Standard & Poor's became the latest agency to downgrade New Jersey's credit rating on Wednesday, the state's eighth such downgrade since Gov. Chris Christie (R) took office in 2010.
Last week, Fitch decided to do the same. In its statement explaining the move, S&P directly cited major revenue shortfalls and the governor's decision to reduce pension contributions this fiscal year for the state's public workers.
“New Jersey continues to struggle with structural imbalance and the governor's decision to reduce pension contributions in fiscal 2014 and 2015 highlights the fact that the state lacks the revenues to comply with its own agreed-on contribution to the pension system," the S&P said. "In our view, the governor's decision to delay pension funding, while providing the necessary tools for cash management and budget control, has significant negative implications for the state's liability profile.”
Though the downgrades haven't yet had a significant effect on New Jersey's finances, they do present another threat to Christie's political aspirations, especially at a time when he is trying to burnish his credentials at home and abroad. A tough-talking governor linked to a messy bridge closure is one thing, but a governor who cannot manage his state's finances is another -- as Kansas Gov. Sam Brownback (R) recently discovered.
The downgrade drew criticism from Democrats on Wednesday, who called Christie's administration a "national embarrassment."
“From his failed economic record to his administration’s gross misconduct during Bridgegate, Chris Christie has failed his state time and again," said Democratic National Committee press secretary Michael Czin. "And now, it doesn’t even look like he’s trying anymore. Instead of working with Democrats to solve the state’s long-term problems, Christie’s busy crisscrossing the country campaigning for Republicans who apparently want to emulate his failed leadership.”