Back in another lifetime, when I lived in the socialist State of New Jersey, I was one of the founders of a website called “Conservative New Jersey.” I will reprint a series of articles we did on Christie, hoping it will convince the good people of the Free Republic of South Carolina to say NO to him.
Here is Part 2 of the series we published about the New Jersey Beluga Whale and the myth of conservatism that surrounded him. I apologize if most of the links are now broken. With time, everything changes.
In this post, you will learn about one of the traits that make me despise this man. It is never the Pillsbury Doughboy’s reason that something cannot be done; it is always someone else who should be blamed. When he was governor, it was always the governors before him that prevented him from keeping his word.
Myth #2: Gov. Christie took on the public employee labor unions and his reforms have reduced the size of state government.
Here are the facts: For all his YouTube bluster and bravado, Gov. Christie took on local labor unions – not the state labor unions. Except for those school districts which the state controls (Newark, Paterson, Camden, Asbury Park, etc.), teacher contracts are negotiated at the local level and the Governor has no control over their salaries or benefits. But then, why is it desirable for Trenton to equalize funding or for that matter to have any say in funding decisions? Why aren’t those decisions decentralized and localized?
While it is true that in March Gov. Christie signed several health and pension benefits reform bills into law (including legislation that bans part-time employees from enrolling in the state pension system) it is also true that not one department has been shut down nor a single state workers’ position cut from the payroll. The Governor claimed that “my hands are tied by Corzine.”
His hands certainly weren’t tied when it came to the salaries for his staff:
Treasury figures show 34 people making $100,000 or more in Christie’s office, compared with 24 for Corzine in April 2009.
Corzine had a payroll of $8.43 million for 118 people…Christie has 117 employees, including himself, with a payroll of $8.86 million per year.
Nor were his hands tied when it came to the budget for various state programs. As we saw in Part 1, spending for numerous programs wasn’t cut or even frozen, but INCREASED.
Moreover, if the Corzine deal prevented Gov. Christie from firing state employees, it did not prevent him from shaming them and the Democrats by publicly identifying the employees he would have fired immediately, made the list public, sent those employees to a “rubber room” with a warning that they should start looking for a new job now because they would be terminated on January 1, 2011 and then held a weekly press conference reminding the electorate of the amount of money that is being wasted weekly on useless public employees as a result of Corzine’s giveaways to the public sector unions – and that if the electorate is really tired of this, then they need to elect conservative Republicans to the state legislature next year. Imagine what kind of statement THAT would have been.
As it is, the Governor recently announced that at least 1,200 workers would be dropped from the state payroll in January of 2011. The cuts will be implemented through a combination of layoffs and attrition; they will affect both union and non-union workers and are expected to save $8.8 million. Note that the state workforce of New Jersey is at least 78,000 strong, with a budget of roughly $3.8 billion which averages out to $48,718 in salary and benefit compensation.
Unfortunately we aren’t told if the cost of unemployment benefits was factored into the calculation to arrive at the $8.8 million figure. If not, the average wage for the 1,200 workers would be $7,333 each – which seems ridiculously low. Either the figure is erroneous or those being dropped from the payroll are the lowest-level workers, perhaps part-timers. Worse yet, assuming every laid off worker collects an average of $200 per week for one year, the $12.5 million cost wipes out the $8.8 million allegedly saved, leaving a deficit of $3.7 million.
If the cost of unemployment was a factor, we can calculate how the $8.8 million figure was obtained: assuming these 1,200 workers make an average salary $20,300 per year, the total saved by laying them off is $24.4 million. Subtracting the $15.6 million cost of unemployment for these workers ($250/week/52 weeks) leaves us with the $8.8 million figure reported by NJ.com.
The matter is complicated by the fact that Gov. Christie’s predecessor, Jon Corzine, made a deal with the public sector employee unions that would guarantee them an automatic 7% salary increase if any of them were laid off. This is the “hand tying” to which Gov. Christie referred.
