Kentucky politicians hate big government even as we depend upon it completely

The Kentucky Bluegrass state has turned hot red. A significant change from the 1950s and 60s when the middle class represented the American dream and was bluer. Hard work paid off. The lifestyle and comfort associated with the middle living used to impress other democracies. Everything was “bigger” in the US. That comfort is no longer attainable on a middle-class income. The quality of life has gone down.

The middle now identifies with Rand Paul and Mitch McConnel’s effective claim that “big government” is bad and must be eliminated. But under their reign, Kentucky has fed off the federal government for years. Their policies have instead increased, not decreased, public expense.

▪ For every dollar Kentucky paid to the federal government in 2020, we received $3.16. The highest in the country! In 2020 KY received $14,300 per capita versus the US average of $3.900. Kentucky received a total of $64.5 billion. That is about 30% of our GDP.

▪ All states have public spending to maintain transport networks, roads, and bridges, ensure public order and safety, people in jail, monitor public health and clean water, and educate children. But Kentucky has almost doubled health care and social assistance in the past 20 years to over 250,000 employees.

Democrats’ struggle: They have a disconnect; how did they lose the middle they built?

At the first conference of BlueGrassRoots in May, Thomas Frank, the author of “Listen Liberal” and other bestsellers, was invited as the keynote speaker. He asked: “What happened to the value we lost? The great middle class of 1965 disappeared. In a time of growing abundance, with GDP growth at 6.5% and widely shared Medicare bills. The wealthiest owned just one billion. Thirty-five percent of workers were organized in unions, and taxes were high for those who made earnings.”

Back then, in 1950-1960, when the middle class knew of comfort, the federal corporate tax was around 50%, and the economy grew at an annual average rate of 3.9%. But in the following decades, the corporate tax was lowered to 35%, and the economy only grew around 1.8% on average. The federal corporate tax is 21% percent now, and in several states, corporations pay zero in corporate income taxes.

Following the Covid recession, the corporate profits margin of a product’s price increased from a typical 11% to 54%, according to the Economic Policy Institute. Labors share went down from the typical 62% to 8%.

“Fast forward to 2021. Low taxes, 6% are organized in unions, five times the prescription drugs, sky rising death of despair, 16 mega multibillion-dollar billionaires, and 84% of new jobs are in the service sector,” Frank said. “It’s an undoing of civilization and all about the well-being of the top. It’s the downfall of the affluent society.”

Today, the “top” are States with larger financial markets, like Connecticut and New Jersey or the many more educated metropolitan regions. Mostly this is blue territory.

The reason Kentucky is a top net beneficiary of federal funds is that our revenue from income tax and social security is much too little to cover our bills. Corporate tax revenue is negligible.

“Republicans who worshipped the corporate sector made it easy to go abroad, with that severe domestic job loss and more tax cuts,” Frank said. “Long summer of corporate love. Suddenly monopolies were harmless, and blue-collar unions were dangerous. Why are Democrats not out there organizing their discontent?”

The corporate welfare means little or no return to society on their profits, destroying state and local economic balances.

Democrats have distanced themselves from who they used to represent. Bill Clinton, the flower of meritocracy: what you earn depends on what you learn. You get what you deserve, what you did in school.

Democrats are learning too well that a state led by Mitch McConnel and Rand Paul is a state entirely depending on federal money and BIG government.

Kris O’Daniel is a farmer in Springfield. Reach her at krisodaniel@ncsmail.net.

This story was originally published June 3, 2022 at 11:03 AM.