S2606 Debate in NJ

Another fissure within the Democrat party in New Jersey concerns how much to give to public employees in benefits with one side, as represented by State Senator and bonding addict Joe Cryan, pushing for more with S2606 while State Senate president and alleged nazi Steve Sweeney wants cut (as long as they don’t impact George Norcross). The internecine battle played out this week at Union County College:
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and in the opinion pages of the Star Ledger yesterday:

Hundreds of public workers in matching red t-shirts jammed into a packed auditorium in Union County Wednesday night to tell Senate President Steve Sweeney exactly what he can do with his plan to cut their health and pension benefits.

“I was walking into an ambush, and I knew it,” Sweeney says. “I went into the lion’s den to have a discussion. We didn’t waiver, and people weren’t happy. But we did have an honest dialogue.”

It was the lion’s den because it was the home turf for Sen. Joe Cryan, a leading liberal who had just drafted a dream bill for the public workers, one that would cut their health-care costs by shifting more of the burden to taxpayers. For some public workers, health costs would drop by more than half under Cryan’s bill.

…..

But how much more can taxpayers handle? Public workers still get much better retirement and health benefits than the average taxpayer, and even Sweeney’s plan won’t change that.

…..

What worries me most is Murphy’s unwavering loyalty to public worker unions, especially the New Jersey Education Association.

Liberal Democrats like Murphy hear the word “union” and they picture coal miners fighting robber barons, or Cesar Chavez fighting for migrant workers toiling on corporate farms. It’s good guys fighting bad guys.

But the NJEA is a racket for its top brass. Its three senior officers earned an average of just under $500,000 each in 2017, according to the latest records available. Spending on the union’s bloated staff jumped 20 percent in the prior three years, setting a new record.

Almost all that money comes from squeezing teachers, who earn an average of $70,000 a year and pay just under $1,000 in union dues.

What would Cesar Chavez say if he went to an NJEA meeting and saw the leadership in their fine clothing, with their fine cars, enjoying a fine meal – courtesy of those classroom teachers?

….

If the governor refuses to make cuts, which I fear is likely, then we’re in for a wild ride. It could lead to a shutdown. And it could even lead to an override vote, if Republicans joined centrist Democrats to block tax hikes.

So far, Murphy has given the unions all they want. If that doesn’t change soon, he’s going to lose this fight. And he’ll deserve to.

 

24 responses to this post.

  1. WOW…. and this contagion is spreading across the States, it’s getting much bigger than the Multi-employer DB Plan crisis that started in 2014 with the MPRA as a solution. AS these Retirement Security challenges converge, so the threat to many many more in how to live out their Golden Years… Maybe Ken Feinberg needs to be placed in an all encompassing Special Committee to address this broader Crisis coming. Russ Kamp and Ron Ryan have for the last seven years been ‘criss-crossing’ the Country with ideas of what they see as wrong and offer solutions that need to be considered… When ever these plans were set up, they could not have understood what problems would likely arise…Leave it for future legislators to figure out. Now the frequently kic’k can is against the wall…

    Reply

    • Thank you John Bury for having this conversation..

      Reply

      • Glad to have it and I can’t see it happening anywhere else.

        Mainstream media ignores it, along with a spate of relevant issues, so as not to make their sponsors in the insurance industry uncomfortable. Public media is beholden to politicians and politicians are beholden to the same business interests plus employee unions that make independent thought on their part inconvenient.

        We happen to have a lot of additional readers today on account of someone linking to this blog post from facebook (which doesn’t allow you to see who it was) so anyone new to this discussion might want to subscribe to this blog. The next few months promise to have another ill-considered benefits reform proposal floated and the more intelligent, unbiased discussion we can have about it, the better for all of us.

        Reply

    • Posted by Tough Love on February 17, 2019 at 1:42 pm

      John C. Anderson,

      There is no “contagion” that’s spreading. Notwithstanding that both are materially underfunded, the problems associated with BOTH Public Sector Pensions Plans and MEP Plans have absolutely nothing to do with one another………… and the ROOT CAUSE of their problems ALSO differs materially.

