They Hired the Money, Didn't They?

Commenting in 1925 on a proposal to restructure European war debt, President Calvin Coolidge said, "they hired the money, didn't they?"

The same might be said of New Jersey and, indeed, of other states, who negotiated labor agreements without setting aside sufficient funds to meet their obligations.

The details set forth in today's New York Times article, "How Chris Christie Did His Homework," makes it clear that for seventeen years, New Jersey did not set aside enough funds to meet the pension obligations to which the state had agreed. In the case of health care obligations, they set aside no funds at all.

This is hardly the fault of the unions.

In many cases, pension and health care agreements were negotiated in lieu of salary increases. In other words, the state said "you provide work for us now in return for future compensation" and signed on the dotted line.

They hired the money.

Did the state negotiate in good faith? If so, the failure to set aside sufficient funds reveals sustained incompetence. If not, what do we call it? A confidence game?