In the past few weeks, Gov. Phil Murphy and the state Legislature enacted major tax increases and made a record-breaking payment to New Jersey's deeply underfunded pension funds. Last week, Senate President Steve Sweeney, D-Gloucester, proposed structural reforms and spending cuts that would, if enacted, marginally improve New Jersey's financial condition.
But these moves -- made in good faith by leaders who inherited a mess -- don't change the unaddressed, underlying reality: New Jersey has made promises to state and local government workers that cannot possibly be met.
Sooner rather than later, New Jersey will have to cut these promises -- not just for future hires, but for current employees. The real question is how to limit the damage. That's where real options can be found that are relatively fair, given the circumstances.
Read the full article here.