“Nobody spends somebody else’s money as carefully as he spends his own,” was the pearl of wisdom I recently borrowed from the late Nobel prize-winning economist Milton Friedman.

Though I originally used the quote in reference to the Kentucky State Fair Board’s willingness to forgive debt obligations from the Louisville Arena Authority worth millions of taxpayer dollars, the principle applies in many other “arenas” (sorry) as well, including Kentucky’s public-pension system.

Not only are the commonwealth’s pension plans woefully underfunded, Illinois is the only state with less of its pension liability covered.

Just how is it that Kentucky’s elected officials have allowed our public-pension system to become so disgustingly bloated that each taxpayer in the commonwealth now owes $4,488 just to fund this feeding trough of government benefits?

If we heed the wisdom of free-market economic champions like Friedman – who would have celebrated his 101st birthday on July 31 – there’d be no wondering at all.

He would, no doubt, remind us that our elected officials, after all, aren’t voting to spend their hard-earned incomes in ways that have led us down the path toward Pension Boondoggle City (Detroit, anyone?)Friedman knew such a state of affairs would result in financial fury, noting that “nobody uses somebody else’s resources as carefully as he uses his own.”

His wisdom is needed today more than ever.

Kentucky faces a $34 billion unfunded pension liability, is threatening citizens’ First Amendment rights via occupational licensing regulations and is one of only eight states without any form of legalized school choice.

According to Friedman, a pioneering supporter of school vouchers, the ultimate goal of such policies is “to have a system in which every family in the U.S. will be able to choose for itself the school to which its children go. … If we had that – a system of free choice – we would also have a system of competition, innovation, which would change the character of education.”

Imagine if those policymakers currently bogged down by the political clout and “perceived self-interest of the educational bureaucracy” – as Friedman once described – would ignore special interests and teachers-union labor bosses and just allow the kind of competition and innovation that has launched so many other areas of our society into the 21st century.

Not only would there spring forth a healthy variety of schools free from the one-size-fits-every-student programs and mandates, our society’s neediest children would find learning havens that fit their unique needs and would have at least a fighting chance to live a productive and fulfilling life.

Finally, what would Friedman say about Kentucky’s blooming reputation as a sultan of censorship?

The stellar Institute for Justice recently filed suit against Attorney General Jack Conway for ordering John Rosemond, a licensed psychological associate and one of the longest-running advice columnists in the commonwealth, to cease offering guidance to struggling families in the Bluegrass State – or face fines and jail time.

Dear Abby and Dr. Phil never faced such government threats for providing educated opinions to the downtrodden. Why, then, the savagery against Rosemond and his constitutionally protected right to free speech?

Involved in the witch hunt against the syndicated columnist is the Kentucky Board of Examiners of Psychology, a group with state-granted powers to choose who’s allowed to provide psychological counsel within the commonwealth’s borders. If someone like Rosemond finds a way around their state-enforced monopoly, it could cost the organization lots of money and its domination of the licensing process.

Another insightful Friedman observation applies concerning the actions by government-favored groups like the psychological licensing board: “Underlying most arguments against the free market is a lack of belief in freedom itself.”

If you would like to know more about Friedman or just want to celebrate his legacy, join me and a host of freedom-loving Kentuckians on Aug. 1 from 8 a.m. to 9:30 a.m. at Louisville’s Midwest Church of Christ, 2115 Garland Ave.

Jim Waters is president of the Bluegrass Institute, Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.