How N.J. got into this pension mess

The Star Ledger posits the question and then proceeds to inadvertently answer it through the misinformation they spread.

The New Jersey pension system is bankrupt because the true nature of the problem has been camouflaged by politicians, actuaries, and other stakeholders for their own benefit with most of the media buying into the spin and even adding their own variations.  For example the Star-Ledger article claims:

Fully funding the pension system this fiscal year would cost $3.9 billion

Wrong! Making the 6/30/14 Annual Required Contribution (based on absurdly inappropriate assumptions that understate the real contribution requirement) would not come close to fully funding pension promises accrued to date which would require an immediate payment of either $37 billion, $83 billion, or $150 billion depending on whether you get your numbers from public plan actuaries, GASB, or me.

Christie reduced the pension payment for the fiscal year that ended June 30 from $1.6 billion to $696 million and the payment for the current fiscal year from $2.25 billion to $681 million. The remaining payments are enough to cover employees currently receiving benefits, but it doesn’t leave anything for the unfunded liability.

Wrong! This payment does not come close to covering “employees currently receiving benefits” or even employees currently accruing benefits (which is what the writer probably meant).  Think about it. A $696 million payment for 500,000 employees!  Ask anyone if they believe the average value of the pension a New Jersey government employee is accruing annually is worth about $1,400 and only if they happen to be the actuaries for the plan will you get any flicker of assent.

Sometimes the only answer that makes sense is that you are being lied to and, if you don’t report that simple fact, you become a co-conspirator.

83 responses to this post.

  1. Posted by Jim Buettner on January 19, 2015 at 5:53 pm

    John, once again you have proved that it is basic math and that the numbers don’t lie unless they are spun by politicians.

    Reply

  2. Posted by Anonymous on January 19, 2015 at 6:06 pm

    TL believes that Christie has been doing the right thing. Well maybe not, he shouldnt have put one red cent into the pension system according to her.

    Reply

    • Posted by Tough Love on January 19, 2015 at 9:14 pm

      That’s not accurate ….

      I have ALWAYS advocated for EQUAL (employer-funding) of Public/Private Sector pensions, meaning that Taxpayers should indeed contribute to you pensions, but in an amount (expressed as a % of base cash pay) that is EQUAL to what they get from their employers. You’re not “special”, EQUAL, but NOT more.

      Got a problem with “EQUAL” ?

      Reply

      • Posted by S Moderation Douglas on January 20, 2015 at 5:48 pm

        And then increase the base cash pay, of course……retroactively.

        Reply

        • Posted by Tough Love on January 20, 2015 at 9:45 pm

          S Moderation Douglas, I think that’s a great idea and we should go for it immediately.

          From the study you quote from so often found here:

          http://www.aei.org/wp-content/uploads/2014/04/-biggs-overpaid-or-underpaid-a-statebystate-ranking-of-public-employee-compensation_112536583046.pdf

          The PRIVATE Sector in NJ indeed has a “Wage” advantage, but its only 4%. The PUBLIC Sector “Total Compensation” advantage that far outweighs that at 34% (and still 23% if the greater Public Sector job security is removed). These percentages are for NJ in Figures 1, 6, and 13 respectively.

          So when do we start RETROACTIVELY giving all NJ Public Sector worker/retirees 4% more in wages, and then also RETROACTIVELY rolling back their pensions, with claw-backs of overpayment to those already retired ?

          Reply

          • Posted by S Moderation Douglas on January 20, 2015 at 10:23 pm

            That’s the average. You forgot to ask what the median is.

            Then you can retroactively increase the pensions of those who have consistently earned less in total compensation.

          • Posted by Tough Love on January 20, 2015 at 11:04 pm

            S Moderation Douglas,

            That would be fine too, as the net would be well in the direction of pension reductions and claw-backs far in excess of any cash paybacks.

          • Posted by Tough Love on January 20, 2015 at 11:33 pm

            S Moderation Douglas,

            While we’re evening things out (and I know “Total Comp> includes it), since Private Sector retirees get almost NOTHING in employer-sponsored retiree healthcare, there quite a huge payback due form Public Sector retirees to even that out … likely $250K-$500K for long retired safety workers who retired in their early 50s with family coverage. Seems fair that it get grossed up for interest too.

