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The Spectacle Blog
In perhaps the first major gaffe I’m aware of by Chris Christie, the fire-breathing budget-cutting Republican Governor of New Jersey, or more precisely by his administration, the state’s Treasurer has announced that the state will appeal a court ruling striking down a new law which allows the government to steal private property in order to help balance its budget.
In particular, the law allows the state to seize the unused value on gift cards two years after their purchase as well as the unused value of any travelers checks not cashed or spent within three years after purchase.
A news story on the judge’s injunction, which was originally handed down in November, says that “consumers can still redeem the gift cards after the state takes the money” which is a concept that only a bureaucrat could think is sensible. This would imply that the state would have some unknown liability, probably actuarially determined at some percentage of the total amount seized.
But even with that fig leaf of consumer “protection,” New Jersey’s proposal is an act of piracy on the open seas of commerce.
The New Jersey Retail Merchants Association, the New Jersey Food Council and American Express each sued to block the law, and Judge Freda Wolfson agreed with them, at least for now.
It’s fairly reprehensible that the state of New Jersey sees fit to appeal a law blocking their ability to steal money — and make no mistake, that’s what this is — regardless of how bad the state’s budget deficit is.
After all, a mugger’s budget probably isn’t all that great, but if he took your gift card or traveler’s check, he’d rightfully go to prison.
View all comments (10) | Leave a comment
More Blog Posts by Ross Kaminsky
http://spectator.org/blog/2011/01/04/gift-cards-for-new-jersey
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Rogue Elephant| 1.4.11 @ 5:18PM
Unclaimed property laws of this sort are ancient (the law of escheat) and common. There is even a Uniform Unclaimed Property Act that was adopted by many states. While common, these laws are subject to Constitutional scrutiny, requiring due process so that that a claimant (the true owner or their estate) can appear and claim the property.
Nevertheless, what is troubling here is that (unlike bank accounts), gift cards have no owner of record. Thus, it seems unlikely any claimant can appear to claim their escheated property.
Ross Kaminsky | 1.4.11 @ 5:41PM
Rogue,
I roughly agree, but would also add that I have a big problem with the burden this puts on retailers. The government is including a provision that would require retailers to collect some information (at least a ZIP Code) for each gift card purchaser. While a ZIP Code is not exactly highly privileged, invasive information, having a store collect it is potentially a huge burden.
it's also somewhat pointless as, by definition, most gift cards will end up in the possession of someone other than the purchaser.
Greg Cabral| 1.28.11 @ 2:25PM
I here that the law is in effect a of 2/1/11. Do you know if that is true?
GetDebit | 1.4.11 @ 8:51PM
The move by NJ is pretty outrageous, and doesn't recognize the realities of gift card usage today. As you point out, any additional burden (like ZIP collection) simply doesn't fit with the way gift cards transactions take place. When I decide to buy a $10 Starbucks gift card as an impulse gift when buying my morning coffee, I don't want any further details about the transaction (and the barrista doesn't want to take time to get it, either). Crazy.
MikeGSP| 1.5.11 @ 9:52AM
"the fire-breathing budget-cutting Republican Governor of New Jersey"
Mr. Kaminsky, are you aware that the Governor's FY 2011 budget actually increases spending in New Jersey by 6%?
Mike, Americans for Prosperity-New Jersey
Ross Kaminsky | 1.5.11 @ 11:10AM
Mike,
I was not aware of that!
I have to say I'm fairly stunned and perhaps made the cardinal sin of assumption when writing that brief note.
Would like to see the data.
rossputin(at)rossputin(dot)com
Best,
Ross
Callawyn| 1.5.11 @ 2:19PM
"...first major gaffe ..."
Did you miss his positions in favor of amnesty and the ground zero mosque?
Chris Christie is fantastic on teacher's union, the tunnel boondoggle, and judges. On social issues, he's nearly a complete loss. On balance, he's really much more the big-government establishment republican type rather than a conservative tea-party guy.
Common mistake, actually, since all most people know about him is from the youtube clips of him taking on the teacher's union.
MikeGSP| 1.7.11 @ 11:54AM
Ross -- Sent you an e-mail the other day. Let me know if you didn't get it.
Rob Peoni | 11.2.11 @ 10:38AM
I fail to understand how New Jersey could possibly view this law as constitutional. The gift cards are a good that is sold like anything else. While it is the state's right to tax the revenue created from such cards, to confiscate the funds entirely seems unjustified and insane. How is this possible?
JMS | 1.9.12 @ 2:05PM
Lost in the shuffle of this gift card ruling - the 3rd Circuit Ct. of Appeals struck a second blow last week against American Express, with a decision that bolsters New Jersey’s attempt to shorten the dormancy period for reporting travelers checks - another seemingly blatant revenue grab. Blog post & opinion here: http://bit.ly/zqFUBO