Consider this situation. You are a business owner. Your business has a lot of potential yet, because of the current economic situation, you are struggling to run at a profit. In fact, you are running at a significant loss.
So, what do you do? Well, as a responsible business owner you look at the cash flow of the organization and analyze where money is going. This involves looking at financial statements, labor numbers, profit and loss reports, etc… in order to assess efficiency and make cuts.
Why cuts? Well it’s obvious that costs outweigh available resources. If we could just keep profits increasing exponentially things would be great. But that’s not realistic.
The Commonwealth of Kentucky is in a situation where some decisions need to be made. A budget shortfall of $1.5 billion dollars is unacceptable. In a recent budget address, leadership presented a plan to raise revenue through gambling legislation and some select cuts in spending. Half of that is the right idea.
Kentucky has a spending — not a revenue — problem.
What needs to happen is for the governor to follow through on the efficiency study he promised a couple years ago. Such a comprehensive study would make government more efficient while reducing its size and cost. Kentucky’s businesses must constantly evaluate spending and make cuts where necessary. Frankfort should try it, too.