New Jersey's Fiscal Woes Imperil An Already-Damaged Chris Christie

The scandal over a made-up study that badly disrupted traffic at the George Washington Bridge may not be New Jersey Governor Chris Christie's biggest problem after all.

Less than a year after the charismatic governor was the toast of the Republican Party and a leading contender to run for the White House in 2016, the story was supposed to be about a New Jersey economy that he had managed to turn around and budget problems he had been able to solve. That narrative appears to be unraveling.

Almost six months into his second term as governor, Christie faces a more than $800 million budget gap. The state's credit rating - already downgraded twice by each of the three main rating agencies - could be hit again, while the state's public unions are suing over Christie's decision to slash mandatory payments to the pension fund by 60 percent.

At the same time, New Jersey's economy is less than buoyant - its jobless rate is 6.9 percent, higher than the national rate of 6.3 percent.

His failures on the fiscal front, though, could haunt him more than the investigations into the scandal, widely known as Bridgegate, political strategists said. Christie already faced an uphill struggle against conservative Republicans because he has not taken aggressive stances on some social issues, such as gun control and gay marriage. He can now also be attacked by Republican opponents over his ability to run New Jersey in a fiscally sound way.

"This has the potential to be a much bigger problem for Christie's 2016 prospects than Bridgegate," said Ford O'Connell, a Republican strategist. "The best he can do to boost his chances in 2016 is to get New Jersey's fiscal state in order."

Read more from Edith Honan and Gabriel Debenedetti at Reuters

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