      The ROOT CAUSE of the Public Sector pension mess is clearly the ludicrously excessive level of benefit promises, while for MEP Plans it’s a funding structure that never made any sense from the getgo (i.e., the funding contributions MUST be a function of benefits that have accrued, and NOT simply a Union/Corporation “negotiated amount” per hour currently worked.)

      Taxpayers had ZERO to do with the MEP agreements (SOLELY between the Unions and the participating Corporations) and THEREFORE, there is ZERO justification for a Taxpayer bailout (or a bailout re-termed a “loan” …. which anyone with minimal math abilities knows will never be paid back).

      Public Sector Plans are, by virtue of promises made by Elected Officials supposedly representing the Taxpayers, a BIG problem for Taxpayers ……… especially in States that have strong Constitutional protections from reduction (often for FUTURE as well as PAST service). While Taxpayer efforts should focus their efforts on reducing the “value” of FUTURE service accruals (via per-year-of-service formula-factor reductions, increases in the retirement age, implementation of correct early-retirement reduction factors, and reduction/elimination of COLA increases ……… or better yet, a shift to DC Plans), the decades-long underhanded deal-making between the Public Sector Unions and our Elected Officials (trading campaign contributions for favorable votes on pay, pensions, and benefits) resulted in the ludicrously excessive benefits now in place, and may provide a legal basis to reduce even PAST service accruals.
      ————————–

      Seems like you are now trying to draw in the problems with Public Sector Plans …… calling for a wider bailout (via “contagion”) …….. just so the MEP Plans (with you as a participant) can squeeze the Taxpayers for an unjust BAILOUT. We’re NOT fooled.

      Reply

    • Posted by stanley on February 18, 2019 at 10:05 am

      “Now the frequently kic’k can is against the wall…”

      Nearly there. Regardless, we older people need to get used to the fact that we are yesterday’s story. It is up to us to recognize facts and make our way through retirement the best we can. Our recent financial history can not be characterized as strong and rational and as a result there are troubles galore in our way. Like it or not funding retirements for older people is not the only looming problem. It is relatively a smaller problem. Older people need to get used to the idea that belt tightening is the only sensible way to go.

      Reply

      • Posted by Anonymous on February 18, 2019 at 10:24 am

        While we are living longer life spans, I fully agree those over 45 or so are in fact becoming yesterday’s news in terms of the work force. I see it in my own profession. When you start to be old enough to be new employees fathers you know that your best days are behind you in terms of your job. Particularly mine. These young are SOOO much more comfortable with technology than the Gen X crowd (my group) and are eagerly waiting to replace us. I suppose as we were with the baby boomers. It just seems that these new guys wind up teaching us tech stuff. Not saying I didn’t to older guys when I got hired, just saying things moved at a slower pace. And the guys before me said the same thing. If you a Gen X Er, you are quickly ceding the the floor to the Millenials. It is harder to keep up with them in many areas involving tech. I think less of them look to people like me as mentors than when I first started. Who knows? Maybe boomer cops said the same about me. Either way, if you are a Gen X employee and haven’t started saving for retirement, you have a ton of ground to make up. (I have from year one, in addition to and in spite of the pension I will receive. My post millenial kids will be entering the work force in 6-8 years after finishing college. Will the USA be on a socialist path by then?? The millennials before them are much more supportive of taxes on the rich, environment, health care for all, etc.
        And they will begin to outnumber us older folks.

        Reply

        • Posted by Anonymous on February 18, 2019 at 10:30 am

          At what point will these younger folks finally be pissed off that 42 people own as much wealth as half the people in the world?? Or that 3 in the US own as much as 150 million?? Or that they’ve watched their parents and grandparents do NOTHING to stop climate change and their offspring being born now will bear the brunt of it. Or that the oceans are filled with plastic that is in the fish meat that they eat?? That’s not why AOC got elected. But it is why her and her ilk appeal to millennials outside her district.

          Reply

          • Posted by stanley on February 18, 2019 at 1:35 pm

            “At what point will these younger folks finally be pissed off that 42 people own as much wealth as half the people in the world?”

            Constable, I don’t believe that you are quite up to speed on the fact that capital is in the service of all especially the non owners. Not likely an idea that you will find explored in those fine NJ schools that you constantly argue for. And as far as the global warming is going, I could use a little more this winter. Darn it all, where did that global warming run off to?

