Is It Any Surprise Small Businesses Don't Do Well In New Jersey?

I have to admit that when I saw the post by Tigerhawk about the Small Business Survival Index, I was not all that surprised at some of the results, though I was a little dismayed to see how my home state of New Hampshire fared.

To see that New Jersey was only one step from the bottom of the list wasn't surprising by any means, seeing how the state government went on a tax-and-spend spree. The fact that the only place worse than New Jersey is the District of Columbia should be obvious to those of us that understand the relationship between high taxes and low job/business growth.

The only jurisdiction that is worse than New Jersey for small business is the one that is controlled by the United States Congress directly. This is not surprising; the Garden State has raised taxes so much since 2001 that it has erased substantially more than half of the notorious "Bush tax cuts" for those of us who earn enough to hit the bogey.

New Jersey has had considerable job growth. Unfortunately most of it was in state government and not the private sector. What did they expect when they raised taxes and added a state income tax? Did they really think it would foster the growth of business is the state? Obviously they did.

I wish I could say that New Hampshire was high up on the list, but it wasn't. With the changes over the past 10 years or so within the state legislature and a Democrat in the corner office for 12 of the last 14 years, much of New Hampshire's business friendly climate has been replaced with one of avarice, with businesses being looked at as little more than sources of revenue for a rapidly growing budget and a spendthrift Democratic majority legislature.

The budget for the biennium that ends on July 1st had an increase of 17.5%. So much for New Hampshire frugality. What makes things worse the legislature vastly overestimated the revenues expected to fill the state coffers. That left the state with a deficit of ~$300 million. If the budget increase had been along the lines of the rate of inflation, then the state would have had a $175 million surplus.

To make up for the shortfalls, some taxes and a host of fees been increased, placing an even greater burden on the taxpayers, and particularly businesses in the state. So much for being a business friendly state. At least we're not as bad as the other five New England states, but that's not saying much.

Taking a look at the list presented in the post linked above, I find it interesting the states with better small business survival indexes tend to be so-called “red” states, while those with poorer indexes tend to be blue states. Now why would that be the case? Hmm. I wonder....