The late Lowell Reece, a Pike County native, sounded the alarm about the pension crisis decades ago. His concerns were real, because we are right now amid a pension crisis. The most egregious example is the exorbitant legislative pensions of the General Assembly. Their pensions are, of course, better funded than those of teachers and other public employees, and as Lowell Reece wrote, the legislative pension is a metaphorical gold rush for those benefiting by it.
Before the General Assembly and the governor do one thing to address the Kentucky pensions for public employees and teachers, they must immediately address the excessive benefits bestowed upon legislators who were fortunate enough to vote themselves a hefty pension in 2005 under HB299. Known as “The Greed Bill,” it made legislators, like former state representative/former Agriculture Commissioner Jamie Comer, and now congressman, poster boys for largesse and abuse of the legislative pension system, which doubled and, in some instances, tripled their pensions.
I would support drastic cuts to the pension benefits paid out to legislators. The legislative pension benefits should reflect the fact that the General Assembly is not full-time but a part-time office. Nowhere in the private sector does a part-time worker receive such pension benefits, and neither should the members of the General Assembly.
This fact should serve as a backdrop for the upcoming special session that now may be pushed to November by some reports out of Frankfort. Legislators should lead by example, cut the excessiveness of their benefits before they vote to deny teachers adequate pension benefits. Once they demonstrate the will to cut their own pensions, they can then move to reform the pensions of state employees.
The governor is to be applauded for willingness to touch this volatile issue, but it is fraught with political danger. It is much akin to what has been called the “third rail” of American politics — Social Security. You touch it and you risk political death. It is that politically dangerous to deal with this issue in Kentucky politics, but the day of reckoning has come.
Everyone acknowledges that something must be done to address the pension crisis. We are to a point of a complete meltdown in the system if immediate measures are not taken. Whatever those are will be debated and forged in the coming months. Every Kentuckian has a stake in the outcome. It could mean higher taxes. It could mean cuts to education — the largest piece of the state government’s budget. It could mean drastic measures are made to the structure of the pensions themselves, potentially denying current recipients promised benefits. One thing is for certain: If the pensions are not shored-up and made solvent, it will mean Kentucky’s economy will be severely impacted, leading to decades of economic woes for not only state and local government, but for businesses in Kentucky.
Should the fix be tax increases, provisions must have those taxes expire after a certain date and require all revenue go to the pension system, and not wasted on pet projects. Whatever the solution, the people need to voice their opinion now.