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Reader says , “public pension funds will be insolvent by 2027… which means NJ taxpayers have unlimited liability carrying the $12B per year”

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“NJ already has the highest combined, state, local, and corporate tax rates in the United States… and the public pension funds will be insolvent by 2027… which means NJ taxpayers have unlimited liability carrying the $12B per year paid out to retired public sector workers, plus their PAYGO (pay as you go) platinum health insurance… Ponzi scheme where the math doesn’t work when private sector employers are leaving and aren’t investing in the state. NJ also has net migration which only worsens the Ponzi scheme. Public sector unions only care about squeezing more blood from a shrinking stone. Greedy pigs “

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 “Same for CA, IL, etc, but When the state sends out $12bn a year already in annual pension checks (or 1/3 of our current annual NJ state budget), we have an unlimited pension liability in perpetuity once the public sector pension funds go insolvent by 2027… and that’s not even including “pay-as-you-go” (PAYGO) platinum healthcare insurance… the math doesn’t work. States like NJ, CA, IL, etc will have to explore bankruptcy filings to protect them from all of these excessive liability claims! “

34 thoughts on “Reader says , “public pension funds will be insolvent by 2027… which means NJ taxpayers have unlimited liability carrying the $12B per year”

  1. The reason the Pensions are underfunded is because the Pension fund Managers kept lining their pockets with outrageous fees. Under Chris Christie, the New Jersey pension system paid more than $600 million in fees to financial firms in 2014 — 50 percent more than the previous year , and a higher rate than almost any other state reports paying for pension management. The figures are buried within an otherwise routine annual report that appeared to change the way the fees were counted to make them look smaller than they actually are.

    That accounting change comes at a time when the Christie administration is under scrutiny for investing pension money in high-fee firms whose executives made campaign contributions to Republican political groups. The move obscuring the increase in reported fees also comes on the heels of Christie telling New Jersey teachers, firefighters, cops and other public workers that “there are no alternatives” to cutting their retirement benefits because the state pension system is so strapped for cash…..

    The PIGGY Pension Managers are the only reason the Public Pensions are underfunded.

    https://www.ibtimes.com/chris-christie-administration-paid-600m-financial-fees-2014-1833872

  2. The real piggies 🐷 are on Wall Street! Those piggies 🐷 steal money from hard working man and women through their Pensions or Retirement accounts with hidden fees, commissions, charges and out and out thieft. If the Pension Manager Fees were reasonable the NJ Pension system would be properly funded.

    Have you noticed the guy complaining about the pension system being underfunded NEVER backs up his foolish statements with a link to the facts. The reason is he is one of those Pension Fund Managers making tons of money off the New Jersey Pension funds because he is one of the managers of those funds.

    https://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/retirement-gamble/how-retirement-fees-cost-you/

  3. Well the politicians need to stop stealing the money for their projects.
    1, major road construction throughout the state.
    2, bad wall Street investments Corzine.
    3, major investment at their gigantic mall at the Meadowlands.
    Every time they do this they’re not repaying the money that they are borrowing. No one talks about that. Let’s stop blaming the workers it’s always the little guy they go after. Stop the bullshit. Isn’t it funny Chris Christie Was a prosecutor and he did the same shit.

  4. Thanks to the pension manager hogs 🐷 and pension manager pigs 🐷 New Jersey public sector pension systems are seriously underfunded. Those piggy 🐷 managers collected outrageous fees effectively stealing money out of hardworking employees.

    https://www.rollingstone.com/politics/politics-news/looting-the-pension-funds-172774/

  5. I don’t know I work in the private sector. And I have an excellent benefits package. And a bonus. Government employees do not get bonuses.

  6. Waiting till July 1. Anyone retiring with enormous amount of vacation and sick time built up. Well from what we are reading you will be leaving with a combination of $7500 that’s it. So much for building a sick time .

  7. Union bosses don’t understand simple math. Make concessions now or get nothing later. At some point NJ will become insolvent.

