Harvard’s Feldman: ‘Disastrous move’ to toss RI pension law

December 6th, 2012 at 10:55 am by under Nesi's Notes, On the Main Site

The prominent Harvard Law School professor Noah Feldman is weighing in on the side of Treasurer Gina Raimondo and super-lawyer David Boies, urging Superior Court Judge Sarah Taft-Carter to uphold the constitutionality of last year’s landmark pension law.

“The Rhode Island courts should respect the law, restrain themselves, and make sure that their state continues to be seen as a leader in fiscal reform, not in judicial backlash,” Feldman wrote Thursday in a Bloomberg View column. It’s the second major national press the pension suit has gotten this week following Wednesday’s front-page New York Times story.

Feldman and Raimondo have nearly identical academic pedigrees: Harvard College, Rhodes Scholars at Oxford University, and Yale Law School. Raimondo’s office confirms the pair know each other from school, though Feldman was a year ahead of her.

Feldman’s legal reasoning, though, doesn’t rest on personal friendship. Instead he argues that Raimondo and her allies are correct that the state can cut pensions legally to serve the broader public interest:

Striking down reform would be a disastrous move — not only for budgets but also for constitutional governance itself. …

[T]he equation of benefits with inviolable contractual rights is too hasty, both legally and morally. As a legal matter, many public-pension plans are in fact created by statute, and it is well established that what a legislature may do by law, it may also undo. …

Even when benefits are created by contract, the states’ obligation to respect those contracts has long been interpreted to allow for them to be altered or even eliminated when public necessity demands it and the modification is deemed reasonable. The looming fiscal crisis in Rhode Island – and in many other states and cities – certainly satisfies the condition of necessity. …

In a pinch, the government may curtail some property rights to preserve the health of the whole system. No one ever likes it – and everyone, regardless of political preferences, makes the same conservative property argument against it.

Read Feldman’s full op-ed here. And speaking of pension arguments, to get a sense of what sort of deal the unions might try to drive in negotiations, read NEARI chief Bob Walsh’s comments from last year.

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16 Responses to “Harvard’s Feldman: ‘Disastrous move’ to toss RI pension law”

  1. Malachi Constant says:

    ah yes…..the worlds of the elite, circling the limo’s… the protect their class interests once again. Constitutions? Those are for the us, not the little people……

    1. Rich says:

      Too bad you were never taught math when you were a kid. Too bad you are a state worker who does not have a clue what those of us in the private sector have to put up to keep you morons in over generous benefits.

      1. We're Doing God's Work says:

        Hey, it’s my eXpecially good friend Rich!

        What do you say to me? I’m no state worker. I’m no union member. I just don’t like parasitic private equity worms bringing millions of dollars of Greenwich, CT money up to RI to buy elections for their criminal, tax-dodging yacht buddies.

        We have enough of our own criminal rich in Newport. We don’t need to import the Wall Street types like Gina.

        This state’s going to hell in a handbasket.

        The most blue state in America, yet we’ve got a Koch-Brothers style flat-tax for rich folk and we make yachts tax exempt. We were told we’d be rolling in jobs by Carcieri if only we stopped taxing the rich. We stopped taxing them. No jobs.

        But we’re happy to talk about taxing old people’s prescriptions and hit you with an $80 annual excise bill on a $500 beater car you need with which to get back and forth to work. And now we have the worst retirement plan for public employees in the country.

        And your solution is to take everything away from teachers and firemen and cops and nurses too.

        My solution is to start taxing rich folk who don’t pay their fair share. Not a teacher with a $20k per year pension. A billionaire with a $20k per hour spending habit. I’m sure Providence Equity could afford to kick a little more in the kitty.

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  3. MICHAEL RILEY says:

    Of course Mr Feldman is right and with regard to RI Futures complaint of your coverage…Who cares what Bobby Plain thinks anyway?

    1. We're Doing God's Work says:

      I guess someone cares what Bobby Plain thinks, otherwise I’d be addressing you as Congressman.

  4. downsized54 says:

    The unions did not need to cry to Linc.The fix is in with Taft Carter on the case.Union victory will be shallow many of their employees will be laid off terminated and state offices will be shut.But Walsh,Nee,Downey will still be fat.

    1. Rich says:

      It is a start. Get rid of as many or the so called $35K per year state employees. These are the masses who drain the state with their health benefits and featherbedded postions. These people are lucky if they they don’t work for 40 hours per week but only 35 hours per week.

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  12. Al Moncrief says:

    If you do not like the terms of a contract, do not become a party to that contract. Once a party to a contract you are bound by its terms. That should not be so difficult for you to comprehend.

    It’s not “math,” it’s “contractual obligations.” Why is the RI Legislature not calling for breach of its corporate contracts? Why are public employee contracts the first target?

    COLORADO COURT OF APPEALS CONFIRMS COLORADO PERA PUBLIC PENSION COLA BENEFITS AS CONTRACTUAL.

    The Colorado Court of Appeals has reversed and remanded an initial District Court ruling that denied the contractual status of public pension COLAs in Colorado. The Court of Appeals confirmed that Colorado PERA pension COLA benefits are a contractual obligation of the pension plan Colorado PERA and its affiliated public employers.

    A huge victory for public sector retirees in Colorado! The Colorado Legislature may not breach its contracts and push taxpayer obligations onto the backs of a small group of elderly pensioners.

    The lawsuit is continuing. Support pension rights in the U.S. by contributing at saveperacola.com. Friend Save Pera Cola on Facebook!

    In 1977, the (U.S.) Supreme Court clarified that state attempts to impair their own contracts, ESPECIALLY FINANCIAL OBLIGATIONS, were subject to greater scrutiny and very little deference because the STATE’S SELF-INTEREST IS AT STAKE. As the court bluntly stated:

    “A governmental entity can always find a use for extra money, especially when taxes do not have to be raised. If a state could reduce its financial obligations whenever it wanted to spend the money for what it regarded as an important public purpose, the Contract Clause would provide no protection at all . . . Thus, a state cannot refuse to meet its legitimate financial obligations simply because it would prefer to spend the money to promote the public good rather than the private welfare of its creditors.”