The Confession (28 page)

New job, new rules.

In one of my first big announcements, I nominated Newark's top cop, Joseph Santiago, for state police superintendent, a position that required Senate approval. The editorial pages liked the selection; Santiago wasn't part
of the trooper culture, which was dogged by accusations of racial profiling. He was also a minority, and the first Latino to be nominated for the post. In Newark, Santiago had a tremendous professional track record for cleaning up corruption. In six years, he had cut crime in half and spearheaded the arrest and prosecution of dozens of dirty cops.

All my life I've been a fan of the state police, especially the rank-and-file men and women who go out on uniformed patrol every day. But the leadership of the force needed changing, and I was convinced Santiago was the man to do it.

However, I also knew Santiago was an imperfect character, with blemishes on his personal record. He'd been arrested in the 1980s for not paying traffic tickets. In 1993 he was convicted of a disorderly persons offense for striking a corrections officer he believed had assaulted his fiancée. In an unrelated matter, the IRS caught him running an unregistered security company off the books, leveling $30,000 in fines that Santiago sidestepped with a personal bankruptcy filing.

These incidents had been thoroughly chronicled in newspaper accounts at the time. They caused me some concern initially, but Santiago assured me he would handle this new position without bringing embarrassment to the office. He said he had attended a conference at Harvard on “managing by objectives,” then laid out his plan for the state police: streamlining efficiency, working more closely with the communities, helping the force to regain a strong footing after the scandals. I thought his vision was exceptional.

“This is obviously different from being a municipal police director. It's going to require a different level of authority and diplomacy,” I told him.

“I'm prepared for that,” he said.

Sharpe James, his boss in Newark, wasn't thrilled that I'd stolen his top cop, but he echoed my assessment. I even sought out Bill Bratton, the respected New York City police chief, for an opinion. “Great guy,” he said. “He'd do a very good job.”

The troopers' unions opposed the nomination, saying they'd rather see someone promoted from within the ranks. Never one to befriend his critics, Santiago responded by shaking up the force with promotions,
reassignments, and pink slips. I saw nothing wrong with that—you can't change the culture of a place without shaking it up.

When statehouse reporters got wind of his record, however, they were predictably harsh. “We all have things in life for which we have made mistakes, errors in judgments,” I told a reporter for the radio station New Jersey 101.5.

I took him on as my first major battle, a decision I regretted almost immediately. The senate demanded an investigation of his past, which I stonewalled, then held hearings on his qualifications even after he already began working. But Santiago's offenses weren't all in the past, it turned out. Soon after he began work, he embroiled himself in a strange bureaucratic fiction. He created a state police class, of which he was the only student, and then graduated himself from it, though there were no teachers. Why? So that he could carry a state trooper badge and a gun, and assume the rank of colonel.

Attorney General David Samson stripped him of the rank, then had to reprimand him for using it anyway. He was also publicly scolded for appearing at a political rally for Sharpe James in violation of our ethics code.

Making matters much worse, long after I'd already gone to the mat for him, unnamed informants presented Attorney General Samson with evidence that Santiago had ties to organized crime. I felt sure the allegations—that he protected illegal gambling operations and consorted with known mobsters while on Newark's payroll—were trumped up by his enemies. But once that kind of charge is in the air, it's almost impossible to make it go away.

Intentionally or not, Bill Gormley, the Republican cochairman of the powerful state Senate Judiciary Committee, was heightening the stakes. Nearly every day, Gormley was energizing the state police and their allies by hammering away at Santiago's record, challenging him to appear before a hearing to defend himself, an invitation we rejected.

After an in-depth investigation, Samson found the allegations groundless.

All the while, I was trying to answer the scandal by not answering it. Paul Aronsohn, my spokesman, and Jo Astrid Glading, my communications
director, tried to convince me to address it publicly; I should have heeded their advice. But I was sure we could weather the Santiago fiasco.

