New Jersey COLA Wars (4): Bridgegate Key to COLA Restoration

Five lawyers argued this week that cost-of-living-adjustments (COLAs) should be reinstated for New Jersey public retirees (individual youtubes below).

I now believe they will prevail, not necessarily because of the the strength of their position which existed when Judge Hurd upheld the COLA elimination in May, 2012, but because the specter of retribution has lifted.

When Jim McGreevey was governor it apparently was common knowledge among government insiders that he was gay and using his office to recruit boyfriends but us outsiders were not privy to that information. So in May, 2012 it may have been an open secret within New Jersey government circles that Chris Christie was a bully and if you crossed him he would get you.  That atmosphere now can’t possibly exist and these three judges don’t need to watch their backs if they cross the governor – there may now even be a Christie-backlash in their minds that could kick in even if the state had a case.  They don’t.

The debt limitation argument that Judge Hurd bought is absurd as, taken to its logical conclusion, it would allow the state to renege on any multi-year contract.  This new stratagem that COLAs are forfeitable because they are not part of the base benefit (though the 1997 law clearly defined lifetime health-benefits as the only exclusion to non-forfeitablity) is an even sillier argument, easily refutable by anyone so inclined, that nobody would take seriously unless they were bullied to do so.

Decide for yourself.  Here are the five lawyers who argued for COLA restoration:

Daniel Grossman
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.
Ira Mintz
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.
Chales Ouslander
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Kenneth Nowak
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David Fox
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25 responses to this post.

  1. Posted by truthnolie on January 31, 2014 at 1:04 am

    Thanks JB! –

    That noise everyone hears is the sound of Tough Love’s head venting like a pressure cooker whistle….hee hee hee

    Reply

    • Posted by Tough Love on January 31, 2014 at 1:23 am

      Reinstating the COLA’s is not the end-game issue.

      It’s what will happen when these Plans run out of assets, when pay-go arrives and when Taxpayers awaken to the financial “mugging” perpetrated upon them by the insatiably greedy Public Sector Unions/workers and our elected officials who sold the favorable votes granting these grossly excessive pensions & benefits in exchange for campaign contributions and election support.

      Reply

      • Posted by Anonymous on January 31, 2014 at 3:52 am

        There are 50 states of which NJ is one of the worst run. That begs the question why would TL live in NJ. Doesnt make much sense really, does it? Over and over again she trusts the politicians to make things right.

        Reply

      • Posted by Anonymous on January 31, 2014 at 10:34 am

        I paid into a pension fund the state forced me into for twenty five years. The state decided the plan was so well funded the employers would not have to pay the portion they were supposed to for over ten years. Then you say I’m greedy, and have a grossly excessive pension. When I was hired I was promised a paycheck and a pension. Now after completing my part of the bargain you say Oh it costs to much your greedy. It’s funny that you say the pension costs you to much when you have NOT been paying your part into it.

        Reply

        • Posted by Tough Love on January 31, 2014 at 1:21 pm

          If you accumulated all of YOUR contributions from the date made (or say midyear for each individual year) with the investment returns of a typical balanced portfolio to the date of your retirement, the accumulated sum is rarely sufficient to buy more than 10-20% of your extraordinarily generous promised pension.

          The Taxpayers are supposedly responsible for the balance.80-90%balance.

          Reply

          • Posted by Elaine on January 31, 2014 at 2:08 pm

            TL……am now very curious… why do you continue to live in NJ? It seems you have job portability since you’re able to post regularly all over the place. Regular office jobs make that hard. (Actually I think I recall you once saying you worked for yourself).

          • Posted by truthnolie on January 31, 2014 at 2:55 pm

            What Ms. Delusional forgets to mention is that public employees get hardly any Social Security due to the Windfall provision and must solely rely on their pensions.

