Christie’s Pension Onslaught Upheld by New Jersey Court
Determined to ride on the backs of public employees in his bid for the Presidency, Chris Christie has broken promises to public servants, demonized them and imperiled the financial future of teachers, firefighters, police and state workers. It is estimated that the fund will go broke in 10 to 12 years.
The New Jersey Public Employment Retirement System (PERS), which covers almost 800,000 current and retired employees, is now funded somewhere between 44 and 50 % of the level necessary for a secure retirement for public servants. Governors and the State Legislature have chronically underfunded the pension system for years, using the “savings” to create the appearance of balanced budgets and then blaming public employees for the crisis of the system. Christie, in his bid for the Governorship, promised to stabilize the system and fulfill the State’s obligation to its employees.
Writing in Rolling Stone, Matt Taibbi states, “…in August 2010, the SEC reprimanded the state of New Jersey for serially lying about its failure to make pension contributions throughout the 2000s.”New Jersey failed to provide certain present and historical financial information regarding its pension funding in bond-disclosure documents,” the SEC wrote, in seemingly grave language. “The state was aware of. . . the potential effects of the underfunding.””
Instead, when Christie took office, he unleashed an attack on public employees with the cooperation of a wing of the Democratic Party led by Senate President, and Ironworkers Union bureaucrat, Steve Sweeney, a tool of the powerful South Jersey Democratic Party machine. Retirement and health benefits were cut back and new employees are siphoned out of the pension set-up into something resembling a 401K.
On June 9, the New Jersey Supreme Court held that Christie does not have to make the pension contribution called for in the 2011 Pension Reform law. This law required increased employee contributions and a series of state payments to be made over a period of 7 years which were supposed to bring the system back from the brink. The Court ruled that Christie was relieved of the responsibility for the state’s portion, but did not relieve public employees from making increased contributions in the future.
This is not an isolated attack, it is part of a national attack on pensions and the right to retire. The bosses want to take every gain made by the US working class in the post-war period away. A naked grab for workers’ pensions by Wall Street aims to put more money in the coffers of the ruling class at the expense of workers. Public pension funds represent more than $2.6 trillion, a potential windfall for already fat investment firms.
In the days following the court decision, Christie appeared at GOP campaign events in New Hampshire and Iowa touting his tough guy stance against unions, while advocating major cuts to Social Security and Medicare in the guise of “entitlement” reform. Christie would raise the retirement age to 69 by 2022, with the early retirement age boosted to 64. Christie proposes to eliminate income taxes for seniors who chose to stay in the workforce after they reach the early retirement age. He also wants to raise the age for Medicare incrementally over a period of years to age 69.
Protecting the right to retire is an urgent task. This means that the labor movement has to take an uncompromising stand in defense of pensions, Social Security and Medicare. Only a mass movement of working people, including retirees, can effectively stop the onslaught against our basic right to live without fear into old age. Time and again, the Democrats have proven themselves no friends to working people. It’s imperative that the unions stand up to both parties and say: No Compromises! Hands off Social Security and Medicare! Pensions for all workers!