Capitol Watch: Tough on pensions, easy on payday loans
Motivations matter
State workers, legislators and taxpayers in Kansas all have to ask themselves these days: Are pension and pay solutions advancing in Topeka the result of tough times and past mistakes? Or are folks using difficult times and very real problems in the Kansas Public Employees Retirement System as cover to advance ideological positions at the expense of promises made to public employees?
From the perspective of those employees it makes a difference. Unlike the current mania to scapegoat them, studies show public employees are generally better educated but paid 15 to 20 percent less than their counterparts in the private sector.
Is this shared sacrifice in tough times — or getting screwed by the lock-step lackeys of the Koch brothers?
The clues of what is happening in the House, especially, don’t look good.
The rest can eat cake
A couple of Kansas House members actually had the gall to propose cutting pay to state workers by $19 million a year but exempt legislative staff (and even increase their salaries). As GOP Rep. Sharon Schwartz, of Washington, Kan., explained to the Lawrence Journal-World: “That is the least we can do to show our support… I don’t see how we can carry on our work without these people.”
Such reasoning is a central problem with the current thinking on spending cuts. It assumes those needing to be cut are those we don’t personally know and classifies those we do know as hard-working and deserving. Legislative staffers work hard. But so do teachers, cops, firefighters and other public employees.
Take that, and that
Both houses in Topeka this week took on the looming $7.7 billion gap between what will be owed and what will exist in the Kansas Public Employees Retirement System. Both ended up shifting more of the contribution burden to employees (which probably has to happen) But the Senate maintains the current system and comes up with a $23 million increase in state contributions to KPERS.
The House version offers a 401k-esque plan to new employees, then slashes benefits to existing ones if they don’t “voluntarily” migrate over to the new system. The House adds in $10 million a year in retirement funding, but it feels like a woodshed type approach to public retirement, breaking promises made because the times make it possible but not necessary, as the Senate plans shows.
You call this reform?
A bill ostensibly curbing payday lending practices in Missouri finally made it out of a legislative committee. Unfortunately, it’s about as effective as fighting a brush fire with a shot glass.
Rep. Ellen Brandom’s bill, which has cleared the House Financial Institutions Committee, is a short-term lender’s dream. It caps the annual percentage rate on a loan at a mere 1,564 percent, down from the current cap of 1,950 percent. And instead of six rollovers on loans, as Missouri law currently provides, lenders would be restricted to three measly loans.
The lending industry is putting up a token protest. In private, one can picture lenders dancing for joy.
As it stands, the average borrower in Missouri who seeks a short-term loan ends up paying an annual percentage rate of 444 percent. So a cap more than three times that amount is essentially meaningless. Plus, no surrounding state allows rollovers. Neither should Missouri.
It’s unclear whether the full House will take up the bill sponsored by Brandom, a Republican from Sikeston, or whether the Senate will weigh in with something less transparently bogus.
Outrage of the week
Our friends at the St. Louis Post-Dispatch note that a Democratic legislator from St. Louis, Robin Wright-Jones, is being sued by the Four Seasons Hotel.
The lobbyists who picked up the tab for her 60th birthday party apparently didn’t ante up enough. Wright-Jones still owes at least $3,658, a lawsuit claims.
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