Christie’s Incongruity

One of the problems with lying is that you pretty much have to stick to that lie even when it would be more convenient in another circumstance had you not lied.

So it is with New Jersey Governor Chris Christie claiming that he is making the “pension payment that takes care of all of the current employees”.

That pension payment comes to $681 million this year based on the July 1, 2013 valuation of the plans but if you look at the profile of those current employees that Christie claims to be covering:

The state has responsibility for paying for all their employees plus all the teachers and judges. Pulling off July 1, 2013 valuation data into a spreadsheet shows that we are dealing with 244,993 employees making salaries of $16,474,383,118 which translates to $2,779 per employee annually or 4.13% of salary.  For state employees in PERS it comes to only $1,653 annually or 2.82% of pay.

How can Christie claim that pension benefits New Jersey is providing are excessive when the purported cost of those benefits is about what some employees pay in union dues?

The truth is that the real cost is much higher and has been artificially reduced to comply with New Jersey’s ability-to-pay requirements.  If Christie wants to claim that benefits are overly generous and need to be cut he must first back off the lies of convenience that everyone in New Jersey has subscribed to for decades.

33 responses to this post.

  1. Posted by Tough Love on August 12, 2014 at 5:04 pm

    I agree that Christie should back off the lies, and doing so would actually HELP his call for benefit reductions if he clarified (to Taxpayers) the true VERY HIGH annual cost of NJ’s Public Sector pensions.

    However, your above statement … “How can Christie claim that pension benefits New Jersey is providing are excessive when the purported cost of those benefits is about what some employees pay in union dues?” …. is misleading.

    What the State is actually “contributing” is a VERY different issue than the “true cost” of the annual benefit accruals (using appropriate assumptions), and I feel VERY comfortable stating that such “true cost” is so far above (ROUTINELY 3x-4x greater) the employer-paid cost of pensions granted comparable Private Sector workers, that there is no reasonable conclusion OTHER THAN that NJ’s Public Sector pension Plans are grossly excessive.

    Unless the Public Sector pension BENEFIT PROMISES associated with the unpaid share of the “true cost” are erased, they remain an obligation of the Taxpayers ….. hence the grossly excessive pensions, regardless of the State’s actual annual contribution.

    And I advocated for exactly such “erasure” because there is simply ZERO justification for such grossly excessive pensions ………. granted only because of the Public Sector Unions BUYING of the votes necessary to grant them via campaign contributions and election support.

    Taxpayers should refuse to remain the sucker in this equation.


  2. Posted by Anonymous on August 12, 2014 at 5:15 pm

    Now I can definitely see how TL agrees with 75 percent of what John says and how he agrees with 3/4 of what she says! NOT!!!!!! She should back off the lies herself, maybe she can in attending a support group!


    • Posted by Tough Love on August 12, 2014 at 5:30 pm

      While it’s difficult to distinguish you form the many other (generally Public Sector worker) commentators who comment under “Anonymous”, as I look back at what appear to be your comments, I can find no actual assertion of facts whatsoever, simply complaints about “facts” (and yes sometimes opinions) put forth by others, and of course the litany of immature insults.

      Unfortunately, WAY too many of those who “serve” the Public are of your questionable intelligence and mentality. When (not if) the Sh** hits the fan in NJ, it would be so wonderful if the most unproductive (of which I suspect you are one) would be the first to go rather than eager youngsters with little seniority.


  3. Posted by Anonymous on August 12, 2014 at 5:18 pm

    We are all wasting our time here, only way things will change is if we dont forgot in November!


  4. Posted by George on August 12, 2014 at 8:40 pm

    A bit of a conspiracy theory but in Rhode Island they appear to have made headway on the pension and benefits issue. They did this by first having a bankruptcy of their tiniest town, Central Falls. Central Falls kind of woke people up to what could happen. Then they appear to have made some real reforms. Eventually I think I read that the state bailed the Central Falls police pension out, which is why you want this to happen in a NJ podunk not Newark.

    So maybe engineering a bankruptcy in some NJ podunk would wake people up earlier rather than later.

    I am not sure what you want Christy to do? It’s not like a state level bankruptcy has happened this side of 1900. I dont know that a municipal bankruptcy in NJ has ever occurred. It is hard to make people believe. Maybe Atlantic City should declare bankruptcy?


