Connecticut's Democratic Governor Gives Up on Tax Increases
NJ slashed funding to wealthy districts years ago. Already done that.
Runner_Guy said:
FYI, Malloy update.
Malloy still isn't raising state taxes, but he's slashing $400 million in school aid to wealthy school districts, ending a property tax rebate, and even cutting CT's Earned Income Tax Credit.
Unions are pissed at Malloy.
http://www.courant.com/politics/hc-malloy-unions-liberals-split-20170209-story.html
This is New Jersey's future.
My bad. I should have made it clear that the aid Malloy is slashing is mostly state payments for pensions.
New Jersey, like Connecticut, has the state pay teacher pensions. Malloy is putting an end to this for wealthier districts.
This is what Florio wanted to do in 1990 and yes, the legislature actually went along with it. Though Florio had never campaigned on this, he got the legislature to pass this Mother of All Unfunded Mandates in a one month legislative blitzkrieg in June. The Republicans took over in 1991 and reversed Florio's action, but still, what Florio did proves that it would be possible for a governor to devolve pensions onto school districts.
So Phil Murphy, John Wisniewski, or Ray Lesniak could "save" money by dumping pension responsibility on localities too.
yahooyahoo said:
NJ slashed funding to wealthy districts years ago. Already done that.
Runner_Guy said:
FYI, Malloy update.
Malloy still isn't raising state taxes, but he's slashing $400 million in school aid to wealthy school districts, ending a property tax rebate, and even cutting CT's Earned Income Tax Credit.
Unions are pissed at Malloy.
http://www.courant.com/politics/hc-malloy-unions-liberals-split-20170209-story.html
This is New Jersey's future.
Ugh. The article repeats the myth that Massachusetts is "Taxachusetts"
That's NOT TRUE (anymore), but the article makes that argument to argue that the departure of businesses from CT to MA means that CT's problems aren't due to high taxes.
Massachusetts has a flat 5.1% income tax. Its average property tax is only $3800 per household. Its sales taxes are close to 6%.
Massachusetts is an average tax state, not a high tax state.
Gilgul said:
Good article on Connecticut:
https://www.theatlantic.com/bu...
Runner_Guy said:
Ugh. The article repeats the myth that Massachusetts is "Taxachusetts"
That's NOT TRUE (anymore), but the article makes that argument to argue that the departure of businesses from CT to MA means that CT's problems aren't due to high taxes.
The writer brought up Massachusetts in reference to the departure of residents, not businesses: "But two of the most common destinations for people moving out of Connecticut are New York City and Massachusetts -- that is, one of the most expensive cities in the world and a state nicknamed 'Taxachusetts.'"
According to a link in the sentence, the observation is based on data from 2011-13, back when Massachusetts was still ranked in the top 10 or so for tax burden.
In any case, taxes aside, it's hardly surprising that a state just across nearly half your border would be one of "two of the most common destinations for people moving out."
This is a really good, thorough comparison of NJ and CT and how CT's efforts to reach solvency through higher taxes haven't been enough to prevent disaster.
"The lesson that emerges from this study is clear: for those who think that New Jersey’s budgetary challenges are rooted in inadequate levels of taxation, Connecticut provides a cautionary tale."
https://static1.squarespace.com/static/5956385fe4fcb5606a4d46ac/t/59e3edb6d74cff9b80f61b99/1508109751405/GWI+Report+-+Connecticut%E2%80%99s+Fiscal+Crisis+Is+a+Cautionary+Tale+for+New+Jersey.pdf
The report also discusses that the reason CT is in a crisis right now while NJ is muddling along is because CT is trying to make its full actuarially recommended payments, whereas NJ (for FY18) is finally hitting 50%.
"The degree of crowd-out that New Jersey is experiencing is artificially low, since pension payments that a government is not making cannot reduce funding for other services. But these payments will have to be made eventually, and reducing contributions in the near term will only increase costs, due to lost investment earnings."
Also, the report points out that post-retirement medical benefits are completely unfunded.
"Both states also owe substantial sums for retiree health care, a benefit that, over recent decades, has largely been phased out among private-sector employers. New Jersey’s unfunded liability for OPEB (other post-employment benefits) totals $67.5 billion and Connecticut’s totals $21.9 billion. Though also a defined benefit, retiree health care differs from pensions in that, in both New Jersey and Connecticut, it is almost completely unfunded.
