and Labor Relations
Alan S. Blinder
Gordon S. Rentschler Memorial Professor of Economics and Public Affairs
Princeton University
Tjeerd Boonman
Specialist Professor of Finance and Economics
Monmouth University
Debra Borie-Holtz
Associate Teaching Professor
Rutgers University Edward J. Bloustein School of Planning and Public Policy
Leah Boustan
Professor of Economics
Princeton University
William Brucher
Assistant Teaching Professor
Rutgers University School of Management and Labor Relations
Alan Drew Cander
Associate Teaching Professor
Rutgers University
Oriol Carbonell-Nicolau
Professor
Rutgers University
Raphaele Chappe
Assistant Professor of Economics
Drew University
Sylvain Chassang
Professor of Economics
Princeton University
Dorothy Sue Cobble
Distinguished Professor of History and Labor Studies
Rutgers University
Henry A. Coleman
Professor Emeritus
Rutgers University
Oliver Cooke
Associate Professor of Economics
Stockton University
Cynthia Daniels
Professor of Political Science
Rutgers University
Adrienne E. Eaton
Distinguished Professor and Dean
Rutgers University School of Management and Labor Relations
Martha Ecker
Professor of Sociology/President AFT Local 2274
Ramapo College of New Jersey
Henry S. Farber
Hughes-Rogers Professor of Economics
Princeton University
Deborah M. Figart
Distinguished Professor of Economics
Stockton University
Janice Fine
Professor
Rutgers University School of Management and Labor Relations
Marc Fleurbaey
Robert E. Kuenne Professor in Economics and Humanistic Studies
Princeton University
Anita Franzione
Associate Professor
Rutgers University
Ira N. Gang
Professor of Economics
Rutgers University
Reza Ghorashi
Professor of Economics
Stockton University
Paul D. Gottlieb
Associate Professor or Agricultural Economics
Rutgers University School of Environmental and Biological Sciences
Gene Grossman
Jacob Viner Professor of International Economics
Princeton University
Andrew Hetling
Associate Professor
Rutgers University
Bo E. Honoré
Professor
Princeton University
Jennifer Hunt
Professor
Rutgers University
Paul Andrew Jargowsky
Professor and Director, Center for Urban Research and Education
Rutgers University - Camden
Timothy K. Judger
Adjunct Professor of Environmental Studies
Ramapo College of New Jersey
Mark R. Killingsworth
Professor of Economics
Rutgers University
Nobuhiro Kiyotaki
Professor
Princeton University
Michal Kolesar
Professor of Economics
Princeton University
Robert Kopp
Professor
Rutgers University
Douglas Kruse
Distinguished Professor
Rutgers University
Ilyana Kuziemko
Professor of Economics
Princeton University
Michael L. Lahr
Distinguished Research Professor of Planning & Public Policy
Rutgers University
Debra Lancaster
Executive Director of the Center for Women and Work
Rutgers University
Jesse Liss
Assistant Teaching Professor
Rutgers University - Newark
Mingwei Liu
Associate Professor
Rutgers University
Mark van der Maas
Assistant Professor
Rutgers University
Yahya M. Madra
Associate Professor of Economics
Drew University
Mariam Majd
Assistant Professor of Economics
Stockton University
Joan Maya Mazelis
Associate Professor of Sociology
Rutgers University-Camden
Nolan McCarty
Susan Dod Brown Professor of Politics and Public Affairs
Princeton University
Patrick McGuinn
Professor of Political Science and Education
Drew University
Lorraine C. Minnite
Associate Professor of Public Policy
Rutgers University-Camden
Joost Monen
Associate Professor of Biology and Biochemistry
Ramapo College of New Jersey
Alan C. Monheit
Professor of Health Economics
Rutgers University School of Public Health
Dawne Mouzon
Associate Professor
Rutgers University
Ellen Mutari
Professor of Economics
Stockton University
Michele Naples
Professor
The College of New Jersey
Robert Noland
Distinguished Professor
Rutgers University
Patrick L. O'Halloran
Associate Professor
Monmouth University
Jennifer Olmsted
Professor of Economics
Drew University
Amanda Page-Hoongrajok
Assistant Professor
Saint Peter's University
Lysandra Pérez-Strumolo
Associate Professor of Psychology
Ramapo College of New Jersey
Anne M. Piehl
James Cullen Professor of Economics
Rutgers University
Frank Popper
Professor
Rutgers and Princeton Universities
Steven Pressman
Emeritus Professor of Economics & Finance
Monmouth University
Thomas Prusa
Professor of Economics
Rutgers University
Ronald Quincy
Professor of Professional Practice
Rutgers University Edward J. Bloustein School of Planning and Public Policy
Richard Roberts
Professor of Economics
Monmouth University
Yana van der Meulen Rodgers
Professor and Faculty Director of the Center for Women and Work
Rutgers University
Cecilia Rouse
Professor of Economics and Public Affairs
Princeton University
Gavin Rozzi
Research Computing Specialist
Rutgers University Edward J. Bloustein School of Planning and Public Policy
Julia Sass Rubin
Associate Professor
Rutgers University Edward J. Bloustein School of Planning and Public Policy
Subarna Kumar Samanta
Professor of Economics
The College of New Jersey
Tobias Schulze-Cleven
Associate Professor of Labor Studies and Employment Relations
Rutgers University-New Brunswick
Susan J. Schurman
Distinguished Professor
Rutgers University
Robert Scott
Professor of Economics
Monmouth University
Joseph J. Seneca
Distinguished Professor Emeritus
Rutgers University
Stuart Shapiro
Associate Dean and Professor
Rutgers University Edward J. Bloustein School of Planning and Public Policy
Neil Sheflin
Associate Professor of Economics
Rutgers University
Bernard Smith
Associate Professor of Economics
Drew University
Barry Sopher
Professor of Economics
Rutgers University
Lynn Tang
Professor of International Business and Economics
The College of New Jersey
Jermaine Toney
Assistant Professor
Rutgers University
M. Turshen
Professor Emerita
Rutgers University
Todd E. Vashon
Faculty Coordinator, LEARN
Rutgers University School of Management and Labor Relations
Ramya Vijaya
Professor of Economics
Stockton University
Paula B. Voos
Professor
Rutgers University School of Management and Labor Relations
John Wall
Professor of Religion
Rutgers University
Mark W. Watson
Howard Harrison and Gabrielle Snyder Beck Professor of Economics and Public Affairs
Princeton University
Eugene White
Distinguished Professor of Economics
Rutgers University
Nancy Wolff
Distinguished Professor
Rutgers University
Bingxiao Wu
Assistant Professor
Rutgers University
Xiye Yang
Assistant Professor
Rutgers University
Owen Zidar
Professor of Economics and Public Affairs
Princeton University