  5. Posted by George on August 12, 2014 at 8:56 pm

    In other news, NJ tobacco bonds look set for a default:

    How Wall Street Tobacco Deals Left States With Billions in Toxic Debt

    So maybe the way to resolve the pension and benefits crisis is with bond defaults?


  6. Posted by Javagold on August 12, 2014 at 11:57 pm

    Start by Putting the public takers ALL on Obamadontcare. Then tax their pensions 98%. Finally get the schools off the fucking property tax bill. Otherwise it’s off the cliff we all go.


    • Posted by Tough Love on August 13, 2014 at 12:28 am

      Add to that ….

      Let all the LOCAL (as well as STATE) workers fund 75+% of their own retirements from THEIR OWN net income (just as most Taxpayers do) instead of sucking at he Taxpayers’ pockets and demanding that Taxpayers fund 80-90% of THEIR (MUCH MUCH MUCH more generous) pensions.


    • Posted by Carlos on August 13, 2014 at 6:07 pm

      99.9% sure your taxes are going up before my pension gets taxed at 98%. As for the Obamacare thing that wouldn’t bother me at all. I’m not big on doctors and I haven’t heard of any major issues with the millions that are on it. Has there been a death panel that I missed yet ?


      • Posted by Tough Love on August 13, 2014 at 6:59 pm

        While I agree that there is likely a ……… 99.9% chance OUR taxes will go up before YOUR pension gets taxed at 98% …… I’d guess there is 75%, 50%, and 25% chance your pensions will go down by 25%. 50%, and 75% respectively, likely accompanied by very modest tax increases.


  7. Posted by Anonymous on August 13, 2014 at 12:32 am



  8. Posted by bpaterson on August 13, 2014 at 9:32 am

    There are risks and costs to action. But they are far less than the long range risks of comfortable inaction.

    John F. Kennedy


    • Posted by Tough Love on August 13, 2014 at 9:40 am

      Talk is cheep.

      REAL action, when the the problem is as big as NJ’s pension mess is, gut- wrenching for politicians who seek to keep Public Sector Union money (and eection support) flowing.


  9. Posted by Eric on August 13, 2014 at 10:00 am

    I do not know why the discussion does not include single payer health care. Everywhere I have traveled, and continue to travel, people love their single payer system. I know that I have mentioned this a thousand times, but I guess it should be repeated. I have spoken to people in the Netherlands, Germany, the UK, Canada, France, Belgium, Switzerland etc. and they all LOVE their health care. There are no forms, no co-pays, no deductibles, no chance of having a condition bankrupt them or their families. The premiums are covered through other forms of taxation, so of course, it is not free. However, there is NO worry about what plan someone may have, or if something may not be covered since it is not a “gold” plan, but merely a “silver” plan etc.
    In the US, health insurance is tightly controlled by insurance companies for profit. This is the way it was and continues to be under the Affordable Care Act or “Obamacare.” This is also why it is so very expensive with such poor results. It is a total failure.
    The press in the US demonizes health care in other countries, and the reporting is a lie.
    I was in the UK speaking to a woman and told her that I hear such horror stories about the health care in the UK. She told me that they are just stories “dreamed up” for the consumption of the uninformed, ignorant Americans. Her husband told me that he had purchased a supplemental plan in the UK which was totally unnecessary and a waste of money. The basic plan covering all citizens was excellent.


    • Posted by Tough Love on August 13, 2014 at 10:29 am

      You may be surprised, but most very large Private employers self-insure their group health care Plans. While companies like UHC and AETNA are hired to “administer” the Plans, healthcare provider bills are paid with the Company’s money and UHC & AETNA are simply paid a flat annual fee for Plan administration. Of course UHC and AETNA price their services to “make a profit”, but no “profit” comes from being “on-the-risk” as the “insurer”.

      From personal discussions, I too have found that Europeans are VERY satisfied with their healthcare.

      In the USA, various group vie for benefit level and cost “advantage”, and those who fair well don’t want to give it up that advantage ….. e.g., Public Sector workers, who often get “Cadillac” benefits at very low (relative) cost.