New Jersey and Connecticut may not have contributed enough for worker pensions over the years (Figure 3), but they have contributed something. Retiree health-care expenditures, by contrast, come directly from the annual budget, not trust funds built up through years of worker and employer contributions and investment returns."
The Garden State Initiative and the Manhattan Institute. At least it’s not from unauthoritative ideologues like New Jersey Policy Perspective and Jon Whiten. I’ll give it a look.
Absolutely right. It's from a think-tank with an ideology. Read it with a grain of salt.
However, the report itself is extremely informative. So far I have not found anything in it that I think is factually wrong nor polemical.
The only discussion that isn't in the report is that CT uses a lower Discount Rate than NJ, a fact that actually means that NJ's is doing even worse funding its pensions than initially appears.
(I don't think that everything from the New Jersey Policy Perspective is bad. It depends on the topic and the writer. Brandon McCoy's revenue estimate for NJ getting $300 million a year marijuana legalization I thought was really good. I read that looking for ways it could be wrong but decided that his $300m estimate was actually cautious.
My annoyance with Jon Whiten isn't his positions per se, it's the ratio of Whiten quotes:Whiten expertise, where he is quoted on transportation policy, tax policy, NJ demographics, economic policy, healthcare policy etc. It's a problem with the laziness of NJ's journalists, not Whiten himself. Whiten himself is no more an expert on these topics than the people like you and me who comment on MOL.
DaveSchmidt said:
The Garden State Initiative and the Manhattan Institute. At least it’s not from unauthoritative ideologues like New Jersey Policy Perspective and Jon Whiten. I’ll give it a look.
Runner_Guy said:
However, the report itself is extremely informative. So far I have not found anything in it that I think is factually wrong nor polemical.
Yes, I’ll be giving it a look. Forgive me, though, based on comments like the one I followed up above in July (and in our discussions of gerrymandering and the Supreme Court), for taking this with a grain of salt as well.
The NJ/CT comparison report is center-right, but it points out that NJ's Normal Payment is actually only a few hundred million dollars.
This is something provides fodder to people who would want to continue DB plans and who want to put all of the blame for the pension crisis on the state itself.
There's also no blame in this report. It doesn't say that the pensions themselves are too generous or talk about how public sector union lobbying is what made them so high in the first place. It doesn't talk about how high NJ's public sector salaries are. (even in relation to our high cost of living).
As this thread's title says, most of Connecticut's senior Democratic politicians have given up on increasing income taxes. They realize that CT's crisis can't be solved by "making the rich pay their fair share." Another round of a "millionaire's tax" is dead in Connecticut.
The central idea of the GSI report that NJ can't rely on the top 1% to solve its problems has already been adopted by most of CT's center-left.
DaveSchmidt said:
Runner_Guy said:
However, the report itself is extremely informative. So far I have not found anything in it that I think is factually wrong nor polemical.
Yes, I’ll be giving it a look. Forgive me, though, based on comments like the one I followed up above in July (and in our discussions of gerrymandering and the Supreme Court), for taking this with a grain of salt as well.
It's ******* tripe. Give me a break. The MI states that its mission is to be a "leading free-market think tank focusing on Economic Growth, Education, Energy and Environment, Health Care, Legal Reform, Public Sector, Race, & Urban Policy." In other words, a mouthpiece for Corporate America to reduce operating costs to improve the bottom line and to hell with society.
Funny thing, though. They want free-market policies except where they benefit the consumer. Why would a free-market "think-tank" support tort reform? That's part of the free-market, right? Unless, of course, it's idea of a "free-market" is to socialize costs and privatize profits.
Did you even read the report?
Steve said:
It's ******* tripe. Give me a break. The MI states that its mission is to be a "leading free-market think tank focusing on Economic Growth, Education, Energy and Environment, Health Care, Legal Reform, Public Sector, Race, & Urban Policy." In other words, a mouthpiece for Corporate America to reduce operating costs to improve the bottom line and to hell with society.
Funny thing, though. They want free-market policies except where they benefit the consumer. Why would a free-market "think-tank" support tort reform? That's part of the free-market, right? Unless, of course, it's idea of a "free-market" is to socialize costs and privatize profits.