            Also what she conveniently fails to address (not directly related but shows how she obfuscates the issues) is that public employees DON’T GET DISABILITY and must rely on accrued sick time to use for injuries/sickness, etc. This is why sick time is allowed to accrue…if not, then disability coverage will have to be offered to all. Towns were happy years ago to not have to take on disability coverage for police, fire, etc and instead were happy to let everyone build up sick time and use that instead with the idea that “you’re on your own” for off the job injuries & sickness. Towns made these deals thinking they were saving money but when payout time comes they find out they got screwed & they want to cry about how much and how unfair it is…..guess what ……..they chose and they lost.

            You takes your chances and you pays your money!

          • Posted by Anonymous on January 31, 2014 at 6:08 pm

            You look at this as it would be a cash balance plan it is not. A significant percentage of workers do not make the 10 year vesting option. Another significant portion dies prior to receiving a pension. Look the deficit doesn’t have to be paid all at once. For 20 years taxpayers received the “homestead rebate” while pension contributions were not made. But it’s not that bad really, the amount is about 47 billion, but it doesn’t have to be paid at once, but over 30 years is the normal term. That’s 1.75 B per year for 8.8 million residents, about $200 each, which would get written of federal tax anyway. I do agree however with TL that workers should pay more. When interest rates are low, you need to put more $ in to get the same payout. But the damage is already done, and I teach my children to always honor their commitments, the state, begrudgingly, will do the same.

          • Posted by Tough Love on January 31, 2014 at 6:33 pm

            truthnolie, what you fail to state is

            (1) that nationally, almost 75% of Public Sector workers are in fact covered by Social Security,
            (2) those impacted by the SS “Windfall Elimination Provision” are being prevented from an UNJUST windfall. They are NOT being penalized. You can read all about it on the SS Website here:
            http://www.ssa.gov/pubs/EN-05-10045.pdf
            (2) those not in SS don’t pay into into SS from their own net pay, and it is reasonable to assume that the share not pay by the employer is in fact received by the employee in the form of added wages (that would not have been added had the employer had to make that SS contribution on the employee’s behalf). Their failure to SAVE AND INVEST that combined (employer/employee) 0f 15% of pay does not translate into the Taxpayers paying for greater pensions because there is no SS…..as they have ALREADY received that the monetary value of the foregone SS benefits via greater periodic paychecks
            (3) For many workers with above-average Public Sector wages (especially police), SS is a lousy deal (from a return-on-investment perspective). In essence, many have benefited from NOT participating… as long as they saved that excess pay. It’s not something that should be made up for by the Taxpayers if not saved.
            (4) quoting… ” public employees DON’T GET DISABILITY “. Then why do we endlessly hear about the (often tax-free) “Disability” pensions granted so many workers (particularly Safety workers), often for the most minor issues (e.g., stapling his “trigger-finger”)… that would never get a Private Sector worker approved for Disability under Social Security?

            So who’s” delusional”?

      • Posted by Anonymous on January 31, 2014 at 11:19 am

        You forgot to mention all the money the state and local governments didn’t put in as they were required to over many years so these same wonderful taxpayers could be given rebates, smaller property tax increases locally etc and did not complain. Time to pay up with interest thank you, I put in my share..your turn.

        Reply

        • Not only the money the local governments didn’t put in year after year, let’s not forget the enormous amount Whitman borrowed (and never repaid). Then there’s the problem of people in power making sure their cronies get taken care of, to wit: Lt. Gov. Kim Guadagno and a quarter-million dollar double-dipping scheme involving her hiring Michael W. Donovan Jr. as “chief of law enforcement division” at a $87,500 annual salary. This, while collecting his $85,000 a year state pension as a retired investigator for the county prosecutor. Something stinks alright; but, it’s not your local police officer or fireman that protects you and your family.

          Reply

          • Posted by Tough Love on January 31, 2014 at 6:35 pm

            Whitman never “borrowed” a dime … educate yourself (and stop listening to your Union’s BS).

          • Your right, to borrow means you have every intention on paying it back. The correct statement is she took the money. That’s a well known fact that I believe you need to be educated on.

