With a potential bid for reelection looming in less than two years, Gov. Phil Murphy used his State of the State address on Tuesday to highlight some of his administration’s biggest achievements, such as increasing the minimum wage, boosting K-12 education aid and tackling climate change.
The first-term Democrat also unveiled a number of new initiatives during the annual speech to the combined Legislature, saying he will be targeting things like the rising cost of health care and the state’s persistent wealth disparities in the months ahead.
Murphy also returned to several familiar themes, like promising to keep pushing for new economic-development tax incentive programs. That was a main focus of his first State of the State address in 2019, but his preferred package of reforms is stalled in the Legislature, even though fellow Democrats control both houses.
In addition, the governor said he will continue to press lawmakers to hike taxes on the wealthy. That’s a top priority of Murphy’s liberal base, but both Democratic and Republican lawmakers have largely resisted the governor’s prior overtures on the issue.
“Overwhelming majorities of residents — of all political stripes — support this,” Murphy said on Tuesday. “We should, too.”
Not surprisingly, Murphy’s speech drew praise from liberal groups. But amid the notable absence of some Democratic legislative leaders afterwards, Republicans faulted the governor for not talking enough about taxes and what they consider to be a growing affordability problem across New Jersey. They also predicted middle-class voters will ultimately choose to reject the direction the governor has been taking the state in following Republican predecessor Chris Christie’s eight years in office.
“I think he’s going to (fall) victim to what other Democrat governors have in the past,” said Assembly Minority Leader Jon Bramnick (R-Union). “People are going to ask him, ‘Hey, why is it no cheaper to live in this state, why is it more expensive?’”
Start of reelection bid?
Political observers often view the start of a governor’s third year in office as the unofficial beginning of their reelection campaign, and Murphy offered a nod to such thinking Tuesday by saying near the start of his speech that he’s hopefully only “a quarter of the way through” a possible two-term tenure. But he also quipped: “That is another speech for another day.”
Murphy then quickly pivoted to a highlight reel of his first two years as governor, citing last year’s minimum wage law that has the state on course to having a $15 minimum hourly rate by 2024 among his top accomplishments. Increasing aid to K-12 school districts by some $500 million was also pitched by the governor as a key achievement.
“Every new dollar in state aid is a dollar that isn’t shouldered by property taxpayers,” Murphy said.
He also highlighted efforts to combat the effects of global climate change, saying the state is making progress toward its ambitious offshore-wind production goals while also reducing New Jersey’s fossil-fuel pollution.
“We know climate change is real. Instead of denying reality, we’re acting on it,” Murphy said, in one of several times he contrasted his administration with that of President Donald Trump.
New initiatives in the offing
Among the initiatives unveiled by Murphy on Tuesday was an effort to take on rising health-care costs by creating an Office of Health Care Affordability and Transparency. While providing few details, Murphy said the effort would be data-driven and reach across state agencies to address issues related to the cost of health insurance.
“We will make smart decisions to limit cost increases and set new standards for quality and transparency,” he said.
The governor also said he’s organizing a new task force to address the persistence of New Jersey’s wide gap between the wealth controlled by the very rich and the poor. And while he highlighted a state unemployment rate that remains slightly lower than the nation’s, he said improving job-training efforts will be the focus of a new “Jobs NJ” program.
More details related to that initiative are expected to be released during an event Wednesday in East Brunswick. But Murphy said the goal will be to “better align our education system to meet the future needs of both employers and workers, and do better at matching our workers with potential employers.”
GOP: Not so fast
After the speech, Sen. Joseph Pennacchio (R-Morris) criticized Murphy for suggesting any of his own policies have helped boost the economy in New Jersey. Instead, Pennacchio suggested the state has been caught up in a broader groundswell of national economic growth generated by tax cuts and other policies enacted in recent years at the national level by the president and his fellow Republicans.
“You can thank Donald Trump for the economy that he has,” Pennacchio said.
Senate Minority Leader Tom Kean (R-Union) also criticized the governor for pushing to increase taxes on the wealthy. In 2018, Murphy worked with Democrats to hike the top-end tax rate on earnings over $5 million, but the governor has been pressing ever since to raise the rate on earnings over $1 million as well.
“Increasing taxes sends a message across the nation, and people are going to continue to look to (move) outside of the state, at every stage of their life and their career, and that’s just simply wrong,” Kean said.
Meanwhile, the top Democrats in the Legislature, Assembly Speaker Craig Coughlin (D-Middlesex) and Senate President Steve Sweeney (D-Gloucester), both ducked out of the State House without speaking to reporters about Murphy’s message. But Senate Majority Leader Loretta Weinberg (D-Bergen) fielded questions from reporters, including about New Jersey Transit.
Murphy had defended his handling of the state’s beleaguered mass-transit agency , saying he has worked to bring on more engineers and to provide new funding for more equipment purchases. NJ Transit is also working on a long-term strategic plan, he said. But Weinberg said the agency continues to lack a dedicated source of operating revenue, an issue lawmakers have been working on in recent weeks.
“The vision and the (strategic) plan are important,” Weinberg said. “But you’re not going to get there without the resources.”
Praise for governor’s progressive agenda
Liberal groups praised Murphy for taking on issues like income inequality and ethics reform — another highlighted item in the speech.
“This is what happens when state government prioritizes the needs of everyday New Jerseyans over those of the wealthy and well-connected,” said Brandon McKoy, president of New Jersey Policy Perspective, a Trenton-based think tank.
“Stronger financial disclosures and tighter pay-to-play requirements will shine the light of transparency on Trenton backrooms dominated by insiders,” said Sue Altman, director of New Jersey Working Families.
But Patrick Murray, director of the widely respected Monmouth University Poll, suggested Murphy may have focused too much on the issues that energize Democrats and liberal voters.
“It looks like he’s preparing himself for a primary rather than a general election,” Murray said. “It was really an appeal to all the different constituent parts to the progressive wing of the Democratic base.”
Murray went on to warn the political dynamics that helped generate Murphy’s election win in 2017 will be different in 2021. Most notably, there may be a Democrat in the White House by then, he said.
“Voters will feel free to go back to their old ways of focusing on property taxes and those kinds of issues that are important to them in a general election,” Murray said.
“The question the middle class asks when somebody is up for reelection is, ‘Have you had our backs during the past four years?’ If they sense you weren’t looking out for them . . . they will entertain a Republican,” he said.