Can Agriculture Secretary Bob Odom make things any worse for himself? He’s wanting to take more tax dollars from Louisianans to build superfluous sugar mills while simultaneously injuring employees and increasing the state’s risk. Now, as if gas prices aren’t high enough, he’s looking to push them even higher.
While minimum markup laws sound good in theory by preventing monopsonistic forces from controlling a marketplace, this politically-inspired belief is way short on facts showing this actually happens. In reality, competition in retail gasoline (and practically every other business) is so open with low barriers to entry that the real impact of these laws is to aid those in the business, not consumers.
Which makes Odom’s support of such a law unsurprising. His political style is to operate in the shadows of the public view, in areas that are of vital concern to special interests but (normally) uninteresting or obscure to the public even if the activities have a direct impact on it. The building of sugar mills in Lacassine and Bunkie are perfect examples. Only a few sugar processors benefit from these deals directly, the state operates them a below market cost to put private mills into distress, and when competition has been reduced, ownership passes to the processors who are currently in league with Odom.
Concerning retail gas, Odom’s tactic is similar, if not more insidious. With this, he takes advantage of emergency rule-making powers that receive little publicity. Here, Odom is trying to help out this sector that he partially oversees. The payoff? Campaign contributions that gives Odom nearly half a million dollars in his campaign fund (most, tellingly, invested in noncurrent assets) – and this is after he spent nearly $150,000 in a nonelection year of 2004. As long as he keeps these interests happy on a regular basis, he can get access to their money.
At the same time, he needs to fool the people every four years into reelecting him, and with all of the bad publicity about the mills, this move he tries to sell as fighting for the public welfare:
Presently there exists within this state advertisements, offers to sell and sales at retail of motor vehicle fuels below cost, which advertisements, offers and sales are unlawful. The advertisements, offers to sell and sales at retail of motor vehicle fuels below cost tend to reduce competition through the elimination of competitors, thereby threatening the free and fair distribution and sale, and thus the supply, of motor vehicle fuels. Maintenance of competition in the sale of motor vehicle fuels is critical to the free and fair distribution and sale of motor vehicle fuels throughout the state. The reduction of competition and harm to the free and fair distribution and sale of motor vehicle fuels constitutes imminent peril to the public welfare.
Obviously, there is no proof whatsoever that any of this is happening. Only Odom would have the audacity to help others expropriate wealth from the public and claim it’s all in the interests of that very same public. And, once again, this is a classic backdoor move, trying to use the state’s emergency statutes, behind the scenes.
Of course, this situation is of the state’s own making. An operator like Odom succeeds only when we let him. First, we put him into office – again and again. Then there’s our other elected officials. His authority to claim power enforce this law is at the sufferance of the legislature; his 90-day review period before permanency of these regulations will occur will be up Apr. 20 and both chambers’ Agriculture Committees have first crack at refusing to countenance this. Given that Odom has legislators like committee chairmen state Sen. Mike Smith in his back pocket and mini-Odom (lake-building version) Rep. Francis Thompson, don’t count on anything happening here.
But at least state Sen. Robert Barham sounded the alarm, and so the odds are slightly better the legislature as a whole might veto the move with a concurrent resolution. Still, with so many good old boys in the Legislature that’s by no means a given. Better yet would be to get rid of the bad law which given its populist appeal may be too unlikely.
In the end, it may all be up to Gov. Kathleen Blanco. The law gives her the power to alter new rules 30 days after their permanency, or May 20, by executive order. If she’s serious about taking charge not only of her party but the state, if she’s the last option, it’s a move she has to make.
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