Gov. Wolf Offers Status Quo Packaged as ‘Reform’

Contact: Gina Diorio, 862-703-6670, [email protected]

Gov. Wolf Offers Status Quo Packaged as ‘Reform’
Liquor and Pension Proposals Fall Short of Much-Needed Change

Good morning,

Yesterday, Governor Tom Wolf announced what he termed “historic” liquor and pension reform proposals. Unfortunately, his plans to lease the state’s liquor system while maintaining government ownership and to offer a stacked hybrid pension plan for state employees fail to meet the threshold of true reform.

Commonwealth Foundation Vice President of Policy Analysis Nathan Benefield stated the following regarding the governor’s announcement:

While Governor Wolf’s proposals were significant, and new to the current budget debate, they represent bad public policy ideas.

Wolf’s plan to hire a private manager to run the liquor system simply replaces a government-run monopoly with a government monopoly run by a private company. Consumers will not see better selection, prices, or service. Instead, they’ll continue to be forced into the one-size-fits-all model that Pennsylvanians have come to hate.

Furthermore, the governor’s proposal maintains the conflict of interest inherent in government both controlling and promoting the sale of alcohol. Corruption and bribery have become almost synonymous with Pennsylvania’s liquor system, and this cozy relationship would only continue under the governor’s plan.

Meanwhile, as our pension system faces more than $50 billion in unfunded liabilities, the governor’s proposal for a stacked hybrid system—a system no other state has embraced—means pensions will remain subject to the same political manipulations that plague the current system. His continued push for borrowing $3 billion in pension obligation bonds is particularly troubling given such bonds have a consistent record of abysmal failure.

While reducing Wall Street investment fees and implementing anti-spiking and revenue neutral option 4 reforms are laudable goals, our pension system requires meaningful structural reform that separates politics from employees’ retirement security and protects our state’s economic future for our children and grandchildren.

Benefield and other Commonwealth Foundation experts are available for comment today. Please contact Gina Diorio at 862-703-6670 or [email protected] to schedule an interview.

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The Commonwealth Foundation transforms free-market ideas into public policies so all Pennsylvanians can flourish.