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I completely agree with you on JCIA. JCIA is an example of the old-school Tammany Hall system. I certainly would not advocate putting more of our services into non-transparent authorities that are filled with cronyism. JCIA should be merged into DPW, not the other way around, and JCIA should be eliminated.

Civil service reform shouldn't mean privatization. It should mean enhancing accountability. And you have less accountability with privatization. I don't think the author of the op-ed was advocating privatization. I know I'm not.

But here's a different example -- the school superintendent, Dr. Epps. His feather-bed contract required that he get a full year's notice of termination. Is that an example of a smart way to run a civil service? No, that was just dumb. And the New Jersey state laws that protect school superintendents to such an extent are examples of problems we now have built into our civil service systems. We should try to fix those problems.

Gotcha. I totally agree. All the transparency that was accomplished with civil service reform is lost when structuring these entities as private-ish. These are entities that would never never form as businesses in a natural market to begin with. Government is supposed to provide needed services when the market cannot handle on its own. I believe pretty strongly in capitalism, but applying business principles to public authorities is a total misunderstanding of what makes capitalism work. What makes it work is a natural rise and fall, a risk and reward. Bailouts and other forms of guaranteed tax funds to cover your "business" or "public authority" completely take the risk out of the equation, making it a horrible idea that leads naturally to corruption, nepotism and ineffective management at the expense of the tax payer.

On another note, the parking authority is something I believe we all agree isn't providing any public good, since all they do is write me parking tickets. heh heh

No, it's not private. It is a public authority. It is free from the constraints of civil services rules and the other "progressive" government elements that the original columnist believes to be quaint anachronisms because smart business minded people like he can do a better job without them.

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The JCIA isn't really fully private is it? I always hear of it as a semi-autonomous agency. The fact that government is making appointments to these agencies is horrible. Seems that agencies like JCIA are the worst of both worlds.

One other thing I will note to bring this home to Jersey City. We can see this taking place in the debate over the merger of the City's Department of Public Works (governed by the civil service system), and the Jersey City Incinerator Authority (no such regulations and widely seen as a patronage pit).

I'll let people decide which model they think is better.

All the numbers and statistics being thrown about can be massaged and manipulated in a myriad ways to prove whatever point someone wants. I will assume for now that the various charts people are posting have some point or another. That's not really the issue in my book.

With respect to NY City, we have now had 17 years of rule by Republican/Independent mayors who have proudly talked of their abilities to "run government like a business" and stick up for the taxpayer against those evil interest groups. They have done so by proudly treating unions with disdain, aggressively seeking to ignore collective bargaining by asserting "management rights," contracting out as many services as they possibly could, and seeking to reduce the role of public sector workers and their unions at every opportunity.

And yet during this time the City's fiscal shape has allegedly reached catastrophic proportions.

The "business model" that many of these elites have supported was the same business model that, required the federal government to bail out these firms at a cost more severe than fixing the public pension crises would require. Yet the former was done without a second thought, while the latter does not require more funding we are told, but concessions on behalf of working class public servants and stripping their representatives of bargaining power.

Of course, the people who made this mess got to keep their compensation, which I think is a little higher than what the "overpaid" public sector worker makes. In fact, may of them are eager to implement "reform" in the education system or government sector. Noblesse oblige, I suppose.

I'm not going to get into an argument over the severity of public pension funding deficits, or whether taxes are too high or too low, or whether civil service regulations make it impossible to effectively operate government. At least now now. I will simply ask Mr. Goldsmith and his businessfolk one question. Considering how much you f%$*d things up over nearly two decades, why should I trust you with planning a picnic, much less "reforming" how government works?

Does that chart include the underfunding of the pensions? You can make your cash situation look really good if the bills aren't getting paid. If you use the accrual method (taking into account future liabilities) NJ and other states fiscal situation is very dire.

As of March 2010 (probably improved a bit since the stock market had some growth) NJ pensions are severely underfunded:

NJ Police & Fire: 39% funded $36 billion in the hole
Teachers: 38% funded $61 billion in the hole
PERS: 38% funded $48 billion in the hole.

For a detailed explanation of how those numbers where calculated:
http://www.aei.org/docLib/Biggs-WP-164.pdf

If you would like to see a nice interactive chart how we compare to other states using the same method of calculation:

http://globaleconomicanalysis.blogspo ... public-pension-plans.html


States have gone broke before and defaulted on their debts. The pension plans are going to see some form of default. There is no way these liabilities can be covered by tax revenue. NJ is already bleeding tax base as income and wealth leave for better tax environs.

I understand completely. When presented with facts that don't fit what you 'know' then you dismiss the facts. It is natural and pretty common.

Of course it is 2 years out of date, all studies like this are at least two years out of date because you can't do them in real time. Do you honestly think that in two years where state employment has dropped almost across the board that this number has gone up?

There are a few big things pushing the budget crisis.

1. Medicare
2. Unfunded federal mandates have been growing for years
3. Massive reductions in revenue due to the recession

Brewster, very astute and this chart is 2 years out of date.
There are so many ways to manipulate the date its criminal.
From its source, I believe its crap.
I would like to know how many Gov Union employees make the minimum wage of $7.25? I know many folks under 30 years old and did not graduate from college make over $70k.
The public servant is all those not working for the gov, and THEY know it.
That is criminal.
In times like this all businesses should trade up for smarter people.

