Defining what’s “legal” for Colorado retirees and Tom Riker

Specifically we conclude that plaintiffs have a contractual right, but that the court must still determine whether any impairment of the right is substantial and, if so, whether the reduction was reasonable and necessary to serve a significant and legitimate public purpose.

So reads a line from the October 11, 2012 Colorado Appeals Court ruling that reversed a summary judgment and remanded the Colorado Cost-of-Living-Adjustment (COLA) theft case to the district court for further proceedings and, for me,  punctuated the difference between the public and private definition of legal and what you can get away with when you are defining the word.   For example, take the case of Tom Riker.

Tom Riker was the 8th pick in the 1972 NBA draft taken by the New York Knicks at a time when I was at the peak of my sports obsession* who, as his Wikipedia entry indicates, flopped.  He comes to mind because the Knicks gave him a ridiculously long contract since they saw him as a blue chip prospect in line to replace Willis Reed.  Notwithstanding any slip-ups by his lawyer(s) all of us would expect that he received full compensation even years (decades) after he was providing no service to the Knicks and their fans because that’s what was in  his private-sector contract.

Now fast forward to Colorado 2010 where the state cut back COLAs and brought on this morass of litigation  Would the Knicks be able to do the same thing to Tom Riker (assuming they’re still paying him)?  What if they wanted to spend that money for other purposes that they considered more significant and legitimate and it was reasonable and necessary to reduce his payments?

Could the Knicks get away with that?**  And if they did would anyone ever sign another contract with them?  Then why should Colorado?



* In a forensics class at RC High I was supposed to come up with five topics from which the instructor would choose one for me to research and give a brief speech on.  My topics were baseball, football, basketball, hockey and roller derby so, as you might gather, sports (watching) was my life.  I wound up giving, as I recall it, a rather fine presentation on roller derby.

** Maybe if they were teetering on the edge of bankruptcy and wanted to negotiate him down for his own good as I feel Colorado and all the other states who have stolen COLAs should have done.  However states can’t file for bankruptcy and most politicians view their election as a mandate to lead, however blunderingly, rather than follow, even if they don’t have a clue where they’re heading or might end up.

49 responses to this post.

  1. Posted by Tough Love on October 14, 2012 at 1:01 am

    John, there is a BIG BIG difference between the Riker/Knicks contract and the Colorado Pension “contract” with it’s workers. In the former the Knicks were spending THEIR MONEY. If they screwed up (as apparently they did) it was THEY
    who paid the piper.

    In the latter case, the Politician-“negotiators” were spending the Taxpayers’ money
    (not theirs). If fact (and they knew it very well), they MORE they “spent” (in pension promises) the more that came back to benefit THEM in the form of campaign contributions and election support.

    This collusive arrangement justifies reneging on that portion of promised pensions that
    would like not have been granted in the absence of that collusion. I’d say it’s AT LEAST 50% of current pension promises.


    • Though I’d argue that the Riker pick was made by whoever replaced Eddie Donovan (couldn’t find who that was though I see John Andariese retired) so it wasn’t that guy’s money either. He was running the club at the time as were those politicians in Colorado and other states who made their own bad deals – in part because they were lied to by their actuaries who fed them what they wanted to hear.


      • Can’t be lied to about big stuff if you have common sense and 8th grade arithmetic. And, choose a true actuary
        As said before, public workers needed their retirement fund on their pay stubs, paid as earned (401(K) type).


        • Posted by Tough Love on October 14, 2012 at 1:03 pm

          And THAT’s where we need to get to now (DC Plans)…. and for current, not just new employees. Think it can’t happen ? Well it may soon be a ballot initiative in Los Angeles. See below …

          “Richard Riordan, Los Angeles’ millionaire former mayor, plunged deeper into the fray over public pensions Friday, announcing he is finalizing language for a ballot initiative that would move newly hired workers into 401(k)-style plans and freeze retirement benefits for existing workers.”


