After seven years of mendacity and braggadocio, the Democrat Gov. John Bel Edwards managed to top itself on those accounts when introducing his last Louisiana budget.
Last week, prior to getting into the nuts and bolts of the fiscal year 2023-24 request, Commissioner of Administration Jay Dardenne pelted the Joint Legislative Committee on the Budget with his version of the state’s financial health prior to and during Edwards’ terms. The presentation noted how through the eight years previous to Edwards each year at some point the Revenue Estimating Conference declared a budget deficit, how budgets routinely used funds sweeps or taking idle money out of accounts that had little or no possibility of being spent for their assigned purposes, and then since Edwards took office how those years had declared surpluses without any funds sweeps with a couple of more forecasted surpluses in the future.
Implied was that the tax cuts previous to Edwards had a negative impact while the tax increases staged by Edwards and insufficiently resisted by a Republican-led Legislature had brought a bounty. A laundry list of items into which the state poured money in the period followed, and as a side note observed the state had the lowest unemployment rate ever.
How typical that Dardenne focus on a rendering of the economic health of government instead of that of the state’s people, celebrating how big government was and how much it could spend rather than improving people’s incomes and job opportunities. Because when reviewing the Edwards record on those metrics, it’s little short of disastrous.
First, it’s important to understand that while state-level fiscal policy can have an impact on the state’s economy and particularly compared to others, the main force affecting it is national economic tides. In all of the eight years prior to Edwards, the first coincided right when the economy went into recession, and the next seven suffered under the low-to-no-growth tax-and-spend policies of Democrat Pres. Barack Obama, who locked these in under his first two years with Democrats controlling Congress and which he prevented the subsequent Republican-led bodies from changing.
By contrast, except for his first year which caught perhaps the best year under Obama, Edwards first governed under the Republican Pres. Donald Trump Administration and republicans controlling Congress that put the economy in another gear through cutting taxes and reducing regulations until that eventually was blunted by the Wuhan coronavirus pandemic – which proceeded to net a boon to states with acceleration of deficit spending force-feeding funds into states then put onto steroids by Democrat Pres. Joe Biden and Democrats controlling Congress for his first two years.
That recklessness in turn tanked the economy, stifling the natural rebound from pandemic policies that throttled the economy to put the country back on a no-growth, if not recessionary, footing. As the deficit pandemic spending impact that has delayed the full impact of the Biden slowdown will funnel out of state finances after this year – just as Edwards leaves – the next governor will have his hands full on budgeting for at least the first half of his first term.
Looking beyond relative state budget deficits and surpluses that have more to do with national trends than chosen state policies regarding revenue and spending levels chosen, Louisiana’s people unambiguously have suffered under Edwards when comparing the state’s economic performance to others, which filters out the impact of national effects. The most glaring indication of state fiscal policy failure comes in the population loss suffered under Edwards at just under two percent from 2016–22, ahead only of West Virginia, or 91,000 fewer residents.
Then there’s personal per capita income growth from the start of 2016 to the third quarter of 2022, which increased in the state by about 28.5 percent. This ranks an unimpressive 36th among the states.
Finally, the unemployment rate is at a historic low largely because of depopulation and the labor force participation rate being at a 45-year low (absent the pandemic period), 1.4 points lower than in 2016 and in the nation’s bottom ten. This is why the state has almost 35,000 fewer nonfarm jobs than six years ago.
The Edwards Administration rightly can brag about how it has expanded government, taking advantage of national economic forces. But it has done so at the expense of the prospects of its people, which is why his legacy will be trying to turn the clock back a half-century while most states raced further ahead, an unpardonable failure for the people of a state who could least afford such callous disregard.