Data show Jindal's economy beats Edwards'

If Louisiana’s Democrat Gov. John Bel Edwards has any hope of winning reelection, he’ll need a lazy and incurious mainstream media to parrot his misleading campaign theme.

That theme, as disgorged through campaign advertising, tries to resonate on two related points: (1) Republican former Gov. Bobby Jindal wreaked havoc on the state economically and (2) Edwards saved Louisiana from that, So, (3) keep him in office because otherwise the likes of the GOP’s Rep. Ralph Abraham or Eddie Rispone will be the second coming of Jindal.

How much either challenger would repeat local, stock, and barrel Jindal’s agenda is questionable, but undoubtedly they would advocate for different policies than Edwards. In particular, they look askance at tax increases that have fueled policies leading to a massive expansion in state government spending.

Consider that the fiscal year 2008 budget Jindal inherited from Democrat former Gov. Kathleen Blanco contained, exclusive of federal money and interagency transfers, spent $16.8 billion. By the end of his first term, Jindal had reduced that to $15.3 billion. But then outlays began creeping back up, with his last budget using $16.5 billion in state-sourced bucks. Still, over eight years, Jindal managed to claw back 3 percent of state dollar spending (even as in his last year he countenanced significant tax increases).

Then Edwards spearheaded the largest tax increase in the state’s history, a sales tax hike which disproportionately affected lower-income households, and government’s size exploded. His second-to-last FY 2019 budget ended up spending a record $18.2 billion, with more to come in this year’s. That’s 10 percent higher that Jindal’s last, an increase almost twice the rate of inflation.

Edwards would have us believe that this fiscal record has produced better economic performance than Jindal, an allegation predictably bought by the drive-by national media. One such example comes from the unabashedly partisan New York Times, which sicced one of its east coast-based stenographers, one Richard Faussett (whose social media postings reveals he enjoys flirting with the “progressive” agenda) to do a story on the messaging by Blanco, Jindal, and Edwards when storms threaten. Tucked into the piece was this nugget of ignorance:

Mr. Edwards, a Democrat, was elected four years ago in large part because voters were worried about the huge structural deficits left by the departing Mr. Jindal, who pushed for tax cuts and breaks that failed to stimulate the economy and contributed to severe cutbacks in higher education funding.

Clearly, Faussett didn’t do his homework, seemingly content to swallow the party line as propagated by Edwards. In fact, the data show the Jindal tax and spending cuts improved the state’s economy, and his and Edwards’ tax and spending increases harmed it.

A review of five indicators of economic well-being reveals this: relative real gross domestic product growth (in chained dollars to discount inflation), personal income per capita growth, employment growth, state unemployment rate relative to the national rate, and relative population change over the previous four years. Relatively higher growths, the better state unemployment, and the more people wanting to live in Louisiana connote better economic performance.

The following table presents comparisons for the three eras featuring different economic policies: (1) Jindal’s first term, which had tax cuts early and spending reduction throughout, (2) Jindal’s second term, where spending began rising again and tax increases occurred at the end, and (3) Edwards’ three years in office, with its large tax increase early and record spending. Each entry also includes in parentheses Louisiana’s relative ranking among the states. In this fashion, national economic performance, which affects all states, can be factored out while gauging how the state performs against its peers.

Indicator	Jindal 08-12	Jindal 12-16	Edwards 16-19
Real GDP (chained) relative change %	-0.5 (32)	-2.4 (47)	-2.1 (49)
Personal income PC relative change %	-0.7 (33)	-1.6 (44)	-0.3 (36)
Number of jobs relative change %	+0.5 (6)	-1.2 (43)	-0.7 (45)
Unemployment rate relative	-1.0 (20)	+1.2 (47)	+0.7 (43)
Population change relative change %	0.0 (26)	-0.5 (32)	-1.6 (44)

(Most data here are taken from second quarters of the years indicated, as that is when the state’s fiscal year for budgeting purposes ends, except for 2019 where the latest state statistics available at present are from May, the last population estimate is from 2018, the last state ranking for employment is from 2018 (and done at the fourth quarter), and the earliest data for Jindal first term personal income was 2010.)

So, by way of example, from the end of the second quarter of 2008 (after Jindal had been in office about six months) through the second quarter of 2012 (about eight months after his reelection), 0.5 percent more jobs were created in Louisiana than nationally, ranking sixth highest among the states.

