Cadiz, KY


Early state direction not making much 'cents'

Wednesday, January 11, 2017 - Updated: 2:09 AM
PMG News Services

Days after formally moving in to every corner of Frankfort, Republicans hastily got to work trying to lower wages on predominantly middle class families.

That sentence is probably going to get a few phone calls or sharply worded emails, mostly noting how unfair it is to focus on the negative when Republicans are doing positive things as well. And that's true. This session, state GOP lawmakers -- now in the majority -- have said they plan to bring more options to where your child goes to school and this weekend passed legislation aimed at increasing health care costs and reducing abortions.

Kudos to them on both accounts. Really.

But that doesn't soften the approaching economic blow they landed in regard to Kentucky blue collar workers.

As this space has said before, right-to-work legislation doesn't make any sense for the middle class. So far, about half the the country has passed some form of anti-labor legislation. Many of them have seen average wages decrease. The exceptions can largely be found in states propped up by the shale oil industry, which is starting to decline as the lucrative easy to drill wells are almost dry and those companies find it harder to compete in a market flooded with cheap OPEC oil.

And that will also surely garner some calls for the other side of the issue, which is that almost all of those right-to-work states have seen job growth. And that is true. They have.

The caveat there is most of that growth is comparable to states with labor unions over the last decade. In other words, an improving national economy has been the biggest factor in job growth.

So it's a fair assessment of Republican lawmakers that as soon as they got into office, their first job was making sure constituents do the same work for less money. Not fixing the retirement system or addressing education funding that's had Lyon County Schools receiving the same dollars as it did when KERA was enacted. No, they used their time to make it harder for families across the Commonwealth to take care of themselves.

By reducing the ability for workers to increase wages to offset inflation and stagnation, Gov. Matt Bevin and Republican lawmakers are furthering dependency on the state.

But wait, shouldn't more jobs (even at less money) mean fewer people on government assistance?

Well, not really.

According to studies by the Economic Policy Institute, 66.6 percent of "families or individuals receiving public assistance, the majority work or are in working families." That rate increases to 72 percent for working families and individuals where the worker is under 65 years of age. About half the workers (53 percent) receiving benefits make under $10. EPI puts the median hourly wage in right-to-work states at $16 per hour, down from $19 per hour in non-right-to-work states.

Both those numbers are well above the wages made by that 53 percent, but economics is much like a nuclear bomb explosion. Generally, the further away from the center you are, the better off you'll be.

As of last year, Kentucky ranked 45th in per capita income at $23,684. The state is 47th in median household income, just ahead of Guam. That's something to hang your hat on.

To risk lowering that doesn't make any sense. Or cents.

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