      I support Universal healthcare for everyone in the USA (at a level, be it silver or bronze, that is affordable to the country as a whole)… paid for via increased income (and Corporate) Taxation. That would end the practice of companies like Walmart (and fast-food) skirting their obligation via part-time work with little or no benefits, passing the cost of healthcare onto other Taxpayers.


    • Posted by George on August 13, 2014 at 9:13 pm

      FWIW the British NHS and similar are not single payer systems, they are national monopolies. The hospitals and everything else healthcare related is owned by the government monopoly. The government has magic powers mere corporations do not. If there is a shortage of nurses, they change immigration laws. To few doctors, the order up more from the government university/educational monopoly. Drugs too expensive, they institute price controls. So single payer is really not a good description of the British NHS or the various Health Canada systems.


  10. Posted by Eric on August 13, 2014 at 2:42 pm

    Tough Love:
    I agree with you that everyone in the USA should be covered, at least at some basic level of health care, as you state. This would prevent fear of losing one’s home or a precious asset due to having the wrong type of coverage. Unfortunately, the insurance lobby in Washington will not let that happen. The politicians in the USA have long abandoned representing their constituents. Only those with sufficient funds elicit any response from this den of thieves.


    • Posted by Tough Love on August 13, 2014 at 3:02 pm

      Very true, and one of the clearest example is the Public Sector Unions’ BUYING of our legislators votes that has resulted in the granting of grossly excessive Public Sector pensions & benefits everywhere.

      It’s WAY past time to REVERSE these promises for the future service of all CURRENT workers.


  11. Posted by Javagold on August 13, 2014 at 3:25 pm

    Here you guys go…this is a must read !……Damn public takers are killing us !!!


    • Posted by Tough Love on August 13, 2014 at 4:47 pm

      Per that article, in NJ the workers’ share of total healthcare premiums is 5%.

      Dear Taxpayer:

      (1) What % of total costs do YOU pay ?
      (2) DEMAND change

      Public Sector workers are NOT “special”…on YOUR dime !


      • Posted by Carlos on August 13, 2014 at 6:38 pm

        That isn’t accurate. I’m retired,but if you go to the treasury web page you can see what the plans cost and they have an employee percentage calculator. Here is the total plan cost: It comes out to be roughly $20,000 per employee with a prescription plan included for a family plan. I selected the Aetna HMO ( that’s what I had as an active employee) I then went to the employee contribution calculator,according to that most employees are at year 4. I made roughly $100,000 before I retired. According to the calculator an employee who makes $100,000 for the Aetna HMO family plan with prescription would pay $305.77 per pay ( bi-weekly). That comes out to be $7950.00 per year and I think that comes to be 40% of the total plan. More lies from the Christie administration. What a shock.


  12. Posted by RealRep on August 14, 2014 at 8:50 am

    The top rate for cost sharing is now 35% of the premium. Employees who paid nothing towards medical now pay up to that amount. That “savings” however was gobbled up by the annual 9-15% premium increases by NJSHBP. Too bad having NJSHBP plans curb their increases to 2% a year was not part of the plan. But they are the real special interest group running the show. Their greed will be their undoing as the next generation has already decided that 30k is an insane amount of money for health insurance. We will be single payer within ten years.


    • Posted by Tough Love on August 14, 2014 at 10:16 am

      Ridiculous, and reflective of the mentality of a Public Sector worker:

      (a) The REASON that the total cost of Public Sector family plan coverage is approaching $30K is because your Plans are WAY richer than most … these “Cadillac” Plans will (as Christie stated) will lead to significant penalty taxes from Uncle Sam next year. The BETTER Private Sector family Plans still have total costs under $25K. You’re no “special” and deserving of a better deal on the Taxpayers’ dime.

      (b) Quoting …. “Employees who paid nothing towards medical now pay up to that amount. That “savings” however was gobbled up by the annual 9-15% premium increases by NJSHBP.” Nonsense, there was no “savings” from them starting to pay.
      Taxpayers were simply being ripped off in all the years they got away w/o paying anything.

      (c) Quoting … “Too bad having NJSHBP plans curb their increases to 2% a year was not part of the plan. But they are the real special interest group running the show. Their greed will be their undoing”. NO, too bad the overall 2% annual-increase cap on local taxes didn’t include the costs of worker pensions & benefits. Then the Taxpayers would have clearly seen how YOUR compensation (via these grossly excessive pensions and benefits) is eating up all local revenue …. and DEMAND that they be reduced for CURRENT workers.