Reviewing these figures, Louisiana’s economy clearly performed better during the era of large tax and spending cuts of Jindal’s first term than during the era of Edwards and large tax and spending increases. In that first term, Louisiana bested national numbers in two categories and tied in a third, and, relative to other states, scored almost in the upper tenth, in the upper two-fifths, almost in the upper half, and twice in the upper two thirds.

Even Jindal’s second term with tax and spending increases marginally went better than Edwards’ three years. Even though all but one of the absolute numbers are better for Edwards, this reflects the state riding the coattails of Republican-induced tax cuts in 2017; the majority of state ranking indicators deteriorated showing the state lost ground to others under Edwards’ policies. And, even the least bad indicator of the bunch (the only one, barely, not in the bottom fifth) of only 0.3 percent lower personal income growth than occurred nationally is a left-handed compliment; that’s an artifact of the massive population loss relative to other states (giving it a negative net migration, the fifth worst among the states) which leaves fewer people to use as the denominator in calculating the average.

In short, in economic terms comparatively Louisianans are not better off than they were three years ago, and they are significantly worse off than they were seven years ago after government had cut taxes and spending than now when government has raised both taxes and spending. Edwards will try to distract voters from this dismal record by pointing to small absolute increases registered by some indicators, but those come from national economic performance using policies he repudiates. In truth, Louisiana has fallen further behind under Edwards.

But tools like Faussett are fooled, and thus they report inaccurate information about the state’s past economic performance, where the record shows tax cuts in part in fact did stimulate the economy. Nor is he correct about funding for higher education, which didn’t face “severe cutbacks” throughout the Jindal terms but instead for educational functions that spending fell less than 1 percent.

Edwards has to hope voters are gullible enough to buy his obfuscation and misdirection on the state’s economic performance under his watch and policies. Otherwise, he’ll be out of a job beginning next year.

Reform, politics shape LA education progress

The initial round of Louisiana’s LEAP test score revelation for last academic year demonstrates the limits of educational reform and political will.

As a whole, the state’s students improved marginally. More substantial improvement, however, came at historically low-performing schools provided with more autonomy, resources, and demanding expectations, known as Transformation Zone schools. Each implemented a Tier 1 curriculum, recognized by the state as best aligned with and able to achieve state-mandated learning objectives. These also received additional funding from their districts (often grant money) and faced fewer constraints in administration, with many being charter schools.

By contrast, the original cockpit of state educational reform, Orleans Parish, suffered a small decline in scores on the standardized exam. This meant that over the past four years essentially no progress occurred in a district that, in that time span, went from having a majority of schools chartered and outside the Orleans Parish School District to having all schools become charters and under OPSD jurisdiction.

Shreveport follies threaten bonding ability

While Tropical Storm Barry may have whimpered its way through Shreveport, a political storm has brewed there that threatens to take down the city’s bonding capacity.

Last month, news leaked that the city delayed production of its Comprehensive Annual Financial Report required by the state annually on Jun. 30. Discrepancies in the city-run pension plan for public safety employees as well as questions over whether the city was making its payroll tax payments appear to have prompted the request.

The payroll problems predated the Democrat Mayor Adrian Perkins Administration, but it has not confirmed that the problems didn’t continue into 2019. Regardless, this piqued the interest of the three Republican members of the city council – Grayson Boucher, James Flurry, and John Nickelson – plus Democrat LeVette Fuller into having the body vote the city into launching an investigation of the matter.

N.O. Luddites put ideology over people

You have to admire ruefully the Luddites in New Orleans for their ideological fervor: they’d rather be right than save themselves and the people they allege to represent in the neighborhood of $100 million.

They’ve had their panties in a wad ever since the City Council reaffirmed a decision to have Entergy New Orleans construct a gas “peaker” plant for use in times of stress on power provision and emergencies (such as a tropical storm slamming the area) for a city with no capacity to generate its own power. They argued for all sorts of alternatives to this relatively clean power, but none are practical or cost effective, or both.

Nonetheless, the faith in their case is such that they pursued multiple legal avenues to overturn the decision. With Louisiana’s weak tradition of rule by law – its political culture too tolerant of men on horseback who bend rules and norms to achieve their desired outcomes – they felt they could hit on an activist judge willing to read into the law their agenda.

Shreveport must scrap liquor law favoritism

If Louisiana ranks as the state with the most barriers to entry in business, Shreveport may be the state’s major city most restrictive in that category.

As recently demonstrated in a suit concerning useless requirements for braiding hair, the state has the most onerous occupational licensing regime among all. And local governments can pile on additional strictures that can be at least as needless.