          • Posted by Al Moncrief on October 14, 2012 at 9:01 pm

            Hey TL, if there is any state in the nation that will not allow breach of public pension contracts it’s California. Have you looked at the case law out there? It is extremely favorable to members of public pensions. That’s why the CA Legislature recently adopted PROSPECTIVE pension reforms, they whacked benefits for those who are not yet hired. Look for the San Jose reforms to fall first.

            TL, get on the prospective pension reform bandwagon, it’s much easier to adopt legal pension reform.


          • Posted by Tough Love on October 14, 2012 at 9:09 pm

            Al, In CA, a ballot initiative changes the State constitution .. and if successful, the freezing the pensions of current workers would clearly be legal.

            Right now ……. while the legality of such a freeze is an open question, it would certainly take a LONG time to implement due to legal challenges.

            That’s why the ballot initiative is such a great idea (for Taxpayers)..

          • Posted by Tough Love on October 14, 2012 at 9:15 pm

            Al, Whoops, I didn’t address your last sentence.

            Mr. Riordan’s ballot initiative certainly sounds like it’s “prospective” only. As long as it stops further pension growth for ALL current workers it’s a major major deal.

            In my opinion, the Public Sector retirees should overwhelmingly vote FOR IT, because w/o that change, the financial mess will likely one day require cuts in the pensions of those already retired. Stopping further growth in these grossly excessive pensions for current workers may create the “breathing room” needed to prevent that.

          • Posted by Al Moncrief on October 14, 2012 at 11:28 pm

            Hey TL, it sounds like the Riordan plan would test the argument that Prof. Amy Monahan has been making, that accrued pension benefits are sacrosanct, but “future accruals” can be taken. Who knows? That might actually fly and be considered “prospective.” But, I seem to recall some CA case law that even the “rate of accrual” is protected as of date of hire, not certain. Al

          • “Best Answer


            …..An example would be if a woman was driving in Illinois and the speed limit was 50mph. So she drove exactly 50mph. The passing police officer checked her speed and insured that she was going the good speed. The next day, Cpngress decided to lower the speed limit to 40mph. That afternoon, that woman was driving 40mph. The police officer checked her speed and insured that she was going the good speed. THEN he remembered that she was driving 50mph yesterday and pulled her over. He would try and give her a ticket for speeding. Get it? You’re getting punished for a law after the fact.

            It is meant to prevent a law being passed to make a past action illegal. Some countries will discover an action they do not like, but is not against the law. So they pass the law to make that action illegal and then apply it to people that broke that law before it was passed……” per somewhere in google

            Seems not to apply for pensions……

    • Posted by Al Moncrief on October 14, 2012 at 8:56 pm

      Hi TL, this is interesting, I listened to the tape of the 1993 legislative hearing where the Colorado Legislature adopted the “automatic” COLA and struck the “ad hoc” language (allowing the Legislature to alter the contract). At this hearing the pension administrators and lawmakers considered the new automatic COLA to be a good deal for the taxpayers. They thought inflation would average about 3.5% over the long haul. It wasn’t a case of (Colorado’s extremely weak public sector) union members pushing for more benefits. It was fiscally conservative legislators trying to get a good deal for taxpayers. Strange isn’t it?

      Read excerpts from the hearing at


      • Posted by Tough Love on October 14, 2012 at 9:19 pm

        The taxpayers certainly should have challenged such contorted logic …. as THEY rarely get ANY post-retirement COLA increases.

        But we all know that the politicians never represent the taxpayers …. only those who bribe them with campaign contributions and election support.


  2. What happened to my old memory that present legislators cannot obligate future actions…….?


    • Posted by Anonymous on October 14, 2012 at 10:22 am

      That rule does NOT apply if the law provides a contractual right. Both federal and state law support this. That’s why legislatures have to be careful and make policies, not legal contracts.


