In New Jersey, it’s a bipartisan tradition to manage the budget like a crazed mall rat on the loose with Daddy’s credit card.The S-L endorses all this WITHOUT the caveat that public employees should not accept any deal that doesn't require the state to start meeting its obligations and begin paying into the system. Remember: the only money coming in right now is whatever meager returns the funds' investments are making, and the MANDATORY payments public employees make - that's what's paying for current retirees benefits.
The only solace is that attitudes are changing. Christie and the Democrats have each proposed tough pension reforms that will make a much bigger dent in this problem. Our preference is for the governor’s plan. Let’s take a look.
Christie would raise the retirement age to 65, eliminate cost-of-living adjustments, require all public workers to pay 8.5 percent of their salaries into pension plans and rescind a 9 percent raise that was granted in 1999 and never paid for.
That’s tough medicine. But even if the Legislature swallows it all, the governor estimates it would take 30 years to reach the safety zone, with 90 percent of the liability funded.
Christie justified not making the state's payments this year under the guise that he didn't want to throw good money after bad. OK - why should public workers be required to do the same? And why would the S-L endorse a plan that completes ignores this problem?
Further - in the print edition, the S-L quotes results from the recent Quinnipiac poll about the public's stance on state worker compensation:
Doesn't look good. But look further at the results the S-L didn't publish:
- 56 - 38 percent support layoffs for state workers. Democrats oppose layoffs 53 - 40 percent and voters with a union member in the household oppose layoffs 53 - 44 percent.
- 65 - 24 percent for furloughs for state workers, including 61 - 25 percent among Democrats and 61 - 28 percent in union households.
- 77 - 20 percent for wage freezes for state workers, including 72 - 23 percent among Democrats and 64 - 34 percent in union households.
- 66 - 29 percent for reducing pensions for new state workers, including 56 - 39 percent among Democrats and 57 - 42 percent in union households.
- New Jersey voters support 55 - 34 percent the so-called "Millionaires' Tax." Support is 72 - 21 percent among Democrats and 55 - 32 percent among independent voters, while Republicans oppose the tax 53 - 33 percent.
- New Jersey voters oppose 71 - 25 percent cutting aid to public schools, with no group in support of such a cut. Voters split 47 - 48 percent on tax cuts for corporations to help stimulate the state economy. [emphasis mine]
So, as many people want taxes on millionaires as want layoffs. I hasten to add that this is in a climate where no one is strongly making the case to raise taxes on the wealthy, or pointing out how much more money the wealthy have compared to years ago, or to point out how historically low their taxes are.
Imagine if people where allowed to point that out in our media every now and then. Imagine if the S-L would dare to bring up such a point.
By the way, I think the growing ambivalence about the wealthy plays into this:
Gov. Christie's proposed cap on salaries for school superintendents is a good way to help balance the budget, 68 percent of voters say, while 25 percent say it is meddling in local government. All groups support the salary cap.
Superintendents salaries are up in the six-digit range, which many people consider wealthy (and it is, but it's actually modest compared to private sector executives). I wonder what would happen if Quinnipiac asked people about caps on salaries for health insurance executives with public contracts up in the eight-digit range...