In the search for news by local media outlets, national stories are often mined for a local angle. Such has not been the case, however, with the Kentucky's Affordable Prepaid Tuition scandal that is now headed to court. And that is a shame, because the connection between the disinformation campaign that rages around KAPT here mirrors that of the efforts to let Social Security drown in an obstructionist-led propanda campaign against reform.
While the KAPT scandal involves a money-losing Kentucky ponzi scheme that will result in taxpayer dollars being spent to make up shortfalls, Social Security is a money-losing Federal ponzi scheme that will result in taxpayer dollars being spent to make up shortfalls. Unfunded liabilities plague both programs, as do loud Democrat politicians whose political futures ride on a persistent status quo. In Washington D.C., Democrats believe they can't allow a Republican to correct the structural failings of FDR's legacy and are seemingly willing to say anything to avoid such a result. In Frankfort, Treasurer Jonathan Miller has ignored repeated warnings for years that KAPT won't work for long; but he knows a good political issue when he sees one. So, the reasoning goes on both levels, turning Republican efforts to protect taxpayers against them works if no one pays attention to the details and the media plays along. So far this tactic is has effectively slowed reform.
But the tide may be turning.
Miller's ability to persuade Attorney General Greg Stumbo to file suit against the General Assembly for stopping the KAPT raid on the General Fund (under the bizarre claim that the opposite happened) is interesting. Their position is untenable and they must know it. General tax dollars were never intended to pay for bad "investment schemes." Much like the Harry Reid claim that a Social Security that can pay 70% of benefits before digging into taxpayer pockets isn't bankrupt, House Budget Chairman Harry Moberly declares KAPT "safe" by explaining that "No General Assembly is going to leave current (KAPT) contract holders in the breach." Translated, this means that Democrats aren't worried about structural problems with these two programs because when the going gets tough they can just raise our taxes. And, unfortunately, Republicans will be able to do little about it when that time comes; hence the efforts at reform now. But you aren't going to see that explained in the news.
Another key point that hasn't been explored in the old media is that the liberals who insist that the same financial markets that can't be trusted to keep Social Security contributions earning more than general wage inflation (which they easily do) can be trusted to keep KAPT contributions earning more than college tuition inflation (which they can't consistently do).
And they say conservatives rely too much on faith.
