In Response To RedState On Jindal…

Yesterday, RedState’s Leon Wolf offered up a defense to the current onslaught against Bobby Jindal’s record as governor of Louisiana which was noteworthy in its indiscriminate nature.

What set Wolf to publication was Rod Dreher’s American Conservative piece which, in its headline, accused Jindal of “wrecking Louisiana.” Dreher was certainly over the top in making such a charge; it’s certainly defensible to say that the governor has wrecked Louisiana’s budget, and that the usual victims of budget cuts – higher education and healthcare – have suffered under his administration.

But higher education and health care, or the state budget for that matter, aren’t Louisiana. This isn’t some communist state where the public sector is the only reflection of Louisiana’s performance.

In fact, Jindal would argue that regardless of the vagaries of Louisiana’s budget issues his time as governor has been of great benefit to Louisiana and he would have a decent case to make on that score. In response to last week’s crossfire that began with articles in POLITICO and the New York Times about Jindal’s terrible performance, the governor’s office sent out an email noting some of the successes in his economic record…

  • The bond rating agencies have all upgraded Louisiana’s credit ratings multiple times since Jindal took office;
  • More people are working in Louisiana than ever before – there are some 2 million people working a job in this state for the first time ever;
  • Louisiana’s in the top 10 in the country for job growth during Jindal’s time in office;
  • 34,600 private sector jobs added in Louisiana in the last 12 months;
  • 86 percent faster GDP growth in Louisiana than the national average during Jindal’s time in office;
  • Per capita income in the state is at its highest point in history;
  • Seven straight years of net in-migration in Louisiana, following decades of net out-migration.

That’s a pretty good record, even if as Jindal’s detractors claim it’s merely a product of the domestic energy boom which is now over thanks to oil prices tanking, and as those detractors further claim Jindal had nothing to do with the good news.

The fact is, Louisiana will do well during energy boom years. But in the past, incompetent governors have squandered those booms by taxing the capital inflow sufficiently to choke it off and then pumping up the state’s public sector to levels which can’t be sustained outside the boom period. That’s how you have 14 public four-year universities for a population of 4.5 million, it’s how you have 10 Charity Hospitals throughout the state and so on. Jindal should get credit for starving the beast and doing what he could to keep the capital from being captured by the government the way, for example, that Edwin Edwards did.

Some of this defense was echoed by Wolf in his RedState piece. But he went far further

Here are the undisputed facts on the ground: 1. Lousiana is facing a $1.6 billion shortfall heading into this budget year. 2. A significant portion of that, by all accounts, is due to falling oil revenues, which are more or less constantly in flux. 3. Louisiana over the last several years has faced several such budget shortfalls and has, every year of Jindal’s tenure, made up the shortfalls by making real cuts in the budget as opposed to tax increases. If you add all these facts together, you have a perfect stew for the anxious and weak-willed to simmer in and complain about how Bobby Jindal has destroyed the State of Louisiana. I was privileged to be on the ground in Lousiana when the poltroons were playing this exact same chorus in 2011 and you can read some of the stories I wrote about this then and note the eerie similarities.

These stories crop up every year in Louisiana and have several features in common: 1.  an observation that the state faces a budget shortfall, 2. complaining from various Republicans indicating that revenues (read: taxes) should be raised 3. anecdotal evidence that previous years’ budget cuts have wrought terrible hardships on the people of Louisiana. They always conveniently omit 1. Actual data 2. The context of previous years which indicates that this truly is another instance of same song, different verse.

Allow me to rectify the first of those deficiencies with some actual data about the effect of Jindal’s budgetary approach, which has remained constant throughout virtually his entire tenure. Weak-kneed pundits (and state legislators’) favorite word for Jindal’s budgetary approach is “irresponsible,” primarily because Jindal refuses, out of hand, to consider tax increases to make up shortfalls. There is absolutely no reason given for why this is “irresponsible” other than the ipse dixit of whatever author is playing useful idiot for the media at that point. On the contrary, people who are paid to rate the fiscal responsibility of state governments for the purposes of evaluating government debt have been consistently bullish on Jindal’s budgetary approach. Moody’s has raised the state’s credit rating from A2 (middle of the medium risk tier) when Jindal took office to Aa2 (middle of the low risk tier) today. Standard and Poor’s has also upgraded Louisana’s credit rating twice since Jindal took office. Fitch has likewise improved Louiana’s credit rating twice. When Governor Jindal took office in 2008, Louisiana had one of the worst credit ratings in the entire country, and it now finds itself in about the middle of the pack. The people who are paid to evaluate Louisiana’s budget practices from  fiscal standpoint clearly view Jindal’s budgetary approach to be sound, especially compared to those of his predecessors.