Steve said:
It's ******* tripe. Give me a break. The MI states that its mission is to be a "leading free-market think tank focusing on Economic Growth, Education, Energy and Environment, Health Care, Legal Reform, Public Sector, Race, & Urban Policy." In other words, a mouthpiece for Corporate America to reduce operating costs to improve the bottom line and to hell with society.
Funny thing, though. They want free-market policies except where they benefit the consumer. Why would a free-market "think-tank" support tort reform? That's part of the free-market, right? Unless, of course, it's idea of a "free-market" is to socialize costs and privatize profits.
The tort "system" is nothing but an extortion racket to enrich lawyers.
if I read the report, in order to keep an open mind I'm going to have to pretend I don't see the biased chapter titles.
Connecticut’s Big Government Fiscal Model Under Strain
Will either of you even acknowledge the bias (and that does not mean suggesting that it is "center-right")?
Burner said:The tort "system" is nothing but an extortion racket to enrich lawyers.
So what is your system for dealing with tortious conduct.
If a negligent automobile driver runs over a pedestrian causing serious injury to that pedestrian should the driver be made to compensate his victim? How?
Something where there is no opportunity for lawyers to profit by dragging out the process or use the process to extort extra money to bump up their payments. Tort lawyers are more evil than ISIS.
Runner_Guy said:
My annoyance with Jon Whiten isn't his positions per se, it's the ratio of Whiten quotes:Whiten expertise, where he is quoted on transportation policy, tax policy, NJ demographics, economic policy, healthcare policy etc. It's a problem with the laziness of NJ's journalists, not Whiten himself. Whiten himself is no more an expert on these topics than the people like you and me who comment on MOL.
DaveSchmidt said:
The Garden State Initiative and the Manhattan Institute. At least it’s not from unauthoritative ideologues like New Jersey Policy Perspective and Jon Whiten. I’ll give it a look.
I guess you're ignoring the fact that Jon Whiten "leads NJPP’s strategic communications effort." Of course he's quoted routinely. Really, you just disagree with him and anyone who can be labelled as being associated with the NJEA.
You are so incredibly simplistic. Anything that lowers taxes and/or regulations is good; anything associated with the NJEA is bad.
Steve,
The GSI is completely frank that it has an ideology, so I don't understand where your criticism comes from. You are exposing what the GSI already openly claims.
As long as the GSI's pieces marshal evidence, everything they write (just like everything the NJPP writes) deserves to be judged on its own terms.
I've followed CT's budget crisis since 2015 and think I know a lot about it compared to most non-CT people. While I'm not a bona fide expert, there is nothing in the GSI's report that is not factually based, as far as I can tell. There is also no blamecasting at public sector unions at all. The report clearly says that each state's Normal Contribution is only a few hundred million per year and would be manageable, if it weren't for the massive Unfunded Liabilities that have accrued. The report tells its readings that neither CT nor NJ has any reserves for post-retirement healthcare too.
The GSI also gives Dan Malloy and CT's leadership credit for hitting 80-100% of CT's Actuarially Recommended Contribution for the last several years, whereas NJ is only hitting 50% in FY2018.
I think that the New Jersey Policy Perspective is wildly unrealistic about a lot of things, and since they are funded by public sector unions I take everything they write about pensions and tax incentives skeptically, however, I still read what the New Jersey Policy Perspective writes because they do base their opinions on facts, they offer good history, and sometimes they are right about things.
An open-minded person reads things he or she disagrees with in order to learn, in order to understand how other people think, in order to anticipate what their political opponents may want next, and even to possibly be personally corrected.
The GSI bases its argument against relying on the top 1% to solve (or even substantially ameliorate) NJ's fiscal crisis on the persistent budget crisis in Connecticut. Since NJ and CT are similar, this is a sound argument to me.
If you want to do well in an argument, instead of whining about the GSI being "tripe," why don't you attempt to differentiate CT from NJ and argue that NJ's trajectory is likely to be different?
Steve said:
Will either of you even acknowledge the bias (and that does not mean suggesting that it is "center-right")?
Burner said:
Something where there is no opportunity for lawyers to profit by dragging out the process or use the process to extort extra money to bump up their payments. Tort lawyers are more evil than ISIS.