I was wrong. For some reason, in September Santiago did something I found indefensible. He circulated a memo instructing that all originals and copies of documents produced in the investigation of his past be sent to his office and destroyed. When his memo was leaked to the press, I'd had enough. I still believe the man had been the target of a character assassination campaign from inside his own ranks. But my faith in his judgment was shaken, and the price of keeping him was becoming too great.

Finally I called him to the governor's mansion and demanded his resignation. He wasn't at all contrite. In fact, he went home and called a press conference, denouncing my decision while drawing the suspicious eye of the press to his sprawling home and grounds—too grand for any salary he'd been paid in public service. He was never prosecuted for taking the files, but he was formally reprimanded, and he was out of a job.

 

I FINALLY SETTLED ON AN AMBIGUOUS TITLE FOR GOLAN: SPECIAL
counselor to the governor. The position hadn't existed before. But his value to me couldn't be contained in other offices, like communication or trade, or any of the cabinet posts. Gary Taffet and Jim Davy both knew how much I had come to rely on Golan. They agreed to the appointment, which would make him part scheduler, part policy strategist, part
consigliere.
Davy, as chief of management and operations, acquiesced to the pay grade, about $80,000.

I was pleased at the notion that I'd found a way to meet Golan's expectations, while keeping any suspicions to a minimum.

But of course neither was the case. He pressured and cajoled my deputy chief of staff, Amy Mansue, about everything from his salary to the placement of his office. We used to meet every few days in the transition office, reviewing office assignments and other logistics. But once Golan was in the picture, he complicated the geopolitics of the place, so much so that she eventually asked for a special meeting to discuss it.

“I gave him this office,” she said, pointing to a perfectly adequate room
on the second floor. “He won't take it. He wants the first floor, but there's no space.”

This was a ridiculous crisis. “Is he nuts? Tell him to forget it.”

“I did,” Amy said. “He offered a compromise.” She pointed to her own office, a room at the top of the second-floor stairway with a fireplace and an adjoining bullpen for staffers. “If he wants it so badly,” Amy said, “I'll move.”

I argued against accommodating him like this, but Golan had worn Amy down. A good friend and a real trouper, she moved down the hall.

But that didn't stop Golan's demands. Next, Jim Davy told me that Golan was refusing the salary we set. “He wants a buck-ten,” he said.

That's where I should have put my foot down. Very few people in the administration were making $110,000 or higher, and his position didn't deserve to be one of them. I owed it to the taxpayers to turn Golan down, even if we weren't in the middle of a major fiscal crisis. But I couldn't find the strength to continue this battle. I remember rolling my head in weary disgust. “Give it to him,” I said.

 

NEW JERSEY'S CONSTITUTION HAS A BALANCED-BUDGET CLAUSE,
as do most states, though not the federal government. This is a good requirement, but it put me in a terrible bind. Not only did I have to come up with a working budget for the coming fiscal year that accounted for a projected $5.3 billion tax falloff; I also had to reissue Whitman's budget for the current year, with some way to make up for her $3 billion shortfall. In a $23 billion overall budget, this was a huge deficit—the largest of any state in the country.

I was hamstrung by my campaign promise not to levy new taxes. I know the Republicans were eager to see me fail on that. The first thing I did, while still in the transition office, was to ask the legislature for a moratorium on new spending. But the Republicans who were about to relinquish their majorities in both houses ignored me. They pushed through $200 million in new programs, including $6 million in gifts to the horse-racing industry, and even more tax givebacks. On my first day in office, I was furious when my state treasurer, Mac McCormac, showed me tax revenue figures
that were well below projections. Our budgetary crisis was even worse than it first looked.

“They cooked the books,” I seethed. “They hid the truth and they left taxpayers to foot the bill.”

