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According to John Garen, the head of the University of Kentucky’s economics department, no.

The very basis of our fiscal problems is that the state spends a lot of money,” Garen said. “It’s kind of odd that we always seem to opt for ‘painful’ tax increases but not ‘painful’ budget cuts.

He also takes issue with proponents who claim raising cigarette taxes is needed to pay for increased Medicaid costs. Instead, Garen said, market-based reforms are needed for Medicaid and other aspects of health care.

“Rather than just throwing more money at the problem, serious reform of this type needs to be pursued,” Garen said. “Scrapping around for more tax revenue is not getting at the root of Kentucky’s fiscal problems. While it may be a temporary Band-Aid, it won’t solve our long-term problems.”

Jim Waters of the Bluegrass Institute will take control of statewide airtime to make the case against Kentucky’s cigarette tax later tonight. Tune in or get the video podcast.

My friends Tom Firey and Jacob Grier had a piece in Sunday’s Washington Post on smoking:

Of course, people have a right to avoid exposure to secondhand smoke, no matter what studies show. But they don’t have the right to force everyone else to live according to their preference. Fortunately, the world can accommodate their desires along with those of people who don’t mind tobacco smoke, just as it can accommodate people who like Chinese food and people who prefer hamburgers. Restaurant and bar owners want to make money, and they do so by catering to different market niches. In Northern Virginia, many restaurants and bars advertise that they are smoke-free, while others cater to a smoking crowd. This offering of many different choices is a virtue of open markets. So why would Kaine override the smoking choices of different people and instead impose his preference on all Virginians?

The governor noted his concern for the health of hospitality workers, who may have more exposure to secondhand smoke. But when bar and restaurant owners set their smoking policies, they must consider the preferences of their staff or else they’ll find themselves facing rapid turnover and paying higher wages. Why should all Virginia bar and restaurant workers be forced to work in a nonsmoking environment that only some of them demand?

Liberal societies allow people to make decisions that others don’t like. If some Virginians want to eat and drink in an establishment that allows smoking, and some workers want to work there, and some entrepreneur wants to finance that business, why does the governor think he should overrule them?

The Lexington Herald-Leader has a preview of Gov. Steve Beshear’s first State of the Commonwealth address. Even though Beshear is continually complaining about how the state budget is in terrible shape it sounds like his proposed “fix” for the state employee pension shortfall will be throwing more money at it without changing or cutting benefits:

Senate President David Williams, R-Burkesville, said he hopes Beshear will use the statewide televised bully pulpit to at least touch on a plan to reform the state employee retirement system, which has been underfunded and must cope with bloating health care bills for retired workers.

Beshear has said he intends to offer such proposals during the 2008 General Assembly.

He says he’s considering selling bonds to raise money to cover part or all of the multi-billion deficit in the public employee pension system. However, he said he was cautioned by the bond-rating agencies in New York that some governments, such as the state of New Jersey and the city of Pittsburgh, Pa., got themselves in more financial trouble by doing so.

Bad idea if this all there is to his pension “solution.” You think it’d be a no brainer to convert all future state employee hires to a 401 k style defined contribution retirement plan, but current state employees seem to raise cain when anyone suggests this notion. Get with the program. Almost everyone in the private sector has this plan and you don’t hear them complaining. Plus, the proposals I have seen do not tinker with any type of current state employees’ benefits.

I expect tomorrow to be a depressing and bleak picture of the state budget. Beshear will probably tell everyone that he will have to cut all kinds of state programs and education funding… that is… unless the legislature passes a ballot initiative to let the public vote on allowing expanding gambling. If the public approves this measure it’ll mean more funding, more programs and no spending cuts… at least that’ll be how I predict Beshear will sell his gambling plan. If the people pass expanded gambling what will happen when the Legislature finds ways to spend all that “new revenue?”

It’ll also be interesting to see if Beshear will support an increase in Kentucky’s cigarette tax. Seems like Jody Richards is backpedaling, as usual, and now would support a cigarette tax increase. Just a couple of weeks ago Beshear was saying he did not support an increase in taxes “at this time.”

The speech airs on KET Monday at 7 PM EST.

From the Associated Press:

State health officials erred when they tried to exempt veterans halls and other private clubs from Ohio’s smoking ban, an appeals court ruled.

The law, which took effect last year following a statewide vote, prohibits smoking in most public places, including restaurants, bars and offices.

The Ohio 10th District Court of Appeals on Monday upheld an earlier court ruling that said the state Health Department didn’t have authority to write rules exempting private clubs. Such a change would need to be adopted by the state Legislature, the ruling said.

The decision was another victory for the Ohio Licensed Beverage Association, a trade group representing Ohio’s bar owners.

It may be a tactical victory, but what do bar owners really get out of this? The inability to convert their bars into “private clubs” to keep the embers burning?

It seems that Churchill Downs’ much publicized exemption to Louisville’s smoking ban is a goner.

The council exempted facilities leased, owned or operated by the Kentucky Horse Racing Authority. A group of business owners, the Metro Louisville Hospitality Coalition, filed a lawsuit challenging Churchill Downs’ exemption and asking that the ban be overturned as arbitrary and vague.

…

Mike Hatzell, the attorney for the businesses that sued, said the ruling validates their claim that the exemption — and possibly the entire ban — is unconstitutional. Hatzell hopes Louisville’s metro council will reconsider the ban and, if it allows smoking at Churchill Downs, it will also allow smoking at some restaurants and bars.

Insert your own tortured scream of “What about the children! Won’t someone please think about the CHILDREN!” here.

Just look at this!