      • Thanks,
        Change our Constitutions to allow future Legislatures to do as they please with these contracts.
        Sure would make interesting elections, and discourage more lending. Maybe even a Third Party….


        • Posted by Al Moncrief on October 14, 2012 at 9:06 pm

          Hi Skip, the US Constitution proscribes retroactive, “ex post facto” laws. Also, the US Constitution prohibits states from the impairment of contracts. So, even state constitutional amendments could not be applied retroactively. Now, prospective pension reform is a legal, available option. Al


          • Posted by Tough Love on October 14, 2012 at 9:21 pm

            Wong and wrong.

            E.G., “ex post facto” laws only apply to CRIMINAL cases.

          • Posted by Al Moncrief on October 15, 2012 at 12:31 pm

            Hey TL, if you think there’s any chance that the taking of a COLA could be breach of contract why support it? Breaking these contracts after people have put in 30 years, and trusted their employers is certainly immoral and most likely illegal. I think you’re coming around . . . and will soon exclusively embrace prospective pension reform. Al

          • Posted by Tough Love on October 15, 2012 at 1:16 pm

            It’s simple, the COLA provision is but one of the many element of public sector Plans that make them WAY WAY more generous (and hence more costly) than the Plans provided your Private Sector counterparts. With Public Sector workers earning no less in “cash pay”, the these much more generous pensions (and let’s not forget the much more generous “benefits” such as retiree healthcare as well) are neither justifiable nor necessary to attract and retain a qualified.

            Not being necessary or justifiable, when combine with the Public Sector Union/politician collusion (and disregard for the Taxpayers who pay for 80-90% of total Plan costs) that resulted in the granting of such excessive pensions demands we eliminate the COLAs …. and more.

        • Posted by Al Moncrief on October 14, 2012 at 11:46 pm

          Hi TL, US Constitution, Article I, Section 10: “No state shall . . . pass any . . . Ex Post Facto law or Law impairing the Obligation of Contracts.”

          Amendment XIV, Section I: “nor shall any state deprive any person of life, liberty, or PROPERTY, without due process of law . . .”

          Retroactively changing the terms of a written, statutory contract is unconstitutional, no?



          • Posted by Tough Love on October 15, 2012 at 12:22 am

            The words “Ex Post Facto law”” and “Law impairing the Obligation of Contracts.” are not meant to be taken together but as 2 distinct statements.

            Ex Post Facto laws apply only to criminal cases.

            I leave it to experts on the contract law issue …… there is certainly enough disagreement among them (the experts) for me to step aside.

          • Posted by briandin on October 16, 2012 at 2:30 pm

            I recommend that any would-be constitutional scholar (state or federal) take some time to compare the “Strict Scrutiny” test – which is applied to governmental actions against a member of a protected class or affecting a fundamental human right vs the “rational basis” test – which allows the state to act in furtherance of an important governmental interest so long as the means chose have a rational basis.

            Does anyone question the need to act on pension and benefits reform? The fact is, even if the contract is impaired, the government retains the right to alter its promises if it passes the rational basis test. I posted this here many months ago when the COLA issue and challenge were first brought up, but the union hacks were so sure they were right.

            Too funny.

      • Posted by muni-man on October 15, 2012 at 8:21 am

        Which is why NJ’s UNCOLA is gonna stand – pension and other benefit rights aren’t contractual in NJ per constitutional settled law. It’s also why NJ can unilaterally do what it wants insofar as changing (i.e. reducing/eliminating) benefits going forward w/o screwing around with the unions if they want to – and they didn’t screw around with the unions on the UNCOLA or medical benefits. They did it surgically, much to the unions’ dismay. NJ definitely got this one right, unlike many other states that gave away the farm and will ultimately have to rely on snotty economics to do the heavy legal lifting for them on benefit rollbacks. And economics WILL do in these over-the-top plans, notwithstanding all the legal malarkey that precedes their demise. It’s just a matter of time that’s all.


