Mike posts on this immediately below. Here is an issue where conservative and libertarian living constitutionalists might weigh in. Given the corrupt bargains made between the politicians and the public employee labor unions, one might conclude that these bargains should not be respected. (One extreme example is the large retroactive pension increases that Gray Davis granted — what could possibly justify such a measure?) One might conclude that the government can only bind future citizens if it has a permissible purpose and that these corrupt bargains were not permissible. This, of course, is living constitutionalism and depends on one's view of current values and desirable principles and results.
What about originalism? One possible argument here is to deny that public contracts are covered by the Contracts Clause. While I don't want to take a position on the original meaning here, there are some strong arguments for concluding public contracts are not covered. Most importantly, at the time of the Constitution, most public contracts conferred monopolies on corporations, and there was a strong distaste for such monopolies.
I wrote my Student Note on the Contracts Clause many years ago. But if I ever return to the subject, I will certainly investigate this public contracts question.
Posted at 3:48 PM