Trust Chafee…Again?

Ok, this is kinda funny. It seems the union leadership is falling for his tagline all over again. “Trust Chafee”.
Last year, after hours of hearings and discussion the General Assembly passed a pension reform bill and Governor Chafee signed it into law. This move quickly drew the ire of the unions who supported is candidacy and helped him get into the Governor’s seat. In November 2011, GoLocalProv’s Dan McGowan reported:

“…top union officials say the Governor has gone back on his word by supporting a complete overhaul of the system”

and

“We like Candidate Chafee’s plan much better than Governor Chafee’s plan,” [NEARI’s Robert] Walsh told GoLocalProv in October.

However, not much more than a year later, Governor Chafee seems to be having some second thoughts about going back on his word to labor with the bill he signed.
Governor Chafee thinks it is a good idea for the state to sit down with the unions and discuss negotiating the pension law as it goes to court. WJAR’s TurnToTen.com site reported:

“Some have said that now is not the time for negotiation,” Chafee said. “I disagree. The state has leverage only so long as there is still uncertainty as to the outcome of this case.”
Chafee met Tuesday with Bob Walsh, executive director of the National Education Association Rhode Island, and George Nee, president of the AFL-CIO. Walsh said specifics weren’t discussed but Chafee expressed interest in striking a compromise.

Wondering how the discussions went?

“We’re right where we want to be with the governor,” Walsh said of the hour-long discussion. “It was a good first date.”

So if I have this straight, before he was Governor, Linc Chafee reportedly made some promises to some people in the area of labor. Then he got elected, went back on those promises. Now he sees that he’s stabbed the labor people in the back and realizes he’ll probably need at least their support to get re-elected in 2014 so he’s trying the whole scheme all over again. If that doesn’t sound crazy enough that Linc Chafee is trying it, the crazier part is it seems that the same people are believing it.
Like they say, politics makes strange bedfellows.

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joe bernstein
joe bernstein
8 years ago

Trust Chafee?hahahaha-I wouldn’t trust that cretin not to eat his own poop

Mark
Mark
8 years ago

Sounds like he pulled a John Kerry who voted for it before he voted against it. Chafee doesn’t even know what he is going to do next.
IF the unions win in court Rhode Island is done, period. The taxpayers will be forced into paying higher property taxes and there will be less disposable income. Add that to the new Obama care taxes and the looming fiscal cliff and you have the state heading into a recession, again! Is that what the unions really want to happen? I guess so.

JohnD
John(@disqus_cihud2gmi1)
8 years ago

I can’t wait ’til they kiss.

Dan
Dan
8 years ago

“We’re right where we want to be with the governor,” Walsh said of the hour-long discussion. “It was a good first date.”
I was banned from the progressive RIFuture blog for “libeling” Bob Walsh by comparing him to prohibition-era kingpin Arnold Rothstein. When reading statements like the above, it’s obvious that Walsh actively tries to foster that kind of image for himself and his organization. It wouldn’t be the slightest bit out of place for one of the characters in Boardwalk Empire to deliver this line after putting the squeeze on an Atlantic County politician. No respectable lobbying group would issue a statement like that. These “look at how much pull we have” statements to the media are completely inappropriate. They only erode public trust by implying that state government is little more than a cabal of connected insiders leaning on the right people and cutting backroom deals to serve their own interests.

joe bernstein
joe bernstein
8 years ago

@Dan-it took me a lot less time than it did you to figure out that RIF is run for and by scumbags-always has been-they would never tolerate a dissident opinion like this blog has with numerous people who make comments that directly attack the premises put forth here.
Some,like “sammy” really oughta be dumped.

Dan
Dan
8 years ago

Joe – A political blog may dismiss whomever it wants, but it reflects poorly upon Bob Plain’s journalistic integrity that he has to cover his true motives for removing inconvenient political comments by falsely accusing posters of “libel” simply for stating widely reported facts about NEA officials or offering personal political opinions about controversial public figures like Bob Walsh. Any attorney could have told Plain that neither case constitutes libel if he had cared at all to check, but that’s par for the course with his consistently lazy reporting. Furthermore, articles like these illustrate that labor leaders are trying to create just that kind of a gangland image for themselves. Only in caricatures of democracy like Rhode Island do characters like Bob Walsh and George Nee meet with the governor in closed-door, back-room sessions and then tell the media that they are “right where we want to be with the governor.” Such inappropriate statements would have them run out of town on a rail in clean-government states, but nobody bats an eye in Rhode Island because they’re used to the degeneracy of the political culture and progressives such as Plain tolerate it for utilitarian reasons to push their agenda. Chafee probably doesn’t even realize he’s being disrespected by Walsh treating him like a puppet in front of the cameras. Teachers who want to be respected as professionals should be mortified.

Tommy Cranston
Tommy Cranston
8 years ago

Anyone comparing Rothstein to Walsh SHOULD be silenced…unlike Walsh Mr. Big was known as a man who possessed some level of integrity.

joe bernstein
joe bernstein
8 years ago

@Dan-I haven’t bothered to read the drivel Plain writes on RIF.I heard him on radio a number of times-I wasn’t interested in more of his party line crap.