  3. Posted by Anonymous on October 14, 2012 at 3:02 pm

    Newsflash! TL provides new slogan for government employees and retirees. “I’m rich, B*t*h!”


  4. At the end of the day the COLA freezes will be rejected by the courts. Better to honor promises to current employees and negotiate a gradual sunset of the defined benefit pensions.


  5. Posted by eatingdogfood on October 15, 2012 at 3:23 pm

    Bankruptcy; Baby! Thank You Democrats And Your Union Bosses!


    • Do not forget Don DiFrancesco’s increase of ~9% for pensions just before 2001 election.
      Both parties tried their darndest to……


      • Posted by Tough Love on October 15, 2012 at 4:08 pm

        I remember when I heard of the increase while driving. If I recall, for police it went from 60% of final pay at 25 years to 65% at 25 years.

        Knowing pension math quite well (and how ridiculously generous, and hence costly the Plans ALREADY were), I mumbled a few choice words at what as*holes our politicians were.


        • Posted by Anonymous on October 15, 2012 at 6:00 pm

          TL The police did not get any raise in pension benifts under the DiFrancesco enhancements, no, that was everyone else, it has been 65% of final salary at 25 yrs from decades ago until 2010 when it was changed. The NJ PFRS is doing much better than any other state run pension fund. In light of that and the fact the police officers do not(some do but the vast majority do not) receive SS benifits, obviously the COLA law hurts us more than anyone else. I always felt that we receive pensions too early, my suggestion was no pensions until 55. You can retire earlier but can’t collect until then. I also thought that not getting a COLA for 5 years after retirement was also fair. The old law was two. Especially for rank and file, law enforcement is truly a young man’s game. Not really fair to have a guy retire with a 60K pension at age 60 let’s say, and have him never get any adjustment for inflation. With no SS, he will be still be receiving the approx. 40K after taxes well into his 80’s perhaps. For a newcomer, they have the option to leave at 20yrs and begin a new career, the 60 yr old does not.


          • Posted by Tough Love on October 15, 2012 at 7:20 pm

            I recall what I said. I’m sure John can clarify if the 2001 changes applied to Police officers.

            As to your comments on justifying post-retirement COLAs, all I can ask is WHY, when almost nobody (OK, certainly less than 5%) in Private sector Plans gets Post-retirement COLAs is it SO ABSOLUTELY IMPERATIVE than Public Sector workers get them ?

            Earning no less in “cash pay” (per the US Gov’t BLS), why are public Sector workers deserving of a better deal … greater pensions and better benefits …. than the Taxpayers whose contributions (and the investment earnings thereon) pay for 80-90% of total Plan costs?

            If you believe they are so entitled, explain why.

  6. Posted by Richard on October 15, 2012 at 10:09 pm

    They are entitled since that was the contract. I have no problem with prospective pension reform. It is pulling the rug out from under people who have already retired that I have a problem with.

    “I am changing the agreement. Pray I do not change it again.”
    Identify that quote to win the prize.


    • Posted by muni-man on October 16, 2012 at 9:03 am

      Retirement benefits are NOT contractual – so sayeth the NJSC in Spina. It’s settled law – get over it. The legislature can change benefits (up/down/eliminate) as it sees fit going forward w/o any union interference whatsoever. Haven’t seen any judges recently filing suit over the UNCOLA have you? Ever wonder why?


    • Posted by Tough Love on October 16, 2012 at 10:19 am

      Even IF it was a contract, was that “contract” an arms length negotiation:
      (a) with one party to the negotiation appropriately looking out for Taxpayer interests,
      (b) not unduly influenced by an “understanding” that Union campaign contributions and election support are IN EXCHANGE FOR favorable votes on pensions ?

      Taxpayers must not be bound to pay for contracts so “negotiated”.


