N.J. top court upholds lower court's ruling saying state not mandated to pay full teacher pensions

[Ed Barrow]

The New Jersey Supreme Court has declined to hear a case in which the state’s largest teachers union sought full funding for its pension fund.

In rejecting the case Tuesday, the court let stand a ruling by a three-judge appellate panel that said New Jersey is not constitutionally required to pay the millions it owes every year into the fund for teachers’ pensions.

That ruling in March came amid contentious discussion over how to fix the state’s underfunded pension plan — including a proposal that could make full funding a constitutional requirement.

The New Jersey Education Association, which represents more than 200,000 workers in the state’s school systems, sued in 2003, saying its members’ pensions were at risk because the state did not pay its pension bills in full.


http://www.nj.com/news/index.ssf/2010/06/nj_top_court_delinces_to_hear.html

[RKP5637]

1. I remember full well my pension fund being cut to nothing and no recourse... n/t

[Hannah Bell]

2. I see a default in their future; lack of full funding has killed other union pensions.

Teachers/public workers are the last ones in america with anything like security; something that used to be considered "normal" for a much larger proportion of workers.

[NC_Nurse]

3. I don't trust any pension program anymore. These days public and private pensions

are only as good as the current solvency of the govt or corporation. Which isn't a good thing lately and
I doubt it will ever be again. Even a union doesn't protect you from cuts anymore, that's been the case with pilots from the big airlines who got screwed. It's a jungle out there. :(

[mzteris]

4. here's an interesting point from another poster

from poster Nicholas D Wolfwood . . . "We also have to realize that there's a reason why companies like GM and US Steel went out of business, and it's the pensions. We should absolutely honor every teacher's pension, but that doesn't mean we should continue offering it. Long term, it's not a viable financial situation - as it currently stands, 40 cents on every additional education dollar spent by the government goes to teachers that aren't in the classroom anymore. Honestly, it's not a great deal for teachers themselves either - it locks them into careers (which this generation of Americans doesn't like at all - most switch careers 3 times in their lives) if they want to ever see their actual earnings, which they don't realize until they're in their late 40s in most cases. Plus, you can't buy a home with pension money you don't get until you retire. If you look on a dollar for dollar, total compensation package, teachers actually do make a very good living, except that most of it is deferred. I say stop deferring it - the average teacher makes about $45k/year now - bump it up to $80k and axe the pensions. The overlap would mean a short-term investment to switch systems, but in the long run, it will save our municipalities and states a lot of money and will make teaching a much more attractive profession for top college graduates.. . " http://www.democraticunderground.com/discuss/duboard.ph...

[NC_Nurse]

5. I understand the point of view, I just wonder if most Americans would take the

higher salary and use it to plan for their own retirement. The 401k has not proven to be a very good alternative to
a pension because most people either under-contribute, and of course, those who do might get hit with a financial downturn like we have now.

It's a tough call.

[Hannah Bell]

6. neither gm nor us steel "went out of business". for starters. not because of pensions or any other

reason.

so there's your first reason to discount whatever follows from that false premise.