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Pension task force co-chair: ‘Everything’s on the table’

July 6, 2012 By Leave a Comment

What’s the difference in past pension task forces and the new one that began meeting on July 2?

So far, the  primary difference between the pension task force that met and offered some sound recommendations during Gov. Ernie Fletcher’s administration and the one meeting this year is that this year’s group is made up entirely of elected officials whereas the previous group was appointed.

Plus this year’s task force was created by concurrent resolution, which has the force of law, and which must offer recommendations for addressing Kentucky’s $34 billion unfunded pension liability by Dec. 7 — well ahead of next year’s session of the Kentucky General Assembly.

Also, let’s hope this task force demonstrates more spine than Fletcher’s group, which did little to address the most serious issues involving our pension system, including moving new hires to a defined contribution plan like a (401)k.

Let’s hope elected officials will begin to feel the heat from the grassroots who are beginning to understand that continuing to deepen Kentucky’s  pension-liability ditch will only result in a deeper fiscal crisis.

At the first meeting of the task force, task force co-chairman Mike Cherry, D-Princeton, claimed “everything’s on the table.”

Everything? Does that mean legislators’ bloated pensions as well?

Filed Under: Reduce Government Spending, Smaller Government Tagged With: ,

Columnist gives shout-out to Bluegrass Institute

July 5, 2012 By Leave a Comment

Kentucky Gazette columnist Bob Babbage’s recent piece entitled “How think tanks think is worth pondering and using” highlights the Bluegrass Institute’s label-defying contributions to the commonwealth’s political landscape.

Babbage notes that not only has the institute focused on traditional issues like public-pension debt and school choice, but also on non-traditional areas like transparency, online voting records, and methamphetamine legislation.

Babbage points to the institute’s recent Liberty Awards event honoring politicians from both parties as another example of the organization’s commitment to non-partisanship and sound free-market public-policy proposals: “Thanks, BIPPS for making us think. A little thought, contemplation and idea celebration goes a long way.”

Filed Under: Media, News Tagged With: , ,

Standing firm against Rx mandates for decongestants

June 19, 2012 By Leave a Comment

A dominant issue during this year’s legislative session was whether legislation was needed requiring a prescription in order to purchase products containing pseudoephedrine, and whether such a law would stop criminals from using it to make the drug methamphetamine.

The Bluegrass Institute opposed this draconian proposal.

Forcing people with the cold or flu to go to a doctor’s office and wait for authorization to get medicine in hopes of stopping meth production is government overkill.

A majority of legislators agreed and instead chose to limit the amount of pseudoephedrine individuals can purchase in a single month or year without a doctor’s prescription.

Nearly two months later the debate has resurfaced.

A Lexington Herald-Leader editorial bashes $486,053 spent by the Consumer Healthcare Products Association to stop SB3 while attempting to portray the CHPA as sinister lobbyists.

Still, it cannot change the facts. In his balanced, factual response to the H-L editorial, CHPA president Scott Melville points out the common sense reasons his organization opposed the law:

* Kentuckians — 6,700 by mail, 12,000 on Facebook — oppose requiring prescriptions for cold and flu medicine

* Only 2 percent of pseudoephedrine sold in Kentucky is used for meth according to the Legislative Research Commission — a far cry from “a huge portion.”

* Kentucky already has effective laws barring previous meth offenders from pseudoephedrine, and a system to track pseudoephedrine purchases.

The facts reveal that forcing law-abiding Kentuckians to obtain a prescription just to purchase a box of Sudafed would have been unnecessarily strict and abusive to our freedoms.

 

Filed Under: Media, Smaller Government, Uncategorized Tagged With: ,

Why the pension-debt explosion?

June 15, 2012 By 1 Comment

It’s no secret that Kentucky’s pension system is in trouble. But it has not always been this way.

In fact, back in 2000, the commonwealth’s pension debt was a meager $960 million. Five of Kentucky’s six public pension systems were running generous surpluses. The Kentucky pension system was among the nation’s strongest.

A dozen short years later, unfunded pension debt has erupted to more than $34 billion, swelling the state’s debt burden and threatening to crowd out other government services like education and public safety.

Funding for pensions fell below 50 percent in 2010 and continues to fall. The Kentucky Employee Retirement System (KERS) has fallen especially low. While it once ran surpluses, the KERS is now only about 30-percent funded — one of the worst funded in the nation. (For a comparative chart of 126 pension systems funding ratios, click here)

What happened?!

Debt apologists will point to poor economic conditions to explain Kentucky’s pensions woes. Obviously, this is part of the problem. As asset values fall, so do funding ratios for state pension plans across the board.

What makes Kentucky exceptional is that it went from being one of the best-funded nationwide to one of the worst in a decade.

If the stock market was the only reason for the pension debt explosion than we would expect Kentucky’s pensions to remain among the best funded. But they are not.

The question we are asking is not “why have unfunded liabilities increased?” but “why have Kentucky’s unfunded liabilities increased so much more than everyone else’s?”

The answer is now obvious thanks to “Future Shock: Kentucky Politicians’ Opulent Pensions Have Become A Modern-Day Gold Rush.”

Poor economic performance is not the only culprit behind Kentucky’s wildfire of unfunded pension debt. Lavish pensions and a generous basket of benefits share the blame.

House Bill 299, which is discussed in the report, illustrates how greedy legislators have voted themselves generous pensions. However, the abuse of the system does not end there. A collection of other perks have been accumulating for years:

* Legislators’ automatic enrollment in the KERS after maxing out their legislative pensions.  “Future Shock” also shines the light on politicians whose retirements have doubled or tripled as a result of HB 299.

* State employees’ ability to buy “air time” — years of service not actually worked — to beef up their pension calculations.

* State legislators also receive full health care compensation … and they are better benefits than most of their constituents can afford.

Kentucky’s pension problem is not the result of poor foresight alone. Greedy politicians and benefit-creep are obvious contributors to the problem.

Filed Under: Reduce Government Spending, Transparency and Accountability Tagged With: , ,

‘Gold Rush’ author Lowell Reese interviewed

June 13, 2012 By Leave a Comment

Radio talk show host Joe Elliot at 970 WGTK interviewed Bluegrass Institute scholar Lowell Reese recently about the Institute’s new policy report “Future Shock: Kentucky Politician’s Opulent Pensions have become a Modern Day Gold Rush. ” The interview is the report in micro: Reese tells all the shocking numbers, obscene abuses, and conclusions the report offers.

Reese pulls no punches on the commonwealth’s retirement services “The Kentucky Employee Retirement System is virtually broke.” In the interview, Reese explains point by point how legislators are responsible for creating a public pension system which is not only in putting every Kentuckian deeper into debt, but also opens the door to new political leveraging.

In this respect, Reese responds to what the report cannot by discussing recent attempts and promises to fix the system.  “What they [the Kentucky Legislature] did in the summer of 2008 with what they called the reforms of the pension system was very, very cosmetic” says Reese.

The interview (and report) makes it obvious that the taxpayers of Kentucky are being duped by their representatives, Republican and Democrat alike, into paying for one of the nation’s most lavish public pensions programs.

The interview can be found here.

Filed Under: Reduce Government Spending, Transparency and Accountability Tagged With: , , ,