      • Posted by muni-man on October 16, 2012 at 10:40 am

        Agreed, what they get, they get via slimy tactics that are anything but arms-length and totally one-sided against TP’s. But NJ’s on terra firma because publics have no constitutionally-protected, contractual rights to retirement benefits. If the UNCOLA was ‘illegal’, those pillars of rectitude (judges) would have filed suit long ago.


  7. Posted by Anonymous on October 16, 2012 at 11:43 am

    at TL: I am seperating police from other public employees in regards to COLA because the police/fire are ineligible for SS benifits(which does have a COLA), for us the pension is roughly equal to a private sector pension and social security. A small COLA(remember the old formula was 60% of the CPI anyway) for employees who do not get SS would not, in my opinion, be unwarranted. Most of us are not the greedy pigs that some on this post would beleive we all are. Unfortunately, there are some. Perhaps they ruin it for everyone else I guess, but that is in any line of work. As John Adams once said: I care not for malicious tongues on either side.


    • Posted by Tough Love on October 16, 2012 at 1:04 pm

      Not that you are doing so, but when Public Sector workers say that they are “not eligible for SS” the connotation is that that’s a bad thing. In reality SS is (for all but the lower paid, and those with a non-working spouse who will collect 50% of the spouse’s benefit w/o additional contributions) a lousy financial deal, as you get back just about what you paid in with little if any investment earnings. This would especially be true for Police Officers as they are higher paid.

      The upshot of such workers not being in SS and therefore not contributing the 6.4% of pay into it is that they should have been saving and investing that on there own throughout their careers. It is therefore not something that taxpayers should make up as part of their retirement needs.

      While I agree that maintenance of purchasing power in retirement (as is accomplished via COLAs) is very important, my point has been that it is NO MORE IMPORTANT for Public Sector workers than it is for Private Sector workers, and VERY VERY few private sector Plans include COLAs. With (a) Public Sector workers earning no less than their Private sector counterparts (per the US Gov’t BLS) and (b) with 80-90% of total Public Sector Plan costs paid for by Taxpayer contributions (and the investment earning thereon), why should taxpayers pay for a benefit for you (COLAs) that they rarely get ? If you want something “extra” shouldn’t YOU pay for it ?

      What Private Sector Taxpayers SHOULD provide is a contribution towards Public Sector retirements EQUAL TO (as a % of cash pay) that which they get from their employers. Right now, to fully fund a public Sector worker’s pension over his working career, Taxpayer contributions would need to be 5-10 times greater than what THEY typically get. Is that fair ?

      I know you don’t want to give up what you have been promised. The main fault lies with the politicians who promised you too much (in exchange for Union campaign contributions and election support) and thought the taxpayers would blindly go along.

      Well, we can afford it, and fairness dictates significant reform.


  8. Posted by Anonymous on October 16, 2012 at 1:51 pm

    @TL: Lets also not forget that the town doesn’t have to pay the employer part of my SS, Nor do they offer a match on my 457 plan(which i contribute a fair amount to-401k version for publics), nor have they been paying the required amount into my pension for years(in some cases getting a full holiday) I do pay a full 10% into my pension. As I said earlier, I would gladly delay my pension for a few years when I can still work and hopefully be healthy, in exchange for a modest COLA increase, I would even pay 15% of my salary for that benifit. However, for the average guy like me these choices were not even considered. Instead it was more important to portray me and my profession as leeches at the public trough. Can i ask you, would you encourage your son or daughter to become a public employee in NJ now? Would you spend $200,000 on education to be a teacher with the rules going forward? Minimal raises every year for your whole career, mandatory enrollment in a pension fund that you have absolutely no control over and is not guarenteed. Doesn’t sound to appealing if, and that’s a big IF of course, the economy starts rolling again. Anyway, I think more gets done when both sides are open to comprimise, (as you say offer us the option to pay for the COLA), however, it is far more easy to name call-Not you- but others on this site and generalize. Ever since we broke from England(and prior of course)- people have not been overly fond of the government. To quote another founding father Alexander Hamilton: If all men were angels we would not need a government. Well, most of the folks that aren’t angels are in fact the politicians as opposed to your rank and file employees. Yet they are continually portrayed in a severe negative light.


