No Brain. No Plan.


To put this into some perspective when Governor Christie came into office in 2010 he set upon reforming the state’s pension system. His ill-thought out, knee-jerk reforms failed miserably in every respect and with cost-of-living-adjustments for retirees about to return and a crash in the values of alternative investments about to decimate the ‘trust’ there is every likelihood that New Jersey retirees will see draconian benefit cuts even as taxpayers and current employees are intimidated into paying more to fund even the reduced benefits to come.

So what’s the plan?……
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Misleading Indicators


Unemployment rates, GDP, and CPI all look to measure our world with methodologies developed decades ago.  Do they still do their jobs?  Zachary Karabell in “The Leading Indicators: A Short History of the Numbers That Rule Our World” explores that question and here are some excerpts from my reading:
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Who’s Double-Crossing Whom Here?


So the democrat narrative is becoming clear. Despite the Dems having control of the legislature for decades and having sporadic control of the Governor’s seat it’s not their fault that the pension system went unfunded and it’s certainly not their fault the system has gone beyond the point of saving. No, no, no, the fault is Christie and only Christie.

I think Christie is a massive SOB but if the NJ Dems are looking for who is at fault for the pension systems unavoidable collapse the best place to start is with a mirror.

Posted by Hoboken_Guy on July 10, 2014 at 12:28 am

A perfect illustration of this mindset appeared today as Sen. Linda R. Greenstein (D) representing the 14th Legislative District and serving on the Senate Budget and Appropriations Committee had an opinion piece in the Trenton Times where she trotted out every sanctimonious piece of blather in the democratic playbook on the pension issue:
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Pension Default as White House Strategy


Politics is the art of the possible.Otto Von Bismarck, remark, Aug. 11, 1867
German Prussian politician (1815 – 1898)

Gay marriage, flag burning, stem cells, medical marijuana, and other social issues designed to inflame an electorate to mindlessly vote their prejudices might work to get Chris Christie into the White House.  Pension reform in New Jersey won’t.

If given the choice between having a fully funded state pension system and a talking point to bash unions and default on pensions I have no doubt that Christie would much prefer the former and never have to deal with another pension reform.  Yet a Bloomberg story today quotes several politicians and pundits as seeing this as some sort of strategem for 2016:

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No Scandal in New Jersey


Charlie Baker is running for governor of Massachusetts.  On May 17, 2011 he donated $10,000 to the NJ Republican State Committee listing his employer as General Catalyst Partners.  As of June 30, 2012 the assets of the New Jersey pension funds included for the first time an investment in GENERAL CATALYST GROUP VI LP valued at $366,322.  The value of this investment as of June 30, 2013 was $3,988,185.  This is viewed by the people at Pandodaily.com as a scandal:
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It is not a scandal by New Jersey standards and an excerpt from the video above hits upon exactly why that is:

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15.5% Return – Really?


For the fiscal year ended June 30, 2014 the New Jersey pension funds got a return of 15.5%:
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If the funds really earned 15.5% you would expect the governor to call for an increase in the 7.9% interest funding rate to reflect actual experience – unless it was explained to him about what the funds are investing in:

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No Simple Solutions to New Jersey Pension Mess


An opinion piece by Edward Buttimore, a former administrator in the New Jersey Attorney General’s Office, Criminal Division and current retiree getting $66,953.16 annually sees three simple steps to solving the problems New Jersey has with its pension system:

1) Make 12 monthly pension installment payments rather than one lump sum pension payment, often at the end of the fiscal year.
2) Cap the rate of future revenue projections to a figure determined by an independent objective party.
3) Honor the pension payment obligations of Chapter 78, passed in 2010.

(1) is a gimmick, (2) is nonsensical as the governor would only pay people who are not independent objective parties, while (3) is unachievable since the whole idea here is that the state can not afford to make anything more than token contributions.

The solutions that Chrisite’s people are likely to come up with sometime this summer will be much more complicated so as to distract everyone with figures, especially figures that the state will be paying their experts to provide.  They will also have one goal in mind: to reduce the state’s contributions for retiree benefits.  I see a more complicated three steps:

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