Are you ******* kidding me? Tort lawyers have exactly no incentive to drag out the process. The faster that they can resolve a case, the faster they get paid. Seriously, what is wrong with you? Saying they are more evil than ISIS? Just wait until you or someone you care about (is there such a person) gets hurt due to someone else's negligent or intentional act.
Runner_Guy said:
Steve,
since they are funded by public sector unions I take everything they write about pensions and tax incentives skeptically
Yet, you don't acknowledge any skepticism from corporate funded entities (and you don't identify and disparage them as such, either). Can't wait for you to tell us how well trickle down economics works and how when tax rates are higher and more progressive the US economy has come to a screeching halt.
I'm waiting.
Right, They are worse than those who rape torture and kill.
You do not know what you are talking about. Why would a plaintiff's lawyer "drag out the process". She gets paid only at the end. It is almost always the insurance company which wants to drag out the process to take as long as possible to pay the claim. I do not know what you mean by "bump up payments". These cases are handled on contingent fee basis. The lawyer gets 1/3 of the net award. (If plaintiff is a minor it's 20% in NJ).
The system is far from perfect but the only "reform" the reformers ever come up with is limiting the amount a victim can collect.
My reform would cut the maximum contingent payout to 10% or $200 per hour spent whichever is lower. And make a plaintiff's lawyer pay the other party's legal fees if the case is lost.
Well, Jon Whiten is very good at his job. I grant him that.
I'll repeat, my problem with the NJPP and Jon Whiten aren't their stances per se, it's that the media lacks the knowledge to discern when the NJPP is taking things out of context or misrepresenting things.
Anyway, I don't want this thread to get too off-topic.
I hope we can talk about Connecticut and the parallels for NJ. I await your differentiation of NJ and CT and forecast for why similar policies in similar states should produce different results.
Steve said:
Runner_Guy said:
My annoyance with Jon Whiten isn't his positions per se, it's the ratio of Whiten quotes:Whiten expertise, where he is quoted on transportation policy, tax policy, NJ demographics, economic policy, healthcare policy etc. It's a problem with the laziness of NJ's journalists, not Whiten himself. Whiten himself is no more an expert on these topics than the people like you and me who comment on MOL.
DaveSchmidt said:
The Garden State Initiative and the Manhattan Institute. At least it’s not from unauthoritative ideologues like New Jersey Policy Perspective and Jon Whiten. I’ll give it a look.
I guess you're ignoring the fact that Jon Whiten "leads NJPP’s strategic communications effort." Of course he's quoted routinely. Really, you just disagree with him and anyone who can be labelled as being associated with the NJEA.
You are so incredibly simplistic. Anything that lowers taxes and/or regulations is good; anything associated with the NJEA is bad.
And the government should bring a racketeering case against tort lawyers for collusion and price fixing.
Burner said:
My reform would cut the maximum contingent payout to 10% or $200 per hour spent whichever is lower. And make a plaintiff's lawyer pay the other party's legal fees if the case is lost.
You sound like a child playing a game of House of Representatives.
Steve,
I wrote my last post before seeing this from you.
I would be skeptical of anything from a corporate-funded group too regarding corporations, but it depends on the topic and the specific paper.
So far the GSI has come out with one research piece, the comparison between NJ and CT. If/when they start writing about other things maybe I'll disagree with them, maybe I won't.
I want to talk specifics, not generalities.
Steve said:
Runner_Guy said:
Steve,
since they are funded by public sector unions I take everything they write about pensions and tax incentives skeptically
Yet, you don't acknowledge any skepticism from corporate funded entities (and you don't identify and disparage them as such, either). Can't wait for you to tell us how well trickle down economics works and how when tax rates are higher and more progressive the US economy has come to a screeching halt.
I'm waiting.
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Ska,
I saw that interview with Christie and what he said is that NJ would be _on the predetermined pace_ to make its "full" pension contribution.
Christie is going to put another $600 million into the pensions for FY2018, which will bring us to $2.6 billion, but the Actuarially Recommended Contribution is $5 billion.
And the Actuarially Recommended Contribution is itself a significant undercontribution because the pensions are already so badly underfunded and New Jersey still uses an unrealistic 7.9% Discount Rate.
https://burypensions.wordpress.com/2017/02/14/pension-surprises-in-nj-budget/