One-Third of New Jersey Businesses Shuttered; Governor Delays Lawsuit Protecting Businesses

CONTACT:
Jennifer Jean Miller (973) 532-2117

(Morris Plains, NJ) Recent news reports have spotlighted the destructiveness of Gov. Phil Murphy’s emergency COVID-19 executive orders, with many blaming Murphy’s mandates for the closure of one-third of all of New Jersey’s small businesses. According to data from the New Jersey Business & Industry Association, 28 percent closed by October, following the series of Murphy’s forced shutdowns since March.

The Hill weighed in with higher numbers, calculating a 31 percent closure up to Nov. 9, per estimates from TrackTheRecovery.org. Some businesses have floundered under Murphy’s partial reopening plans, the Governor having recently cracked down again on restaurant and bars, mandating 10 p.m. indoor closures and authorizing counties and municipalities to double down with further restrictions. The Governor even limited the number of people allowed in residents’ own homes, to a maximum of 10.

Rescue New Jersey, a not-for-profit and non-partisan group formed to assist New Jersey residents and businesses, has facilitated a lawsuit advocating not only for the plaintiff, but all businesses harmed by Murphy’s violations of the Disaster Control Act. As part of his edicts, Murphy was mandated - but failed - to establish compensation boards in each county, where businesses and individuals could petition for “reasonable compensation,” in return for the governor’s control over their property in his back-to-back states of emergency.

The case against the governor, filed in the Superior Court in September, which originally sought a declaratory judgment compelling him to establish these boards, is currently in the Appellate Division. The Governor, however, has asked the Appellate Division to deny counsels’ request to expedite the case, to obtain financial relief for the plaintiff’s owner, who already had to close her business in October, because of Murphy’s draconian restrictions. “This ongoing and escalating tragedy underscores the urgency of the lawsuit we’ve brought on behalf of JWC Fitness, LLC and its owner, Darlene Pallay, to obtain the reasonable compensation due by law to businesses injured by the Governor’s decrees,” said Robert W. Ferguson, Esq.

Ferguson, of the of the law firm of Stern, Kilcullen and Rufolo, LLC of Florham Park and Catherine M. Brown, Esq., of Denville, filed the suit for Pallay, a Sussex County business owner who operated CKO Kickboxing Franklin, under her LLC. “Our claims are straightforward: the emergency powers exercised by the Governor to order business shutdowns and other restrictions require the state to compensate those individuals and businesses whose property has been impaired by those orders,” Ferguson continued.

“But despite the state’s clear and unambiguous obligation to compensate affected property owners, the Governor’s lawyers, sadly but not unexpectedly, have opposed requests to expedite our case so that those who have complied with the Governor’s orders may obtain some redress for the disproportionate costs they’ve borne on behalf of the public.” “I am proud of the role that Rescue New Jersey has taken in advocating for those who have been left behind, such as Mrs. Pallay, in the Governor’s haphazard response effort to COVID,” said Donald Dinsmore, Esq., Rescue New Jersey’s chairman.

Court briefs have described Pallay as “a law-abiding, taxpaying citizen of this State,” who helped to support her family over the last decade with her business,” including her three young children. Pallay received Congressional recognition for “COVID-related activities that benefitted her community,” according to court documents.

“The defendant [Murphy] called upon all of us to comply with his executive orders for the good of the greater, general welfare,” the Appellate brief stated. “Plaintiff’s owner Mrs. Pallay did as she was ordered. But defendant asked her to give much more to the general welfare than most, her livelihood from a business she has built up over 10 years, and ultimately, the business itself.”

The brief further outlined Pallay’s debts to her commercial landlord and other creditors, which accrued as a result of her inability to operate under the restrictions.

For more information about Rescue New Jersey and this case, go to: www.rescuenewjersey.org

Has the NJBIA become a voice of woke capitalism?

Remember when Republicans were the party of business and Democrats the party of the working class? While the GOP still loyally votes on behalf of the interests of business, the days of business rewarding that loyalty with its support appear to be long gone.

Today’s corporate class votes Democrat because they (1) know the Democrats will do nothing to threaten their economic position in society, and (2) they get to publicly assure themselves that they are "good people" by doing so. Yes, for them the modern Democrat Party is a religious experience – but one that doesn’t require sacrifice.

Government intrudes on business so much these days that instead of organizing resistance to those intrusions, many businesses have made politics their partner. Government is, after all, run by politicians – so corporations hire lobbyists, fund candidates, and more importantly adopt political and social policies that signal the virtues they want the world to see. And for some, it’s sort of like the pious mob boss who makes a great show of paying for the new roof on the church, so that possible critics look the other way when his real work comes to light.

Woke capitalism is crony capitalism with a social justice cover.

Here is a succinct but very much on-point explanation by Kajal Iyer, who boils down a New York Times editorial by Ross Douthat, called “The Rise of Woke Capital.”

Ms. Iyer outlines how corporations are embracing a woke identity to couch their “malpractices” and market their products. These corporations have disrupted the traditional balance between Left and Right in America, between business and labor – its yin and yang.

Woke corporations are like hip middle aged husbands who have successfully found a young mistress, content in the continued loyalty and forbearance of the dutiful wife at home. Guess which political party is “the wife at home”?

Take the New Jersey Business & Industry Association (NJBIA) and its political action committee, New Jobs PAC, which calls itself “The Voice of Business”. When the NJBIA and the Chamber of Commerce rolled out their “Plan for an Affordable New Jersey” in July, who handled the messaging?