      • Posted by Rescue1NFD on January 31, 2014 at 5:18 pm

        I was a firefighter in Newark for 25 years paid into my pension for those of you that are not aware Police and firefighters do not get to collect social security this law was past back in the 1980s , and just to note I TOOK THE JOB BECAUSE OF JOB SECURITY AND THE PENSION ALSO THE LOVE FOR HELPING PEOPLE IN NEED. So to all of you people that feel like my pension is somehow a burden on your life or its why your taxes are so high hey dont blame me for that blame the politicians that give us the raises over time and if you dont think I earned every penny of my pension then just walk into any firehouse in Newark they will be more then happy to give you some gear and ride along but I dont think that will happen .

        Reply

  2. Posted by skip3house on January 31, 2014 at 10:48 am

    Change the target to eliminating retiree medical, and include the NJ action of returning Medicare deductions from Social Security.
    Why should any group be exempt from this?
    (I will say Medicare should be allowed to bargain for Part D Rx…..)

    Reply

    • Posted by Anonymous on January 31, 2014 at 6:25 pm

      As a teacher, I can tell you the average retirement age is about 62. Medicare kicks in at 65, so there is no real savings there. Especially when you consider that the local municipality will be paying the veteran teacher 50% more than a new teacher.

      Reply

      • Posted by Tough Love on January 31, 2014 at 8:58 pm

        Something for Taxpayers to think about………. Almost all studies of teacher “effectiveness” show that teacher effectiveness plateaus at 5-7 years with no material increment associated with greater years of service.

        So, perhaps step increases should end at 7 years, there being no incremental “educational value” justification for those additional steps.

        Reply

  3. Posted by Anonymous on January 31, 2014 at 6:13 pm

    Must be nice for Tough Love to write off his/her home office, car insurance, auto payment, entertainment expenses, mileage, cell phone, clothing, and meals. State workers get none of it. How about the matching 401k funds? And then of course there is flex time too. Maybe the state and federal govt should rein in these expenses, after all this is an “if I don’t get it” discussion…..

    Reply

    • Posted by Tough Love on January 31, 2014 at 6:38 pm

      I agree that they should be reigned in………….I don’t get any of them.

      As should be your grossly excessive pensions.

      Reply

  4. You could have addressed this issue without the homophobic crap about McGreevey, which is completely irrelevant. Sure seems like something you’re still thinking about when no one else cares anymore. You know what that means, right?

    Just the relecant facts, sir.

    Reply

  5. Posted by truthnolie on January 31, 2014 at 7:24 pm

    @ Tough (but not very bright) Love:

    Re:

    “(1) that nationally, almost 75% of Public Sector workers are in fact covered by Social Security”

    Once again, fuzzy logic…..WHO CARES about nationally??!!!….Any Public Employee in NEW JERSEY who will get a pension will get a miniscule social security payment due to the Windfall Provision.

    Funny…..but I don’t hear you offering or saying that your social security (which will be several times what any public sector employee will get) should be reduced because the Fed Govt. has a deficit ……you and people like you would go ballistic if you SS was cut to a fraction of what is expected. Why don’t renounce your SS now or in the future to aid the gov’t in becoming solvent???

    “(4) quoting… ” public employees DON’T GET DISABILITY “. Then why do we endlessly hear about the (often tax-free) “Disability” pensions granted so many workers (particularly Safety workers), often for the most minor issues (e.g., stapling his “trigger-finger”)”

    Fuzzier than fuzzy logic which further illustrates the lengths you go to obscure the issues by taking part of what I posted out of context….Now….read s-l-o-w-l-y:

    Yes there are Disability Pensions which are FUNDED BY THE INDIVIDUAL PENSION SYSTEMS!……You grab at some headline making frauds (which need to be squashed) but these slugs are getting payouts from the system FOR ON THE JOB (ALLEGED) CAREER ENDING INJURIES and NOT from Disability Insurance.