            So glad you suggest this idea !

        • Posted by S Moderation Douglas on January 20, 2015 at 11:54 pm

          You didn’t actually read the study, did you?

          Much of the alleged “overpayment” is at the level of the lowest level workers, and most of that is due to health care and retiree healthcare. So cancel their healthcare, and put them on Medicaid? How much have you saved?

          The devil is in the details, not the charts.

          Reply

          • Posted by Tough Love on January 21, 2015 at 12:32 am

            Yeah, lets cancel the retiree healthcare of CA’s (where you live) $100K-pensioned police and firefighters and see if they are approved for Medicare ….LOL.

          • Posted by Tough Love on January 21, 2015 at 12:33 am

            Oophs … that’s Medicaid (as you suggested), not Medicare.

  3. Anonymous, give it a rest. Stop worrying what TL thinks or says and come up with your own data, solutions or pertinent information. The pensions will not be funded because they are too out of control. Doesn’t matter what Christie says or what the courts say. The time is well past for any true and meaningful reform to assure that public workers receive a “fair and equitable” pension upon retirement. Its only a matter of time and what the collapse will look like is anyone’s guess. Way way too much was promised without any realistic way of paying for it and now the devil wants his due. The publics should have been questioning all along as too how this very generous retirement would be funded but perhaps most publics are just now finding out that it won’t be funded at any meaningful level.

    Reply

    • Posted by Anonymous on January 19, 2015 at 6:54 pm

      MJ give it a rest yourself and stop worrying about what I think or say and come up with your own date, solutions or pertinent information. The pensions will not be funded because from the very beginning the plan was never to fun them . I am getting 17k per year for 30 years of service. You dont know the facts, you only know what you are told and you take it for gospel You are just one of the many sheep in the herd.

      Reply

      • Anon, could care less what you think or your 17k, Hold on tight and hope that you are able to continue receiving your check,

        Reply

        • Posted by bpaterson on January 21, 2015 at 6:18 pm

          MJ-anon’s 17k annual pension works out to 27 years at the minimum part time salary of $7k which was minimum to receive pension credits: that works out to pension of $3k/year. Then the pension padding kicks in as anonymous is, of course, politically connected so he makes a $280k salary for the last 3 years. That adds $14k to the $3k = $17k/year. Incredulous but listening to the guy’s arrogance at trying to cry poverty its pretty close to what he gained of the system. Voila a free grand and a half a month for life. Work-minor to none.

          Probably anon was a no show aide of some sort to a legislator (they’ve been known to do that for their friends), then was bumped up to the director of some “utility authority” for 3 years, known for rampant patronage. Easy guess, anon? or tell us your “sad” actual situation.

          Reply

          • Posted by S Moderation Douglas on January 21, 2015 at 6:29 pm

            Cause that happens all the time.

          • Posted by Tough Love on January 21, 2015 at 8:15 pm

            S Moderation Douglas,

            That it happens EVER is horrible and so grossly unfair to the ripped-off Taxpayers. It’d also a very good reason why Taxpayers should demand an END to Public Sector Defined Benefit pension for all CURRENT Public Sector workers.

            This simply COULD NOT happen under a Defined Contribution Plan, with even a huge end-of-career pay increase having minimal impact on Taxpayers pension costs.

          • bpatterson, I guessed as much or something close to what you describe. That’s one more reason so many publics will get screwed on their pensions. The arrogance and sense of entitlement at everyone else’s expense both public and private. Some people are lucky if they make 17,000 a year working full time at a real job where they actually have to produce something in order to keep working.

    • Posted by Tough Love on January 19, 2015 at 9:16 pm

      Quoting … “Anonymous, give it a rest. Stop worrying what TL thinks or says and come up with your own data, solutions or pertinent information. ”

      When pigs fly.

      Reply

      • TL, seems to me that the publics should be more concerned with their current situation instead of posting on here, calling names, spewing this and that at anyone who suggests immediate reform. I notice that Anon did not contribute any useful information, suggestions or realistic solutions to the problem. Nobody knows anything only him/her and the 17k pension.