That has come to the forefront as an issue concerning sales of unprepared food and high-content alcohol in Shreveport. A new business called Corks & Cuts located in the extreme southern portion of the city – an area recently annexed because of the high-end retail and commercial residences springing up there – wishes to sell spirits and steak cuts. But Ordinance 10-84 prohibits such sales unless a wall of at least 6 feet separates the area with alcohol from that where other goods are sold, and that separate entrances exist for each area. The owners complain that this would require renting the next-door retail space and make $60,000 in modifications.

More reason not to hike LA minimum wage

Need another good reason to understand the utter folly of attempts to make Louisiana raise its minimum wage? Just observe those touchscreen checkouts when you walk into a store selling groceries.

By now, informed individuals know full well how the minimum wage costs jobs and how, because almost no sole breadwinners of families work full-time at the minimum wage and even fewer of them are younger than 25, the modal category of such workers are young, recent job force entrants who have no dependents and live in a household with others who are employed (particularly when removing the 70 percent who technically earn below it but more than make up for that in tips). Single parents with older children working full-time at minimum wage are hardly more common than unicorns.

The minimum wage by nature serves as a job training tool, to acclimate new workers to certain desirable traits such as punctuality and dependability, while imparting certain skills and motivating individuals to work better so as to deserve a raise – remember that wages vary directly with productivity – or to move into a job that pays more. In fact, its artificiality in setting a floor on pay induces economic inefficiency by overpaying for the actual productive value of the work, denying a more efficient use of that capital.

Schroder sequester bedevils ironic Edwards

Irony stares Democrat Gov. John Bel Edwards right in the face as Republican Treasurer John Schroder hoists him on his own petard.

Last week, Schroder announced that he would not authorize a move of $25 million from the unclaimed property account to the general fund as budgeted. The fund keeps monies owed to the public by state government, which in its balance floats between $850 million and $900 million. Around $88 million comes in every year, and until this year creditor entities typically claimed only around $30 million annually.

However, the balance doesn’t go higher because the Legislature siphons off tens of millions annually. R.S. 9:165.1 allows $15 million yearly to go towards completion of Interstate 49, but the rest goes into the general fund. Further, in the past year repayment efforts have improved considerably, meaning in the future the gap between retained and claimed will shrink and leave fewer dollars theoretically available for immediate use. In fact, the gap’s magnitude shrunk so much that Schroder reported difficulty in paying off successful claims in a timely fashion.

Arrests often arrest NW LA political ambition

History would suggest that Shreveport City Councilor Levette Fuller just put a cap on a  promising political career.

The first-term Democrat was arrested last week on suspicion of driving while intoxicated and texting while driving. Specifically, police found her vehicle stopped in the middle of the road in the wee hours of the morning, where she informed them that while texting she may have hit another car and had drank two to three glasses of wine. A later social media post on a site advertising itself as connected to her Council position seemed to come off as an admission and apology.

Although on the Council just a few months, Fuller already had made an impression that suggested she might aspire to higher office. She won in her district that has a small black majority and in her short period in office developed a reputation for fiscal restraint, opposing intrusive regulation and laws, and promoting transparency, bucking controversial decisions made by another black Democrat elected rookie, Mayor Adrian Perkins.

Edwards displays vindictiveness again

Legislators ideologically opposed to Democrat Gov. John Bel Edwards, if this turns out to be his last round of line-item vetoes, won’t miss his vindictiveness.

That trait he put on clear display with decisions concerning HB 2, Louisiana’s capital outlay budget. Often, governors will use this power as a weapon to punish legislators who champion measures not only contrary to his worldview about politics, but also which have the potential to make him look bad.

Edwards used the power sparsely in this election year, excising only six items out of over $4 billion worth (although a distinct portion represents only a pledge, not the actual disbursement of cash or intention to issue bonds). But each sent a message.

Independence Day, 2019

This column publishes every Sunday through Thursday around noon U.S. Central Time (maybe even after sundown on busy days, or maybe before noon if things work out, or even sometimes on the weekend if there's big news) except whenever a significant national holiday falls on the Monday through Friday associated with the otherwise-usual publication on the previous day (unless it is Thanksgiving Day, Independence Day, Christmas, or New Year's Day when it is the day on which the holiday is observed by the U.S. government). In my opinion, in addition to these are also Easter Sunday, Memorial Day and Veterans' Day.

With Thursday, Jul. 4 being Independence Day, I invite you to explore the links connected to this page.