  8. Ok start with management making 175,000 or more .

  9. No Problem… We’re RICH and STUPID… we’ll happily pay.

  10. Who is the IDIOT talking about the Pension system being a Ponzi scheme. A couple of hundred million a year in management fees? That’s bullshit, try a couple BILLION a year. You pension managers are through screwing people trying to save for their retirement in New Jersey. You and your PIGGY buddies have been exposed for what you are PIGGY Thieves. New Jersey has passed legislation that makes Piggy investment advisors like you responsible as a fiduciary. I am glad to have been involved in lobbying for and successfully getting this regulation proposed. Piggy investment managers like YOU will no longer be able to steal from hardworking men and women who are saving for their retirement.

    https://www.nj.gov/oag/newsreleases19/pr20190415b.html

  11. Not only do the GREEDY HOG Pension managers steal money from the Pension System they also lose BILLIONS on stupid investments trying to increase their fees and charges. Who loses out when these Pension Managers make stupid GREEDY decisions? The hard working men and women trying to save for their retirement, that’s who! The Greedy Pension Managers don’t lose a dime.

    HERE’S PROOF
    A New Jersey pension fund run by one of Barack Obama’s earliest and biggest campaign fundraisers/bundlers has lost $25 billion — including $9 billion in October, according to a report issued today by a state panel. The New Jersey Investment Council, chaired by hedge fund manager Orin Kramer, says that the value of the state pension fund has shrunk from $82 billion in July to $57 billion.

    https://observer.com/2008/11/obama-bundler-says-he-lost-25-billion-of-n-j-pension-funds/

  12. that legislation has nothing to do with pensions , the state hires them the state pays them …..hummmm kick backs maybe???

  13. Under Chris Christie, the New Jersey pension system paid more than $600 million in fees to financial firms in 2014 — 50 percent more than a year ago, and a higher rate than almost any other state reports paying for pension management. The figures are buried within an otherwise routine annual report that appeared to change the way the fees were counted to make them look smaller than they actually are.

    That accounting change comes at a time when the Christie administration is under scrutiny for investing pension money in high-fee firms whose executives made campaign contributions to Republican political groups. The move obscuring the increase in reported fees also comes on the heels of Christie telling New Jersey teachers, firefighters, cops and other public workers that “there are no alternatives” to cutting their retirement benefits because the state pension system is so strapped for cash.

    “The lack of transparency, skyrocketing risks and fees and chronic underperformance makes New Jersey the poster child for the kind of shenanigans happening in pension systems across the country,” said former Securities and Exchange Commission attorney Ted Siedle, who conducts forensic investigations of state and local pension systems.

    The report from the Christie-appointed State Investment Council was released in late January. It shows that taxpayers spent $600.2 million — or $1.6 million a day — on fees to private financial firms in 2014. The year before Christie took office, New Jersey’s State Investment Council reported that the pension system paid $125 million in financial management fees. By 2013, the state reported paying $398 million in such fees.

    In all, since Christie took office, his administration has spent $1.5 billion of retirees’ pension money on Wall Street fees. That’s more than the cut Christie made to the state’s required pension payment in 2014, and it is more than the state has budgeted for its entire Department of Environmental Protection over the last 5 years. Had the Christie administration maintained the fee level the state was paying in the year before the governor took office, the pension system would have saved more than $914 million.

    The higher fees are a result of the Christie administration shifting billions of dollars of pension money into high-fee hedge funds, private equity, venture capital firms and other so-called alternative investments in politically connected Wall Street firms. State records show the share of alternative investments in the pension portfolio has increased by nearly a third.

    https://www.ibtimes.com/chris-christie-administration-paid-600m-financial-fees-2014-1833872

  14. hate to break it to you but $600 million is chump change , The New Jersey pension system’s funded ratio was 35.8 percent during the 2017 fiscal year, according to the S&P report. (The funded ratio is a comparison of the pension plan’s total assets and its liabilities.)

    Murphy’s first state budget increased the state contribution to pensions to a record-high level of $3.2 billion. But that budgeted payment represents only 60 percent of the total calculated by actuaries, meaning the pension hole will continue to deepen even as the contribution is rising.

  15. That’s correct James, that legislation has nothing to do with pensions, however it will require all retirement account managers and advisors to be fiduciaries and prevent them from charging outrageous fees to manage retirement accounts which has been an ongoing problem nationwide.

