Actually Jersey’s public pension system is not “open-ended” - it is funded at set levels of payback as in effect delayed compensation through contributions made by state-workers and supposedly by the state - up until about twenty years ago the system was one hundred percent funded by these set levels until Governor Christie Todd Whitman - a Republican - “borrowed” a billion or so dollars from the fund to cover shortfalls in other areas of government, especially her pet environmental projects - governors since then have not only continued to “borrow’ funding, but have failed in many cases to make the state’s payments into the fund as required by law - a couple of issues probably not addressed in the article (I didn;t read the whole thing) are that Christie’s proposal is to turn the pension system over to the unions to run (and we all know how trustworthy unions have been with pension money in other venues) and his proposal will require the public to approve by vote a constitutional amendment allowing the move because as of now the Jersey constitution requires the state to provide the pension - the Jersey pension system is on shaky ground, but more so because politicians have been siphoning money out of the fund and refusing to pay into it as required by law (although a judge only a few days ago ordered Christie to pay 1.5 billion dollars which he was refusing to do) than because of the rapaciousness of the state workers......
An acquaintance just retired at 46 as a cop in NJ; the public-sector “workers” are to blame for this problem in NJ. This guy will most likely spend more time collecting his pension than he ever spent working.
What really has brought this to a head is that a lot of teachers in NJ would stay on the job well past retirement age because they didn’t have to do any work and raked in incredible salaries (due to union rules, based on years of service); within the last couple of years those teachers were offered great packages if they retired or risked a lot if they stayed on - so they retired. Those costs, coupled with the costs of their replacements, are crippling the state.
Christie has maintained he will not raise taxes; he knows that is just speeding up the death spiral here by forcing more and more companies and Americans to flee (shrinking the tax base further). Nobody is foolish enough to open a business or buy a house here as long as it means buying a share in a huge IOU to people who retired decades ago; one can expect no return at all on current taxes paid to the state/municipalities while we pay off those commitments to former “workers”.
Thanks for your insight.