            After the Chavez/Maduro show, if anyone votes in socialism they just about have to be nihilists or insane. If anyone wants a better life, they will repeal the bulk of 20th century liberalism that afflicts our country that is promoted by those fine NJ schools. It’s naive to think that people are drastically changing the climate. That is about like the rooster thinking that his crowing brings the sun up in the morning.

          • Posted by Anonymous on February 18, 2019 at 3:28 pm

            I’m sorry Stanley. I like you. However, you are factually incorrect on much of your last post. To say that one is naive to think that humans are changing the climate is indeed factually incorrect. I don’t see Venezuela here in our future. Just a tweaking where the tables are less tilted. I think far left ideas like that will gain some traction and pull the middle folks a little less. The numbers already show that. Most have NO problem having folks that make more than $10 M pay a higher rate. Doesn’t mean it has to be 70%. As I said before, I am firmly in the camp of if you don’t work, you don’t eat. But I see the tide changing as it did after WW2. Huge tax rates on the rich back than and by any metric life was great. Of course, we had just won a world war but…..

          • Posted by stanley on February 18, 2019 at 4:34 pm

            ” Most have NO problem having folks that make more than $10 M pay a higher rate.”

            The lions share of the taxes are paid by the very wealthy already. You are arguing that the wealthy are consuming too much and it won’t hurt to have them downsize a little. Do you really think that a rich guy is going to switch from silver salmon to pink salmon? Or sell his Gulfstream and buy a Cessna? I don’t think so. You might be able to reduce the business that he does. Build fewer buildings, build fewer products, finance less research and development or finance fewer home sales and so on.

            There are very definitely needed reforms. Health care is badly in need of reform. The sector needs the discipline of serving paying customers. The permitting process desperately needs reform. 15 years to permit and build a nuclear generating plant is insane. We deserve to freeze in the dark. The economy needs the discovery process that economic freedom provides.

            And we need to ship a bunch of democrats off to the soylent green plant.

  2. Posted by NJ2AZ on February 17, 2019 at 4:13 pm

    https://www.state.nj.us/treasury/pensions/documents/forms/ha0897.pdf

    would love to see what the employee portion is for some of those platinum plans. the best plan my employer currently offers (and i have a good employer) comps to the Aetna 2030/2035 freedom plans, and our portion is $612/mo. i’m guessing the teacher’s are getting a far better deal.

    the PWs should all be knocked down to silver plans/gold plans, just like the taxpayers financing their benefits.

    Reply

  3. Posted by Anonymous on February 17, 2019 at 5:17 pm

    I just want to remind everyone the reason for NJ having a Pension crisis is because, the Politicians took money out of Public Worker pensions to pay bills that benefitted Taxpayers. The money was supposed to be paid back but never was. In addition, Town Governments were allowed to stop paying their portion into the Pension for a great many years, further benefitting the Taxpayer on the backs of Public Service workers. To add insult to injury, Politicians now want to further reduce benefits and blame the entire mess on the Public Workers whose money was stolen. In any other civilized society this would be called Theft plain and simple. So now, its long overdue for the money to be paid back. Money that was contractually obligated to Public Workers at the start of their careers. People now complaining how their health benefits aren’t as good as Public Workers, or complaining about the money being paid for their work should reflect on all those bonus’s in years past that their companies paid to them that Public Workers never get. Take some responsibility New Jersey, pay your bills and stop the blame game. You didn’t care that we didn’t want you to take money from our futures, and we don’t care now how you pay it back.

    Reply

    • Posted by Tough Love on February 17, 2019 at 5:44 pm

      Quoting ……………

      “I just want to remind everyone the reason for NJ having a Pension crisis is because, the Politicians took money out of Public Worker pensions to pay bills that benefitted Taxpayers. The money was supposed to be paid back but never was.”

      Where do you come up with this BS …. from your Union ?

      Not one dime has ever been “taken out” of Plan assets other than for paying Plan benefits and expenses. Never, period.

