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State Budgets and Your Pensions

Public employees are not feeling any “holiday love” this season as some political leaders continue to use them as scapegoats in efforts to cut pension plans.

Last night, 60 Minutes reported a segment on state budgets and the financial dire straits many are experiencing.

Illinois and New Jersey served as the poster children for financial dysfunction.

In the 13 minute segment, your public pension plans and benefits were cited as one reason for the out of control deficits.

Gov. Chris Christie took some jabs at public employees in the broadcast by saying his state’s financial crisis is a “benefits problem, not an income problem.”  He also took a pot shot at public unions (you should watch for those remarks around the eight minute mark).

Christie said to reporter Steve Kroft, “We got to change those benefits.”

No union representative was interviewed for the 60 Minutes story.

It is no secret that Christie has declared war on public employees and unions in his state.

Union supporters have long pointed out that New Jersey’s financial quagmire can be blamed on state leaders. For the past decade state benefit programs have been underfunded, they said. In addition, supporters said some state and local employees are barely making ends meet and would be compensated more handsomely if they lived in other areas of the country.

Comments (1) -

  • Douglas Baier (Bremerton)

    12/25/2010 2:29:52 AM |

    This is from Jeff Carnes blog-site "Caveat Lectores" regarding pensions.

    Caveat Lectores on “The End of the Line” by Jim Brantley
    Caveat Lectores usually avoids using the works of others to make a point unless they did a better job that I would have done.

    Jim Brantley, Esq. is a former firefighter from Florida who followed the hallowed footsteps of this writer to attend law school and practice law as a labor attorney. He is smarter than the Lector because he retired before he left so he collects a pension. I take partial credit for helping him through law school only because I kept telling him to settle down and enjoy the ride while in school. Now he has to work like the rest of us.

    Jim is not usually a man of few words, but he punched out some really good thoughts here in only a few words.

    Roger Lowenstein doesn’t mention how public pension funds became so underfunded. During the boom years when pension-fund investment returns were high, the majority of public employers used those returns as justification to take a ‘‘pension holiday,’’ meaning that in the times of high investment returns, many public employers contributed little or nothing to their employee pension plans. Public employees were not given the same opportunity — most plans require the employee to contribute to the plans in both good investment times and bad. In some instances, public employers failed to contribute to these plans for many consecutive years. Now that these plans find themselves underfunded, the employers and Lowenstein are advocating that the employees must foot the bill for this calculated investment error through the reduction or elimination of their pension benefits.
    Jim Brantley, Fort Myers, Fla.

    Jim will be published in the New York Times Magazine on Sunday, July 11, 2010. You read it here first. He has an invitation to contribute to the Rants at Caveat Lectores anytime.

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