“We need to remember where we started, fiscally, before the chaos of the pandemic, because that is exactly where we will end when it ends,” O’Scanlon said in a statement. “Except that the hole will be deeper, our children’s debt will be even greater and the road to true solvency even more insurmountable.”
In November, the state lent $ 4.29 billion to cover its operating costs, a measure that Republicans tried unsuccessfully to block, citing the burden it would place on future generations of taxpayers. The state is not expected to start paying interest on that debt during the fiscal year covered by the proposed budget, government officials said.
James W. Hughes, former dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University, said the state’s decision to apply for loans made sense at the time.
“It’s used a lot, but whatever the term – unprecedented, uncharted waters – five, six months ago, that was really the case,” said Hughes.
“In the summer, we were still unsure of the scale of layoffs that could have occurred if we followed a conventional recession,” he added.
During the peak of the pandemic, when most companies were closed in an effort to reduce the spread of the virus, 831,000 residents lost their jobs. That was twice the number of jobs won over the past 10 years, Hughes noted.
“If that isn’t scary,” he said, “I don’t know what kind of metric is scary.”
Since then, the state has recovered about 58% of those jobs, but about 350,000 residents remain unemployed.