        Reply

        • Posted by Anonymous on January 20, 2015 at 2:24 am

          MJ and TL the two great problem solvers.. It is amazing how much time they waste responding to me.

          Reply

          • Posted by truthnolie on January 20, 2015 at 1:31 pm

            Exactly….they should be looking for 2nd and 3rd jobs they will need to pay the higher taxes that are coming to fund the pensions and other obligations. Although they’ll whine and complain, unlike the state they won’t be able to just not pay what is required.

          • Posted by Tough Love on January 20, 2015 at 2:07 pm

            Truthnolie,

            Readers know that you are a LOCAL Public Sector worker/retiree riding this gravy train and throwing in you 2 cents toward not having it justifiably derailed..

            While STATE default on it pension/benefit obligations will likely comes first, you’re being pretty naive to think that our towns homeowners won’t equate their burdensome property taxes to your grossly excessive pensions & benefits.

            They will be reduced, only WHEN is not yet clear.

        • Posted by Anonymous on January 21, 2015 at 8:31 am

          That sound coming from the road is not a can, it’s our Governor running to the exit. Oh, what a mess he created here in NJ with his failed leadership. Getting large donations from the Koch brothers to enrich the coffers of the Republicans is not a the way to the White House, personally I think he used NJ and got used by the party.

          Reply

          • Posted by Tough Love on January 21, 2015 at 1:34 pm

            Quoting ….. ” Oh, what a mess he created here in NJ with his failed leadership”.

            Oh really …. he, not DECADES of prior elected officials who (in payback for Union campaign contributions and election support) granted Public Sector workers FAR more than necessary, just, fair or affordable ?

          • Posted by Anonymous on January 21, 2015 at 3:56 pm

            I’m so caught up in this present-day crash and burn looking backwards is not needed. Taps blowing in the background.

          • Posted by Tough Love on January 21, 2015 at 4:08 pm

            Anon, Looking backward won’t help solve the problem, but let’s put the CAUSE and lay the associated BLAME on the right party … that being NJ’s Public Sector Union Bought-Off Legislature.

          • Posted by Anonymous on January 22, 2015 at 7:55 pm

            TO you have been blowing this union collusion whistle for months where is your documented proof?

          • Posted by Tough Love on January 23, 2015 at 1:16 am

            Anon, Proof ?

            What rock have you been living under ?

  4. Posted by PatB on January 19, 2015 at 10:09 pm

    “The remaining payments are enough to cover employees currently receiving benefits…” is exactly what Christie wants the media and public to think. He has succeeded in getting everyone to think that the normal cost is the actual current cost of the pension. Nice work, gov.

    Reply

  5. Posted by Tough Love on January 19, 2015 at 10:11 pm

    Quoting John …. “The Star Ledger posits the question and then proceeds to inadvertently answer it through the misinformation they spread.”

    Glad that you too see the misinformation that nj(dot)com spreads re NJ’s Public Sector pension crisis.

    The thing that irks me the most, and that most websites, not just nj(dot)come, are guilty of, is the wrong-headed focus on lack of full annual Taxpayer “funding” as the ROOT “CAUSE” of the mess NJ and many other States and cities are in.

    Ignored is the fact that “funding” requirements FOLLOW from (and directly in proportion to) Plan “generosity”. Not being able to fully fund a very “generous” Plan is usually NOT due to a lack of political will, but due to the fact that the HUGE sums needed to do so are simply not available (while meeting a city’s essential service needs)….. with the ROOT CAUSE of this (incorrectly labeled) “funding problem” being directly traceable to grossly excessive pension/benefit “generosity”.

    “Funding” problems are a “CONSEQUENCE” of that excessive generosity, not a “CAUSE” of the financial pension mess many States and Cities now find themselves in.

