Mix Ignorant Voters with a Broken System and you get the election results we got last week which changed nothing, chastised nobody, and were a disaster for real public pension reform in this nation.
In Oregon, Montana, New Hampshire, and San Diego candidates who proposed moving public employees into Defined Contribution plans were defeated. In New Jersey a feel-good public question upbraiding judges passed easily though it will have no significant effect on funding levels. But the height of irrelevance in reform might have occurred in Illinois where Public Pension Amendment, HJRCA 49 was voted down, 1,748,601 No Votes to $2,213,269 Yes votes.
This amendment would have required a supermajority (60%) to raise benefits for public employees anywhere in the state (as if anyone outside of Union County, NJ were raising benefits) though a supermajority was needed for it to pass which it didn’t get for reasons explained in an article in Pensions & Investments:
Illinois was one of two states along with Michigan where a constitutional amendment relating to pensions and benefits was rejected. Illinois, which the Pew Center on the States has said has the worst public pension funding of all states, saw a measure fail that would have required a three-fifths supermajority vote by the General Assembly, city councils and school districts to enhance any public employee pension benefits.
“I think some voters were just simply confused and didn’t know what the amendment was doing, and frankly, who could blame them,” said Diane Cohen, general counsel of the Liberty Justice Center, a public interest litigation center started by the Illinois Policy Institute, Chicago. “It wasn’t very informative, and it was simply fake reform.”
Although the simple majority to increase benefits will now remain in the state, which has a funded status of 45%, the Illinois Commission on Government Forecasting and Accountability a non-partisan legislative service agency, reports that benefit increases in 2011 accounted for only 1% of the increase in pension debt among Illinois’ five public pension systems, while 51.2% of debt was attributed to insufficient employer contributions.
“We don’t need the constitution to amend pension reform,” Ms. Cohen said. “We can move to defined contribution plans for public employees, stop the cost-of-living increases for retirees and raise the retirement age. There’s a lot that can be done short of an amendment.”
Yes a lot can be done but presenting these otiose ‘solutions’ to a confused electorate leaves us in the Same Old State.