  16. I got a better return on the vanguard SP 500 index fund.
    Lowest fees since it’s not “managed”
    The hedge funds charge 2+20 and use this as their benchmark to beat.
    They rarely do but still eat up 2% despite lackluster performance or losses.

  17. in the long run most people should stick to index funds and focus on a plan of regular investment (ie dollar cost averaging) , if you have a hedge fund that does not significantly beat its bench mark after fees you are investing with the wrong people

  18. Is that number (35.8) the median of all of the state county and local Pension systems? I don’t think so. That may be the Teachers Pension System funded ratio, but NOT all of the funds ratios.

    Here is the latest Pension System Report……. https://www.state.nj.us/treasury/pensions/documents/financial/annrpt2018/2018divisioncombined.pdf

  19. The New Jersey pension system’s funded ratio was 35.8 percent during the 2017 fiscal year, according to the S&P report. (The funded ratio is a comparison of the pension plan’s total assets and its liabilities.) Not sure if that is just state workers or included all state pensions like teachers

  20. I agree James,

    Dollar cost averaging and investing in different sectors inside various mutual finds (Growth, Growth & Income, Emerging Markets, and International)within large and small cap index funds is the way to go. ETFs are also an interesting play.

  21. James,

    FYI, here are the Statutory Funded Ratios and Unfunded Liabilities – FY 2018. You will notice that the local Pension Plans are over 70% funded. The huge underfunding is in the State Pension Plans. The person complaining about the underfunding of pension plans and the state going bankrupt because of local Police and Firefighters pensions doesn’t know what he is talking about. The problem is at the state level, NOT the local level.

    State Pension Plans
    PERS – 45.1%
    TPAF – 59.3%
    PFRS – 40.6%
    CP&FPF – 105.8%
    SPRS – 56.5%
    JRS – 31.3%
    POPF – 201.3%

    Local (County and Municipal) Pension Plans
    PERS – 70.3%
    PFRS – 73.5%

    Source: New Jersey Department of the Treasury, Division of Pensions and Benefits. Information was derived from the actuarial valuation reports as of July 1, 2018

    https://www.state.nj.us/treasury/pensions/documents/financial/gasb/statutory-summary-chart-2018.pdf

  22. managing a multi billion dollar pension fund is entirely different than managing your 401K ,obviously you need a huge amount of cash on hand to meet current pension payments

  23. smart money is moving south. sooner than later ..don’t be the last one holding one of the ridgewood height mini mansions when the crap hits the fan..happened before ..
    will be much worse when there are few takers outside of the real estate collapse buzzards ..Business model in Ridgewood is to flip the house to the new rubes with four kids and A huge mortgage ..

  24. I just clicked on the link in the comment above (See Below)

    https://www.state.nj.us/treasury/pensions/documents/financial/gasb/statutory-summary-chart-2018.pdf

    And checked out the numbers. According to that information we are no where near being $130 billion in unfunded liability. Here is what someone said….

    “Maybe the money will grow on trees to make up the 64% unfunded pension hole which equates to a $130 billion unfunded liability?!?!”

    So tell us MR. 130 Billion, where did you get your number from? Or are you just making it up as you go along!

  25. While one of the central tenets of repeated calls for major changes to New Jersey’s public pension system is the claim that public employee pensions are overly generous, retirement benefits for the state’s public workers are already among the least generous of all large publicsector pensions in the country, in part because of cuts enacted in the pension reforms of 2011.

    In fact, New Jersey ranks 95th in pension generosity among the country’s 100 largest plans.

    To arrive at a ranking for each plan, we measured three key dimensions of pension generosity: whether the plans offer inflation protection to retirees, how benefits are calculated and the amount employees contribute to their own retirement plans. (For the full methodology, see Appendix A.)

    Here’s how New Jersey gets its low ranking for overall generosity:

     New Jersey retirees have no automatic protection against inflation. While 69 of the 100 largest plans offer retirees some inflation protection, cost-of-living adjustments for New Jersey retirees were suspended indefinitely by the 2011 legislative pension reforms.

    New Jersey Has Modest Public Pension Benefits
    http://www.njpp.org 2

     New Jersey uses a very low multiplier. The percentage by which New Jersey calculates state pensions per year of service – known as the multiplier – is among the lowest nationally, at 1.67 percent. This means pensions benefits equal 1.67 percent of final salary multiplied by the number of years of service; 1.67 percent is a lower multiplier than all but 21 of the 100 plans. New Jersey lowered the multiplier from 1.81 percent in 2011.

