In June, 2011 New Jersey made some modest reforms to the state’s pension system and also took away cost-of-living-adjustments (COLAs) on payouts. At the time:
COLAs will come back if the judicial system in this state works in any responsible manner (translation: 50/50 chance) essentially gutting those 2011 reforms and yet, as we found out earlier this afternoon, more needs to be done:
For those who could not make it through the full video:
- Nothing about what the new pension reforms will be
- $52 billion in unfunded pension liabilities admitted to even after the 2011 reforms in New Jersey
- Detroit is irresponsible
- California politicians: “unacceptable conduct by people who like to call themselves leaders.”
The state of New Jersey is responsible (so to speak) for about 60% of the liabilities of the plans (their own employees plus teachers and judges) while localities make their mini-contributions for their own employees including local police and fire representing the other 40%. Since the state has consistently under-contributed more than the localities the assets break down about 50/50 between state and local.
The New Jersey plans are being bankrupted yet a governor making 50% of an already understated ARC for plans that are actually 30% funded struts it as an accomplishment and, as to the pension payment, a Wall Street Journal story claims:
The pension payment was slated to be $2.4 billion under a state law Mr. Christie passed after tough negotiations with Democrats in 2011. The law required the state’s obligation to increase annually for seven years as a giveback to state workers, who would pay more into their benefits.
The administration’s revised amount of $2.25 billion reflected the recommendation of state actuaries, according to Mr. Christie’s advisers.
If so, shame on them all: the advisers, the actuaries, and the Chrisites.