Nov. 4 (Bloomberg) -- Republicans swept governors’ races in New Jersey and Virginia as voters worried about jobs and the economy punished Democrats.

New Jersey’s Democratic Governor Jon Corzine, a 62-year-old former co-chairman of Goldman Sachs Group Inc., lost to Republican Christopher Christie, 47. In Virginia, Republican Bob McDonnell, 55, beat Democrat Creigh Deeds, 51, by a 17-point margin. In a congressional race in New York that took on national significance, Democrat Bill Owens defeated Conservative candidate Doug Hoffman.

Republicans said the results were a sign the electorate is leaning back toward their party one year after President Barack Obama’s election. “It’s great news,” said David Carney, a political director for former President George H.W. Bush.

“When we’re like us, we win; when we’re like them, we lose,” said Republican Dick Armey, the former House majority leader from Texas, who now chairs FreedomWorks, a group that has aligned with conservative activists.

Armey is on one side of a debate among Republicans over whether the party’s response to losses in the 2006 and 2008 elections should be to move further to the political right. In New York, Republicans including Armey and 2008 Vice-Presidential candidate Sarah Palin endorsed Hoffman, 59, a Conservative who ran as a third-party candidate, over the choice of local party leaders, Dede Scozzafava, 49, who dropped out last weekend. Late last night, Democrat Owens narrowly won in a district that has been represented by a Republican since the Civil War.

‘Frugal Government’

Speaking to supporters in Richmond, Virginia, Governor- elect McDonnell pledged “a wise and frugal government” and to keep taxes, regulation and litigation “to a minimum.”

“Tomorrow begins the task of fixing our broken state,” said Christie, who pledged to cut regulations and spending and “get government back under control.”

The Republican wins in two out of three races could embolden conservative activists seeking to promote rivals for the seats of party lawmakers and officials such as Florida Governor Charlie Crist who supported Obama’s $787 billion economic stimulus.

The results in New York, in particular, will stoke a debate in the Republican Party over its direction, said former Republican Representative Tom Davis of Virginia. He said his party must develop a message that goes beyond opposition to Obama’s agenda by offering alternatives to his policies.

“You’ve got to be able to mold that discontent into majorities,” said Davis, who led his party’s recruitment efforts in Congress.

Mayoral Races

In New York City, Mayor Michael Bloomberg, an independent, was elected to a third term, beating Democrat William Thompson, the city’s comptroller, by a 5-point margin. Bloomberg is founder and majority owner of Bloomberg News parent Bloomberg LP.

In Boston, Mayor Thomas Menino won an unprecedented fifth consecutive four-year term, and in Detroit, Dave Bing, a former NBA star, won re-election. In Miami’s mayoral race, Tomás Regalado defeated Joe Sanchez.

In Maine, voters repealed a state law that would allow gay and lesbian couples to marry. Final results for a similar proposal in Washington state were not available.

Exit polls indicated the gubernatorial and House races weren’t referenda on the president’s job performance, though Democrats learned the possible limits of gains made in last year’s election, when Obama became the first in his party to win Virginia since 1964.

Unreliable Barometers

Still, the outcome in Virginia and New Jersey may be unreliable barometers of how the elections next year will play out, with local issues such as taxes and transportation driving much of the debate. Virginia hasn’t elected a governor from the party that holds the White House since 1973. McDonnell’s election ends an eight-year streak of Democratic governors.

Deeds trailed McDonnell for much of the race, except in the weeks after a thesis paper McDonnell wrote more than 20 years ago calling working women “detrimental” was publicized.

McDonnell recovered in the polls after his campaign ran a television ad that showed Deeds equivocating on whether he would raise taxes. Yesterday, McDonnell won 58.7 percent to 41.3 percent, with the support of many of the independent and female voters who backed Obama a year ago.

In New Jersey, Christie started the campaign with a lead in polls that reached 12 percent in July and fell as Corzine aired a series of television ads attacking his driving record, ethics and opposition to abortion. Christie won 49 percent to 45 percent.

New Jersey

The last time a Republican won a statewide election in New Jersey was 1997, when incumbent Governor Christine Whitman defeated challenger James McGreevey in a tough campaign. Whitman’s 1993 campaign, in which she defeated James Florio amid voter outrage over $2.8 billion in tax increases he pushed through in his first term, marked the only defeat of a sitting New Jersey governor in a general election.

In Virginia, 65 percent of independents cast their ballots for McDonnell and in New Jersey, Christie took 60 percent of the independent vote, according to CNN’s early exit polls. The economy and jobs were the most important issue to voters in both states, with 32 percent of New Jersey voters and almost half of Virginia voters saying so. Six in ten New Jersey voters and 55 percent of Virginians said Obama had no effect on their vote.

The data refute the arguments of Republicans who said the races were referenda on Obama, said David Plouffe, the president’s former campaign manager.

‘Local Races’

“These are local races,” he said in an interview yesterday on Bloomberg Television. “By Thursday or Friday the remnants of this will be forgotten.”

Tom Reynolds, a former congressman from New York and head of the National Republican Congressional Committee, agreed.

“It probably will have little to do with next year’s outcome,” he said. “Whether it is who wins the House baseball game or a fight in the off-year, people are wanting to take credit.”

While voters in Virginia said the race wasn’t a referendum on Obama, the low turnout among blacks and young voters was a failure of his grassroots campaign machine, said Jennifer Duffy, an analyst at the Cook Political Report in Washington.

“Looking to 2010, it’s a good lesson to relearn,” she said. “It’s not going to be the silver bullet for Democrats.”

Amo Houghton, a former New York congressman and founder of the Republican Main Street Partnership, which promotes centrist Republicans, said the ouster of Scozzafava by Hoffman could be a bad omen for the party. Hoffman had assailed Scozzafava’s support for the stimulus, gay marriage and abortion rights. Owens had 49 percent of the vote, compared with 45.6 percent for Hoffman.

‘Tragic’

“It’s tragic,” he said. “You don’t turn on your own people if you believe in the country and the two-party system.”

Armey said Republicans would have won if they “had nominated a true conservative from the outset.”

John Lapp, who was the director of the Democratic Congressional Campaign Committee in 2006 under then Illinois Representative Rahm Emanuel, said the results last night could impair Republicans chances in swing districts, such as the Northeast, where there are only two Republican senators, Olympia Snowe and Susan Collins of Maine.

“There has been a purist civil war, revolution for the heart and soul of the party and the moderates have lost,” Lapp said.

To contact the reporter on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net.

Last Updated: November 4, 2009 01:29 EST