Blanco shows signs she may not impede Louisiana's improvement

Perusing Gov. Kathleen Blanco’s remarks about the past special session, one gets the sense that she kind of, sort of, understands what Louisiana is up against and maybe, just maybe, with a lot of prodding and enlightening, she’ll actually do something constructive about it.

She seems to grasp that businesses will need incentives to return to the hurricane-devastated areas of the state, but can’t seem to see past a state sales tax-free three-day holiday and a $5 on $1,000 utility tax exemption are things designed to improve marginally a fundamentally bad situation made worse. In other words, the disasters only magnified a structural problem already present, that Louisiana invests too much power in government to control aspects of the economy (whether by confiscatory tax policy, poor spending choices, inefficiency induced by politics, corruption, or all of the above) rather than in having it avoid interfering with the economy as much as possible.

Blanco gives us no better example of her thinking on the issues of flood control and government spending. She touts SB 71 as “putting together a hurricane protection authority that will manage both coastal restoration and hurricane protection - with a pretty big stick, I might add, because the authority has been given a lot of authority to create a master plan and then have the local boards adhere to it.”


In reality, instead of streamlining and improving the process of flood protection as SB 95 would have (which she refused to back), this bill she will sign just empowers an additional government agency, with all the inefficiency and extra expense that this entails, which can only poke and prod over a considerable period of time with great effort local levee boards to follow a master plan which may take years to develop. While coordination is a problem the larger problem is that some levee boards have become havens for patronage and extraneous activities that only entire restructuring, not rearranging, can eliminate. Blanco simply has moved around deck chairs on the Titanic, and who knows when the next iceberg may hit.

The same myopia exists with Blanco concerning state spending and how to address it in an era of collapsed state revenues. While her cuts and the agenda she endorsed to cut in the Legislature were almost all good and necessary, they ignore the reality of the situation, a reality that has existed for decades in the state: Louisiana’s government features more inefficiency than necessary, with some misplaced spending priorities. That means the optimal strategy to solve this problem comes through cuts of whole, unneeded operations, rather than taking slices from small to medium out of almost everything.

To cite three different examples; on the operations side, why should the state continue to favorably subsidize nursing homes beyond the market’s true demand for their services? On the capital side, why spend money on local, nonessential projects? On both, scuttle the rebuilding and reopening the devastated Southern University – New Orleans when perfectly good facilities with plenty of capacity exist a couple of miles down the road. Blanco doesn’t indicate she understands that businesses don’t just cut corners when in trouble, they lop off entire inefficient functions of low overall importance some of which are very dubiously related to the scope and purpose of government anyway.

And, while Blanco still doesn’t seem to understand that the worst thing that could happen would be to try to borrow the state’s way out of the situation, putting a bandage over a problem rather than doing the restructuring to heal and eliminate the problem, she does give us a glimmer of hope by her commitment to use most means possible to try to improve the abysmal public school system in Orleans Parish by making it the state’s school system. It’s just unfortunate that the drastic measures necessary to save Orleans schools probably never would have happened at this time without Hurricane Katrina’s destructiveness.

Because of the incompleteness of her solutions, regrettably Blanco must call another special session – the question for her is not if, but when. If enough people who properly understand the situation can put pressure on her, she’ll have one that gets at the roots, rather than the surface, of the state’s problems – many of which existed long before the disasters and exacerbated them while becoming themselves magnified. At least she’s shown there’s a chance she can play a constructive role in the major policy overhaul needed not just for the state to recover from disaster, but also to make it a better place in which to work and live.