The dispute is not about money — the unions agreed to salary and benefit concessions early on. The Governor just wants to bust the union because it supported his opponent in last fall’s election. It is actually rather chilling. There is no reason he could not try to do so with a private business that did the same thing.
There has been a lot of bashing of public employees recently because of what is perceived to be their generous pensions. The bashing ignores three things:
(1) In public safety agencies, it is essential to have generous early retirement, lest you have 59 year old firefighters with heart disease trying to carry you out of a burning building, and 59 year old police officers with heart disease trying to subdue a criminal who is resisting arrest. The early retirement is for the good of the agency.
(2) Had the politicians been making the required pension contributions as is required of every private sector company, the pension funds would not be in such bad shape. Instead, the politicians have been diverting the money for other spending and for tax cuts. Democrats and Republicans are both guilty of this. And the politicians who are attacking the unions are committing this grand robbery even today: Both Christie and Bloomberg have skipped pension fund contributions. The robbery is truly on a Madoff level — the unfunded liability to New Jersey alone is over fifty billion dollars. Those who are bashing the public employees are blaming the victims.
(3) Benefits earned in the past must be paid. The unions should indeed agree to more affordable pension plans for the future. But even if they did, how can they be sure that the politicians won’t just steal the money as they have in the past? If I were still a public employee, I would urge the adoption of defined contribution plans with immediate vesting. In fact, when I was a public employee a number of years ago, I opted for such a plan rather than the traditional retirement plan. My retirement money was not stolen. The trouble is, that would prevent the politicians from EVER playing games with the pension funds, ever again. It is much easier to bash the employees.
(4) Compensation of government employees must be competitive in order to attract the best and brightest into government service in careers such as teaching. Government agencies are not immune from the effects of labor markets. You get what you pay for.