All that chart might mean is that the rest of the state budget is just slightly more bloated than the payroll is. I'd bet that "reduction" is a result of Medicaid spending going through the roof.

It all sounds so reasonable until the fact that employee compensation as a % of state budgets has been trending down for 15 years now. And yes the accounting includes pension obligations. It's almost as if state governments deliberately did not pay into pension funds for decades until the problem because so large that they couldn't make up the gap. Oh wait, that is exactly what they did. http://www.americanprogressaction.org ... tate_budget_deficits.html

This op-ed piece by the deputy mayor of NYC appeared in the paper today. The title sounds harsh at first, but give it a read. This is the most sensible thing I've read lately about municipal governments, pensions, and unions.


Progressive Government Is Obsolete
The rule-based civil service was a step forward from Tammany Hall. But today's regulations stifle government workers at a time when getting value for tax dollars is more important than ever.

By STEPHEN GOLDSMITH
Across the country, the interests of organized labor, elected officials and taxpayers are colliding over wages, work rules and the astronomical costs of retiree pensions and health care. As important as these specific issues are to resolve, there is another, more fundamental problem causing so many Americans to lose faith in their government: It is not government unions per se but progressive government itself?long celebrated in Wisconsin, New York and elsewhere?that no longer produces progressive results.

In the early 20th century, the progressives championed a rule-based approach to public-sector management that was a big step forward from the cronyism and corruption of Tammany Hall. Today, however, the very rules that once enhanced accountability, transparency and efficiency now stifle the creativity of public-sector workers and reduce the ability of public investments to create opportunities for citizens?outcomes precisely the opposite of those intended by Progressive Era reformers.

New York City has more than 300,000 employees who work under more than 100 collective-bargaining agreements, along with layers of bureaucratic state civil-service laws. State law mandates that over 1,500 job titles must be filled through competitive written exams, specifically ignoring an employee's actual performance or qualifications. We are even required to administer a civil-service test for the head of our Police Department's counterterrorism unit! (We found a way around it.)

Seniority rules require that layoffs are based on date of hire, not merit. These rules also prevent any significant rewards for outstanding performance and make dismissing bad apples in the Big Apple all but impossible. Even asking employees for their ideas can be against the rules.

No one wants a return to the bad old days when public employees feared arbitrary dismissals. Today, however, the pendulum has swung too far in the opposite direction. Rather than too few rules governing public employees, there are far too many, and they hurt the very people progressive reformers cared most about: the least fortunate members of society who depend the most on effective support services.

A hundred years ago, progressives envisioned a highly professional public-sector work force reining in exploitative corporate interests. They saw those on the margin being victimized both by corrupt government and business interests. They believed that the worst abuses of capitalism?think Upton Sinclair's "The Jungle"?would be reined in by government regulation.

Ironically, today we find that in many cases special interests are working in the bureaucracy, using Progressive Era rules to protect the status quo and themselves.

Recent efforts to trim approximately 150 laborers, carpenters and electricians from city hospitals, for example, were halted by a lawsuit brought by the unions. In a city facing a multibillion-dollar deficit, every nonessential dollar spent is a dollar less available for hospital care?or shelter for the homeless, or police for troubled neighborhoods. In a word, these special- interest interventions ultimately lead to socially regressive results.

For cities to survive, we need a post-progressive approach in which the efficient creation of the common good is the shared goal of labor, management and citizens alike. This means rethinking the rules of the early 20th century in light of the realities of the 21st century. A system that hires without discretion, promotes without considering performance, and lays off teachers without regard to merit cannot truly serve its citizens.

Progressive Era reformers rightly targeted corruption among Boss Tweed-type contracts for city work. Today, however, excruciating contracting rules produce unintended results.

Antiquated and overly complex procurement rules lead to year-long delays and waste millions of taxpayer dollars. These complex bureaucratic processes lock out small businesses and lock in existing contractors. Simpler, less prescriptive processes with greater transparency would produce better, faster and cheaper results, minimize political favoritism, increase competition among contractors, and improve the quality of work done on the taxpayer's dime.

The current systems punish taxpayers in other ways too. Unaffordable pensions imposed by state legislators on unsuspecting citizens have created an unsustainable burden. In fiscal year 2012, New York City will pay $8.4 billion from its operating budget to fill a hole in its unfunded pension obligations. An expense of this magnitude leads directly to budget cuts for social programs and education, and to higher taxes that squeeze working families' budgets and kill jobs.

Would an increase in the "progressivity" of the tax system be the way out of our budget woes? More and more, urban mayors understand the futility of trying to tax their cities into prosperity. Few would dispute the fairness of a progressive tax system?but there are limits. In New York City, the highest-earning 1% of tax filers pay approximately 50% of the city's income taxes. Those paying the most are also best-positioned to relocate.

We need a new approach to governance that includes more respect not only for students in need of high-quality education but also for taxpayers, that has less job-killing red tape, and that fosters a more productive work force. The first rule of city government should be an unwavering commitment to delivering real value to the public with every tax dollar. That would be real progress.


Mr. Goldsmith is the deputy mayor of New York City.
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