In Kentucky, government IS the problem — the lack of it, that is Skip to content

In Kentucky, government IS the problem — the lack of it, that is

3 min read

In Ronald Reagan’s 1st inaugural address, he famously said, “Government is not the solution to our problem – government IS the problem.”

In his first speech to a joint session of Congress, President Joe Biden gave a remedial history lesson and praised government funding that paid for America’s transcontinental railroad, the GI Bill, the interstate highway system, the Apollo 11 moon landing, the Internet, bridges, schools, the exploration of Mars, and the current mass-vaccination drive.

We now have a new mantra: Out with Reaganomics — In with Bidenomics.

But in an interesting spin, for Kentuckians government IS the problem – not too much but LACK OF IT.

We have long-standing problems that have held us back for decades, including:

  • Many families living in distressed rural and urban communities can’t afford housing, childcare, health care, food, or other basic needs, and face serious economic instability if they lose their jobs, get sick, or face a recession.
  • People of color, immigrants, and poor whites face unequal opportunities in education, employment, health, and housing – disparities that have been “unmasked” in this pandemic.
  • Kentucky’s government hasn’t made the public investments that we know pay off: high-quality early childhood education, modernizing our physical and digital infrastructure, and fighting the threat of climate change.
  • Kentucky’s wealthiest individuals and corporations have reaped “banana-republic-sized” profits and have been given special tax loopholes to avoid paying their fair share.

It’s time for the wealthiest among us, who have profited off the economy of all of us, to finally pay their share to help make that economy actually work for all of us.

Corporations like Amazon, Netflix, Chevron, Eli Lilly, and Deere & Co. (to name just a few) have paid ZERO taxes year after year.

According to the Institute on Tax and Economic Policy report, these companies were “able to zero out their federal income taxes on $79 billion in U.S. pretax income, eliminating $16.4 billion in taxes, and enjoyed a net corporate tax refund of $4.3 billion, blowing a $20.7 billion hole in the federal budget last year.”

As we move forward to “Build Back Better,” an overwhelming majority of Americans support real tax increases on the income of corporations and the wealthiest who have been given a free ride for decades. These individuals and corporations need to help pay for the national plans to both bring us out of the pandemic and recession, and to take our country — all of us — to a better future.

What does this better future look like? For Kentuckians, the Democratic American Rescue Plan [ARP], which has helped us survive this pandemic, provides some examples.

According to Kentucky Center for Economic Policy Executive Director Jason Bailey, “combined with prior federal aid such as the 2020 CARES Act, the ARP rises to the occasion of an economic crisis in which 33% Kentuckians report having difficulty affording usual household expenses, 20% Kentucky parents say their children aren’t getting enough to eat, and 16% of Kentucky renters are behind on rent payments.”

The American Rescue Plan reflects a lifeline to Kentucky families and communities. It will provide much-needed relief and allow us to emerge on the other side of COVID-19 stronger and secure.

As noted by KCEP, the plan provides these key hardship-reducing measures for Kentuckians:

  • $1,400 checks to every adult and child with incomes up to $75,000 or $150,000 for couples, or 92% of Kentuckians;
  • $300 a week in extra unemployment benefits through Sept. 6 and a continuation of other pandemic unemployment programs, helping over 100,000 laid-off Kentuckians;
  • An expanded child allowance of up to $3,600 per kid that will go to 86% of Kentucky’s children and their families, and a portion will be continued monthly;
  • Food and rental aid for those struggling to pay for basic needs, as well as over $760 million in Kentucky for childcare assistance;
  • More than $4 billion in aid to Kentucky state and local governments to protect public services and restore budget cuts, support essential workers, and allow water, sewer, and broadband infrastructure investments;
  • More than $2 billion for Kentucky public schools and universities to allow them to operate safely, address learning loss, and support students;
  • Expanded assistance to make purchasing healthcare on the state’s health care exchange more affordable for at least 78,000 Kentuckians;
  • Monies to accelerate vaccination and further bolster the public health response to COVID-19.

And most importantly, it recognizes that the biggest risk is doing too little to get families and communities back on their feet, rather than too much. We already tried that after the Great Recession of 2009, and it caused the effects of the recession to last much longer than necessary.

The next step?

We need a major investment in modernizing our infrastructure and clean energy, an increase in the minimum wage, and ARP measures made permanent, particularly the groundbreaking child allowance which alone will cut American child poverty nearly in half.

It’s time for Kentucky, and America, to have enough government investment to be the state and the nation we want to be.

Out with the “feed the rich and starve everyone and everything else” approach of Reaganomics — in with a better economy, and a better world, for all of us.

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Marshall Ward

Marshall taught history and economics for twenty years in Charleston, SC, then moved to Murray, KY, where he taught AP history for seventeen years. (Read the rest on the Contributors page.)