"What does not change / is the will to change"
--Charles Olson, "The Kingfishers"

Thursday, December 23, 2010

Tell me again who's at fault for the pension mess



The state treasurer announced today that the state pension shortfall is at an all-time high.

As reported by The Star-Ledger, the shortfall grew by more than $8 billion over the last fiscal year to about $53.9 billion -- an astronmical number that dwarfs the state's annual budget. All told, the state pension system, the story says, "is 62 percent funded."

The report offered the Christie administration an opportunity to continue its push for pension reform, which State Treasurer Andrew Sidamon-Eristoff said include "rolling back a 9 percent increase in pensions given by the Legislature in 2001, and upping workers’ contributions to 8.5 percent across the board," according to the paper.
“Unchecked, the cost of this impossible burden will fall not just on the taxpayers of today, but on future generations of New Jerseyans,” he said.
That governor, he plays hard ball. He also is proving to be an ideological hack who seems unconcerned with the facts of the pension crisis. Remember, the governor followed in the footsteps of nearly every predecessor going back to the early days of the Whitman administration by failing to pay into the pension system. The $3.1 billion pension payment he didn't make accounts for nearly 40 percent of the growth in the unfunded obligation.

And the governor, as Chris Hayes pointed out the other night on Countdown, seems prepared to default on the state's obligations to its workers -- cops and firefighters, teachers and roadworkers, secretaries and others -- rather than a) asking taxpayers for more money or b) getting in the bondholders' faces.

As Dean Baker, an economist with the left-leaning Center for Economic Policy and Research, point out, the pensions are contractual obligations, a promise made to the people who work for the various levels of government in the state. Threatening default -- or at least alluding to it -- is irresponsible and morally questionable. It is blackmail, plain and simple, and just more evidence that this supposedly no-nonsense governor is really just a bully.

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5 comments:

Anonymous said...

It's the shock doctrine or disaster capitalism at its best. We have a huge Great Recession, the worst in more than 70 years, what a great opportunity to kill off public sector unions and all their pensions and benefits. Private sector wages have been falling or stagnant for years, private sector benefits and pensions have been hallowed out or become extinct. So how dare public sector workers expect anything, it's a race to the bottom in which American workers must compete with Chinese or Indian workers who earn a few dollars a day and have absolutely no protections or benefits. Teachers and other public sector workers did not cause the Great Recession but they will be made to pay the price for the crimes of the Wall Street criminals. In 2008, the pension fund lost $400 million directly because of the fraud and corruption at Morgan Stanley. Shock and awe for the working class, champagne and caviar for the banksters.
Never pass up a disaster to sock it to public sector workers or any workers for that matter: Katrina was the disaster and the excuse to fire all the teachers and to institute the quasi privatization of the New Orleans school system with public money.

alibertarianin08824 said...

>It's the shock doctrine or disaster capitalism at its best.

Be nice if these two terms were defined? Or, perhaps, these are terms d'art of the Liberal media. You can't seriously define what has been going on in the USA since say about WW2, (although some little L libertarians woud argue the "turning point" was 1913 with the income tax, the FED, and the Seventeenth!), as "capitalism"! Maybe "mercantilism", "federal socialism", or "empirical nationalism"?

> We have a huge Great Recession, the worst in more than 70 years

I'd call it a depression. But then I'm out of work. So I guess since you're drawing a check, it's only a recessions.

>what a great opportunity to kill off public sector unions and all
>their pensions and benefits. Private sector wages have been falling or >stagnant for years, private sector benefits and pensions have been hallowed >out or become extinct.

But weren't public sector pensions raised when private pensions were supposedly higher? So it's logical, that, when private pensions become "cash basis defined contribution plans", public pensions change as well.

(Note for those that don't read my blog, I thought that CTW's failure to make pension contributions or address the problem was terrible. "Pensions and benefits" are a FRAUD perpetrated on the working class. Without getting into yucky details, a business can pay $X for a certain unit of work. Now out of that $X, if the business "pays" $Y for "benefits", then the worker gets X-Y. But, their "benefits" are tied to their job. So, let's use life insurance as a concrete example. And, let's keep it simple, life insurance costs either the company or the employee X$. Why don't we just let the employee buy hi s or her own Damn insurance? Cause the Gooferment, the Company, the Politicians and Bureaucrats all have a vested interest in screwing the worker. And, everyone plays along with the fiction that some how this is "better". Not better for the worker when he or she gets laid off, downsized, or whatever euphemism for fired you want to use.)

> race to the bottom in which American workers must compete with Chinese
> or Indian workers who earn a few dollars a day and have absolutely no
> protections or benefits.

