Union Leader Blasts Raimondo: “She’s Not Honest”
Monday, October 24, 2011
The President of the Cranston Firefighters is accusing General Treasurer Gina Raimondo of making people believe the state’s pension fund is in worse shape than it really is in.
Paul L. Valletta Jr. claims the Treasurer’s assertion that taxpayers will be on the hook for hundreds of millions in additional taxes if the General Assembly fails to pass legislation that will modify the pension system by freezing cost-of-living-adjustments, raising the retirement age and switching to a hybrid 401k-style plan is incorrect.
“I think it’s all a scam,” Valletta said Friday. “All the numbers are lies. Yes I think we have a problem, but they didn’t have to do these changes.”
Valletta was one of the few critics that appeared in the glowing New York Times Sunday profile of Raimondo and the state’s pension problems. The Treasurer maintains that her plan will cut the state’s unfunded liability by $3 billion. If the measure passes in its current form, Raimondo said it would keep taxpayer contributions to the system at the same level for next year (almost $300 million) and save taxpayers nearly $3 billion over the next decade.
But in an interview with GoLocalProv, Valletta said the critics of the pension system aren’t telling the entire story.
“They based everything on the last ten years,” he said. “When we had an attack on our country, two wars and a recession.”
Valletta said he believes the economy is starting to turn around and that a dramatic overhaul of the pension system is unnecessary.
“You look at what they’re doing to the teachers and the state workers, it’s unbelievable,” he said. “If I thought the numbers were accurate, that would be one thing, but they’re not. “They want a 401k and that just gives Wall Street and banks more money.”
Liability Over $7 Billion
But for Raimondo, who has consistently stressed that politics be pushed aside in favor of math, the numbers don’t lie. The system in its current form would bottom out by 2042 and it will continue to force tax hikes across the state if changes aren’t made immediately.
“As you know, the state’s pension system is approximately 48 percent funded and has an unfunded liability of over $7B,” Raimondo told the General Assembly last week. “Without reform, the taxpayer contribution into the pension system is projected to double to over $600M next year and to $1 billion in just over 10 years – much of this burden is passed onto municipalities.”
If the legislation doesn’t pass, the consequences will affect everyone, according to Raimondo.
“The current underfunded system places the burden most heavily on the taxpayers and younger employees,” she said. “The consequences of not passing this bold reform affect all of us, there will be significant tax increases, painful budget cuts, and a pension fund that could run out of money before many of today’s employees reach retirement.”
It’s A Political Thing
Despite Raimondo’s insistence that politics should have nothing to do with the legislation, Valletta said she the Treasurer is creating “class warfare and I believe it’s a political thing.”
“If she doesn’t run for Governor in four years, I’ll apologize,” he said.
Valletta criticized Raimondo for offering different messages to different groups of people as she traveled across the state in an attempt to shed light on the state’s pension crisis. He said he went to dozens of community meetings and Treasurer’s message was always tailored for the room she was in.
“She not honest,” he said. “If she was, why wouldn’t she tell everyone the same thing?”
In the end, Valletta claims the pension changes will severely affect the average worker.
“I still think they hit these people too hard,” he said. “Some people are going to lose their homes because of this.”
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