Pension settlement and the General Assembly: Is it doomed this year?

Feb 11, 2014

What everyone in the Rhode Island political swirl should understand about the state pension overhaul settlement details that are due for release tomorrow: This is very likely to be only the beginning of a protracted process.

One thing we know for sure. Even if it is fair and reasonable, not everyone is going to like it. Some unionized state employees and teachers will not be satisfied with anything less than a full restoration of the pension benefits that were sliced dramatically in the 2011 special General Assembly pension session.

And some in the business community and among Rhode Island’s political conservative groups are going to spin any union concessions as evil incarnate and the next step in bankrupting state government. Even if the deal is somehow revenue neutral, it is election year so the parsing and posturing will begin furiously at 2:30 tomorrow afternoon when the deal is unveiled.

In just about every legal case settlement, some in the parties fear they gave up too much. This settlement will inevitably be more complicated that the usual legal pact that settles a long-running lawsuit.

The process for ratification will be cumbersome: the unions will have to agree, then the General Assembly will have to consider it. One thing anybody who knows anything about R.I. politics is that legislative leaders have no stomach for putting prickly issues to rank-and-file members in an election year. That’s why the pension overhaul measure was done in an off-year.

While it is in the interest of State General Treasurer Gina Raimondo’s gubernatorial campaign, especially in a primary, to put this issue to rest with a settlement, legislative Democrats who care about nothing so much as electoral survival have a different agenda.

The political noise in the Democratic gubernatorial primary is about to get louder within the next 24 hours, when WPRI television and the Providence Journal release a public opinion survey that for the first time will test primary Democrats Raimondo, Providence Mayor Angel Taveras and recent entry Clay Pell.

Pollster Joe Fleming’s numbers have been as closely held as the pension settlement details and haven’t been released. But those of us who have been around R.I. politics for a while guess they will show a close race between Raimondo and Taveras, with Pell, newly in the contest, trailing in third place and a substantial undecided vote large enough to swing the race. Early polls tell us everything about name recognition, and of course, nothing when it comes to the outcome on September 9.

On the Democratic side, organized labor is an important player in legislative primaries. Democrats who run afoul of union workers can easily make themselves vulnerable in primaries. If you don’t believe this, have a chat with Doug Gablinske of Bristol or Jon Brien of Woonsocket, two Democrats who lost their seats in primaries where union members  and their progressive Democratic allies stumped diligently to beat them.

History informs us that in our cozy state  of  R.I., labor’s clout is most effective in small-turnout September primaries and gets diluted in the big turnout general elections. With hot primaries across the state this year, from the gubernatorial races to down ballot offices (general treasurer, lieutenant governor and secretary of state) and the Providence mayoral tilt, voters are going to be engaged more than in most off-year elections. Legislative incumbents detest primaries. Even if an incumbent wins, a serious primary forces a state rep to hustle, raise money ,  walk a district in July and August, and campaign vigorously.   That means scant time for family, golf or the beach.

For Republicans, the off-year elections represent the beleaguered state GOP’s best shot at picking up seats. The Republican leaders will simply oppose any changes, asserting that a settlement is a taxpayer sellout done in secret negotiations by the Democrats who control both branches of the legislature and every statewide and federal elected office.

Then there is the pension issue itself. This isn’t a cut and dried topic. Even hot-button measures such as gay marriage and abortion rights are quite understandable to both lawmakers and voters. You are either, for example, for same sex marriage or against it.

Not so with pensions, an issue fraught with nuance and complexity. It is difficult for average voters to get their arms around it. Beginning tomorrow, the actuaries and data crunchers will run their calculations and estimates. The health of a pension system is driven by a plethora of factors, including the Wall Street investment return of the retirement fund and how long retirees live and collect pensions.

These arguments are arcane and the province largely of specialists. Everyone has heard the Mark Twain line: `figures don’t lie but liars figure.’  In an election season, this issue will inevitably become juicy political fodder, a field day for the pollsters and a full-employment program for consultants.

Then there are city and town officials who were upset that Raimondo’s pension overhaul plan did nothing to address their concerns with the exploding cost of police and firefighter pensions. The mayors and town council members always have the ear of state reps and senators.

So don’t be surprised if House Speaker Gordon Fox, D-Providence and Senate President Teresa Paiva Weed, D-Newport, shy away from considering a pension settlement anytime soon, unless it is structured with no political downside, which is not likely. Again, neither of them wants to foist a tough vote on their reps and senators just before an election.

When the political system can’t decide how to deal with a tough issue, there are always the courts, which is where the pension overhaul landed. There are risks inherent in not approving a settlement – that means  rolling the dice on a legal case that will surely go to the R.I. Supreme Court, where the outcome is uncertain. Unlike politicians, judges are not subject to the whims of voters every two years.