jim waters headshotKENTUCKY (4/13/18) — By the time many read this column, we’ll know whether the Republican-dominated legislature overturned Gov. Bevin’s vetoes of its budget – which proposed spending $600 million more than the governor’s plan – and a mammoth tax increase to fund it.

Meanwhile, on the other side of the political aisle is Democratic Attorney General Andy Beshear, who fancies himself as the boy wonder of Kentucky politics, filing a lawsuit against a reasonable pension-reform bill that changes little for current beneficiaries but ensures new teachers have sustainable accounts and generous annuity payments when they retire.

Beshear’s boy-wonder schtick loses its luster, however, when considering his father and former Gov. Steve Beshear’s administration woefully underfunded state pension plans.

But those aren’t the only two peas in the pod.

The Kentucky Education Association – the state’s largest teachers’ union – is joining Beshear in his lawsuit.

Yet while we have a whole lot of tax-hikin’ and lawsuitin’ goin’ on, there’s not much problem-solvin’, at least not the kind related to this important principle: sound policy requires consideration of the long-term effects on all Kentuckians rather than just the short-term impact on a relatively small group.

We need to hear more talk in Frankfort about taxpayers who produce every day to support public workers’ pensions, even if, like Bevin wrote in a recent op-ed, “these men and women are too busy working and raising their families to come to Frankfort and yell at legislators.”

These folks matter too, don’t they?

They certainly form the majority of the nearly 1.3 million taxpayers across the commonwealth, each one of whom would have to write a check today for $48,000 to cover Kentucky’s pension liability even though the Census reports the commonwealth’s median household income is only about $42,000.
Beshear’s lawsuit doesn’t seem to give this large group much consideration.

There are over a half-million members and retirees in the public-retirement plans, meaning taxpayers not currently in a public system outnumber by at least a nearly 2-1 margin any combination of retirees and retirees who also file returns.

The only reform affecting current teachers in the pension bill, which Bevin signed into law soon after issuing his vetoes, was in not allowing future unused sick days accrued after Dec. 31 to be used to spike lifetime pension benefits.

Otherwise, the reforms are limited to creating a 21st-century cash balance retirement accounts for new teachers that are portable, protect against unfunded liabilities and provide secure annual annuity payments.

Beshear may achieve a modicum of short-term political gain by winning his lawsuit and yet, in doing so, stop a plan ensuring a secure retirement for future teachers and addressing the current pension systems’ slide toward insolvency.

Like the KEA, the only solutions offered by Beshear and his union pals revolves around taking more away from taxpayers and giving it to Frankfort.

Republicans also seem eager to take more out of our pockets with their proposal to pick government winners and losers by levying taxes on 17 additional services.

Politicians of both parties are famous for swearing they’ve cut spending to the point that the bone sticks out of the patient.

So, does this mean that GOP politicians think owning and maintaining 13 golf courses is a core function of state government that can’t be cut?

Apparently so, since they voted for tax increases on privately owned golf courses.

How else can you maintain government-owned courses unless you tax private ones?

Does this mean, then, that if this tax package were implemented, private golf-course owners would be forced to subsidize their publicly owned competition?

Apparently so.

It’s too bad, isn’t it, that taxpayers can’t file their own lawsuit?

I’m told they wouldn’t have standing.

Maybe not, but they’d have plenty of reasons.

Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read previous columns at www.bipps.org. He can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it. and @bipps on Twitter.

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