People who are paid to hyperventilate in public about Republicans, not so much.

What Republicans are arguing for higher taxes in Louisiana? Perhaps from his perch in Tennessee Wolf has seen one. From here in Louisiana, I can’t say I have. There have been some calls to revisit the tax credit program the state has been running for selected businesses and industries, and virtually everyone agrees there is some corporate welfare which could be scaled down or eliminated (which is not an anti-conservative position; if Wolf thinks, for example, that wishing to pare back Louisiana’s $200 million tax credit for solar energy somehow makes one a RINO then he ought to say so specifically). But that’s a different thing than pining for tax increases as he’s suggesting.

The critique of Jindal’s budgeting from the Right is that he only gave us half a loaf. Jindal went along with the dissolution of the Stelly Plan back in 2008, which gave Louisiana a sizable tax cut and created those positive economic indicators his office boasts of. But what he didn’t do was to follow up on that tax cut with the requisite structural changes to state government that would roll it back down to a size that the state’s smaller tax base could fund it at a surplus.

In other words, I’m arguing that Jindal needed to be a lot more savage about cutting the state’s government than he has been.

Jindal has had to ratchet the government down little by little over the past several years, rather than ripping the bandage off the wound once, because of his relative timidity. And the problem with that approach is that he’s constantly being assaulted as a destroyer of Louisiana’s social safety net or its infrastructure to support economic growth. Most of that is bilge, but it would have been better to engage in some more radical structural change early and take the political hit for it, and to be coasting now. Particularly if Jindal wanted to run for President in 2016.

Back in 2008 when Louisiana was swimming in Katrina recovery dollars and had $30 billion to spend, Jindal could have done himself an enormous amount of good by chopping the budget down under $25 billion and use the resulting surplus on a huge boost to LSU’s endowment, for example, and paying down some of the unfunded accrued liability in the state pension program. Had he done that, he could then have gone after sizable reductions in the state payroll and a program of redirecting LSU’s funding away from the state’s general fund and toward a more tuition-based model (which is what he’s done, and the supposed cuts to date are overstated because they’re measured only in funding from the general fund using that $30 billion budget in 2008 as a baseline – which was never a sustainable figure) without having it constantly said that he “hates LSU” or whatever.

It was an opportunity missed. And because he missed it, there were hundreds of millions of dollars that wouldn’t have been spent but have been, and those dollars could have been sitting in slush funds waiting for Jindal to access them now. He could have just papered over what would have been a smaller budget shortfall in his final year as governor and nobody would really be worried about a deficit Jindal could wholly blame on low oil prices.

Wolf’s piece, like many of his previous stories about Jindal and his detractors (he once called former House Speaker Jim Tucker a RINO who wanted to raise taxes), doesn’t even address those criticisms. He simply assumes that if you don’t like Jindal’s budget practices then you’re a tax-and-spend liberal.

Which is stupid, and it’s a mistake that hurts Wolf’s – and RedState’s – credibility.

Somewhere between Dreher’s hyperventilating critique of the “wreck” Jindal has made of the state and Wolf’s glowing defense of Jindal’s record lies the truth. From this quarter, though, the problem isn’t ideology so much as it is communication and political skill. Jindal is paying the price in bad publicity for not making his view of Louisiana’s budget the accepted conventional wisdom, and putting the state on a more sustainable path with a budgetary approach the Left would have decried as draconian years ago.

But as a critic of Jindal from the Right, I’ll not be called “lily-livered,” in Wolf’s parlance. That’s ignorant, and unacceptable.



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