Pensions and Tax Cuts --- The Past Becomes Present -New Jersey Edition

[benld74]

>Snip
It's important to keep in mind that none of this is a surprise. When Whitman was defunding the pension system in order to cut taxes, there were warnings that this is exactly what would happen. Here, for example, is a September 5, 1994 Washington Post article:

The first thing Christine Todd Whitman did upon taking office as governor of New Jersey in January was to cut the state's income tax. Then in July, as she signed into law her first state budget, the Republican cut taxes again while simultaneously closing the huge deficit left by her predecessor.

This is what her supporters call the Whitman miracle, the fiscal accomplishment that has sent her stock soaring among New Jersey's voters and transformed her on the national scene from a political unknown into one of the Republican Party's newest stars.

…

But the key to the Whitman miracle lies neither in her political philosophy nor in her spending cuts, but rather in the fine print of her budget. Contained there is a series of arcane fiscal changes that some experts say amount to this: Christine Todd Whitman has balanced New Jersey's books and paid for her tax cut by quietly diverting more than $1 billion from the state's pension fund.

Whitman calls what she did a "reform" of the pension system that puts it on a more "sound actuarial footing." Others are less charitable. The one thing that even the actuarial consultants hired by the Whitman administration agree on, however, is that the chief effect of the changes will be to shift billions of dollars in pension obligations onto New Jersey taxpayers 15 to 20 years from now.

Let's see, that article ran in 1994, so 15 or 20 years would be right about … now. Huh.

Snip>

And another Republican is going to fix it??!?!?



http://mediamatters.org/blog/201103070032

[LiberalEsto]

1. Sounds like Whitman could use some "reform"

in prison.