If you answered “the Clinton grease machine” you would be correct.

Yep, MWW, the firm that is so close to Bill and Hillary they even found a job for disgraced former Congressman Anthony Weiner when he was too controversial to be hired elsewhere. The biography for the firm’s founder notes that he is “known for his political contributions and fundraising for the Democratic Party” and he’s served as a Deputy Finance Chair of the DNC.

So how pro “leave me alone and let me create jobs” kind of business is this firm and what kind of messaging are you going to get out of them? The answer can be had just by going through the media section of the NJBIA website, which offers lectures on climate change and diversity as well as a host of other left-wing incantations. The rest is a course in “politics/government is your wingman”. Do what they want, pay them what they want, support who and what they tell you to support, and they will allow you to do business.

For the non-woke businessperson who just wants to make a living and create jobs, the message is one of subservience. Pay the Danegeld or the Vikings will pillage your business.

On the other hand, if you are a big pharmaceutical firm mired in controversy over the fallout from one of your products… being uber-LGBTQ can change the focus and make you one of the “good guys”. Yep, too bad about the cancer… or the opioids.

Is this the only voice for business in New Jersey?

Is it time for Republicans to quit playing the loyal “wife at home” and ask for a divorce? Why take the blame for all that corporations do, only to watch them hire the Left to provide a Leftist message that helps Leftist politicians to run against you? Wouldn’t it just be better to leave the Democrats and their crony capitalist backers in the muck and run on a message of reform and clean government?

Does anyone really believe that the “corruption tax” (so labeled in the Soprano State) has gone away? Or would the average voter say that crony capitalism has made it stronger than ever?

20,000 NJ businesses applaud end of estate tax

The New Jersey Business & Industry Association (NJBIA), represents more than 20,000 businesses in New Jersey.  These 20,000 member companies employ more than 1 million people in New Jersey -- that's right, 1 million NJ jobs. 

Michele Siekerka, NJBIA president and CEO, wrote the following column.  Her research shows her that eliminating the estate tax will improve New Jersey’s economic climate.  Siekerka writes: "Scrapping it signals we might finally address the issues that make the Garden State so expensive for residents and businesses."

Along with other conservative leaders, Senator Steve Oroho has long championed eliminating the estate tax.  Unfortunately elements of what can only be described as the "Alt-Right" or alternative right (alternative to the traditional American variety of conservatism practiced by William F. Buckley and Ronald Reagan), have attempted to incite opposition to ending the estate tax by using various, often openly Marxist, arguments.  At the forefront of these efforts has been Bill Spadea and his fellow "Red Shirts" -- like Sussex County's Kevin Mazzoti, whose writings are violent and pornographic, nearly every sentence containing the word "f**k."

In this column, published today in New Jersey Spotlight, the New Jersey Business & Industry Association President and CEO explain the benefits that come from eliminating the estate tax:

The elimination of the estate tax was one of the key provisions of the recently enacted law that increased the gas tax but reduced taxes in several other key areas, including taxes on pension income for retirees.

Getting rid of the estate tax has been a very high priority for the New Jersey Business & Industry Association.

First, the name “estate tax” is very unfortunate. The name itself connotes wealth — yachts, country clubs, private schools and heirs. Although the opponents of estate tax elimination would surely like it to be so, the estate tax is really about none of these things.

New Jersey is only one of two states with both an estate tax and inheritance tax and its estate tax has the lowest threshold in the nation at $675,000. This means that if a small business is worth more than that — as many are— or if a taxpayer owns a home, has a life insurance policy and a small 401k, they are likely over that limit and will be taxed.

In particular, the estate tax hurts business succession planning, most specifically with family- owned businesses. It’s not uncommon for a family-run business to have to sell business assets in order to pay the estate tax bill. In our 2016 Business Outlook Survey, two-thirds of our members said they take the estate and inheritance taxes into account when making business decisions and that they would not retire in New Jersey.

Opponents of the estate tax elimination are fond of pointing out that general fund revenue would be lost if the estate tax was eliminated. To only fixate on the potential lost revenue completely misses the point. Rather, we need to focus on the revenue that would be kept in state if residents did not leave to avoid the tax.

NJBIA has found that this amount is significant.

If just 20 percent of the taxpayers older than 45 who left the state in 2013 had stayed it would have resulted in an additional half a billion dollars in adjusted gross income that would have stayed here, flowing through the economy along with over $300 million in economic activity.

As we have learned, outmigration is a significant issue that is hurting New Jersey and its economy. The state’s tax burden is a significant factor. New Jersey is now at or near the bottom of every category including, income, sales, property, corporate and estate and inheritance taxes. And where do the residents go? While the naysayers are fixated on Florida, it is actually Pennsylvania and New York that are the top two outmigration states, both of which fare better on these taxes than New Jersey.

During the last 11 years we have lost a total of $20.7 billion in net adjusted gross income. The loss of these funds resulted in a loss of $13.1 billion in economic output, nearly 87,000 jobs, and $4.6 billion in total lost labor income.

The elimination of the estate tax is an important signal that New Jersey is finally serious about addressing real tax reform and the issues that impact affordability for our businesses and residents. It is only the first step in what we hope will be an ongoing discussion about comprehensive tax reform in which we take a deep dive and look closely at how we raise revenue and, most importantly, how we spend that revenue.

We thank our courageous policymakers for taking this very necessary step toward comprehensive reform. NJBIA will continue the difficult and challenging work of making New Jersey affordable for businesses and for families.