    You either purposely ignore (or are too blinded by your ignorance) to understand that what I referred to was a PE getting injured or sick OFF THE JOB and being out several weeks or months (think broken ankle, arm,etc or heart attack, appendix out, etc) ……in such a cases no worker gets DI but must use accrued sick time they have banked to get through the recovery period until return to work.

    Stop changing up the issues or rearranging them to make sense in your convoluted head.

    Reply

    • Posted by Tough Love on January 31, 2014 at 9:33 pm

      quoting truthnolie………”Once again, fuzzy logic…..WHO CARES about nationally??!!!….Any Public Employee in NEW JERSEY who will get a pension will get a miniscule social security payment due to the Windfall Provision. ”

      So, did you not read #2 in my prior comment to you….or just choose to ignore it because it proves you wrong ? It’s not ME saying that the “purpose” of the appropriately-named SS provision (the “Windfall Elimination Provision) is to PREVENT an UNJUST “windfall”, it’s the SSA saying it.

      Here’s my #2 again (pasted from above):

      (2) those impacted by the SS “Windfall Elimination Provision” are being prevented from an UNJUST windfall. They are NOT being penalized. You can read all about it on the SS Website here:
      http://www.ssa.gov/pubs/EN-05-10045.pdf
      ———————————————–

      quoting truthnolie…”Yes there are Disability Pensions which are FUNDED BY THE INDIVIDUAL PENSION SYSTEMS!……You grab at some headline making frauds (which need to be squashed) but these slugs are getting payouts from the system FOR ON THE JOB (ALLEGED) CAREER ENDING INJURIES and NOT from Disability Insurance. ”

      The Disability “fraud” goes far beyond my one egregious example. How aboiut the “disabled” Police Officer videotaped on a recent reality show wresting people to the ground? And, while I know it’s NY, but 1-2 months ago they announced a decades-long “Disability” fraud by NYC Police, and a few years ago by Metro North. It’s endemic….in some Cities it even has a name (for firefighters) called “chief’s disease”). The rules TO BE APPROVED for (and TO CONTINUE receiving) a Disability pension are FAR to lax. ANNUAL Medical re-certification of disablement (by an independent physician-panel …NOT associated in any way with your Union). And since it’s supposed to be a pension because you are “disabled” (and shouldn’t be able to work), that pension should be reduced by earned income…. from ANY source. Taxpayers are the suckers in the current arrangement.

      And what the heck does…”FUNDED BY THE INDIVIDUAL PENSION SYSTEMS” mean? Do you think we’re stupid ? It’s funded by the TAXPAYERS ….just like EVERYTHING else you get.

      Reply

  6. Posted by MJ on February 4, 2014 at 7:45 am

    The problem is as it has been for years. Yes the publics paid in a little, yes you worked your 25-30 years, yes you were promised….but the problem is that through all of those years, the benefits were so overly generous and out of touch with reality that there is no possible way to fund unless most other services were cut or eliminated. Raise taxes??? WE already have the highest real estate taxes in the country and NJ is ranked last for job growth or business expansion and poor economy. The publics should have been screaming 20 years ago to their unions who where supposed to look out for them. Investments were made and didn’t work out, so in the real world you move on. It is much crueler to the publics to keep the shell game going as opposed to making significant reforms so that they are not screwed half way through their retirements and still have time to make adjustment if needed. The math really isn’t that difficult to understand. The money is just not there.

    Reply

  7. Posted by George on February 7, 2014 at 2:21 pm

    “The debt limitation argument that Judge Hurd bought is absurd as, taken to its logical conclusion, it would allow the state to renege on any multi-year contract.”

    It is not an absurd argument. “States” are under no obligation to conform to any agreements they make. New Jersey is not a “State”, it is more of a province or maybe the French term department.would be better.

    At any rate the basic idea is that the legislature has the option of making or not making any payment for any arbitrary or capricious reason it likes. State courts can condemn the legislature but they cannot issue a check. Now one level up is the federal government that could simply take over the state in part or in full, just like the feds repeatedly did in the South for various reasons, assuming the federal government felt strongly enough about it…

    Reply

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