The New Jersey state Assembly, with a large Democratic majority, gave final approval yesterday to a bill that eliminates collective bargaining rights for public employee health care benefits and imposes the equivalent of a pay cut by increasing health and pension contributions. Unions in New Jersey actually have no collective bargaining guarantee other than health benefits, so this eliminates pretty much their main bargaining chip.
The legislation will impact 750,000 public workers and retirees, and was highly sought by Republican Gov. Chris Christie. Democratic legislative leaders complied without batting an eyelash.
The Assembly passed the bill 46 to 32, as Republicans and a few Democrats defied raucous protests by thousands of people whose chants, vowing electoral revenge, shook the State House. Leaders in the State Senate said their chamber, which had already passed a slightly different version of the bill, would approve the Assembly version on Monday. Mr. Christie, a Republican, was expected to sign the measure into law quickly.
In a statement released after the vote, Mr. Christie said, “We are putting the people first and daring to touch the third rail of politics in order to bring reform to an unsustainable system.”
The legislation will sharply increase what state and local workers must contribute for their health insurance and pensions, suspend cost-of-living increases to retirees’ pension checks, raise retirement ages and curb the unions’ contract bargaining rights. It will save local and state governments $132 billion over the next 30 years, by the administration’s estimate, and give the troubled benefit systems a sounder financial footing, mostly by shifting costs onto workers.
This balances the state budget on the backs of public employees, which did not contribute to the financial crisis or the Great Recession which followed. It’s not about shared sacrifice but very specific sacrifice. And the Democratic leadership in New Jersey, mainly the party bosses and their figureheads in the Legislature, went along with it. The majority of Democrats in both houses voted against it, but the leadership got enough support for the bill to pass.
The suspension of cost-of-living adjustments for retirees may face a court challenge, but for the rest, public unions will have to face a new reality in New Jersey, one with less protections.
New Jersey votes on an off-year schedule, so there will be legislative elections in November. The protests at the state house in Trenton suggest that labor will not forget about this betrayal. This, from Blue Jersey, accurately describes the mood of many Democrats in the state.
The specifics of the bill are here.