When a New Jersey politician looks to Pennsylvania as a model for policymaking, he’s in the middle of a fiscal disaster, looking across the Delaware River, where another government — not quite as close to calamity — looks good by comparison.
That was my first thought about Republican Jack Ciattarelli campaigning for governor of the Garden State while also hyping the Keystone State. “They don’t have a property tax crisis, they don’t have a business climate crisis, they don’t have an energy crisis,” Ciattarelli said of Pennsylvania in a Politico report that noted the candidate’s admiration of his neighbor.
I would not presume to give campaign advice to Ciattarelli. However, he really should set the bar higher for improving Trenton’s failed policies. Crisis or not, my state of Pennsylvania has serious problems in the areas he named.
Consider the thousands of Pennsylvanians who annually lose homes to sheriff’s sales or have left the state to find work. Because of the “green” agenda of Democrat administrations, the commonwealth, despite being rich in coal and natural gas, faces higher electricity prices and possible blackouts — what the North American Electric Reliability Corp. has called a “five-alarm fire” in power-grid reliability.
Both states risk insolvency due to atrocious fiscal policies, with New Jersey’s position somewhat more dire than Pennsylvania’s. Truth in Accounting’s “Financial State of the States 2025” — which compares how well 50 governments fund their budgets — graded New Jersey and Pennsylvania as “F” and “D,” respectively.
States with a surplus of funds rank higher than those with deficits — the latter applying to the two low-ranking states. New Jersey is dead last in 50th place, with each taxpayer “burdened” with $44,500 of per capita deficit spending. Pennsylvania, number 40 on the list, has a deficit of $9,400 per taxpayer. By comparison, exactly half the states have budget surpluses, ranging from Maine’s $100 per taxpayer to North Dakota’s $63,300.
Those states are on the road to prosperity; New Jersey and Pennsylvania are on the road to nowhere. Whatever the relative degree of failure, the pair’s long-term trend is downward.
Between 1930 and today, the number of congressional seats for Pennsylvania and New Jersey dropped from 34 to 17 and from 14 to 12, respectively. Both have lagged other states in population growth for years.
The Tax Foundation’s 2024 State Business Tax Climate Index ranks New Jersey overall at 50th — last again — and Pennsylvania at 31st. They are also low on the list in the ranking for corporate taxes: 48th for New Jersey and 41st for Pennsylvania.
Having spent decades advising hundreds of companies on avoiding or surviving bankruptcy and six years as a Republican member of the state House of Representatives, I know about financial risks and public policy.
As founder and chair of the bipartisan Financial Rescue Caucus, I led efforts that empowered the state’s Independent Fiscal Office to account for unintended consequences when evaluating policy proposals. We also created internal controls for the state’s pension systems, which helped produce better returns on investments for retirees and protected taxpayers from having to pay for shortfalls in pension funds.
Yet, when I left the legislature nearly three years ago, much still needed to be done. Lawmakers failed to enact my “lean-government bill” because both parties resisted injecting into the budgeting process ways of identifying unnecessary spending, which makes up 20 percent of the state budget. Languishing to this day is the Taxpayer Protection Act, which would link government spending to the rate of inflation and population.
The current budget impasse in Harrisburg — where legislative Republicans are resisting Gov. Josh Shapiro’s proposal to spend billions more than anticipated revenues — reflects an absence of controls and distinguishes Pennsylvania as the only state without a budget. Budgeting processes that measure the effectiveness of programs — which private companies routinely use — would ensure responsible expenditure of funds.
Throwing more money at issues does not solve problems. For example, continual increases in the state’s education budget repeatedly produce failing schools. Pennsylvania spends more than $23,000 per student, up 44 percent since 2015, yet fewer than half the students in public schools are proficient in any subject area. Reforms that would direct funds to students rather than to schools and expand choice among public and private schools should be implemented.
I know from my experience in government and from the budget surpluses of other states that responsible governance is possible. If Ciattarelli could bring sufficient leadership to achieve that in Trenton, perhaps Harrisburg could look to him for inspiration.
Frank Ryan is a CPA who specializes in corporate restructuring. He served six years as a Republican member of the Pennsylvania House of Representatives and retired as a Marine Reserve colonel, having deployed to Iraq, Afghanistan, and numerous other locations abroad. He can be reached at fryan1951@gmail.com.