      • Posted by Tough Love on August 14, 2014 at 10:56 am

        To clarify the “Cadillac” Plan issue ……..

        The US Gov’t has always allowed the employer-paid cost of healthcare premiums to NOT be considered taxable income to the employee. The gov’t is well aware that allowing such not only costs it a GREAT DEAL in lost revenue (had it been taxed), but that BECAUSE health premiums are not taxable income, those with rich benefits benefit tax-wise more-so than those with less-rich healthcare Plans. For this reason, when Obamacare was enacted, it included provisions to cap the tax-preferential level of heathcare premiums.

        Interestingly, while this was a more-or-less “ho-hum” issue to the Private Sector (as few were impacted), there was a huge protest from the PUBLIC Sector Unions. WHY ? Because most of THEIR plans are so generous that they were above the cap and introduced material tax consequences. Obama, (not wanting to upset his vote base … Union workers) increased the cap and pushed out the effective date of such new taxation.

        In EVERY way (but particularly in Pensions and benefits) Public Sector workers get a BETTER DEAL than Private Sector workers …. with the vast majority of the cost paid for not by THEM, but by the Taxpayers…… e.g., who but Public Sector workers gets employer paid-for retiree healthcare benefits today? AND, it’s often free or very low cost to them.

        ALL of this preferential treatment must end for the future service of all CURRENT workers. Taxpayers ….. DEMAND IT !


        • Posted by RealRep on August 14, 2014 at 11:04 am

          Not a public employee, sorry. Just someone who sees and understands both sides of the coin, unlike yourself. Your jealousy is so out of control that no one takes you seriously. Do you see that?


          • Posted by Tough Love on August 14, 2014 at 11:29 am

            I re-read your comment and it seems that you have a finger in this pig-fest….

            While you say that you aren’t a “public empolyee”, I’d bet that either you or a family member (active, retired, or vested-terminator) are or will be collecting a Public Sector pension.

            And I am not “jealous”. But being having been in the financial sector for many years (and well versed in pension design and funding) and a Taxpayer, I’m simply pissed at the enormity of the taxpayer ripoff.


          • Posted by RealRep on August 14, 2014 at 1:35 pm

            You can’t reason with crazy.


          • Posted by Tough Love on August 14, 2014 at 1:38 pm

            Responding to RealRep ….. nor can you reason with the insatiably greedy Public Sector Unions/workers.

            Unfortunately for them, this is really a MATH problem, and in the end, the MATH always trumps politics.


  13. Posted by JG on August 14, 2014 at 11:00 am

    Spoken like an insurance company employee. I think the point he was trying to make was the more you make the employee pay the more freedom you give the insurance companies to raise their rates. I have been following this blog for a while. I have to say it is difficult to follow when you reply to every post with the same slant. Maybe you could take another break. Last week was refreshing.


    • Posted by Tough Love on August 14, 2014 at 11:37 am

      I provide very needed balance to the enormity of the BS coming from Public Sector workers/retirees wanting to keep this pension/benefit “pig-fest” rolling along with no or minimal reform.

      My goal is to educate those being ripped-off (the Taxpayers), and in particular, I object to the emphasis on the State’s underfunding. While true, “funding” requirements follow directly from Plan “generosity”, and grossly excessive Pension & Benefit “generosity” is the ROOT CAUSE of the problem.


  14. Posted by MJ on August 15, 2014 at 8:17 am

    I would be willing to bet that what we are reading is only the tip of the iceberg. With all of the lies, over promised benefits and pensions, wasteful spending, raiding every fund imaginable, fake disabilities, double dippers…..the tobacco article was interesting too making for more debt, why don’t they just fix the problem once and for all? If this pension plan is so great why hasn’t it been funded in years? Why throw good money after bad is my thought. Just seems like a matter of time and what politician will take the fall. Reduce the pensions and benefits, and reduce the wasteful spending, that should help start to solve the some of the fiscal problems. Way too many publics doing way too little for way too much, that the ticket I would run on! Way too many lifetime welfare queens, cheats and other takers who have contributed nothing.


  15. as a public employee, you cannot choose to not have a health plan- it is mandatory and you pay for it even if you are healthy and have no or minimal costs.


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