    To truly “fix” the problem, Taxpayers must address the REAL CAUSE (excessive “generosity”) and must demand either:

    (a) a hard freeze (zero future growth) of all Public Sector DB pensions for the future service of all CURRENT workers. The current absurdly excessive DB Plans should be replaced (for future service) with SS (for those not now covered) plus a DC (401K-style) Plan with a Taxpayer %-of-pay “match” of 3%-5% of pay, just like Private Sector Taxpayers typically get from their employers, or

    (b) If (a) above is not possible (after exploring ALL legal avenues and options to do so), then the pension accrual rate for the future service of all CURRENT Public Sector workers should be reduced by 50% for all non-safety workers and by 66% for all safety workers (with the most egregious pensions) …… and even AFTER such reductions, the resultant pensions would STILL be greater than the pensions granted 90+% of comparable Private Sector Taxpayers.

    Reply

    • Posted by S Moderation Douglas on January 20, 2015 at 6:40 pm

      “excessive generosity” is in the eye of the beholder.

      Christie inherited a mess, but he can’t solve it by blaming the workers.
      ………….
      The root cause of the funding problem is government taking the easy way out for decades and not honoring it’s commitments. If public workers have been overcompensated, pay should have been reduced instead of failing to fund the contracted benefits.

      You may well be correct in that math will prevail and current and future retirees will not receive all that they earned. But that doesn’t make it right.

      Reply

  6. Posted by Javagold on January 20, 2015 at 12:33 am

    2 + 2 = 5 ….. The public takers time is up.
    2 + 2 = 4 ……. Simple math. Truth has returned.

    Reply

    • Posted by Tough Love on January 20, 2015 at 1:09 am

      Public Sector Union/worker/retiree math ….

      What’s MINE in Mine and what’s YOURS is mine.

      Reply

      • Posted by TL for TL on January 20, 2015 at 9:29 pm

        I love it when people say simple things like that. By JG and TLs logic, all their tax free retirement accounts and home they ‘own’ is not theirs. Silly silly silly. Why don’t you just donate them to the FED with your abrogated promises. Lol

        Reply

  7. Posted by Indyisgreat on January 20, 2015 at 10:42 pm

    The best thing you can do to protect yourself from the looming pension disaster is move to Indiana. Indiana has a 2 BILLION dollar surplus, 50% lower taxes, a balanced budget for over 10 years in a row, no pension issues, AAA credit rating, better schools, a much lower cost of living, more jobs and opportunity, better schools and one of the best business climates in the country 🙂

    Reply

  8. Posted by Charles on January 21, 2015 at 12:53 pm

    TL

    My wages were about 60 percent of private sector wages from 1969 to 2005 then we’re brought up to about 80 percent from 2005 to 2009. Do I get all that money back plus interest if your plan goes through?

    Reply

    • Posted by Tough Love on January 21, 2015 at 2:22 pm

      Ah, our engineer is back …..

      For a professional engineer, it is possible to earn much higher “wages” in the Private Sector, so much so that the incrementally greater wages might exceed the much lower value of their Private Sector pensions & benefits, but that situation mostly exists only for the cream of the crop,

      Perhaps you are one of these, we don’t know (and we’re not talking about just YOU). What we often see is the average run-of-the-mill Pubic Public Sector worker comparing their wages to the wages of Private Sector workers in the “best” go-to Private Sector companies. For example, in the IT field, it might be Facebook or Google,

      Now give that some thought, Google looks to hire risk-takers with a entrepreneurial mindset, where working 24/7 (with no overtime) for 3 days straight to complete a project for which they have “ownership” and great “passion” is considered sport.

      Compare that to the extreme-security, never-take-a-risk mindset of most Public Sector workers, where they are packing their bags the minute 5 PM hits, and DEMAND overtime for staying a minute later. Facebook and Google wouldn’t even consider bringing in workers with such characteristics (likely including past employment in the Public Sector) for an interview.

      Reply

      • Posted by Anonymous on January 21, 2015 at 3:01 pm

        TL = Tough Luck, not tough love.

        Reply

        • Posted by Tough Love on January 21, 2015 at 3:17 pm

          Brilliant contribution to the discussion.

          Reply

          • Posted by S Moderation Douglas on January 21, 2015 at 4:23 pm

            The discussion was already worthless.

