What parent in his or her right mind would give a teenager unlimited use of an unlimited credit card? No parent I know. So we must ask what legislator in his or her right mind would give public-employee unions unlimited use of tax dollars to pay for unlimited public-employee pensions? You would think the answer to that would be “no one.” Not so in New Jersey.
The state Legislature has just approved Senate-Bill 3040 to turn over the police and fire pension system to the police and fire unions. Well, most of the system, anyway. The part of the system that pays for the benefits would still belong to the taxpayers. The public-employee unions would get to decide what benefits they want and how much to charge the taxpayers. The taxpayers get to pay the bill. The whole bill. Public employees want better benefits? No problem. The taxpayers will pay.
Proponents of the bill argue that the New Jersey system has been so badly run that letting the public-employee unions take it over would be a good thing. Of course, they are just talking about the unions taking over the spending side, not the paying side.
It is true that the New Jersey retirement system has been a disaster, with systematic overpromising and underfunding running up billions of dollars of pension debt. You might think it could not get any worse. You might think letting the public-employee unions take it over might not be disastrous. You would be wrong.
If you think legislators and governors have been irresponsible, too willing to give out sweet benefits and too unwilling to pay for them, you are right. But legislators and governors at least have to face the voters from time to time. Instead, this bill would put people in charge of making decisions who never have to face the voters. People who have no interest in controlling the spiraling costs of existing or future benefits would get unlimited credit cards. New Jersey is set to jump from the frying pan into the fire.
The unions argue you need to minimize political interference. The premise is true, but this solution is completely wrong. You don’t minimize political interference by giving control to one of the most influential special-interest groups in the state and cutting the taxpayers completely out of the system. That’s just capitulation. That’s how you maximize political influence for the public-employee unions, and minimize political influence for taxpayers.
The public employee unions will be able to give out benefit increases without those pesky taxpayers sticking their noses into the process. The public-employee unions will be able to invest tens of billions of taxpayer dollars through their friends and into politically correct, union-friendly companies. All with no risk if the investments fail to produce returns. No worries. The taxpayers are on the hook.
Yes, New Jersey, things are bad. Your pension debts are enormous. But this bill will make them far worse.