So at my first cabinet meeting, I blocked as much of the new spending as I could and ordered department heads to cut their operating budgets by 5 percent across the board, making up $100 million over six months. Every cut was agonizing. Next I was forced to lay off six hundred technical workers, gut the “smart growth” office that was responsible for fighting sprawl, freeze aid to municipalities, reduce college funding, end future school construction programs, and postpone dam repairs, park improvements, and new tuition assistance grants. Even my campaign promise to eliminate tolls on the Garden State Parkway was going to have to be delayed; we simply couldn't afford to lose the revenue.

Unfortunately, these poison pills weren't solving the fundamental problems in the state. I could borrow as much as $2 billion against our portion of the national tobacco settlement. But Moody's Investors Service was condemning us for not levying a tax. Cutting out fat wasn't going to make ends meet, they argued in a report on my policies. “Given the administration's pledge not to raise taxes, we do not expect the state will be able to return to structural balance and restore its reserves to strong levels for at least several years.” For the first time in a decade, they downgraded the state from an Aa1 to an Aa2 rating, which meant we'd be paying higher interest rates on state borrowing.

Very tentatively, we began looking at taxes. I still vowed to not increase property taxes or income taxes. But there were some aspects of New Jersey's tax code that didn't make sense. For instance, corporations in the state were paying less now than ten years earlier, while corporate profits doubled over the same period, to $867 billion nationally. Thanks to a series of yawning loopholes, thirty of the state's biggest companies paid just two hundred dollars a year in corporate taxes. Eliminating those loopholes added $600 million in new revenues. Some may have argued that this amounted to raising taxes, but it was nothing of the kind: we were simply ending an unjust corporate welfare program that never should have been there in the first place.

But I did raise taxes on tobacco. In survey after survey, nobody ever complained about cigarette tax hikes. I added fifty cents in taxes to each pack of cigarettes sold, for $200 million in total revenue, and cancelled a $7 million cut in cigar taxes pushed through by Republican lawmakers in the days before I took over. I hated being forced into abrogating my own campaign promise. Publicly I argued that I had income and sales taxes in mind when I made that pledge. But I still felt terrible about it. There just was no other way to balance the budget.

 

RAY LESNIAK CAME TO SEE ME TWICE IN MY FIRST FEW WEEKS AS
governor. Both visits were awkward. In the run-up to my victory, I'd grown much closer to John Lynch than to Ray. Both men had long coattails, and both were actively committed to my victory. But I was lured in Lynch's direction in part because he required an overt display of loyalty in exchange for his efforts on my behalf, whereas Ray's support for me came more loosely, without strings. But I'd also come to the conclusion that Lynch was the more powerful of the two. His hunger for influence in state politics was growing by the year.

During his two decades in the public service, John had served first as the brilliant mayor of New Brunswick during its renaissance, then as minority leader and senate president, a position once held by his own father. But just as I was being inaugurated, he decided to leave the senate and concentrate on making money in the private sector. This didn't mean he backed away from politics; in fact, just the opposite. What gave Lynch increasing power was his political action committee, New Directions Through Responsible Leadership, which doled out nearly $1 million a year in campaign contributions across the state. Going to his yearly fundraisers at Breakers in Spring Lake was like peering into a G-8 summit: the most powerful men and women in New Jersey came out en masse.

Lynch regularly dropped by my office to give me fatherly advice on my performance. I always welcomed his ideas and observations, which were unvarnished and often stern, but I took responsibility for my own decisions, sometimes to his bitter consternation. He felt I was too stridently
progressive about some things and not sufficiently assertive about others, all of which was probably true.

Ray Lesniak, meanwhile, was undergoing a personal awakening of sorts that seemed to pull him away from politics, though he remained in the Senate. First a good friend of his died; then his girlfriend dumped him, sending him into a terrific tailspin. That was his catalyst for joining the twelve-step movement—to recover from his need to control his ex-girlfriend and, by extension, everything else around him. When I went to him for advice thereafter, I got AA-style maxims about not controlling everything. The “Serenity Prayer” was his driving principle now:
God grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference.