FRANKFORT – You can argue with his policy, and quibble about his performance, but Matt Bevin keeps getting better at politics.
In his combined State of the Commonwealth and budget speech Tuesday night, the new governor announced Kentucky’s single biggest budget cut in memory, 9 percent for most agencies – and starting immediately, not even waiting for the legislature to pass a budget.
Because he’s exempting elementary and secondary education and a few other things, and putting more money into a few others, the total cut is only 2.5 percent – but that’s deep, because the state is expected to bring in 3.2 percent more money in the next budget, and most agencies were cut by a third or more under then-Gov. Steve Beshear.
The new cuts, and new appropriations, are aimed at rescuing the state pension system, at best the nation’s third worst-funded. That’s the priority Bevin set when he was a candidate, and it’s his meta-priority as governor.
“This entire budget is about saving our pension system,” he said in a briefing for journalists before his speech to a joint session of the House and Senate. Of course, it also serves a priority of many Republicans, shrinking government.
Democrats who control the House – barely – want to borrow $3.3 billion for pensions, saying the scheme will make money because the interest rate would be lower than the likely rate of return on pension investments.
That would probably work, eliminating the need for drastic cuts, but financial markets have become more uncertain in recent weeks, and Bevin told journalists, “I don’t think it’s going to be happy time in the markets. … I’m not holding out for happy days ahead.”
(I asked Bevin how his experience as a financial manager had most strongly informed his approach to the budget, but he didn’t answer that part of my multi-part question. He said he was informed by growing up in poverty, living much of his life “hand to mouth, financially” and being the father of nine.)
The Democrats’ idea is dead anyway, because Republicans are in control and having none of it, using the simplistic line: “We cannot borrow our way out of debt.” And now they have a governor, who repeated it in his speech.
It’s not a debt, in the usual sense. It’s a projected liability that is not funded. But it is a legal obligation, and the last three governors have failed to live up to it, not recommending enough for pensions in their budgets. With the 2008 market meltdown and some apparent mismanagement in the system, we have a crisis, and the state’s credit rating is falling.
The legislature went along with the last three governors’ pension-budget recommendations, making it easier for them to spend money on things like, as Bevin put it in the briefing, “flagpoles around the state with legislators’ names on them.”
The governor was more politic in his speech to the General Assembly and a statewide television audience, perhaps his best and broadest introduction yet to his constituents. In an hour and eight minutes, there were no flashes of anger or impatience like those journalists documented (and sometimes prompted) during his campaign, and he displayed an engaging, upbeat demeanor that seemed to help his audience better swallow the dose of budgetary castor oil. He seemed less like a politician than a self-confident CEO addressing an annual meeting of stockholders, which in a way it was.
The speech was a bit rambling, because Bevin doesn’t use prepared texts or the politico-governmental rhetoric of his predecessors, so he missed applause lines for some of the few budget increases he mentioned, and blurred what he called his laser-like focus on pensions – but that message got across. On social media, talk radio and self-selected media polls, the reaction has seemed positive.
The apparent consensus that pensions should trump almost everything else, at the expense of dozens of programs that legislators and their constituents hold dear, was shown by a comment from a veteran Democratic lawmaker, Arnold Simpson of Covington, chairman of the House budget subcommittee on higher education: “We have a responsibility as a government,” he told the Lexington Herald-Leader. “We have to honor the contracts we’ve made” with employees and pensioners.
The politics of this are pretty basic. The crisis is obvious, and there are hundreds of thousands of pensioners, future pensioners and relatives who want action. And the details of the budget and programs are lost on most voters, whose diet of reliable information about state government has dwindled in the past decade, mainly due to the shrinkage of the Frankfort press corps.
Voters want politicians who deliver what they promised, and show “energy in the executive,” as Alexander Hamilton put it. In public polling on Kentucky governors, the highest job rating ever went to Democrat Paul Patton soon after he accomplished perhaps his most controversial move, a higher-education reform that took community colleges away from the University of Kentucky.
Patton got 71 percent approval in the Courier-Journal’s Bluegrass Poll in the spring of 1997. Most of that was from people who said they “somewhat approved” of his work, and my interviews with some poll respondents could be boiled down to this: We’re not sure he’s doing the right thing, but at least he’s trying. They want their leaders to succeed.
Those attitudes could take Bevin a long way. He doesn’t need to defend his policies with gratuitous slaps, such as, “There will be more incentives to electrical engineers than French literature majors,” in what would be the biggest higher-ed policy shift since Patton. He could use some practice with a prepared text, and the legislative session is likely to test his patience.
But if Bevin continues to inspire confidence, and the next president is a Democrat, we’ll probably see him making more trips to Republican events in New Hampshire, like he did last weekend, even as the budget was being finalized.
The man who had the gumption to challenge Mitch McConnell and get back in the political fray after a crushing defeat, then scored a big primary upset and a surprisingly strong victory, is a change agent. That’s what voters seem to want more than ever, and they are worrying less about the direction of the change.
Al Cross, former C-J political writer, is director of the Institute for Rural Journalism and Community Issues and associate professor in the University of Kentucky School of Journalism and Telecommunications. His opinions are his own, not UK’s. This column previously appeared in the Louisville Courier-Journal.