      And where YOU call Taxpayers paying less than the full annual amount necessary to fully fund your pensions an “insult to injury”, I call doing so (i.e., paying LESS) a START at fairness for the Taxpayers, because that “full annual amount” that you would like Taxpayers to pay is based on (i.e., the calculation thereof is A FUNCTION OF) your promised pensions ……… which by any and every reasonable metric are ludicrously excessive, with NJ’s non-Safety-worker pensions typically 2 to 3 times greater in value upon retirement than those of comparably situated (in wages, age at retirement, and years of service) Private Sector workers, and with that 2 to 3 times rising to 4 times for NJ’s Safety workers (with even richer pensions).

      And the real “THEFT” (from the Taxpayers, NOT you) is the underhanded deal-making between your Unions and NJ’s Elected Officials, the result of which are the ludicrously excessive Public Sector pensions (AND benefits).

      —————————

      And quoting ………….

      “Money that was contractually obligated to Public Workers at the start of their careers.”

      Are you nuts ?

      Reply

    • Posted by PS Drone on February 17, 2019 at 6:39 pm

      Ridiculous benefits never should have been accrued, less funding would have been required, no “theft” would have been alleged since the amounts actually contributed would fund rational, logical benefits. You need a pension, not a winning lottery ticket paid for by taxpayers. No “repayment” plan will be forthcoming; If I were you I would plan accordingly.

      Reply

      • Posted by NJ2AZ on February 17, 2019 at 9:54 pm

        i say again and again: if the benefits as they are now actually had to be funded as they were accrued, those benefits never could have been granted in the first place as the required taxation never would have been acceptable to the public.

        look at what funding retiree healthcare is doing to the post office

        Reply

        • Posted by Tough Love on February 17, 2019 at 10:02 pm

          You are correct ………… and it’s a point I have been making for years.

          That’s why DC plans which (BY DESIGN) are fully funded every year, is the ONLY form of retirement security that should exits in the Public Sector ……… and that’s because Elected Officials simply CANNOT be trusted with DB Plans.

          Reply

          • Posted by Anonymous on February 17, 2019 at 11:17 pm

            You are 100% correct. Elected officials cannot be trusted with DB plans. Which is exactly why the Police and Fireman’s Retirement System is now NOT under the control of those same politicians that YOU (correctly) say cannot be trusted. Thank God for that!!!

          • Posted by Tough Love on February 17, 2019 at 11:37 pm

            Anon (El gaupo ???),

            I’d trust a politician running the PFRS pension BEFORE I’d trust your Union. At least the Politician theoretically has to answer to the Taxpayers (AND has to factor in the possibility of being voted out of Office).

            Your Union is driven by nothing but self-interest. ALL Public Sector Unions are nothing but a CANCER inflicted upon civilized Society.

          • Posted by NJ2AZ on February 17, 2019 at 11:53 pm

            EL G, or anyone else who is informed: has there been any progress (or even attempt) to actually segregate the assets for PFRS? I was under the impression everything was still all commingled

          • Posted by Anonymous on February 18, 2019 at 2:20 am

            The PFRS asserts are now separate and can not be used to bail out the other failing systems. And thankfully, we will not be subject to any more pension reform. Our fund is much better shape. The others not so much. Sooner or later Seeeney path to progress will pass and the pension will end for new hires. Not for the cops tho.

          • Posted by Tough Love on February 18, 2019 at 3:37 am

            The PFRS would have a funding ratio of under 50% if valued using the identical valuation assumptions & methodology required of Private Sector DB pension Plans in their valuations..

            Yes. that puts it “in better shape” than NJ’s other Plans, but still in TERRIBLE shape, in fact so “bad” that it were a Private Sector Plan, it would be barred (by Treasury/IRS Regulation) from granting additional accruals.

  4. Sweeney should NOT be serving as state Senator and any elected official. He and Norcross hijack elections; use media sites and trolls to intentionally and purposely manufacture stories; personal hack emails; blogs; Facebook accounts and clone victims smart phones. All of this is criminal cyber stalking and wire fraud. Steve Sweeney is an ugly Bully. A grade school drop out; Racist and demonic. Sweeney abuses his power and
    Violates laws. God is going to take him down in the worse way. He is going straight to Hell where he belongs. He’s nothing but an uneducated, old beat down thug. We are in to you and your digital wire fraud and that’s gonna out you away for life bitch. Those indictments in Philly run deep Sweeney. You’re next

    https://law.justia.com/cases/new-jersey/appellate-division-unpublished/2010/a2152-08-opn.html

    Reply

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