To understand how this works, let’s start with the average salary/benefit package of $47,718 per state worker. A 7% raise for all 78,000 workers amounts to an average of $3,340 each or $260.5 million. Obviously, the monetary value of the savings incurred by laying off workers would have to exceed the cost of giving raises to the remainder. A layoff of only 1,200 at the $47,718 salary range would save $57.3 million. Assuming all the laid off workers receive the maximum unemployment benefit of $500 per week for one year, we need to subtract $31.2 million from the gross savings, leaving us with a net savings of $26.1 million while the cost of giving raises to the remaining 76,800 would be $256.5 million, leaving the state in the red for $230 million.
Even if the Governor immediately laid off 30% of the workforce or 23,400 people for an initial savings of $1.12 billion in salaries and benefits and further assuming every laid off worker collects the maximum $500/week in unemployment benefits for the next year at a cost of $608.4 million, the savings would be reduced to $511.6 million. The remaining 54,600 workers would receive their 7% pay increase at a cost of $182.4 million. Subtracting the cost of the salary increases from $511.6 million leaves a final net savings of $329.2 million – not a heck of a lot of money given the size of the NJ budget and especially its unfunded liabilities.
UPDATE @ 9:13 PM on 11/10: Today Gov. Christie announced that he is backing down with regard to laying off 1,200 state workers in January:
Christie, who last week said 1,200 jobs would be shaved in January, today told a town hall audience in Clifton the state may meet that goal just through attrition.
And a commission today sided with state unions opposing Christie’s plan to make them work the day after Thanksgiving.
Christie’s budget planned for cutting 1,300 jobs. But no layoffs could occur before January because that would trigger raises under a union agreement with former Gov. Jon Corzine.
“It may turn out we don’t have to lay off anybody if we reach that 1,200 … number, or somewhere in that neighborhood,” Christie said. “Stay tuned, I’m hopeful we won’t have to.”
Christie spokesman Michael Drewniak today said as of Friday, most jobs were on track to be cut through attrition.
Hetty Rosenstein, state director for the Communications Workers of America, said many workers have retired because of Christie’s proposed pension changes and staff shortages. More than 7,000 state workers had put in to retire as July.
It remains to be seen how many of the retiring workers will be replaced.
Gov. Christie could have made a high-profile budget-cutting move by taking an ax to the Schools Development Authority (SDA), a quasi-governmental agency responsible for overseeing public school construction projects throughout the state. For several years, the SDA has been roundly criticized for waste and mismanagement; for the past eight months it has halted any new construction projects but only recently recently reduced the size of its 308 person staff – nearly 50 of whom are paid annual salaries of $100,000 or more.
Did the Governor hack away at this revenue-sucking monster with his budget-cutting ax? Nope. You see, the CEO of SDA is Mark Larkins – a former federal prosecutor who once worked for Mr. Christie and is now bagging a salary of $195,000 per year.
Christie in a press conference said the SDA is “in the midst of reorganization,” and he looked forward to a full report by the end of the year.
He pointed out that Larkins has already reduced staff by about 10 percent, with more reductions coming. And he said he expected there also would be some reductions in individual salaries.
Anyone willing to bet against the odds that pink slips were handed out to thirty of the agency’s lowest paid employees – and that any proposed salary reduction will affect only those on the lower rungs of the SDA ladder?
The bottom line here is that the elimination of 1,200 low-level state workers amounts to a fart in a hurricane and is nothing but public relations window dressing – an assessment shared by conservative pundit Paul Mulshine, who summed up the matter smartly in a recent e-mail:
The state operating budget is $6 billion, up from $5.7…the real problem here is that there is just so much that can be cut from $6 billion. In other words, draconian cuts would knock off just a billion or so. That’s where Christie was lying during the campaign. He and the other RINOs always maintained that cutting the state operating budget was the cure for everything…I knew it was BS all along and pressed him on it. Sure enough, once in office he didn’t cut a dime. These cuts are symbolic.
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In Part 3 we will examine the myth that Gov. Christie’s cabinet appointments mirror his solid brand of Reagan conservatism.