In our continuing coverage of State of the State addresses today, we noted these comments from governors of two very different states, New Jersey and Mississippi.

New Jersey Gov. Chris Christie: “If we cannot shed regulations, reduce spending, and hold the line on taxes, we cannot attract and create the jobs our citizens so desperately need.”

Mississippi Gov. Haley Barbour: “[Our] goal has to be to grow our economy faster than the nation as a whole, and we can do it. We have to focus on our advantages: low taxes, a friendly business climate, rational regulation, abundant natural resources and especially a first rate, affordable work force.”

Now comes Illinois, where lame-duck lawmakers approved Gov. Pat Quinn’s plan to balance the state budget and raised the personal income tax by 67 percent! The state’s business tax will go up by 46 percent! The Huffington Post reports that, according to the The Tax Foundationthe hike would force Illinois businesses to pay the highest combined national-local corporate tax rate in the industrialized world.

From The Chicago Tribune, “Quinn congratulates Democrats on income tax increase“:

A triumphant Gov. Pat Quinn congratulated fellow Democrats early today after the Illinois Senate and House sent him a major income tax increase without a single Republican vote in favor.

Quinn smiled and shook hands on the floor of the Senate around 1:30 a.m. after the Senate voted 30-29 for the bill, which would raise the personal income tax-rate by 67 percent and the business income tax rate by 46 percent.

If it’s a triumph, it’s of the Phyrric sort. Gov. Mitch Daniels of Indiana made two telling observations in interviews as reported in The Herald-Review, “Indiana governor says Illinois tax hike would be good news for his state“:

• “We already had an edge on Illinois in terms of the cost of doing business, and this is going to make it significantly wider.”
• “Folks in Illinois will eventually have to decide: Is this working well enough for us or do we want some-thing different? Point one of our anti-recession strategy here is to avoid doing what they’ve now decided to do.”

Gov. Chris Christie did not mention manufacturing or industry in his State of the State address Tuesday. His speech, entitled “For New Jersey: It’s time to do the big things,” instead concentrated on fiscal issues and highlighted Gov. Christie’s efforts to turn the state and state government around, making it more responsive and competitive.

But you don’t have to cite the specific words — manufacturing, industry — to be relevant to manufacturers. The emphasis on competitiveness should indeed strike a chord with business, industry and the citizens of New Jersey. Christie, a Republican, said:

For New Jersey: it’s time to do the big things. For this year, the biggest things fall in three categories:

One: We must stick to the course of fiscal discipline.
Two: We must fix our pension and health benefit systems in order to save them.
And three: We must reform our schools to make them the best in the nation.

On these three, what is at stake is no less than the future of New Jersey.

You see, we are in a global competition, and we are in a competition among states.

If we cannot shed regulations, reduce spending, and hold the line on taxes, we cannot attract and create the jobs our citizens so desperately need.

If we cannot make the promises of our pension system more realistic, there will be no pensions.

And if we cannot repair our schools, our people will not be ready for the jobs of the future.

The National Association of Manufacturers has long emphasized the need for the United States and U.S. government to create an economic and business climate that is more globally competitive. (See our 2010 policy guide and call to action, “Manufacturing Strategy for Jobs and a Competitive America.”) Gov. Christie’s remarks fit well with that vision of competitiveness.

The trial lawyer lobby occasionally tries to sell the argument that business owners are not that troubled by the burdens and costs of being sued. We’ll concede that there may be a difference in attitude between employers who have been sued versus those who have not been…yet. Small businesses are keenly aware of the consequences of being sued.

Indeed, the New Jersey Lawsuit Reform Alliance last week released results of a survey of small business owners on the state’s legal climate. Monmouth University Polling Institute interviewed owners and senior operators of small businesses (2 – 50 employees) in July 2010. Results were released at a news conference with NJLRA’s executive director,  Marcus Rayner, and Assemblywoman Amy Handlin (R-Monmouth). Highlights:

• Most (70%) of New Jersey’s small business owners agree that the state’s liability laws make it less attractive than other states for business.
• Nearly two-thirds (64%) say that lawsuits are a problem for New Jersey’s overall business climate.
• One-in-five small businesses have had a lawsuit filed against them by a client or customer in the past five years.  One-in-three think it is more likely than not that they will be sued in the next five years.
• The majority of New Jersey’s small business owners (55%) say that reforming our liability laws would improve our business climate. 
• Among the small business owners who were sued in the past five years, many were forced to make changes to their business.
• Liability insurance, which is necessary for most businesses, increased for at least 55% of New Jerseyís small businesses in the past five years.

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NJLRA’s news release is available here, and you can download the full report here. NJBiz covered the release, “Study: Small business wants tort reform.”

Reform-minded Gov. Chris Christie has devoted most of his energies to solving the state’s budget crisis, obviously a priority. But he included tort reform as a plank for economic growth in his 2009 campaign platform, and he’s willing to shake up the state’s legal system. Fix the budget, then fix New Jersey’s legal system, governor!

Governor Chris Christie of New Jersey was sworn into office at noon Tuesday and delivered his inaugural address to a joint session of the Legislature. It was a relatively brief, scene-setting speech with few programmatic details, and the Republican did not mention “manufacturing,” “industry,” or related words.

He certainly had something to say about fixing the state’s business climate, though. From the text, as prepared:

The era of runaway spending and higher and higher taxes has not worked. We have the largest budget deficit per person of any state in the Union. We have the highest tax rates in the nation. We have the highest unemployment rate in over a quarter century. Our economy is stagnant and our people are suffering under the burden government has placed on them. And we cannot continue to mortgage our future if we hope to improve it.

Today, we are taking a new direction. Today, a new era of lower taxes and higher growth will begin.

For earlier commentary on governors’ state of the state addresses and inaugurals, see these posts.

As a former U.S. prosecutor, New Jersey Governor-elect Chris Christie talked much about the law and corruption during his successful campaign against Gov. Jon Corzine, but we didn’t see much about liability reform from either side. So it’s encouraging to see the issues included in the Christie campaign’s “88 Ways Chris Christie Will Fix New Jersey,” under the category, “Getting New Jersey Working Again”:

Forty Seven: I will restore fairness and common-sense to our state’s legal liability policies by making it more difficult for out-of-state plaintiffs to sue in New Jersey courts.

Forty Eight: I will end the abuse and manipulation of New Jersey’s civil justice system by preventing the admission of flimsy and dubious testimony offered by expert witnesses.

Forty Nine: I will make our state more affordable for consumers and businesses by making it more difficult to file class action lawsuits for frivolous reasons.

Lots of good bullet pointed policies on easing unnecessary regulation, too.

New Jersey election results here.