Christie Campaigns With Ducey, Highlights AZ Candidate's Failed Fiscal Record
Governor Christie will campaign with Arizona Republican Doug Ducey today. It’s fitting, because they both have something in common: gross fiscal mismanagement. Ducey is a right-wing politician who made millions off failing businesses and left taxpayers with the tab for defaulted loans. Under Christie, New Jersey has been downgraded a record–breaking eight times. That’s the same kind of failed leadership that Arizonans could expect from Ducey if he’s elected governor.
Ducey finds himself in a neck-and-neck race because voters understand that if elected, he’d aways put the wealthiest and well-connected ahead of the middle class, students, and sound fiscal management. It’s what he’s done his entire career. Just look at New Jersey under Christie – Arizona can’t afford it.
Here’s the background:
Ducey Has Regularly Touted His Time Running Cold Stone As Qualification For His Campaign. “Ducey rarely talks about his job as state treasurer, the only public office he’s ever held. Instead, he plays up his time at the helm of Cold Stone — a hometown company that started small and made it big in the franchise business and, during its boom years, drew comparisons to Starbucks. Ducey uses that experience as CEO, a job he left seven years ago, to establish his qualifications to run a $9 billion state government still recovering from the Great Recession. He asks voters to judge him based on their experience with Cold Stone. One campaign ad calls him ‘the conservative ice-cream guy.’” [Arizona Republic, 7/17/14]
Over The Past Decade, Cold Stone Creamery Franchises Have Defaulted On 29 Percent Of Government-Backed Loans. “Over the last decade, franchisees in the Cold Stone Creamery ice cream chain defaulted on 29 percent of working-capital loans backed by the government, costing taxpayers tens of millions of dollars, according to an analysis of Small Business Administration data published by the Wall Street Journal last week. The default rate for Quiznos, the sandwich chain that filed for bankruptcy in March, was 30 percent.” [Bloomberg Businessweek, 9/16/14]
Franchisees Pointed To Cold Stone’s “Defective” Business Model, Rapid Expansion. “Numerous franchisees were quoted in a 2008 Wall Street Journal story saying the company had a ‘defective’ business model that pushed the cost of running a store so high that it was difficult for individual owners to make a profit. The franchisees said rapid expansion — the company grew from a local scoop shop to more than 1,400 outlets— crowded stores too close together and brought in inexperienced franchisees. When asked if he wants voters to also judge him based on the company’s business failings, Ducey responded that he is proud of the company’s ‘American success story.’ […] ‘Did every franchisee have success? No. This is America. Success is not guaranteed.’” [Arizona Republic, 7/17/14]
Franchisee: “We Were Pretty Much Set Up To Fail.” “The former CEO of Cold Stone Creamery bases his qualifications on his business background, specifically expanding Cold Stone Creamery from about 70 franchises to 1,440 franchises. In a Thursday news conference orchestrated by Cherny’s camp, five former franchisees of Cold Stone Creamery said Ducey took advantage of franchisees. They said there was a lack of transparency from Ducey and the corporate office… ‘We were pretty much set up to fail,’ said Ed Normand, who ran a store on 75th Avenue and Lower Buckeye Road.” [Arizona Republic,10/8/10]
September 2014: New Jersey’s Eighth Credit Downgrade Under Christie “Most Ever For A Garden State Governor.” “New Jersey had its credit rating cut one step by Standard & Poor’s, handing Chris Christie his eighth downgrade, the most ever for a Garden State governor. The reduction to A, the sixth-highest level, with a stable outlook follows a Sept. 5 downgrade by Fitch Ratings… ‘New Jersey continues to struggle with structural imbalance,’ S&P analyst John Sugden in New York said in a statement today. ‘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.’” [Bloomberg, 9/10/14]
NY Times: New Jersey Economic News Has Been “Dire Drumbeat,” Christie Tied Record For Credit Downgrades During His Term. “For months, Gov. Chris Christie of New Jersey has kept a low profile, waiting for new headlines to distract from the George Washington Bridge scandal. Now they have: The news has been a dire drumbeat about his state’s economy. Credit agencies have downgraded the state’s bond rating six times — making him tied for the record among New Jersey governors, and giving the state one of the lowest credit ratings in the nation — and have threatened that they may do so again because of the pension plans. The state’s unemployment rate remains above the national average, its growth, below, and slower than its neighbors. Its foreclosure and mortgage delinquency rate are the nation’s highest. And New Jersey has recovered only about 40 percent of the jobs lost during the recession, even as the country as a whole has recovered nearly all.” [New York Times, 5/23/14]
Star-Ledger Headline: “For Christie, Jersey’s Economic Woes May Be Biggest Roadblock To White House.” “It’s not the bridge, Governor. It’s the economy… With each day last week, the news about New Jersey’s troubled fiscal condition grew worse. A gaping $807 million hole in the state budget. Warnings that the state may not be able to make its promised pension payments. The threat of slashing property-tax rebates or school funding. And yet another downgrade of New Jersey’s already-low credit rating — the fifth one under the Republican governor’s watch. At the heart of these budget problems is a sputtering New Jersey economy, which has brought in billions less in tax revenue than Christie has forecast over the past three years.” [Star-Ledger, 5/4/14]
Conservative Think Tank Ranked New Jersey’s Fiscal Solvency Worst In The Nation. “New Jersey is in the worst fiscal shape of all 50 states, according to a think tank. An analysis released Thursday by the fiscally conservative Mercatus Center at George Mason University ranked every state by four measures based on 2012 data. New Jersey ranked last in two of them, and near the bottom in the other two. ‘Although the ranking represents a snapshot in time, the states at the bottom are there due to years of poor financial management decisions, bad economic conditions, or a combination of both,’ study author Sarah Arnett wrote.” [Star-Ledger, 1/17/14]