How Can New Jersey, Other States Rescue Underfunded Pension Systems?
By John Reitmeyer
NJ Senate President Sweeney says officials need to be honest with the public and state workers about the problem
State Senate President Stephen Sweeney (D-Gloucester), left, participating in a panel discussion on state pension funding Other panelists, from left, included former Maryland Gov. Martin O’Malley and former New York Lt. Gov. Richard Ravitch.
State public-employee pension systems across the country are facing a combined $1 trillion in debt, and many states, including New Jersey, aren’t getting much help on the investment side these days thanks to stubbornly low interest rates. Medical breakthroughs are also testing the math of pension systems as retired workers are now living much longer.
But experts participating in a panel discussion yesterday on state-pension problems that included New Jersey Senate President Stephen Sweeney (D-Gloucester) weren’t ready to throw in the towel and say states should just give up and let their pension systems go bust.
Instead, the group that gathered in Philadelphia for the pension talk organized by Penn Mutual Asset Management took a more optimistic view. Boosting government pension funding, rethinking investment strategies, and adopting reforms were all presented as ways to ensure state pension systems can survive their current challenges. Creating portable retirement plans and using pension assets to finance infrastructure investments were also discussed as future goals during the event, held during the ongoing Democratic National Convention.