As we noted in an early post about Mauldin/Whitney and municipal budgets, a big reason for the budget gaps facing many state and local governments are because of massive costs to fund pension plans. On a recent “60 Minutes” segment, NJ Gov. Chris Christie made his position clear – states shouldn’t have pension plans and instead should have 401(k) plans like most companies have today. (Needless to say, his position is not popular with many of the unions, particularly the teachers).
Today’s Wall Street Journal had another look at the pension funding crisis – how in many areas, property taxes are being raised to help fund the gaps. Just what a slow recovering economy needs – higher costs. Gov. Christie is right – the time has come for state and local workers to have the same benefits as those who work for companies. It is the most responsible stimulus plan that state and local governments could introduce to get the economy chugging on six cylinders.
Click here to see The Wall Street Journal article.