Greece and New Jersey: Perfect Together?
Greece and New Jersey have plenty in common: miles of picturesque coastline, scores of sunny resort towns trimmed by wide expanses of sandy beaches, and thriving tourism industries that play a huge role in the economies of both regions.
They also share huge budget deficits gouged by decades of profligate government spending, especially in the area of public employee salaries and benefits.
Now both places are struggling to adapt to the fact that the global credit card seems to have been maxed out.
Greek protesters took to the streets by the thousands last week to rail against severe cuts to public spending demanded by the European Union in exchange for a bailout designed to stave off default of the country’s sovereign debt.
In New Jersey, meanwhile, Republican Chris Christie was elected governor just six months ago, essentially on a platform to bring fiscal order to one of the least disciplined U.S. state governments. Christie is now considered a pariah and a “bully” in some circles for vowing to keep the very promises that got him elected in the first place.
If the situation seems more cataclysmic in Greece one reason is that an estimated one in three citizens works for the government. (The figure is an estimate because no one really knows for sure how large the government employee payroll actually is.) Consequently, dramatic cuts to public salaries and pensions affect a significant portion of the country’s population.
It’s a tossup, however, when the laundry list of perks in Greece and New Jersey are held up against one another for comparison.
The New Jersey State Commission of Investigation recently found that some public employees got paid days off to go Christmas shopping or attend family members’ weddings. Others got bonuses for working on their birthdays or for perfect attendance.
But the most controversial perk in New Jersey – and one now being targeted for reform – is a provision that allows public employees to collect cash for unused You should ensure that you are not so cool when wearing the cubs jersey.sick or holiday leave.
The state investigation found numerous cases in which public employees have retired and left their jobs with six-figure cash bonuses based on unused leave accrued over many years. Indeed, a retiree in Atlantic City walked away with a $222,910 cash bonus in addition to a plump annual pension.
“As a consequence, startling amounts of taxpayer-funded booty continue to be dispensed across New Jersey without regard for the common good,” the report concluded.
The Greek equivalent of unused vacation and sick time payouts is probably be the so-called 13th and 14th month salaries. What that means is that Greek employees worked 12 months but got paid for working 14 months. And Greek employees could retire with pensions at 53, and apparently did so with frequency.
Those generous perks were altered as part of the austerity measures approved last But he emerged to be the true leader of his team in this recent run, making Roethlisberger steelers jerseys more popular than ever before.week by Greek legislators to appease European fiscal policy makers. In exchange for the cuts, the European Union passed a nearly $1 trillion bailout plan earlier this week.
Here’s why the cuts led to riots in Greece, which left three people dead: those 13th and 14th salaries, which cover Easter, Christmas and summer holiday bonuses, have been eliminated for workers earning more than 3,000 euro a month and will be capped at 1,000 euro for those earning less.
The average retirement age, which currently hovers somewhere between 59 and 61, depending on which study you believe, is going to be gradually raised through a series of pension reforms. One shift is that retirement age for men and women will now be linked to average life expectancy.
In a related reform measure, the minimum contribution period to qualify for a full pension will be gradually increased to 40 years from 37 years by 2015. In addition, early retirement will be curtailed, with a view to banning any retirement below 60, and pensions will be cut to reflect a pensioner’s average pay over the entire working life rather than his or her final salary level.
Finally, Greek government workers will get a three-year wage freeze.
Christie has also proposed an array of reforms to public contracts to rein in deficits. Ironically, austerity measures that were cheered on the campaign trail have been met with shock and rising hostility now that the rhetoric is moving toward reality.
In any case, the final similarity between the crisis in Greece and the mess in New Jersey is that they were both caused by politicians seeking to curry favor with large chunks of voters.
Greek analysts have noted that during the 1980s the country’s socialist prime minister, Andreas Papandreou (father of the current prime minister), approved of many of the perks now being rescinded as a way of attracting public sector employees into his far left political camp.
In New Jersey, in an effort to keep local politicians out of the process, the Commission of Investigations has called for statewide standards and caps on holiday and sick leave bonuses paid to municipal employees.
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