Proposed Ky Public Pension Changes Nowhere Near Enough

The changes being put forth by Kentucky Senate Republicans, based largely upon recommendations of a task force, don't even begin to deal with the issue, as we see the problem being kicked down the road yet again.

While there are some good things in Senate Bill 2, such as cutting some of the retirement benefits and eliminating an existing law that requires cost-of-living increases, it does nothing to deal with the real problem, which is the unfunded liabilities.

The Kentucky Retirement Systems requirements stand at $11 billion, with only 44 percent of that available to meet the needs.

Didn't Kentucky get the memo from Wisconsin Governor Scott Walker? His simple answer to the challenge in his state was to have the actual people receiving the benefits pay a little more into them rather than the taxpayers. It worked extremely well, as Wisconsin quickly recovered from the weight of having to underwrite the outrageous wages and benefits public workers get over the more productive workers in the private sector.

Not only that, but the language in SB 2 says that Kentucky must totally fund its contribution starting in 2014. That means the Commonwealth must come up with $327 billion for fiscal year 2015. After that the required amount would increase by hundreds of millions of dollars.

As I said, absolutely nothing is being done to address the real issue, which is government workers were given more benefits than can be paid for, and now it has brought the state and the rest of us to the brink of insolvency. Call it what you want, but that's exactly what it is.

Why haven't the lawmakers of Kentucky - both Republican and Democrat - dealt with the issue? They are hoping they can kick the can far enough down the road so they don't have to deal with the outcome of the hard steps that need to be taken to deal with this disaster.

Senate leaders said they would have preferred to see more changes in the government worker pension system, but don't believe the bill would have passed if they didn't work along the guidelines suggested by the task force.

That's incredibly stupid by the Republican-led Kentucky Senate, as they should have put forth a comprehensive bill that would have radically dealt with the problem in a way that would have actually solved it. If that would have been done, it would have been on the Democrats when the house of cards comes tumbling down after they voted against the changes.

As it is, reality will deal with the pensions of government workers in Kentucky because there simply isn't enough money to pay for it, and there will be drastic austerity measures put in place sooner or later. It should have been now, as it would have helped to ease the transition for those counting on the promised benefits. Unfortunately, when the hundreds of million of dollars are needed in the future, nothing being offered as change will do anything to provide for it.

One thing for sure, Kentucky politicians better not even thing of boosting taxes on the productive private sector and free market in order to pay for the outrageous promises they made to government workers, promises that are now being exposed as the fool's gold they were.