The entire structure, including the politics, of public-sector pensions is an exercise in kicking a can down the road. It’s been rewarding to public officials to give lavish pensions to government employees, because it wins them votes, the financing confuses most people, and the bill doesn’t come due for decades. A sufficiently aware electorate would be learning the lesson and not being so easily fooled.
Unfortunately, the public isn’t sufficiently aware, and so we get more can kicking. Here’s what I mean:
Lawyers from both sides in the lawsuit challenging the constitutionality of the state’s sweeping 2011 pension overhaul law met in Newport Tuesday for a closed-door status conference with the judge. A court official said the jury trial in the case remains scheduled to begin April 20.
Superior Court Judge Sarah Taft-Carter said last month that she was satisfied that a jury should settle the long-running case. Meanwhile, Governor Raimondo, who as general treasurer crafted and lobbied lawmakers to approve the overhaul, has expressed willingness to try again to settle the case before then.
Why would Gina Raimondo want to settle the case? As the general treasurer championing the pension reform, she expressed confidence that it was lawful far and wide, and even if there’s now doubt, why not get an answer? Of all people in Rhode Island, she should know what a looming avalanche pensions threaten if they aren’t reformed. And of all people in Rhode Island, the governor has a responsibility to guide the state past disaster.
We need to know how far the state can go toward undoing the unreasonable, impossible promises of past politicians, as encouraged by labor unions that gamed the system to control both sides of every bargaining table. The sooner we find out that this reform isn’t constitutional (if it isn’t), the sooner we can get to work finding another — or changing the constitution, if no other reform will do.
Raimondo may still be confident that the state would win its case but wants to avoid the risk; there are two problems of short-sightedness to that approach. First, it assumes that the things negotiated are worth sacrificing, and those things might only be indirectly related to pensions. It’s possible that recent talk about exempting retirement income from state taxes is just a backdoor gimme to the unions, and that expense will require either cuts or taxes in another area. It’s also possible that Education Commissioner Deborah Gist’s job is on the negotiating table, which means that the future of Rhode Island’s children is a possible sacrifice on the pension altar. Is that worth it?
Second, if folks like me are correct that Raimondo’s pension reform was insufficient to solve the problem, then future reforms will be necessary. In that case, if Raimondo’s reform stands because of behind-the-scenes negotiations, future reforms will be much more difficult to enact, because Rhode Island will have a better sense of the legal battle ahead, but without any more legal certainty.