JR Ball: The great Louisiana budget divide
Enough apparently is enough. That can of fiscal-cliff-flavored LaCroix our—ahem—state leaders have been kicking up and down Fourth Street for the better part of two years has finally grown tiresome. Either that or some legislator lost the can in the bushes circling Huey Long’s tombstone.
Regardless, Gov. John Bel Edwards says he’s ready to open a serious can of reform on Louisiana’s byzantine tax code while also bringing much-needed sanity to the insane way our oil-and-gas-addicted state goes about its budgeting business.
It’s a promise we’ve heard before, dating back to the campaign trail of 2015, but now, Edwards says, he’s double-dog-dare serious. Fiscal conservatives in the state House—and LABI—be damned, the time has come, says our governor, to bravely go where no man has gone before and bring fiscal order to Louisiana’s house.
Jumping from one billion-dollar fiscal cliff to the next may be fun for thrill-seeking millennials but it’s no way to run a state government.
Jumping from one billion-dollar fiscal cliff to the next may be fun for thrill-seeking millennials but it’s no way to run a state government. Yet that’s what Louisiana has been doing ever since former Gov. Bobby Jindal—against his own judgement—ultimately put political aspirations ahead of the state’s best long-term interests and wrapped himself in the Republican repeal of the Stelly Tax Plan. Completing the cataclysm: Turning off the spigot of largesse known as federal hurricane recovery dollars, and a slumping oil and gas industry no longer pumping steady streams of cash into the state’s coffers.
Absent that free-flowing money, Louisiana has been producing budgets seemingly put together by Mayhem, the guy from the Allstate Insurance commercials.
So, facing yet another $1 billion-plus shortfall in next year’s operating budget, Edwards began the long and winding road to fiscal reform with an Aug. 8 meeting with 21 business leaders from around the state. The goal, says the governor’s spokesman, is to involve those in the process who actually do business in the state and pay taxes—if there’s any to pay after accounting for the myriad of credits and exemptions. Left unspoken: Edwards would not be sad if he could find noteworthy allies in the business community and fracture the all-powerful legislative influence of LABI—especially with Republican members of the House.
Also on the Democratic governor’s schedule are meetings with the Council for a Better Louisiana, Together Louisiana and the C-level executive dominated Committee of 100, which for several years has been preaching reform and publishing proposals.
It all sounds perfectly giddy, but let’s get real: Yes, there’s universal agreement on the theory of simplifying a tax code so convoluted that only the wonkiest of accountants could love, but once the conversation turns to actually getting it done it’s like watching a “Real Housewives” episode.
For example, several business leaders in attendance at the governor’s meeting said the conversation was cordial, but they left shaking their heads. The governor may have been talking reform, but what some in the room heard was Edwards’ desire for more revenue to fuel his budget desires.
Not exactly a good starting point.
Yes, there’s universal agreement on the theory of simplifying a tax code so convoluted that only the wonkiest of accountants could love, but once the conversation turns to actually getting it done it’s like watching a “Real Housewives” episode.
It gets worse once you factor in there’s a cabal of cash-rich business tycoons who’ve made it their mission to get Edwards out of office after one term. Does anyone think those folks, and their well-financed PACs, have any desire to hand the governor such a monumental win?
Then again, no one saw Edwards becoming governor of this Trump-loving state in the first place so, I guess, anything is possible.
Setting aside the debates over 1) whether Louisiana’s budget is growing or shrinking—yes, that’s a thing, 2) government needing more revenue or more cuts or 3) business paying too much or too little in actual taxes, can we at least admit the state has effectively been in a deficit-spending mode for the past six or seven years?
Yes, the governor on duty and state legislators have annually come up with something semi-approximating a balanced budget, but who’s kidding who? Achieving a zero-sum situation has come only by employing a myriad of budget gimmicks and three-care monte sleight of money maneuvering.
Louisiana’s love affair with excess isn’t just for hedonistic good times and tax exemptions. No state loves to study things—over and over again—more fastidiously than this one. It’s a passion play ranking right up there with pickup trucks and shotguns.
Laissez les études rouler!
But, as we learned from “Seinfeld,” we know how to conduct the study, we just don’t know how to implement the study. And that’s really the most important part of the study process—the implementation.
There are a slew of studies and reform proposals currently collecting dust at the state Capitol, including one published earlier this year, so let’s select one and begin the process of turning it into reality.
That won’t happen as long as we flatly reject any and all tax increases while also demanding to keep receiving the bounties of our populist past. Business must accept that not every tax credit and exemption is sacred. Those who believe government is bloated must come forward with specific proposals—something those in the House GOP has been unable to do for the past two years. And supporters of big government need to start accepting the notions of fiscal efficiency, performance evaluations and government existing to provide services, not jobs.
At the moment, all sides are entrenched, believing others must capitulate. Right now, there’s no sign of that happening. And neither will serious fiscal reform until everyone is willing to embrace a little something called “compromise.”