Governor Chris Christie was the big winner last night when he and the state’s top Democratic and Republican legislative leaders announced they had reached agreement on legislation that would require teachers, police, firefighters and other government employees to pay more toward their pensions and healthcare.
The agreement would effectively strip public employees of the right to bargain over health benefits in their union contracts by having the state unilaterally set health benefit contribution levels through legislation. The unions will undoubtedly challenge any such law in court, but previous court opinions in New Jersey, Wisconsin and other states have upheld the legality of such laws.
"We expected this from Governor Christie, but we did not expect so-called Democratic leaders to abandon working families,” Hetty Rosenstein, New Jersey state director for the Communications Workers of America, (CWA) said last night on the eve of a previously planned 9 a.m. mass rally by union workers at the Statehouse.
The rally is expected to bring thousands of public and private union members to Trenton.
"Make no mistake: more than one million unionized New Jerseyans are passionate, engaged and outraged -- and the soul of the Democratic Party is at stake," Rosenstein continued. “We call on true Democrats and the State Senate and Assembly to reject this unprecedented assault on workers' rights and insist that Governor Christie negotiate in good faith with his state’s public workers,” she said.
In contrast to that sense of anger and betrayal, the statement by the governor's office was understated. Besides Christie, it listed Senate President Stephen Sweeney (D-Gloucester), Assembly Speaker Sheila Oliver (D-Essex), Senate Minority Leader Tom Kean and Assembly Minority Leader Alex DeCroce (R-Morris).
“After months of serious discussions, we are pleased to announce that we have reached agreement on legislation to reform our public pension and health benefits systems in New Jersey,” the statement read. "We all fully support this legislation and will work together to assure its passage by both houses of the Legislature and enactment into law no later than June 30, 2011."
Christie could not have scripted it better politically, even if he didn’t get all of the savings he wanted.
Sweeney’s proposed pension and health benefit legislation was a "Christie Lite" version of the plan the governor laid out in his March budget address. Where Christie’s plan called for public employees to pay 3 percent more of salary toward their pensions immediately, Sweeney’s legislation calls for government workers and teachers to pay 1 percent immediately and an additional 1 percent phased in over the next seven years. (Police and firefighters pay an additional 1.5 percent immediately.) While Christie wanted public employees to pay 30 percent of the cost of their health care premiums, Sweeney’s plan provides for public employees to pay from 8 percent to 30 percent on a sliding scale based on income.
Sweeney, a business agent for an Ironworkers Union local who is the highest-ranking state government official to come out of the ranks of labor, has been calling for public sector workers to pay more toward their pensions and health care since 2005. He believes passage of his legislation would take a campaign issue away from Christie and the Republicans in the November elections, and he defends his legislation as less onerous for public employees than what Christie was seeking.
But labor leaders found it incomprehensible that a union leader like Sweeney would go along with Christie in stripping public employees of the right to bargain over healthcare benefits, especially when negotiations were already underway on new state worker contracts this spring and Christie had proclaimed his eagerness to engage in tough negotiations at his various town meetings.
To state and national labor leaders, the Sweeney-Christie plan was just the latest in a wave of national efforts to crush the power of public employee unions that began in Wisconsin with legislation passed by Republican Governor Scott Walker and his GOP-controlled legislature. That law effectively stripped public employee unions of the power to negotiate anything other than pay raises -- and then only up to the rate of inflation.
Charles Wowkanech, president of the New Jersey State AFL-CIO, and leaders of the state, local government, police and firefighter unions have publicly attacked the legislation both for bypassing collective bargaining and for the level of pension and health benefit increases the bill would impose on middle-income public employees when Christie is refusing to consider imposing a millionaire's tax surcharge. The AFL-CIO has warned that efforts to limit collective bargaining in the public sector will be followed by attacks on collective bargaining in the private sector, and they have continued to lobby legislators to oppose the bill, regarding the Assembly as their best chance to block the legislation.
The New Jersey Education Association (NJEA), which is not a member of the AFL-CIO and which has been a particular target of Christie's since he took office, effectively declared war on Sweeney yesterday by launching a $1 million television ad campaign in the New York and Philadelphia markets. The ad attacks not only Sweeney, but also his South Jersey political mentor, George Norcross III.
The NJEA ad charges that a provision in the Sweeney legislation requiring public employees to use New Jersey health care providers is designed to "protect Norcross," who is the president of a New Jersey insurance firm and serves as chairman of Cooper University Hospital in Camden.
