Governor Phil Murphy ordered a hiring freeze last week, and a salary freeze, and he asked department heads to prepare for tough times next year by cutting their budgets by 5 percent.

He can’t say he wasn’t warned. The latest wake-up call came two years ago, when a bipartisan think tank of experts who had managed previous budgets told him that he run towards a brick wall. He shrugged and kept his foot on the accelerator.

“This is exactly where we said we would be,” said former Senate President Steve Sweeney, a centrist Democrat who co-founded the Rowan University think tank and is now candidate for governor. “It’s not partisan. It’s just a matter of numbers.

The numbers are indeed ugly. This year, the state is spending about $2 billion more than it takes in. And Murphy’s own Treasury Department says next year will be about twice as bad, with no change in course. In other words, the governor now seems to agree that it’s time to pump the brakes. Its final budget will be the most painful.

Where will the victims appear?

I suspect the most vulnerable program is Speaker Craig Coughlin’s pet project, Stay NJ, a costly plan to give seniors mammoth credits that could reach $6,500 a year when combined with other relief property tax. It’s a regressive designproviding a break-even point for wealthy seniors earning up to $500,000 per year. It’s expensive, costing about $1.3 billion a year once it’s operational, starting in 2026. And since it’s not yet in place, removing it may not result in such a high political cost.

But don’t you dare say that to Coughlin. The man commits to it. And he is a respected player, not only because he knows his stuff, but also because he has enormous power as president. He can kill any bill himself. Lawmakers are well aware that without his support, they cannot do squat.

“If the goal of property tax relief for seniors is important, we can achieve it,” Coughlin says. “Just like we did with fully funding schools or paying pensions, if it’s a priority, we find a way to work together to make it happen.”

This is definitely music for old people. And Democrats who are afraid of losing their seats will probably be there too. Because Stay NJ may be a reckless policy, but it’s a great policy. An election year is approaching and seniors are voting.

In the 2020 presidential election, 72% of seniors voted, compared to 48% among voters under 25. When looking at income, the gap is similar, with wealthier voters far more numerous. So, by targeting relief to the elderly, and including wealthy seniors, Coughlin hits the sweet spot – almost as if that was his intention.

“This is a group that, if you’re a Democrat, you want to keep happy,” pollster Patrick Murray of Monmouth University told me last year.

Maybe Coughlin will get there. His team points out that in a $57 billion budget, finding $1.3 billion is a manageable task. Maybe. But that’s on top of the Treasury’s expected deficit of nearly $4 billion for next year.

Republicans say they could find budget cuts without breaking a sweat, and as usual, they have their eyes on school aid for poor urban neighborhoods. Their case is bolstered by the maddening waste in Newark, where Superintendent Roger Leon chaired a meeting collapse of test scores and an explosion in spend on trips to warm climates.

“We don’t need to cut state aid to districts like Newark, we just need to rein in the big increases,” says Sen. Declan O’Scanlon, a Republican budget expert. “This administration will go down in history as the administration of wasted opportunity. »

This seems too harsh to me. Republicans point to the increase in total spending under Murphy’s leadership. Chris Christie’s final budget was $35 billion, and seven years later the total stands at $57 billion, an increase of $22 billion. But it’s not as bad as it seems.

On the one hand, Christie’s budget was artificially low because it cut pension payments and left tiny surpluses, which is why Wall Street lowered New Jersey’s credit rating again and again under his watch. And most of the increase under Murphy went to restoring the health of the pension fund, fattening surpluses and fully funding schools.

These are all expense items, of course, but they are not reckless. Most of Murphy’s spending increases were aimed at strengthening the state’s long-term financial health, such as a family spending money to reduce credit card debt and invest in college savings accounts. This is why Wall Street improved the state’s credit rating each of the last four years under Murphy’s leadership.

It actually reduced the size of the state’s workforce, according to the Treasury Department.

Yes, this man is lucky. He was in the chair when the pandemic money tidal wave arrived. He has shown no interest in reducing the cost of government operations, as Christie did. And while credit scores have improved, that’s true in every state across the country, thanks to pandemic relief and the rapid growth that followed. New Jersey still has the second lowest bond rating in the country, behind Illinois.

So here we are again faced with another horrendous structural deficit. The test for Democrats now is whether they will adopt tricks to get through a year or two, or whether they will face the crisis honestly and make painful choices like adults. On this point, neither party has inspired much confidence in recent decades.

More: Chronicles of Tom Moran

Tom Moran can be contacted at [email protected] or (973) 986-6951. Follow him on Twitter @tomamoran. Find NJ.com Notice on Facebook.

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