#48 New Jersey

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The overall freedom ranking is a combination of personal and economic freedoms.

From 2009

New Jersey State Overview

State Facts

Net Migration Rate (?) -5.6 % 
Personal Income Growth (?) 0.33 %
How does the freedom ranking relate to these?


New Jersey is a highly regulated state all-around, scoring near the bottom of the pack in both personal and economic freedom, but after significant deterioration in 2007—8 the state bounced back somewhat in 2009—10.

Taxes are very high in New Jersey, at 11.2 per- cent of income, but government consumption plus subsidies is below average at 10.4 percent of income. Debt is also high, at 22.1 percent of income.

On economic regulation, New Jersey’s most significant flaw is real property rights. Indeed, New Jersey’s abysmal score on real property rights protection contributes twice as much to its negative overall freedom score as its entire personal freedom score. Local zoning laws are extremely strict, rent control is authorized, eminent domain has scarcely been reformed, and private malls and homeowners’ associations must allow political speech on their property. Labor laws are predictably costly, with a strict workers’ compensation mandate, short-term disability and paid family leave programs, a “smoker protection” law in employment, and of course no right-to-work law. Occupational licensing is ranked worse than average, and there is extensive community rating for private health insurance. The state also scores poorly on the regulation of other insurance, although rate classification prohibitions were apparently removed during 2009—10.

New Jersey’s gun control laws are among the most restrictive in the country, not surprisingly given the state’s ideology. Its marijuana laws are not as liberal as one might expect from a left-leaning state, although a fairly restrictive medical marijuana law was enacted in 2010. New Jersey is ranked as the very worst state for travel freedom, with primary seat belt enforcement, motorcycle and bicycle helmet laws, a cell phone driving ban with primary enforcement, a federally compliant open container law, sobriety checkpoints, and mandatory underinsured motorist coverage for drivers. Fireworks and raw milk are prohibited. Cigarette taxes are high, and smoking bans are as draconian as any in the country. On the positive side, home and private schools are hardly regulated at all. Same-sex partnerships are also recognized. Alcohol is not very regulated, although there is a “happy hour” ban. The state’s crime adjusted incarceration rate is fairly low.

Policy Recommendations

  • Trim spending on libraries, parking lots, sanitation and sewerage, miscellaneous commercial activities, employee retirement, and unemployment insurance, all of which are above national averages. Slash property taxes, which are among the highest in the country.
  • End rent control. This move would have raised New Jersey six places on regulatory policy.
  • Liberalize the aforementioned travel regulations. An average score on travel freedom would raise New Jersey two spots on personal freedom.
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