While the NJEA attack ads were aimed at undermining the Sweeney legislation, Sweeney, Norcross and others counterattacked the NJEA on school reform issues that had nothing to do with the pension and health benefits legislation.
Sweeney accused the NJEA of wasting $1 million on its attack ad, and Norcross responded by pointing out that his insurance company does business in all 50 states, so the provision would not benefit him.
What was most significant about the NJEA attack is that it may just be the first shot of the fall legislative campaign. Two months ago, Christie and the Republicans were reeling after Democrats won approval for a legislative redistricting map that virtually guaranteed preservation of their 24-16 majority in the New Jersey Senate and 47-33 edge in the state Assembly.
But legislators with long memories recall how the NJEA almost took out Senate President John Lynch, the Middlesex County Democratic boss, in 1991 because it was angry that he had sponsored legislation to shift some teacher pension costs to local school districts, which the NJEA feared would negatively affect teacher pension payouts. That was the same 1991 election in which Republicans took back control of the Legislature from Democrats in the backlash against Democratic Governor Jim Florio’s $2.8 billion tax increase.
Norcross was a key player with Essex County Executive Joseph DiVincenzo in engineering the leadership coup that ousted Senator Richard Codey from the Senate presidency in December 2009 in favor of Sweeney and put in the relatively unknown Oliver, who is employed as an aide to DiVincenzo, as Assembly speaker to replace retiring Speaker Joseph Roberts.
It was Oliver who announced last Friday that she and Sweeney had come up with a compromise provision that would "sunset" the healthcare premium payment provisions of the Sweeney bill and specifically allow public employee unions to again bargain on health care issues as the fiscal year 2014 – the year after the next gubernatorial election. It is unclear whether that sunset provision remains in the compromise announced by Christie and the four legislative leaders last night, but the provision was clearly designed to lessen union opposition.
However, Oliver’s willingness to consider Sweeney’s legislation despite strong opposition within her Democratic caucus -- and, in fact, within her own Essex County Democratic Assembly delegation -- was challenged sharply by Assembly Majority Leader Joseph Cryan (D-Union), the second-ranking Democrat in the Assembly after Oliver, and by Assemblywoman Bonnie Watson-Coleman (D-Mercer), a former state Democratic chair who had been considered one of the favorites for Assembly speaker because the Sweeney-Oliver leadership deal was arranged.
Oliver said previously she would not post the Sweeney legislation without significant support from the 47 members of her Democratic Assembly caucus -- and Cryan maintains that more than half of the Assembly Democrats remain adamantly opposed to the legislation.
Reginald Jackson, the influential executive director of the Black Ministers Council who is aligned with Christie on expanding charter schools and providing school vouchers in inner cities, came out with a press release on Tuesday warning Cryan preemptively against any attempt to seek a "no confidence" vote that would challenge Oliver’s position as Speaker.
Jackson also was one of the members of the Urban Education Reform Coalition who defended Norcross last night at his Cinnaminson press conference and who was listed in the press release characterizing the NJEA’s attack ad as just another example of the "union cartel opposing school reforms to protect its own interests." Christie and Norcross appeared together a week ago at a joint press conference in Camden County focused on expanding charter schools, which the NJEA opposes. Newark Mayor Cory Booker, who also has found common ground with Christie on school reform issues, also showed up last night to defend Norcross and attack the NJEA.
This represents the second year in a row that Sweeney and Oliver have worked out a deal that would give Christie the ability to pass major legislation by adding just the handful of Democratic votes needed to those of the Republican minority in the Senate and Assembly. But the deal on the pension and health benefits legislation this year is not like last year’s budget deal, when most Democratic legislators acquiesced because they wanted Christie and the Republicans to take the blame for school aid, municipal aid and property tax rebate cuts.
Watson-Coleman, Cryan and other Democrats have questioned whether the Democratic legislative leadership was sacrificing its heart and soul in aligning itself with Christie on pension and health benefit legislation of critical interest to the Democrats’ traditional labor allies.
But the real question is whether Christie’s evidently close ties with Norcross, DiVincenzo and other Democratic power brokers such as Hudson County’s Brian Stack will continue to give Christie the Democratic legislative votes he needs when he needs them, including the final votes he will need to pass his budget by June 30.
It is a question asked increasingly by Democrats and political analysts in other states who do not understand how Christie can continue to achieve legislative victories when he does not control either house of the legislature, and how New Jersey Democrats can continue to allow the darling of the national Republican Right to burnish his credentials for a future White House run -- even if he is waiting for 2016, as most recent interviews suggest.