KenW
KenW
8 years ago

I think what Chafee is beginning to realize is there is case law regarding pensions and the union where the has union won.
In Hawaii the state was not contributing its obligated share into the pension fund causing an unfunded liability.
The Hawaii GA was diverting funds to other areas so the union sued the state. The case made it all the way up to Supreme Court Level and the justices found for the union.
The state of Hawaii is under court order to increase state contributions of its obligated share into the pension fund and to make up the unfunded liability it created.

Dan
Dan
8 years ago

Ken – States have different laws and Hawaiian case law is not binding on other states. Thanks for the anecdote.

Monique
Monique(@monique-chartier)
Editor
8 years ago

“Chafee met Tuesday with Bob Walsh, executive director of the National Education Association Rhode Island, and George Nee, president of the AFL-CIO.”
Reconciliation – oh, it’s so romantic!

Patrick
Patrick
8 years ago

Ken, it’s actually the opposite here in RI. The unions did also sue, as you indicated happened in Hawaii, except the ruling went the opposite way. The judge in RI ruled that the state is not bound to put anything specific away as long as they make the payments on the other end.
That being said, I have no idea why, if the unions were so concerned about the lack of savings, why they didn’t put the amount to saving in the contract?

Mike
Mike
8 years ago

It’ s a win-win for the politician and unions. Politicians promise to pay union employees big retirement money and then don’t fund it. Unions sue, and the politicians let the courts find in favor of the unions…then the politicians can shrug and say ” sorry..we have to raise taxes….it is the law.” And the sheeple are too apathetic to put 2 and 2 together…and vote these irresponsible clowns back in.

KenW
KenW
8 years ago

Governor Bruce Sunderlun during the saving and loan debacle started underfunding the state pension system in RI and every governor since then has continued underfunding the system. Before Governor Bruce Sunderlun the RI system was 80% funded.
To my knowledge the RI employees are still putting in their 100% because it is withheld from paychecks but the State of RI is only matching with 45% funds which are causing the continued underfunding.
The difference between RI and HI was the Hawaii GA started diverting funds from the actual pension system causing the underfunding and after years of court appeals the police union won in the highest state court forcing HI under court order to replenish the retirement system and stop the underfunding.

Patrick
Patrick
8 years ago

I wasn’t here during Sundlun’s reign, but I know now, the Governor has no say over how well these things are funded. The Assembly controls all of that and does whatever they want. The Governor is basically a figurehead in Rhode Island.

Max D
Max D
8 years ago

Ken,
The architect of the underfunded pension plans was House Speaker Joe DeAngelis (88-92). He personally pressured the retirement board to implement and early retirement program without funding it and then for two years failed to make contributions to the pension fund to plug budget holes. Like Patrick said, no governor in this state had that power.

Andrew
Andrew(@carroll-andrew-morse)
Editor
8 years ago

Ken,
Can you source your claim that “every governor since [Sundlun] has continued underfunding the system”? WPRI-TV’s Ted Nesi investigated what happened under Sundlun, and came to the conclusion that:
bit.ly/rBsHE2

It’s among the most common talking points used by opponents of the Raimondo-Chafee pension bill: Why should retirees suffer cuts in their benefits when so much of the problem was caused by the General Assembly raiding the pension fund during the credit union crisis?

It’s also pretty much a sideshow. The underfunding in the DEPCO era is responsible for about $60 million of the state’s $7.3 billion pension shortfall, according to the state’s actuary…

In February 1991, the Sundlun administration effectively borrowed $20.9 million from the state pension fund and deferred part of the state’s 1991 and 1992 pension contributions to deal with twin fiscal crises: an enormous and growing budget shortfall halfway through the fiscal year, and an angry outcry from depositors who couldn’t access their money after the credit unions closed.

…and as far as I know, the state has made its required contribution in every year since ’92.

KemW
KemW
8 years ago

A June 2012 report by the PEW CENTER ON STATES uses states’ own actuarial assumptions data up to year 2010 for the analyst which shows Connecticut, Illinois, Kentucky, and Rhode Island ranked the worst; all were under 55% funded in 2010.
Actually RI came in at 49% funded according to the study so if every governor since Sunderlun was pushing for funding the pension fund at 100% why the big discrepancy???
Employee contributions are automatically withheld from each paycheck by the state.
://www.pewstates.org/uploadedFiles/PCS_Assets/2012/Pew_Pensions_Update.pdf

Dan
Dan
8 years ago

The unfunded liability is a symptom, not a cause. That money was prioritized to other public programs, which would have required the same amount of replacement revenue if the money had been contributed to the pension system instead. The state would be experiencing the same degree of financial hardship regardless of where the money was spent. Unions focus on state contributions as a diversion tactic because the benefits themselves are indefensible. The unavoidable issue is that there is a chronic spending-revenue shortfall, and the state isn’t likely to raise property taxes to 10% to pay for 6-figure pensions in perpetuity.

Dan
Dan
8 years ago

The unfunded liability is a symptom, not a cause. That money was prioritized to other public programs, which would have required the same amount of replacement revenue if the money had been contributed to the pension system instead. The state would be experiencing the same degree of financial hardship regardless of where the money was spent. Unions focus on state contributions as a diversion tactic because the benefits themselves are indefensible. The unavoidable issue is that there is a chronic spending-revenue shortfall, and the state isn’t likely to raise property taxes to 10% to pay for 6-figure pensions in perpetuity.

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