Lexington Herald-Leader, January 9, 2008: Cycle of poverty

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Governors and legislators come and go, state budgets strain under new and old demands, but Kentucky’s grinding, intractable poverty remains a constant.

Education is the single most important tool to disrupt that cycle of poverty.

That was the message of the 1990 Kentucky Education Reform Act and of higher education reform in 1997. Ambitious and optimistic, each embodied the belief that Kentucky could reshape its future to change the persistent failures of the past.

Gov. Steve Beshear recognized that in his campaign and, again, when the budget cuts he announced late last week spared funding for the lower grades, K-12, although he’s opened the door to cuts in the next budget cycle.

But higher education has not fared so well in the early days of the budget shortfall Beshear inherited when he took the oath of office last month. Beshear has told university presidents to come up with a 3 percent cut this year.

That might be manageable with short-term cuts, hiring delays and shifting projects into the next fiscal year. But Beshear asked them to prepare for cuts as high as 12 percent in the next cycle, and that’s where the damage could be done.

And so the cycle of Kentucky poverty threatens to again outmuscle attempts to defeat it.

Beshear can’t be held responsible for this mess. He was happily ensconced in his private law practice as recent governors and legislatures passed one fundamentally unbalanced budget after another and borrowed money without worrying about when or how it would be repaid.

We wish candidate Beshear had left himself open to raising the tax on tobacco products, and certainly believe a more rational tax system could improve our revenue picture. But taxes alone won’t solve this problem. Kentucky is just too poor.

Which brings us back to education. The best way to increase tax revenue long-term is to increase the wealth of taxpayers. And the best way to do that is by attracting or creating fewer poor ones.

So what to do?

First, the legislature should pass, and Beshear should sign, a law giving public universities the authority to float their own bonds for projects that pay for themselves.

It will save money and allow university administrators to plan more effectively for big projects, like dormitories or the new hospital at the University of Kentucky.

Second, the pork train has got to stop. Practice facilities, roads to nowhere, pet local construction projects, tax giveaways masquerading as incentives, costly questionable change orders — they all drain money away from education, and Kentucky’s hope of future prosperity.

The governor and lawmakers could hand out diplomas (real ones) instead of those silly, fake oversized checks if they need local photo-ops.

Third, admit that tuition hikes — an inevitable result of severe budget cuts — are a tax increase. Then consider that higher taxes often drive people to change behavior to avoid the taxes.

Then ask this question: Which will help Kentucky in the long run, taxing cigarettes or students?

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