          • Posted by Tough Love on January 21, 2015 at 8:48 pm

            S Moderation Douglas,

            Why is that …. because it challenges your goal of not reducing the overstuffed Public Sector pension & benefits strangling America’s States & Cities ?

      • Posted by S Moderation Douglas on January 21, 2015 at 4:21 pm

        Another TL “opinion”.

        It’s called “rationalization”. But, the data does not back that up.

        “Public Sector workers, where they are packing their bags the minute 5 PM hits, and DEMAND overtime for staying a minute later.”

        If it makes you somehow feel superior (or maybe at least “adequate”), you can keep believing this crap.

        I can tell you from personal experience it is no more true in the public sector than in the private.

        Reply

        • Posted by Tough Love on January 21, 2015 at 4:56 pm

          It’s a reasonable “observation”, one that I wouldn’t expect you (as a Public Sector retiree) to agree with. Here’s a story told to me ……

          A lawyer friend in Private practice in NYC told me that quite often newly bar-certified lawyers bang on his office door looking for a job … unsolicited. He said that unlike what many people assume (both in the Public and Private Sectors), the vast majority of lawyers DON’T come out of law school with multiple job offers from the prestigious big-city law firms …. any many struggle to find ANY job. The big starting salaries we hear about are reserved for those at the top of their graduating class, and from law schools like Harvard, Stamford, etc.

          I’d bet that Public Sector lawyers routinely complain about their “lower pay”….. but how many graduated at the top of their class and from one of America’s best law schools.

          Reply

          • Posted by S Moderation Douglas on January 21, 2015 at 7:08 pm

            Were talking about professionals earning 59% higher wages in the private sector and 20% more in total compensation.

            The researchers use huge datasets with detailed geographic data to compare similar workers in similar locations. Their regression analysis and statistical methods de-emphasize the extremes of the private sector.

            “…..regression analysis cannot prove that any single individual is over- or under-paid, it can indicate whether pay differs systematically between the public and private sectors.”

            And, there is no disagreement on the disparity in wages between the most liberal and the most conservative studies. None. The only disagreement is the value of benefits.

            When Charles says he was “brought up to about 80 percent from 2005 to 2009” He may actually be underestimating the compensation in the private sector. It may well be 80% of total compensation, but a much larger disparity in wages.

            All in all, concurrence in all the major actual statistical studies trumps :

            “Here’s a story told to me ……”

          • Posted by Tough Love on January 21, 2015 at 9:04 pm

            Quoting S Moderation Douglas “Were talking about professionals earning 59% higher wages in the private sector and 20% more in total compensation.”

            Yup, the AEI study you often quote from shows that Private Sector advantage, but

            (a) it encompasses only 2% of all Private Sector workers and 6% of all Public Sector workers … so it it really meaningful in the context of ALL workers ? I think not.

            (b) ONLY the PRIVATE Sector database from which those %s were calculated includes some super-earners with Millions and Tens or even Hundreds of Millions in annual compensation. Remove these outliers and the entire Private Sector advantage might disappear.

          • Posted by S Moderation Douglas on January 21, 2015 at 10:21 pm

            “Remove these outliers and the entire Private Sector advantage might disappear.”

            Yup. Keep repeating that. Ignore the experts. You crack me up.

          • Posted by Tough Love on January 21, 2015 at 10:27 pm

            S Moderation Douglas,

            Well, removing the super-earner outliers WILL lower the “Professional” Group Private Sector advantage. How much so ???

            Even if lowered only modestly, with it’s VERY small share of Public and Private Sector workers, it’s hardly the group that should be looked at to develop Public Sector pension reform policy.

          • Posted by S Moderation Douglas on January 21, 2015 at 11:36 pm

            Some public sector workers earn more in total compensation than their private sector equivalents. Some earn less.

            Nationally, sixty percent of public workers earn equal to, or less than, their private sector counterparts in total compensation. Professionals are only the most extreme example.

            “the pension accrual rate for the future service of all CURRENT Public Sector workers should be reduced by 50% for all non-safety workers and by 66% for all safety workers”:

            Just doesn’t make sense in any context.

            Some states, e.g., California and New Jersey have higher benefits than the average state, but no one, nowhere have compensation as egregious as your rants imply.

