ICYMI: Pittsburgh Post-Gazette: Budget Bluster: Wolf Offers Nothing On Liquor, Little On Pensions

You’d think a former businessman would know the art of compromise. What Gov. Tom Wolf has offered state legislative leaders is no compromise at all.

The Democratic governor says he wants the Republicans who control the General Assembly to give him a severance tax on shale drilling, more money for education and options for property tax relief. What he has offered is a private lease proposal that doesn’t privatize the state liquor monopoly and some changes on public pensions that don’t really reform the pension system. (A 401(k) plan for new employees making at least $75,000? How many state or school employees start at that salary?)

No wonder Mr. Wolf’s negotiating opposites are unimpressed. The Republicans should stand their ground until the governor is ready to offer something significant.

Let’s start with Mr. Wolf’s liquor plan.

On Wednesday he said he would lease the state-owned wholesale and retail system to private management for 10 to 25 years. The private operator would determine the number and location of stores and have flexibility on pricing. The stores would be open seven days a week, 8 a.m. to 11 p.m.

A major negative is the firm would have to keep the current workforce, who are paid at union scale and who therefore make the government system far more costly to operate than comparable retail stores. And where in the governor’s plan is the dynamic of competition — the hallmark of free enterprise — if just one private entity runs the entire statewide liquor system?

As if that isn’t already lacking, the governor says that still to be negotiated are the sale of wine in grocery stores and restaurants and the sale of beer six-packs in convenience stores.

The plan is a loser. It privatizes nothing. What’s worse is that by projecting an aura of private operation it could perpetuate Pennsylvania’s antiquated system for far longer. The state needs to get out of the liquor business, once and for all, as soon as possible, without the use of Tom Wolf’s smoke and mirrors.

Then there is the governor’s pension “reform” proposal.

It begins with a mandatory 401(k)-style plan for “all new employees above $75,000 annual income.” Why not a 401(k) for “all new employees?” Other pension provisions are worth pursuing, however: anti-spiking and a reduction in Wall Street management fees.

The governor’s office says the pension proposals would save $20.23 billion over the long haul. If Mr. Wolf truly tried to compromise with Republicans on a new budget and on major reforms such as pensions and liquor, the savings could be far more.

As it is, the governor and the Legislature are nowhere on reaching a 2015-16 budget accord. For that reason, a stopgap plan, for a limited period, to keep money flowing to public schools and human services is worth pursuing. Mr. Wolf is wrong to threaten a veto before even seeing a plan.

Republicans should not design a stopgap along the lines of the partisan budget that the governor vetoed on June 30. The governor’s office also claims the GOP plan is being fattened by millions of dollars of specially earmarked pet projects. If the Republicans really want Mr. Wolf to approve temporary spending, the specific terms should resemble the state budget that just expired, which is what happens in the private sector — employees continue to work under the terms of their old contract while they and their employer negotiate toward a long-term agreement.

Eighty days after it should have had a new budget, Pennsylvania is an awful mess. Neither Tom Wolf nor Republican legislative leaders have covered themselves in glory. If the paychecks of state leaders and their staffs were at stake, maybe they would really learn the art of compromise.

To read the complete editorial from the Pittsburgh Post-Gazette, please click here.