In case you weren’t aware, Louisiana has a $313 million current-year budget deficit – and a $400 million budget deficit for next year. And in case you weren’t aware, Gov. John Bel Edwards is expected to put out a call for a special session as soon as he gets back from his junket to see the Pope.
And at that special session Edwards will rely on recommendations from his blue-chip “tax reform” commission to propose a raft of policies which were rejected last year during his never-ending legislative battles which produced the current deficit. And when his 1 percent state sales tax hike expires next year that budget deficit will jump to $1.5 million or more.
The long and short of the situation is that Louisiana’s budget is a mess, and furthermore it’s every bit the mess it was before Edwards took office. What dent he has made in the problem is only temporary.
It’s tempting to say that nothing has changed in the time since Edwards took office, but something might well be different this time. Specifically, last fall Edwards backed Foster Campbell for the U.S. Senate and his candidate was so badly trashed that it reset the state’s political equilibrium. This is no purple state, as the governor’s partisans were claiming after his victory over David Vitter in the 2015 gubernatorial election; it is deep-red, and his political status is shaky at best.
A year ago, the Republicans in Louisiana’s House of Representatives opted to largely play defense in an effort to mitigate Edwards’ tax increases. Now, with increasing buzz that the Senate election has made the governor a lame duck with a diminishing supply of political capital, the ball might be changing hands and Edwards might no longer be driving the agenda.
At least that’s what one might take from statements made by Republican House members in an Advocate article from earlier today on the budget.
Republicans in the Louisiana House are aiming to offer actual proposals next month that would cut spending if the Legislature, as expected, goes into a special session to eliminate a budget shortfall.
Following weeks of private meetings by a select group of their lawmakers studying the budget, House Republicans are also seeking to offer specific ways to cut spending and raise taxes during the regular legislative session that also will focus on budget problems, beginning in April.
If the House Republicans follow through with specifics, which is by no means certain, they would address a major gripe of Gov. John Bel Edwards and his top aides that the Republicans have been carping about the governor’s spending plans without devising alternatives.
State Rep. Lance Harris, R-Alexandria, said Republicans in the House are wary of tapping into the rainy day fund because legislators and the governor have done so repeatedly in recent years.
“Members are concerned that every time we have hard issues come up, we look to the rainy day fund,” Harris said. “Over the years, we have depleted the rainy day fund and not put money back into it.”
Harris put together a seven-member blue-chip panel of his own to come up with recommendations for spending cuts and most of what they’ve produced are ideas to scale back free stuff. A prime example is something Rep. Tony Bacala (R-Prairieville), who handled the foray into the Department of Health and Hospitals’ books, is pushing – Bacala says the state could save $90 million a year if it imposed a co-pay on Medicaid patients for doctors’ visits of just $8. Considering the money spent by the state, particularly at emergency rooms, by Medicaid patients who show up for free health care they really don’t need, it might be that the co-pay saves the state a whole lot more than $90 million once those patients understand that while it’s cheap, it’s not free to hit the emergency room because you might have a sniffle.
That is a budget cut, though you can absolutely bet it’s going to be panned as a “tax increase.” And the people who will pan it will double down by calling it a “tax increase on the poorest among us,” even though on their fervent recommendation Louisiana has added 300,000 people to the Medicaid rolls according to an Obamacare expansion which now picks up people who are more lower middle class than poor. It’s a slight rollback in a freebie the state is offering, applied at a time when that freebie is accessed – that fulfills none of the elements of the definition of a tax increase.
Everybody knows there are savings the state can squeeze out of a $27 billion budget. That budget was $25 billion two years ago, and Louisiana had enough money to fully fund TOPS.
And yet, if you listen to Jay Ephialtes Dardenne, Edwards’ pet Republican and Commissioner of Administration, of fat there is none.
“The challenge now with Republicans in the House is to show us the cuts,” Jay Dardenne, the Edwards administration’s top budget official, said in an interview Tuesday. “Last year, they were unsuccessful in showing us meaningful cuts even though they had plenty of opportunities to do that.”
The onus on Republicans in the House will be especially high if they insist on eliminating the projected $313 million shortfall during the special session with cuts only.
Edwards and Dardenne say that lawmakers will have to cut too many vital government programs during the special session — programs they believe that Republicans also want — unless they balance the budget by taking $119 million, the maximum allowed, from the state’s rainy day fund.
“It will be politically impossible to make $313 million in cuts,” Dardenne said, noting that the Legislature already had to make $313 million in cuts last month.
This is the type of narrative war the Republicans in the Legislature did their best to avoid in the aftermath of Edwards’ victory, opting instead to scoff at the new governor’s over-the-top claims about canceling college football if he didn’t get his demanded tax increases and simply play defense. Now that Edwards’ political star is settling a bit – nobody really believes his approval rating is actually the 62 percent pollster Bernie Pinsonat measured in the fall – Harris and his colleagues are getting a little more aggressive.
Which is good. Fiscal conservatism needs to own Louisiana’s budget debate, and fiscal conservatives need to be unafraid to propose major reforms to the size and scope of state government. Everything should be on the table, because much of what the state spends money on constitutes structural waste – from the overabundance of public universities the state can’t adequately fund to the massive public-sector welfare afforded to local governments by the state to the wildly extravagant expenditures in Louisiana’s runaway Medicaid program. When Donald Trump beat Hillary Clinton by 20 points and John Kennedy destroyed Foster Campbell, it was a signal that Louisiana’s voters are again interested in less government rather than more. Harris and the House Republicans need to act on that signal and drive budget cuts to Edwards’ desk this spring.