            And the recent changes in California and other states are much more significant than they are given credit for.

            Theoretically, according to Biggs, California workers average a 23% advantage in pay plus benefits.
            A current miscellaneous employee with the average wage ($70,000), average length of service (20 years) and average retirement age (60) would get an unmodified allowance of $32,396 annually. Under the new formula, that would be $25,200. 22% less.

            Most miscellaneous employees previously contributed 5% of wages toward retirement, and now pay 8%; a 60% increase.

            60% increase in cost coupled with a 22% reduction in pension is serious business.
            …………….

            “Take California: A state highway patrol officer hired before September 2010 can retire at age 50 after 30 years on the job with 90% of his salary. At an average salary of $100,000, that would translate into a pension of $90,000 a year. But if that same officer was hired this year instead, his annual retirement check at age 50 would total $60,000. That’s a $900,000 difference over the course of a 30-year retirement.”

            (CNN Money, Feb 11, 2013)

            The reduced formulas apply only to new employees, but all employees will be paying the higher share, most have been for over two years now.

            Not the 50% to 67% you have been calling for, but substantial decreases in compensation nonetheless. In fact, there have already been several articles here speculating on increased salaries to compensate for the benefit losses.

          • Posted by Tough Love on January 22, 2015 at 12:18 am

            (1) Quoting S Moderation Douglas (where he is quoting from my earlier comment)…

            ““the pension accrual rate for the future service of all CURRENT Public Sector workers should be reduced by 50% for all non-safety workers and by 66% for all safety workers”: Just doesn’t make sense in any context. ”

            Oh really, Seems like you’re basing that conclusion on the AEI study conclusions. But YOU KNOW that that study excludes all SAFETY workers with the MOST egregious pensions … by FAR … ALWAYS 4+ times greater in value at retirement than the pensions typical granted an EQUALLY PAID Private Sector worker retiring at he SAME age and with the SAME years of service.

            So you’re at it again …. distortions, mis-statements, omission of material facts, and outright lies. Into which category should we classify ?
            ————————————————————————–

            (2) Quoting S Moderation Douglas ….. ““Take California: A state highway patrol officer hired before September 2010 can retire at age 50 after 30 years on the job with 90% of his salary. At an average salary of $100,000, that would translate into a pension of $90,000 a year. But if that same officer was hired this year instead, his annual retirement check at age 50 would total $60,000. That’s a $900,000 difference over the course of a 30-year retirement.””

            At least you correctly mentioned that the reduced pension formula ONLY applies to NEW workers. ALL CURRENT CA workers will continue to accrue pension credits for FUTURE service based on that grossly excessive 3%@50 formula, some for 20, 30, even 40 years.

            Why is that fair to Taxpayers where pension change for THEM legally CAN (and almost ALWAYS DO) apply to the future service of all CURRENT workers, What makes Public Sector workers so “special” that they deserve not only FAR greater pensions and MUCH better benefits, but iron-clad protection from FUTURE service pension/benefit reductions ?
            ————————————————————————————

            (3) Quoting S Moderation Douglas … “The reduced formulas apply only to new employees, but all employees will be paying the higher share, most have been for over two years now. ”

            Higher “Share” ? if you increase a VERY small share by a even a large percentage it’s STILL small.

            If you accumulate all of a Public Sector worker’s pension contributions (INCLUDING interest on those contributions) to the date of retirement, RARELY would the accumulated sum be sufficient to buy more than 10%-20% of the VERY VERY rich pension that they have been promised.

          • Posted by S Moderation Douglas on January 22, 2015 at 1:40 am

            “Why is that fair to Taxpayers”?

            Because *some* state workers earn more than private in total compensation. Some earn less. (60%, earn equal to or less than private). It is logically not “fair” to reduce the compensation of those who are already earning “equal or less”.

            “FAR greater pensions and MUCH better benefits”
            is, still, your opinion.

            …..if……you can definitively identify only those who are actually demonstrably overcompensated and reduce their pay or benefits the appropriate amount, you might have a point. But to reduce everyone equally is……still……a non-starter.

