New Jersey Governor Chris Christie is once again taking aim at the pensions of state workers and teachers. He issued an executive order May 20 unilaterally slashing the state’s contribution to the public pension fund by $900 million in order to plug a sudden shortfall in this year’s budget. He also said he wants cuts of a billion and half dollars more next year, but he has to get the legislature’s okay for that. He also promised he would come out soon with a plan for more pension and benefit changes.
Tom Moran, chief of the Newark Star-Ledger’s editorial board—perhaps making amends for the fact that he and his newspaper endorsed Christie for re-election in 2013 and then, embarrassingly, retracted it after the fact when Bridgegate erupted—calls the governor’s actions the “final straw” in putting an end to Christie’s presidential ambitions:
Mark this week on your calendar as a turning point in the drama of Chris Christie, the moment when his presidential ambitions were finally snuffed out, once and for all. … Because this was this governor’s landmark achievement, the heart of his appeal. He was supposed to be the magician who came to Trenton, knocked some heads together and cleaned up the fiscal mess.
Moran goes on to say:
As it turns out, he did only the easy part. He made public workers pay more for skimpier benefits, and froze cost-of-living adjustments for current retirees. That tough medicine was justified to deal with the emergency.
But the other half of the deal was just as important. For his part, Christie promised to ramp up state payments into the pension funds gradually, over seven years, to make up for the scofflaw governors in both parties who shorted these funds over two decades.
The point is that both sides had to absorb their share of pain. Public workers did their part. Now Christie is saying he will not do his, that he will short the funds by a whopping $2.4 billion through next year.
A “sudden” budget crisis erupted over the last several weeks when state income tax revenues in April came in way under projection, primarily because of maneuvers in 2012 by wealthy residents to avoid anticipated higher federal tax rates in 2013, according to NJ Spotlight.
Christie, like some of his fellow Republican presidential hopefuls, including Wisconsin Governor Scott Walker, has been touting his ability to rein in public pensions and benefits. Two years ago Christie worked out a budget deal with two Democratic Party bosses to slash pensions and health benefits and increase out-of-pocket payments from state employees. He agreed then to make significant contributions in upcoming years to the pension fund, in order to reduce its long-term deficits. Now Christie’s budget balancing sleight of hand rips that agreement to shreds.