Kentucky Leaders Open to Tax Hikes and Pay Cuts (for Themselves Too)

The Blue Grass state is facing its own budget crisis. The latest estimates put the state's shortfall at $456 million. In an admittedly symbolic gesture, Kentucky Governor Steve Beshear and six other high ranking state officials have agreed to a 10 percent pay reduction. Latest reports are that all options, including resurrecting a failed attempt to raise cigarette taxes and cutting services drastically, are on the table. Raising cigarette taxes certainly isn't an ideal revenue raiser because of its regressive nature and declining yield, but it's good to see that the Governor is not focusing only on cutting public services.