Imagine, a law that requires ongoing adequate funding🤔

The State of New Jersey does this for its roads … but not for its pension obligations.

Too bad Social Security and Medicare trusts don’t operate in a similar manner.

Do you wonder why❓IMHO it’s simply which tax increases are the easiest to hide and quickly forgotten by the public.

3 comments

  1. Maybe. More likely is the fact that New Jersey has over-promised and under-funded public employee pension plans. So long as politicians believe they can commit taxpayers to fund their vote buying initiatives, we will always have politicians like this New Jersey idiot who assert it is OK to increase revenue demands (versus curtailing the public employee workforce, or the public employee pensions or health coverage) as part of the ordinary process for the public purse.

    When private sector firms see reductions in revenues, you know employment, benefits, salaries or all of the above will be curtailed. Not so, apparently, for the public employees and public operations in New Jersey.

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    1. Absolutely correct. I was on three task forces to evaluate pensions and benefits, the last chaired by the now governor. It was mostly a farce. People can borrow from their DB plan at an interest rate lower than the assumed return. The state still reimburses many retirees for their Part B premiums.

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  2. Totally in favor of such funding laws for trust funds and long term public “bonded” projects.

    But the funny thing was the NJ governor announcing this tax increase at his news conference. First, he announced the “jaw dropping” high unemployment numbers followed by the requirement to increase the fuel tax because nobody was driving to work. I still don’t think that he has put 2 & 2 together that nobody was going to work because he has shutdown the state for the covid-19 and he still has parts of the economy shutdown.

    Now the problem with such laws. The stable funding is great to pay back bonds but it does nothing to reduce the projects in bad economic times. Meanwhile the fuel tax will keep going up resulting in a higher cost of living for those who still have jobs. Forturently, the law does allow for the gas tax to go down if consumption goes back up, that is until we are all driving electric vehicles.

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