    • Posted by Tough Love on October 16, 2012 at 2:53 pm

      Lets do a reasonable comparison of employer paid-for Private Sector retirement benefits vs Taxpayer paid-for Public Sector benefits.

      Private Sector (and we’re talking about the Middle Class masses not CEOs with big stock options):
      (a) usually 3% into a 401K
      (b) +6.4% employer SS contribution

      Public Sector:
      True total Plan cost (with appropriate accounting as REQUIRED by the gov’t for Private Sector Plans) if funded over the working career of the employee …. a level annual 30-35% of pay for mics. workers and 50-60% for safety workers. Deduct the employee contribution and perhaps its 25-30% for misc workers and 40-50% for safety workers.

      Get the picture ? Public Sector workers earn no less in cash pay (although a direct comparison for Police Officers is not possible) yet Taxpayers pay multiples MORE toward your pensions than what our employers pay toward ours. Now granted, many States (incl. NJ … one of the worst offenders) are not actually contributing their full “ARCS”. While that’s certainly a very big issue, unless the workers agree to pick up a piece of it, the cost share split stays the same. We (the Taxpayers) are (call it ) “allocated” 3-5 times more to pay toward your pensions than our employers pay towards ours.

      Now lesser-thinking Public Sector workers like to say .. well that’s your problem (i.e., you employers are screwing you) and it shouldn’t mean we should get “less”. But from OUR prospective, it’s not US getting “less”, it’s YOU getting “more”, on our dime.

      There is nothing wrong with becoming a public employee in NJ now. But all earnings need to be reflected in the year earned (which is automatically done in DC Plans). The problem with DB Plans in the Public Sector is 3-fold:
      (a) the politicians who are primarily interested in their own political survival trade votes for money and election support and can’t be trusted, and
      (b) It’s too easy to hide the true costs (deferring them to future years) in DB Plans, and this results in approving more than Taxpayers can really afford.
      (c) the investment and mortality risks are all on the Taxpayers. Private sector investors must assume such risks so why shouldn’t Public Sector workers ?

      Wise younger Public Sector workers should demand the reforms I support … as all their contributions are (or will be) going out the door to pay excessive pensions to current (and soon-to-be) retirees ….. and Taxpayers won’t be lining up to top-up that shortfall.

      Lastly, you said …”offer us the option to pay for the COLA”. Great idea and while you seem more amenable to paying for such extras, most of you colleagues want Taxpayers to pay for everything. By the way, even if you paid for it, it would still be quite advantageous because you would be paying for it with Pre-tax dollars. I’m not sure you are aware of how costly COLA is. For the ages at which Public Sector workers typically retire, a 3% annual COLA increases the cost (of an otherwise identical Plan) by about 1/3 … 10-15% of pay ! Costly features such as COLA, very early full retirement ages, heavily subsidized early retirements, liberal definitions of “pensionable compensation” (with possible inclusion of overtime, allowances, sick/vacation payout), end of career promotions and raises to “spike” salaries and hence pensions, very liberal definitions of disability …. as well as high per-year-of-service formula factors …… all combine to create the VERYcostly Public Sector pensions we have in NJ and elsewhere.


  9. Posted by briandin on October 16, 2012 at 2:22 pm

    “punctuated the difference between the public and private definition of legal and what you can get away with when you are defining the word.”

    I find it amusing that anyone could compare promises (enshrined in a contract) made by a private party and those made by a public body, as you are doing here. A private party can go to a bankruptcy judge and have ANY unperformed promise completely vitiated (torn up and disregarded), leaving the person wanting to enforce the promise with nothing but an empty bag. All in the name of giving the promisor a “fresh start”.