So, instead of moaning and groaning, we have to learn to compete by moving up the value chain. We have to clear the road blocks to successful competition: taxes, regulation, education, paradigms / memes, and energy.

>Teachers and other public sector workers did not cause the Great Recession

Well, maybe they did. They have permitted the dumbing down of society. And, their union is absolutely out of control in the incestuous relationship with the professional politicians. Finally, as voters, they participated in a process that was designed and accomplished the destruction of the USA.

>they will be made to pay the price for the crimes of the
> Wall Street criminals.

As we all are!

> Katrina was the disaster

of Gooferment!

>

We have to separate the Gooferment from "Education". If we are to have any hope of saving "the American Experiment".

Anonymous said...

>>Well, maybe they [the teachers] did. They have permitted the dumbing down of society. And, their union is absolutely out of control in the incestuous relationship with the professional politicians. Finally, as voters, they participated in a process that was designed and accomplished the destruction of the USA.<<

It looks like the teachers did a great job teaching the kids who became the Wall Street magnates, CEOs and bank executives who did quite well earning huge multimillion dollar bonuses. I went to public school with some of the future Wall Streeters at Princeton High School, they did not all go to private schools by any stretch of the imagination.
You are blaming teachers for the dumbing down of America? Excuse me, you are giving a pass to the right wing media and the corporate media which lies, ignores many important news stories, or just gives them a few seconds of air time or places the story in the back of the newspaper. The media have done more to dumb down the populace either by omission or commission of the news than the teachers. That's just a silly accusation against teachers. Amazing how teachers are never given any credit for the success stories but, oh boy, let's bash teachers for the failures. There are many public school kids who succeed and become great successes but teachers are never ever given any credit for them.
The NJEA is not out of control, it was just doing its job very effectively. I am sick of all the lame hyperbolic baseless union bashing. You seem to prefer a gutless wimpy union that kowtows to management and says yes massa at every available opportunity. News flash, the latter is not a union but then libertarians are rabidly anti-union, no surprise there. It's corporate America that has the true incestuous relationship with the politicians because many of the politicians come from corporate America or join corporate America after their stint in Congress, it's called the revolving door. A congressman retires to then become a lobbyist for the corporation that he just passed favorable legislation for. Or a lobbyist can become a politician and run for Congress. Corporate America and their lobbyists have vast sums of money to throw around that dwarfs by comparison the relatively paltry amounts that the NJEA can muster up. So many outlandish lies, half truths and pure balderdash have been told about the NJEA that it is truly disgusting.
Libertarianism is a creation of the economic elites and it's great if you're a billionaire or "mere" millionaire. Otherwise, libertarianism is pure toxic sludge for ordinary working Americans, the non-millionaires and the non-billionaires.

Anonymous said...

@libertarian:
Hey, a really nice (outrageous) job of scapegoating, demonizing and swiftboating of teachers and the NJEA. It's not surprising with our loud mouthed blowhard governernator sliming teachers and the NJEA on a daily basis. Where did you learn reading, writing and arithmetic? You forgot to blame teachers and the NJEA for WWII, the Vietnam war and the Katrina disaster.
Teachers struggle every day, often against overwhelming odds to educate the children and for this they get kicked in the teeth and spat upon. I know a wonderful devoted teacher who reported bruises on the arm of a child to the nurse as she is required to do by law. If she had not reported the bruises, she could have gotten into trouble. For her conscientiousness, the parent turned around and accused the teacher of bruising her child. The teacher had to go through a months long ordeal but was ultimately vindicated and cleared of any wrong doing. The mother had been in trouble with child welfare before, she was terrified of losing her child so she blamed the teacher for her own actions. People have no concept of what teachers have to deal with on a day to day basis. That's why teachers need tenure and a strong union.

reinkefj said...

@anonymous

>nice job

Thanks. I worked hard to get the correct tone.

>forgot to blame teachers and the
> NJEA for WWII, the Vietnam war
> and the Katrina disaster.

I have less problems with "teachers"; more with "teachers' unions". My big problem is with Gooferment.

Well, if you insist there is a relation between Gooferment "education", aka propaganda, and America moving from isolationist pre-WW1 to an interventionist WW2.

Remember Wilson, the racist, was elected on a "keep us out of war platform" and immediately got us into WW1. Lusitania was carrying arms in violation of the "rules".

> TEACHER

I'd like to truly "privatize" education. If parents paid for the education they wanted for their children, everyone -- child, teacher, parent, and taxpayer.

Gooferment, with its one-size-fits-all and claim to some right to use force on everyone, prevents us from improving.

Imagine how much a good teacher would be worth in a truly free market.