     New Jersey employees pay more into the system than those in most other systems. New Jersey public employees contribute 6.93 percent of their salaries to their own pensions, more than 55 other plans in the top 100. By 2018, the employee contribution level for New Jersey pensions will rise to 7.5 percent, which is more than employees contribute today in about two-thirds of the top 100 plans.

    In addition to being some of the least generous pensions in the country, New Jersey’s pensions are modest in dollar amounts, even though the Garden State remains one of the highest-cost states in which to live.

    Pension benefits in New Jersey average $26,000. State employees receive $25,000 on average and local government employees about $16,000. Teacher pensions average $40,000.2 While police and fire personnel receive higher average benefits, their benefits are inflated by comparison with other groups (both public and private) because New Jersey police and fire retirees do not receive Social Security. Correcting for this brings safety personnel average benefits down to $41,402.

    http://njpp.org/assets/reports/NJPPPensionBenefitsDecember2014.pdf

  26. lol nice try , broke is broke

  27. James, I realize its difficult to accept the facts when you know nothing about what your talking about, go back to what you do best, blogging.

  28. Here is a history lesson for you James…..

    February 22, 1995,
    The New York Times
    Over the past 25 years the State of New Jersey has struggled, under a succession of Democratic and Republican governors, to reverse a social and economic decline that, by the 1960’s, had hit many Northeastern industrial areas.

    Difficult budget decisions were made, often at significant political cost. But the benefits for New Jersey residents were many. A vastly improved higher education system was developed and state aid to local public schools surged. The environment was cleaned up. Mass transit was improved. The state’s budget was balanced without gimmicks and its credit rating was triple-A.
    There is a strong link between those developments and the fact that New Jersey residents today are among the best educated in the country, and rank near the top in per-capita income.
    Now many of the gains made over a quarter of a century are in danger of slipping away because the current Governor, Christine Todd Whitman, has chosen to finance her political ambitions with a popular buy-now, pay-later economic policy that will place a financial stranglehold on future generations of New Jerseyans.

    This is best illustrated by Mrs. Whitman’s decision to withhold billions of dollars that should be going into the public employee pension funds over the next few years, and using the bulk of that money to balance the state budget. Then, with an audacity that dazzles her supporters and even draws grudging admiration from opponents, Mrs. Whitman smiles and characterizes the withheld funds as savings.

    Mrs. Whitman’s decision to withhold billions of dollars ….BILLIONS in 1995 dollars.

    Read the entire article here…… https://www.nytimes.com/1995/02/22/opinion/in-america-whitman-steals-the-future.html

  29. you mean the idiots raised taxes and chased tax payers out of the state, destroying the tax base, then stole from the pension funds to fund their vanity projects

  30. Hey Mr. I hate Police and Firefighters,

    That’s NOT any Police or Firefighter complaining about anything MR Hog. Apparently you can’t read. That statement is from an independent agency (The New Jersey Policy Perspective) Your comment just proves how stupid you really are……Mr Hog.

  31. Sounds to me like you chose the wrong profession and now your complaining about it…that’s too bad. I guess it sucks to be you in the private sector Ha Ha Ha !!! What a dumb ass!

  32. There he is Boss Hog 🐷 Kime,

    I can’t remember, how long have you been crying 😢 and complaining about NJ pensions and health care benefits, 5 years, 8 years or maybe 10 years? And what has all of those years of your crying 😭 and complaining accomplished, well we both know the answer to that…. NOTHING! Apparently No one agrees with you or your crazy nutty 🥜 claims. You have been proven as a liar so many times you have no credibility anymore.

    But I know you will keep on crying 😭 and carrying on about this. And while you are complaining you will have to dig deeper into your very deep pockets as your taxes will continue to go up for exactly what you are complaining about.

    Of course you will continue to ignore the real problem why New Jersey ended up with so much debt. You will not care about finding reasonable solutions, you only want to cut benefits that YOU think are excessive. Go on complaining, I’ll be watching and laughing!

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