    The public workers and their union bosses hide behind the “impairment of contract” clause and claim that given the government’s unbridled power to tax, the action is a constitutional violation since by definition the herd can always be bled enough to feed the next generation of public sector ticks. All the while presuming that the next generation of “hosts” will flock into the jurisdiction to happily allow themselves to be tapped (or “pay their fair share” if you will).

    As a patent lawyer with more than a passing interest in matters of constitutional law, I find the result in the Colorado case to be not only the expected one (govt action is subject not to strict scrutiny in this case but only to the “rational basis” test), but also the fair and correct outcome. Why? It represents symmetry against what would happen to a similar pension promise in the private sector – where pension recipients are lucky to get pennies on the dollar. Let alone what social security will ultiimately pay to the retirees of tomorrow.

    I also find it ironic that the party of Robin Hood finds itself as the advocate of a Sheriff of Nottingham strategy (bleeding the citizens dry to pay for the lavish lifestyle of the so-called public servants – free, perpetual blue cross healthcare and pensions for all).


    • Posted by Tough Love on October 16, 2012 at 3:17 pm

      Well, not quite ANY …. don’t try it with a school loan or childcare payments.


    • Posted by Tough Love on October 16, 2012 at 3:19 pm

      Quoting …”..the herd can always be bled enough to feed the next generation of public sector ticks. All the while presuming that the next generation of “hosts” will flock into the jurisdiction to happily allow themselves to be tapped (or “pay their fair share” if you will).”

      Bravo … that has to be a classic !


      • Posted by Anonymous on October 16, 2012 at 3:55 pm

        @tl. I take back the exemption from name calling. “Public sector ticks…” Nice. Do you feel that way when you read stories of cops cracking a case and locking up a child molester? I know most of my best friends are private sector employees. I wish them all the best and for the most part they wish the same for me. It amazes me why this resorts to hatred and name calling. A lot of my friends work for Merck and I don’t hold them responsible for the high price of Rx drugs. Nor do i begrudge my contractor friends who write of all the business expenses they do(like dinner and sports tickets for clients). Publics get none of that. Nor is overtime, sick time included on pension payouts.


        • Posted by Tough Love on October 16, 2012 at 5:07 pm

          It’s not about name-calling, hatred or insults.

          It’s about stopping and reversing the Public Sector worker “I’m entitled to MORE” entitlement mentality.


      • Posted by Brian on October 16, 2012 at 7:29 pm

        I will take ownership of the analogy and stand by it. It was not motivated by hatred, just self preservation. In the same way a slave resents the harsh treatment at the hand of a cruel overseer, i resent having to work twice as long and twice as hard to honor promises which should never have been made in the first place. Expect the blowback to get worse when Atlas shrugs.


  10. Posted by Captain Argentina on October 16, 2012 at 8:18 pm

    Enforcing contracts on governments is a historic problem. When Supreme Court Justice Roberts called Obamacare a tax he was right. Any time the gov wants to screw you it can call it a tax. So at the extreme the unnegotiated change in the contract could be construed as a tax. Or a tax that targeted it could be created.

    Ultimately governments have used the power to debase currencies (gas goes from $1 to $5 a gallon), the power to tax, and the power to unilaterally alter contracts because they enforce contracts to avoid what others considered their obligations.

    Here is an interesting example. During its financial crisis Argentina unilaterally reneged on payment of what I believe is US$ denominated Argentine government bonds. What could investors do? Nothing, the Argentine government did it, and the courts signed off on it. But guess what. Ghana is in Africa not Argentina so when the honorary flagship of the Argentine Navy showed up (it is not clear how it ended up in Ghana, but that’s another story) the Ghanaian seized it for the creditors.


  11. Posted by richard on October 16, 2012 at 11:57 pm

    Darth Vader: I am altering the deal. Pray I don’t alter it any further.


  12. Posted by Bill Cord on October 25, 2014 at 1:12 pm

    It was nice to see Tom Riker is remembered by people. He was part of three great South Carolina basketball teams from 1969 to 1972.


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