At the beginning of the 20th century one plutocrat arrogantly declared, “We own America; we got it, God knows how, but we intend to keep it.” In 2018 Kentucky, we might paraphrase a beaming multi-millionaire or billionaire saying, “We own Kentucky; we got it by buying the legislature, and we intend to keep it.”
As we near the end of the General Assembly’s 2018 session, we have witnessed out-of-state corporate interests and the rich check off items from their wish lists as the House, Senate and our governor moved closer to a laissez-faire economy at the expense of working men and women and our most vulnerable citizens.
Kentucky is poised to take big steps backward on many of the main issues of this year’s session:
Taxes. Lawmakers approved a horrible tax bill that would shift the already-too-light burden from the rich and move it onto the backs of the working poor and middle-class families. It would give the rich and corporations major tax breaks, most notably by setting the personal income tax rate at a flat 5 percent, instead of current brackets in a range of 2 to 6 percent. Average people pay more and the rich pay less.
The tax scheme also called for a corporate tax giveaway in the form of a flat tax on corporate income that would have cost the state about 8 percent of income generated by the tax. It would also hurt middle-class retirees by lowering the pension income exclusion to $31,110 from $41,110.
Our governor, who refuses to keep his promise to release his tax returns, has consistently been wrong in saying that a solution to our state’s fiscal problems is a “consumption tax.” All consumption taxes — sales taxes — are sold as fair. But a sales tax is the most unjust tax of all. Why? Because every dollar a struggling working Kentuckian makes, they spend to live. So every dollar spent is taxed (except for groceries, prescription drugs and personal utilities). But only a fraction of every dollar a millionaire earns is spent. The rest is invested to make even fatter portfolios. Under a broadened or increased sales tax, the rich will pay a much smaller percentage of their income in taxes compared to a working-class family.
The governor says he will veto the tax measure lawmakers approved, though for the wrong reasons. He is a fan of shifting the tax burden from the wealthy to the middle class; he just wants to do it in a plan that differs from the one lawmakers sent to him. Still, his veto means there’s now a second chance for common sense to prevail in the General Assembly. We still have a chance to demand a stronger, fairer tax reform plan that will raise the revenue we need while offering relief to the working poor. Such a common-sense step, however, faces an uphill battle in Frankfort.
The budget. Kentucky’s failure to craft meaningful tax reform has again produced a mean-spirited budget that fails to invest in people or the programs we depend on. State agencies already slashed to the bone will once again face budget cuts, this time 6.25 percent. Universities are not spared.
Though some claim the increase in per-pupil funding for public school students will rise slightly, the truth is schools will suffer another cut because we aren’t investing enough in them to even keep up with the rate of inflation.
While the cuts will hurt programs across the state, some agencies, such as the Commission on Women, face the prospect of closing as they lose all funding.
The governor says he will veto the budget plan. That might not be bad if the plan was to prepare a better budget, but that’s not what he has in mind. He preferred much deeper cuts than lawmakers approved. He also complains that the tax bill upon which budget spending depends was based on faulty assumptions. That may or may not be true, but no one can be sure because of the hasty, sloppy manner in which the tax bill and budget plan were approved, without proper deliberation or public input.
Teachers’ pensions. At a time when we should better support our schools and teachers, the General Assembly is going in the other direction over the vehement objections of the people we depend on to educate our children. It is nothing less than an insult to the teaching profession to force new teachers into a “hybrid” 401 (k)-style savings plan, rather than the better, traditional pension plan. Also, we will require new teachers to work longer before becoming eligible for full retirement. In other words, we have cut compensation for new teachers when we should be improving their low pay.
Some state leaders have also disrespected teachers by wrongly accusing them of “hoarding” sick days (in the governor’s words) and telling them that, after Dec. 31, any sick days they accrue will no longer count toward their pension.
Workers’ compensation. The General Assembly has approved flawed workers’ comp legislation that would shift costs onto injured workers. This anti-worker bill says that when workers become partially disabled due to a job-related injury, they will receive benefits for no more than 15 years before they have to reapply. When a worker is permanently disabled on the job, we shouldn’t make them jump through hoops every 15 years. It’s no wonder that the Fraternal Order of Police opposes this bill and says it will harm our state’s first responders.
The workers’ comp bill also essentially assures that coal miners who develop Black Lung Disease — an illness caused when mine owners cut corners on properly ventilating mines — will not receive the compensation they deserve when they are sick and no longer able to work due to a work-related illness.
With poverty growing (nearly one in three of our children lives in poverty) and the gap between the rich and poor widening, now is the time to build a society that works for all citizens. Instead, throughout the 2018 legislative session, we witnessed the further crushing of the middle class and the poor by the corporate elite and their cronies who spend millions to influence what happens at the state Capitol.
The age-old Amish dictum proved correct once again: “Those who have too much are never satisfied.”
All the harmful legislation passed this year raises many baffling questions. But perhaps the biggest question is this: How is it that members of a single party controlling both legislative chambers and the governor’s office still can’t work together to govern our state?
Now’s the time to remind all members of the General Assembly that they were elected to serve all Kentuckians, not just the elite’s wish list. It’s time to refuse to permit the rich to own our government, or our great commonwealth. •
Rep. Jim Wayne is a veteran Democratic state representative from Louisville.