The New Jersey supreme court yesterday ruled that Chris Christie didn’t break the law by skipping a big pension payment he’d been scheduled to make. This is being read as a victory for a guy who might be about to hit the 2016 campaign trail, and it is — but it really just allows Christie, the legislature, and the state’s public-sector unions to hash out a new agreement on pension reform, which could be crucial to Christie’s 2016 pitch, and will be no easy task.
Unions took Christie to court over the fact that he vetoed a tax increase and $1.57 billion pension payment last year, the latter of which had been scheduled as part of his grand bargain on pension reform reached with the unions back in 2010. The problem with that bargain is that it wasn’t a bargain for taxpayers: They were still stuck with unrealistic, unaffordable obligations to some of America’s most generously compensated union workers. Christie skipped the payment because he said the state was in a fiscal emergency, which seemed reasonable — and yet the payment he couldn’t make then was actually much smaller than the payments he had agreed to make in the years to come.
So, given that the original agreement turned out to be such a burden, Christie decided to go back to the negotiating table with the unions (the Manhattan Institute’s Steve Malanga covered the story in more detail in an NR cover story). He set out a “road map” for pension reform, cutting back generous health-care benefits, and moving responsibility for fiscal management of the pensions to the unions, in February.
#related#But it came out the same day that a lower court ruled Christie had broken the law by skipping his billion-dollar payment. The teachers’ union especially had expressed some willingness to talk about the road map, but, a couple months later, walked away — and there’s some sense this was because they thought the ruling had given them the upper hand. With the court on their side, they thought they could force the legislature into sticking to its pension-payments schedule, even though that would mean huge tax increases or big service cuts in state government. It won’t be easy for Christie to get a responsible political solution, but with the court out of the way, it’s a little more likely than it was yesterday.
This is a bit of a symbolic victory, too: Some of New Jersey’s overtaxing, overspending habits have been enforced by an activist state supreme court. And, while the problem is most acute in New Jersey, all across the country, state courts have interpreted constitutional provisions to shield generous union benefits from political debate. In this one case, thankfully, the New Jersey courts thought better of it.