NJ AFL-CIO President Charles Wowkanech: Labor offers realistic path toward meeting N.J.'s pension obligation - Health Professionals & Allied Employees

NJ AFL-CIO President Charles Wowkanech: Labor offers realistic path toward meeting N.J.’s pension obligation

From the Times of Trenton – Opinion, July 18, 2015

By Charles Wowkenach, NJ AFL-CIO President

For the past five years, New Jersey’s public pension system has been a punching bag for a governor seeking the national spotlight. In 2011, Gov. Christie acted like he was extending a hand to help the seriously underfunded pension system back to its feet, while he actually was winding up to deliver another blow. Nearly 800,000 current and retired public employees have been watching this spectacle from the sidelines.

The result is a pension system in such bad shape it’s caused the state’s credit rating to drop nine times under Christie’s watch. This isn’t just a public employee problem. Taxpayers are paying millions of dollars more when the state borrows money (which it does all the time) because of the governor’s fiscal irresponsibility.

When it comes to pension funding, New Jersey is the nation’s biggest deadbeat. The National Association of State Retirement Administrators reports that in the 13 years ending in 2013, New Jersey shortchanged pensions more than $23 billion by making just 38 percent of its required contribution. This is the worst contribution rate in the country. Imagine the balance you’d run up by paying just 38 percent of your credit card bill … for 13 years.

The average pensioner here receives $26,000 per year after a career in public service. Despite the governor’s rhetoric, New Jersey’s pension benefits rank 94th in generosity when compared with the country’s 100 largest plans, according to a New Jersey Policy Perspective/Keystone Research study.

Labor’s Plan to Restore the State Pension System to Health:

  • Phase out Wall Street fees from alternative investments
  • Front-load the pension payment.
  • Put a millionaires’ tax on the ballot.
  • Dedicate any unanticipated revenue to pensions.

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