Pension Reform for Weasels

“This is a pivotal moment in our state’s history. We’ll seize it like honorable men and women or squander it like pandering, spineless weasels.”

New Jersey state senator Declan O’Scanlon, R-Monmouth on Public Pension Reform

The set of reforms proposed this time are weaselly in themselves but the answer to Senator O’Scanlon’s query may lie in this remarkable simulation of how laws get enacted in New Jersey.

17 responses to this post.

  1. Posted by Anonymous on September 17, 2018 at 11:50 am

    Is the status quo preferably?

    Reply

    • Posted by NJ2AZ on September 17, 2018 at 11:52 am

      they will never make the necessary changes proactively. The smart ones will term out before it becomes an issue, the dumb ones will assume something will come along and save them

      and eventually it will all go to hell and then we’ll see what happens

      Reply

  2. Posted by skip3house on September 17, 2018 at 12:33 pm

    Solution….. it has all been said, and ignored.

    Reply

  3. Posted by geo8rge on September 17, 2018 at 1:24 pm

    “Pensions and bondholders are playing the insolvency game smartly (from their perspective), as we’ve written often. It’s all a matter of getting ownership, liens or some kind of priority on anything and everything of value before things blow up. When that happens, they’ll get paid first. Service recipients and taxpayers are in growing danger of have nothing to work with. Even a formal bankruptcy wouldn’t help.”

    Pension Intercept Comes To Chicago – Latest Dibs On Body Parts
    http://www.wirepoints.com/pension-intercept-comes-to-chicago-latest-dibs-on-body-parts/

    For example, putting the NJ Lottery revenues in the pension scheme means when the collapse comes at teachers pension has first dibs on the lottery money. Unlike other industries based on selling stuff printed on paper for a high markup at local retailers, the hope is the lottery is never ‘disrupted’.

    Reply

    • Posted by boscoe on September 17, 2018 at 2:54 pm

      It could be worse…and it likely will be. They’re yapping now about dumping state-owned non-liquid non-income producing “assets” into the systems to artificially pump up their funded status. When t-minus-1 hits, they’ll be trying to auction off commemorative bricks from the State House on eBay. Oh, wait: the NJ Economic Development Authority already owns the State House….

      Reply

      • Posted by Anonymous on September 17, 2018 at 4:01 pm

        It’s like NJ2AZ said, when it goes to hell the NJEDA bondholders will own the State House b/c the State won’t be making the debt service approp to NJEDA.

        Reply

        • “…the NJEDA bondholders will own the State House b/c the State won’t be making the debt service approp to NJEDA.”
          States are sovereign, and have sovereign immunity under the 11th Amendment. They can repudiate/cancel ANY debt they want to. With NO consequences whatsoever, because they cannot be sued in either state or federal court. By anyone, for $$$ monetary vale. Even under Chapter 9 of the Title 11(BK Code), municipal real property assets are not subject to seizure or liquidation to pay debt/s. When push comes to shove, sooner or later, one of the upside down public pension states is going to pull the “repudiation” of debt trigger. Start all over from zero. A “reset” button if you will.

          Reply

    • Posted by geo8rge on September 18, 2018 at 11:53 am

      I might be all wrong on the future of the lottery.

      “The stereotype is that the lottery is a tax on the uneducated or it’s played almost entirely by lower-income people,” he says. “That’s just not true.” Massachusetts, for example, is a high-income, highly educated state, yet it’s also the state with the most lottery spending.

      https://arstechnica.com/science/2018/09/the-math-of-why-its-so-hard-to-build-a-spherical-death-star-in-space/

      Off topic but, with the ‘trade war’ tariffs coming at the exact same time as the proposed pension crisis bailouts, is it possible that the Trump tariffs are already slated to pay for the bailout. Reagan was an R outsider that changed the mix of taxes ultimately raising them. Could it be R outsider Trump is changing the mix of taxes ultimately raising them through his tax on imports, tariff? Underfunded pension schemes probably will have to shift assets to short-term US Treasury debt, and the interest rates for that debt are being increased. So a bailout is becoming possible without increasing debt.

      Reply

    • For example, putting the NJ Lottery revenues in the pension scheme means when the collapse comes at teachers pension has first dibs on the lottery money. Unlike other industries based on selling stuff printed on paper for a high markup at local retailers, the hope is the lottery is never ‘disrupted’.
      Sooner or later SOMEONE, anyone, with a backbone, is going to make a constitutional law challenge to this practice of selling off FUTURE taxpayer assets (ie lottery revenues), to benefit past employees/service, which IMO the gov has no legal right to. Especially when it is to fund ongoing general budget obligations that will continue unabated in the future (such as $100K+ public pensions well below the 66-67 retirement age of SS).

      Reply

      • Posted by NJ2AZ on September 18, 2018 at 3:28 pm

        i have always suspected something similar to what you describe would be the basis of a lawsuit to invalidate the pension contracts…the idea that they involved third parties who could not be party to the negotiations (future generations)

        all it takes is a judge (or judges) who are willing to play along

        Reply

      • Posted by boscoe on September 19, 2018 at 12:34 am

        Net proceeds from the state lottery (after paying prizes and commissions) have always been deposited in the state General Fund with the stipulation that they be used for education and institutional purposes. The recent 30-year dedication of the lottery to pay for the employer share of pension contributions for the TPAF does not violate that constitutional restriction, as the proceeds are still deemed to be going to education. Apart from the fact that this dedication was accomplished by a law instead of a constitutional amendment, what has been done with the lottery is legally no different than the dedication of all or parts of the motor fuels tax, the sales tax or the corporation business tax. The lottery is not a separate legal entitiy from the state of New Jersey; it is created within the Department of the Treasury. And as far as NJ2AZ’s comment about future generations being left out of the negotiations, that’s a decent emotional argument but a useless legal argument. Do you think that future generations of taxpayers had anything to say about entering into war in Iraq or weighing in on the recent federal tax cut that will increase U.S. (i.e., taxpayer) debt obligations well into the future?

        Reply

  4. Posted by Anonymous on September 18, 2018 at 12:25 pm

    https://www.nj.com/politics/index.ssf/2018/09/nj_murphy_public_worker_unions_health_care.html#incart_river_mobile_index

    Interesting lesson for Sweeney by the rookie Governor. It’s a bone the Unions refused to throw Christie but without fanfare handed over to Murphy.

    Guess the Unions can read the writing on the wall after all. Could be the beginning of more bones to come and taking the wind out of the Senator’s reform road show.

    Reply

    • Posted by Tough Love on September 19, 2018 at 8:23 pm

      Hopefully it will be the beginning of a GREAT DEAL more pension/benefit reductions yet to come ………….. and L*O*N*G overdue.

      Reply

  5. OMD you are KILLING me with that Ferret video!I I just LOVED it 🙂

    You will not believe this, but my home state of CA is one of only two states in the nation that ban ferrets. They don’t call us Krazee Kalifornia for nothing …. Insane state Krazee Kalifornia is.

    BTW-the analogy was spot-on.

    Reply

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