Christie aide: ‘World is watching’ US economy

“Why do I mention 1979?” he asked, after a discussion of the socioeconomic challenges the nation faced during Ronald Reagan’s election. “Because it was a period where the country faced significant challenges and also faced a need for real leadership that led to an election. While the challenges the country faces today are quite different, they are, especially in the economic arena, if anything, more severe ... 2012 has the opportunity to be a similar election.”

Bagger said he considered New Jersey to be a “micro case study” of large-scale financial problems and that the state could offer a model for the rest of the country to follow.

“My hypothesis is that the challenges facing the United States ... and even the fiscal challenges we face in New Jersey, all have the same root cause and likely require the largely same remedy,” he said.

The main cause, Bagger said, is overspending.

“It’s fair to say the causes of those fiscal challenges are spending beyond our means and making promises that we can’t afford, and then sticking with those policies ... for a period of decades at a time to create a crisis where it becomes significantly harder to mitigate the situation.”

He illustrated this point with some of his own experiences in politics.

After Christie’s election, he said, when Bagger headed the transition team on state finances, he was charged with balancing the budget and cutting roughly $2 billion in spending, or one third of the budget remaining for the fiscal year.

“Within a period of two-and-a-half weeks of taking office, Governor Christie went up to the legislature and explained how, by executive action, he had closed that budget gap, making hundreds of difficult cuts,” he said of the policy he advised.

One month later, the state was facing a nearly $11 billion gap between projected spending and available resources for the following fiscal year’s budget. Bagger said Christie vetoed a bill to raise taxes and had to make another “series of extraordinarily difficult decisions” about where to make cuts. The result, he said, was a state with “realistic, balanced budget.”

Bagger said the example of New Jersey’s budget bodes well for the rest of the country. “If you have strong leadership from an executive and you have legislators working together on a bipartisan basis and willing to make tough choices ... you can take on some pretty serious issues and take action that bends the curve of the fiscal crisis,” he said.

With states like New Jersey demonstrating that steps can be taken to combat the current financial crisis, Bagger underscored the importance of presidential leadership and bipartisan cooperation. He said the federal government had a great responsibility in meeting the challenges it currently faces.

“The world is watching,” he said.

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Bagger graduated with a degree from the Wilson School in 1982 and holds a JD from Rutgers School of Law-Newark. Prior to serving as Christie’s chief of staff, he represented the 22nd Legislative District in the New Jersey General Assembly and was elected to the New Jersey Senate in 2001. He also served as senior vice president for government relations at Pfizer.