          • Posted by Tough Love on January 22, 2015 at 1:49 am

            S Moderation Douglas,

            I agree. Let have Equal PUBLIC/PRIVATE Sector cash pay, pensions & benfits (and for all CURRENT workers) …. which for pensions means 3%-4% in a DC Plan, and for retiree healthcare subsidies, it mostly means NOTHING, because NOTHING is what almost all Private Sector workers are accruing in employer-sponsored retiree healthcare today.

            And yes, simply to get out from under the Union/Politician games, dealmaking, deceit, and thievery … all at taxpayer expense ….. is WELL WORTH the very remote chance that cash pay will need to rise more than very modestly to reach “EQUAL”.

          • Posted by SDouglas47 on January 22, 2015 at 2:17 am

            “the very remote chance that cash pay will need to rise more than very modestly”

            Denial

          • Posted by Tough Love on January 22, 2015 at 2:29 am

            S moderation Douglas,

            No denial. The article is about NJ’s pension Plans, and (per that AEI study) there is only a 4% (average) “cash-pay” differential. I’d GLADLY trade an average 4% raise to HARD FREEZE all DB Plans (ZERO future growth and replacing them with a 3%-4% DC Plan contribution) for all CURRENT workers, and an END to all retiree healthcare subsidies.

            And I would expect all non-Public-Sector NJ’s taxpayers would agree wholeheartedly.

          • Posted by Tough Love on January 23, 2015 at 1:22 am

            S Moderation Douglas,

            Don’t thank me. The 99 ways to “spike” ones (CA) CalPERS pension will only hasten CalPERS demise, by BOTH a draining of assets, and pissing-off more Private Sector Taxpayers.

      • Posted by Charles on January 22, 2015 at 4:38 pm

        Of course I am talking about me. One size fits all doesn’t work here. How are you going to sort this out?

        Reply

  9. Posted by Tough Love on January 22, 2015 at 12:03 am

    Quoting S Moderation Douglas (where he is quoting from my earlier comment)…

    ““the pension accrual rate for the future service of all CURRENT Public Sector workers should be reduced by 50% for all non-safety workers and by 66% for all safety workers”: Just doesn’t make sense in any context. ”

    Oh really, Seems like you’re basing that conclusion on the AEI study conclusions. But YOU KNOW that that study excludes all SAFETY workers with the MOST egregious pensions … by FAR … ALWAYS 4+ times greater in value at retirement than the pensions typical granted an EQUALLY PAID Private Sector worker retiring at he SAME age and with the SAME years of service.

    So you’re at it again …. distortions, mis-statements, omission of material facts, and outright lies. Into which category should we classify ?

    Reply

    • Posted by SDouglas47 on January 22, 2015 at 2:12 am

      It ain’t that complicated, TL….”that study excludes all SAFETY workers”

      But you want to reduce compensation for all *non* safety workers also. (Which the study does include.)

      What I called before; the meat axe approach.

      Logically, if “A” is overpaid, reduce the compensation, either pay or benefits, or some combination, for “A”.

      If “B” is undercompensated, increase the compensation for “B”.

      Don’t reduce the compensation for all because one segment is overpaid.

      And you haven’t supplied anything but anecdotal evidence for that allegedly overcompensated portion.
      ………
      And, for your own benefit, please grow up.

      “distortions, mis-statements, omission of material facts, and outright lies.”

      “sucking at he taxpayer’s teat” (sic)

      “the annoying S Moderation Douglas”

      I assure you I have been called worse, and your childish remarks don’t bother me at all, but it is a poor reflection on you. And, frankly, tiresome.

      Reply

  10. Posted by javagold on January 22, 2015 at 12:44 am

    You all crack me up. Why waste your breath on each other. It doesn’t matter.

    The pension ponzi pyramid is going to collapse. It’s just a matter of When.

    Reply

    • Posted by Tough Love on January 22, 2015 at 12:55 am

      Quoting …. “The pension ponzi pyramid is going to collapse. ”

      Yes, that is awaiting MANY States & cities. Too bad it will hit NJ well before CA where the annoying S Moderation Douglas lives, sucking at he taxpayer’s teat as a Public Sector retiree.

