Our Views: Much more than nips

‘We’re going to have to set real priorities as a state.” That statement might be considered stern, even a bit bold, if it wasn’t Gov. Bobby Jindal’s fifth year of saying something like that, during years in which he was supposed to have been setting real priorities, and yet in which there is another in the series of recurring budget crises that have been a hallmark of Louisiana’s recent fiscal management.

Déjà vu, all over again, y’all.

A new estimate that the state must cope with a $211 million revenue shortfall within the next few weeks because of unexpected drops in tax revenues is only the latest in an administration — in office since January 2008 — that must be nearing some kind of a record for most emergency budget cuts.

Of course, unacknowledged by Jindal and many other politicos in the State Capitol is that much of the problem is self-inflicted. In 2008 and later years, Jindal prioritized tax cuts and business tax breaks that have sharply eroded the state’s revenues.

Those tax cuts and business breaks have been good for the governor’s politics, as well as for many legislators’ politics. Priorities, indeed. But the fact is, once the tax base was weakened, a soft economy was bound to hurt, and badly.

The new and lower revenue estimates also hit in the new fiscal year, beginning July 1. That’s the budget that lawmakers are working on now in the Capitol: It would require about $300 million in additional cuts, based on the lower revenue estimates. And that’s not counting millions, maybe $100 million or more, in cuts that may be required in Jindal’s fiscal year 2013 budget proposal; the governor based his budget on passage of new laws, including asset sales, that might not be agreed to by legislators.

Man, we’re going to have to set real priorities as a state.

Or something like that.

Comments

1) Comment by Scrooge - 29/04/2012

"ranked Louisiana among the best states to do business" one of the highest poverty, crime rates and uneducated work force may not be so conducive, there are obviously many other factors than tax rates which attract viable business. State police have not had money to recruit new troopers in four years? The paradigm doesn't appear to work that great.

2) Comment by Mr. T - 29/04/2012

Jindal stinks.

3) Comment by ScotB - 29/04/2012

You cannot have the business growth and accolades the state has received under Governor Jindal and Secretary of Economic Development Moret in a vacuum. The many jobs and expansions of the TAX BASE are the direct result of his setting priorities for the state. Job creation, busines expansion are better ideas than raising the tax rate. California has very high tax rates. Take a look on Google as to what is happening to their budget and business within that state. "The Tax Foundation, in collaboration with KPMG, ranked Louisiana among the best states to do business in an analysis of business tax burdens in the United States. The report, titled Location Matters: A Comparative of State Tax Costs on Businesses, found that Louisiana had the second lowest state and local tax burden for new firms and the tenth lowest for mature firms in the United States. Among Southern states, Louisiana ranked No. 1 and No. 3 for lowest tax burden on new and mature companies, respectively." - from an article in The Time-Picayune dated March 2nd, 2012. Jindal's policies have been good not just for his politics, but for the state of Louisiana and its citizens. People want jobs and we've got 'em because of Bobby Jindal and Stephen Moret. I would just rather people said, "Thanks!"

4) Comment by SuzanneMS - 29/04/2012

Thank you for telling it as it is.

5) Comment by agagent - 29/04/2012

It is not so difficult for the editorial writers to compare the results of the 2003 tax cuts with how the federal stimulus and Obamacare influenced GDP, jobs, and tax revenues. After all the recession ended before the full effects of the stimulus were felt and before Obamacare was passed.

6) Comment by agagent - 29/04/2012

“Here’s what else happened after the 2003 tax cuts lowered the rates on income, capital gains and dividend taxes: GDP grew at an annual rate of just 1.7% in the six quarters before the 2003 tax cuts. In the six quarters following the tax cuts, the growth rate was 4.1%. The S&P 500 dropped 18% in the six quarters before the 2003 tax cuts but increased by 32% over the next six quarters. The economy lost 267,000 jobs in the six quarters before the 2003 tax cuts. In the next six quarters, it added 307,000 jobs, followed by 5 million jobs in the next seven quarters.”--Heritage Foundation

7) Comment by agagent - 29/04/2012

“The tax cuts enacted by the U.S. Congress in 2003 were an important cause of an economic expansion that roared for some 50 months and created 8.1 million jobs. The opposite philosophy—a stimulus that has crowded out private investment, plus an enormous health bill and a nightmarish financial regulatory package that are killing job creation—has only delayed recovery and left us with 9.1% unemployment (June, 2011).”--Heritage Foundation

8) Comment by agagent - 29/04/2012

Higher tax rates and greater government spending is not the answer for a sputtering economy but is part of the problem. Lower tax rates left money in the private sector creating more jobs than if government taxed and spent the money. It helped Louisiana weather the financial crisis better than most states and much better than the national average.

9) Comment by lovemykids - 29/04/2012

Jindal is setting priorities, HIS, not Louisiana's.