Perspective | Kentuckians want progress

All parties must now collaborate to solve the state’s fiscal issues
Mark Green is executive editor of The Lane Report.

The Nov. 6 election (a few weeks away as this is written) is changing some – perhaps many – of our elective decision makers, but it is not changing the agenda Kentucky’s leaders must address. It is time to get to work – together.

Kentucky’s motto may be more than 200 years old but it remains relevant as ever: United We Stand, Divided We Fall. When our elected decision-makers are Kentuckians first and members of a political party a distant second, everyone wins. While politics is often viewed through a zero-sum prism in which someone must lose for another to win, that is a false choice and a shackle against progress.

And our state needs to move forward. Our neighbors are, and standing still is actually taking a step backward. In the decade since the last recession ended in 2009, average incomes in the commonwealth have grown 36 percent, which sounds good. But the number loses its luster when measured against the 48.6 percent increase experienced by all Americans.

Kentucky needs to find and implement strategies to do better.

A decade ago in May and June 2008, The Lane Report published a two-part look at “Finding The Keys” to better prosperity – essentially, the answer is better education achievement in our rural areas – that noted the state’s per capita income was only 80 percent of the national average. In September 2018, the Kentucky Chamber of Commerce released “A Citizen’s Guide to Kentucky’s Economy Since the Recession” (find it at kychamber.com), a study by noted economist Paul Coomes, that finds our per capita income of $39,393 in 2017 was down to 78 percent of the U.S. average of $50,392.

So, we are growing our incomes yet still falling further behind financially. It’s frustrating.

It is likely relevant to note that Kentucky rebalanced its budget – cut spending – at least seven times during the past decade, and planned education funding decreased. Meanwhile, the state’s unfunded pension liability grew to become THE worst in the nation. The state is increasing the emphasis on pension funding in its budget today, which is absolutely the responsible thing to do, and this continues to limit resources available for pushing education forward.

It is argued, with some merit, that good education is not a straight-line dollars-in, better-results-out proposition. There is a correlation, however, between better funding and improved outcomes. School districts with the best financial resources achieve better results. It is difficult to argue that Kentucky should not invest more in education funding.

The General Assembly took commendable tax reform steps in its 2018 session to shift toward a more consumption-based revenue structure, and collections for the first quarter of this fiscal year are up, conforming to state budget expectations.

Changes in the state pension system to reduce liabilities moving forward were controversial when enacted, generating a lot of political friction, and are being challenged in court. Regardless of the outcome of those challenges, significant further steps are needed in order for our state to meet its future financial obligations.

Which brings us back around to the initial point here: It is time to get to work rather than do political battle.

Kentucky must take further steps to meet its responsibilities to pay the pension bills coming in the next 30 years. Even with an improving economy and its better investment returns, the most reasonable estimates are that more revenue is needed.

Kentucky should take steps to improve its support for education. That is an investment that will provide more revenue in the long term. And even conservative estimates are that this too will take more revenue.

True success in dealing with the state’s issues will come from consensus rather than conflict. Because Kentucky’s teachers and public employees have strong financial interest in solutions to our intertwined issues of pension reform and education reform, it is reasonable they should have a seat at the table in crafting the answers our state needs. With that seat, however, comes the responsibility to offer reasonable ideas and support plans to move our state forward toward solvent pension systems and adequately resourced education systems. Progress comes not from complaints but solutions.

It is time to get to work.


Mark Green is executive editor of The Lane Report. He can be reached at [email protected]

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