      Reply

    • Java, I was thinking the same exact thing. Round and round it goes. I agree, its just of matter of when and what political ass will take the fall.

      Reply

  11. Posted by Jim on January 22, 2015 at 5:06 pm

    John, do you think that ultimately the Feds will simply assume all the state pension and retirement liabilities? There the ones with a printing press.

    Reply

  12. Posted by truthnolie on January 23, 2015 at 1:13 am

    This just out:

    http://pension360.org/new-jersey-may-be-working-up-proposal-to-merge-municipal-state-pensions/

    As I’ve said all along (rejected only by the clueless naysayers and dimwitted clods that post here) the LOCAL parts are not the ones having the issue it is the STATE part…..

    Now Gov. Jabba Fatboy McTriplechin has an idea (no doubt competing in his head with where the closest all you can eat buffet might be and how to travel there by helicopter as an “official” stop) to try to merge the systems so as to try to save some (drooping jowl) face. Not gonna work but that’s apparently all he’s got.

    But again…the point to be taken here is the local parts are not in the dire straits the state part is but idiots here choose to ignore this fact and lump all systems together.

    Reply

    • Posted by truthnolie on January 23, 2015 at 1:43 am

      Here’s the full post from 101.5:

      http://nj1015.com/possible-solution-to-cash-strapped-pension-fund-could-hurt-municipalities/

      ““The state pension system is a ticking time bomb,” warned Dressel at the monthly meeting of the Ocean County Mayors on Jan. 20 in Toms River. “Our system is in the black. It’s about 74 percent funded. The state’s system is not in the black,” he said.”

      Reply

    • Posted by Tough Love on January 23, 2015 at 1:45 am

      VERY interesting.

      I doubt that the State will succeed. They are legally independent Plans, and a “merger” steal from one to benefit the other. Protest from local police will be heard far and wide.

      But if successful, it would accomplish a major Christie goal, shifting a need for additional STATE “taxes” to fund the hugely underfunded STATE Plans, into additional LOCAL property Taxes (which he can disavow) to fund the now poorer-funded LOCAL Plans.

      ———————-
      I’m betting the NJ Commission will recommend taking a machete to retiree healthcare as #1, switch new workers to a Federal worker style hybrid Plans as #2, and hopefully (because w/o doing THIS the rest is mainly BS) shift all CURRENT workers to that same hybrid Plan for their future service as #3.
      —————————-

      Let’s be clear truthnolie, YES, the LOCAL Plans are not as deep into the shithole as the STATE Plans, but they’re not really that far behind. A mid-60s funding ratio for the LOCAL Plans under the new GASB rules is REALLY REALLY “BAD”.

      Reply

      • Posted by truthnolie on January 23, 2015 at 2:20 am

        What’s this??…..A (mostly) rational post from you with no vilifying of public workers or comparing them to pigs at the trough?

        Color me shocked…..gotta say, first post I’ve seen from you where you seemed level headed and without malice.

        Reply

        • Posted by Tough Love on January 23, 2015 at 2:32 am

          I call a spade a spade … ALL the time.

          We just don’t see eye-to-eye on many issues, perhaps because as a taxpayer I’m helping to pay for the 80-90% of your pension (that you don’t pay for), a pension routinely 3-4 times greater in value at retirement than those of equal-earning Private Sector worker retiring at the SAME age and with the SAME service.

          Reply

  13. […] While this is only the tip of the iceberg for the state pension mess some estimates for fully funding pension promises accrued to date would require an immediate payment of either $37 billion, $83 billion, or $150 billion depending on whether you get your numbers from public plan actuaries, GASB, or me.https://burypensions.wordpress.com/2015/01/19/how-n-j-got-into-this-pension-mess/ […]

    Reply

  14. […] in New Jersey are bullied/cajoled/bought-off to provide ridiculously rosy numbers on pension liabilities so why wouldn’t auditors get the same […]

    Reply

  15. Great commentary , BTW , if someone is searching for a a form , my business filled out and faxed a blank document here https://goo.gl/5mrmZk.

    Reply

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