Bramnick on Generosity of NJ Benefits

Jon Bramnick happens to be my representative in the New Jersey Assembly and he is concerned about the public pension crisis we have here:
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But he completely misses the point about the generosity of employee benefits as being the root cause of the crisis.

You do not create a $100 billion+ debt (or any debt) by providing benefits that are more generous than what other states provide. You build up a $100 billion+ debt by providing benefits (any benefits) that you DO NOT PAY FOR. You could provide the most generous benefits in the history of mankind and there would be no debt if you actually funded those benefits at the time they were earned.

Because New Jersey is a pay-to-play cesspool there is a need to free up tax money to keep the gravy trains we run here stoked. To that end (and as abetted by the actuarial hierarchy) we have been paying our employees, in part, with scrip on the resources of future taxpayers.

7 responses to this post.

  1. Posted by bruce paterson on January 7, 2019 at 1:09 pm

    agreed, under the cgreevy and corzine regimes, the public sector was getting 4-5-6% annual raises over the course of nearly 8 years which would have been fine if there were no other impacts such as the pension obligation which also increased proportionately. If the state had funded the pension obligation at the same time as the raises being given out, instead of ignoring the funding obligation, the state would have been astounded at the high budget impacts from the overall labor burden and ameliorated those raises down to 2% or less or maybe 3% max.

    Reply

    • Posted by Tough Love on January 7, 2019 at 7:05 pm

      Yup, the (MOOCHER) Public Sector workers complain that their “wages” are lower than those in the Private Sector (a claim in-and-of-itself that is FALSE for most jobs), but not-surprisingly, don’t like to talk about “Total Compensation” which included wages + pensions + benefits ………. because THEY KNOW that when their ludicrously generous pension and benefits are included, PUBLIC Sector Total Compensation FAR FAR exceeds that of comparable Private Sector workers.

      Reply

    • Posted by Tough Love on January 7, 2019 at 8:24 pm

      John,

      Of course you are correct in that regardless of a Plan’s “generosity” level (whether very minimal, average or ludicrously excessive), if the specified level of benefits are not fully funded using reasonably conservative assumptions, MATERIAL underfunding will very likely develop over time.

      That said, The ACTUAL generosity level of Public Sector pensions is VERY important to Taxpayers ………… because Taxpayers pay for almost all of the cost (noting that as an actuary, YOU understand that there is no “3-rd party” called “interest” that is picking up part of the cost). And if “wages” in the same occupation in the Public and Private Sectors are reasonably close (which they are in any occupations), there is ZERO (yes ZERO) justification for the MUCH MUCH MUCH more generous pensions and benefits ROUTINELY granted PUBLIC Sector workers.

      Reply

  2. Posted by skip3house on January 7, 2019 at 2:40 pm

    Here is my short reply tweet to his…. :
    Seen same often. Why not add specific solutions to NJ problems…Pensions/School funding/rezoning for developments/…. What are the NJ Republican values, anyway? Since the Whitman ‘posse’ lowered NJ Income Tax for wealthy, borrowed billions $$ …….
    ,
    Jon Bramnick @JonBramnick
    Tonight at 630 I will be on NJTV to discuss the 2019 State Elections. The show is On the Record with Michael Aron

    Reply

  3. Posted by boscoe on January 7, 2019 at 4:05 pm

    Well, damn! I think our moderator has poured some hot sauce onto the word salad that sometimes masquerades as discussion on this site.

    Reply

  4. Posted by Tough Love on January 9, 2019 at 3:11 pm

    Surely ANOTHER of Bergen County’s “best & brightest” for which we pay THRU-THE-NOSE for ($169K in “wages” alone how outrageous !)………….

    https://www.northjersey.com/story/news/crime/2019/01/08/hackensack-nj-police-officer-charged-burglary-stalking/2516947002/

    Reply

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