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Big media template of special session ignores reality

If a smattering of nattering about the recent special session of the Louisiana Legislature is any indication, either the state’s traditional media doesn’t get it about the partisan and political implications of it, or doesn’t want to.

After the session produced little of consequence, media analysis looked for who were the winners and who were the losers. It’s difficult not to conclude that Gov. Kathleen Blanco lost big in the session, able to get only one consequential, albeit short term in its policy impact, meaningful piece of her agenda through – insurance relief via tax credits for ratepayers saddled with extra costs due to the huge losses incurred by the state-owned property insurer. (Another measure set up a fund, but did not actually put money into it, to attract a foreign steel manufacturer, which may never get used.) And in going down in flames, she managed to drag legislative Democrats with her who were unwise enough to tie themselves to the populist/liberal agenda she espoused of showering money out like Carnival throws.

But to fail to see the potential large political gain legislative Republicans can realize out of the session reveals a myopic political analysis. For example we have the claims that “Rather than heroes of fiscal prudence, Republicans really came off more as partisan obstructionists” – an argument sustainable only if one didn’t really keep up with what actually happened at the session, or could not really understand the GOP agenda.

Perhaps it’s liberal political ideology espoused by the state’s old media that puts blinders on them when it comes to its dissemination of opinion about Republicans, but a more sophisticated and accurate understanding of the legislative conflict is this: (1) Republicans wanted tax relief for all taxpayers, (2) they refused to spend beyond the state’s constitutionally-imposed cap on expenditures, (3) they agreed with some of the Democrats’ agenda that included paying down state debt and the transportation infrastructure backlog and pay raises but insisted on tackling the issue of bloated state government in tandem, (4) Democrats refused to cut spending in bloated areas to allow for additional spending in others.

So, it is impossible to conclude that GOP “obstructionism” was to blame for little being done in these areas. If anything, it was Democrat obstructionism, because Blanco and her party are so wedded to big government that they could not bear to part with one cent of spending. (And they already know where much of the wasted spending is, for example.) Ironically, big media themselves seem to have consensus that there is unnecessary spending in state government, as one would gather from the scathing attacks they have on some facet of it from time to time, yet in relation to this session they seem to have forgotten that in their zeal to prevent the GOP from getting any credit.

Instead, their argument is too simplistic by ignoring the spending reduction request of the Republicans and instead they mistakenly tie the refusal to spend past constitutional limits to wanting tax cuts, an idea claimed to deserve “more deliberate analysis of their long-term effect: Will the state's economy continue to support recurring salary boosts and tax breaks?”

While accurate in calling for studying finances to support permanent salary increases, advocating that much time is needed at all to investigate the effects of tax breaks makes one wonder where have these authors been for the last three decades. To summarize succinctly what we have learned theoretically and empirically (even if this is resisted by some in the academy and politics who prefer to postulate on the basis of ideology rather than fact): tax cuts cause economic growth, and economic growth translates into higher government revenues. (And certainly you cannot argue that Louisiana is on the wrong side of the Laffer curve, given its higher level of marginal tax rates and other hidden taxes such as fees and overregulation.)

In short, there is no debate here: tax breaks only will benefit the state. But notice simultaneously the lack of understanding and knowledge of those who would express such a sentiment when they write, “Will the state’s economy continue to support … tax breaks.” They have it completely backwards: it is tax breaks that support the state’s economy, not the reverse.

With these in mind, we can understand the template into which the media is trying to cram the events of the special session: (1) Democrat ideas were hasty but not bad in theory, (2) Republicans ideas were hasty but might be worthwhile to pursue, (3) Republicans blocked Democrats in order to gain acceptance of their questionable ideas, (4) Republicans therefore obstructed progress. (Recall that in the liberal ethos to which the state media generally subscribes that “progress” is equated with “government action.”)

Contrast this simplistic summation to a more sophisticated, realistic analysis (partially restating from above): (1) Democrats wanted to spend more that the people, courtesy of the constitutional amendment they passed, thought wise, (2) Republicans wanted to stay under that cap, (3) Republicans wanted to shift spending to areas of higher priority and to promote economic growth by reducing government interference in people’s activities, (4) Democrats wanted to keep spending according to existing, sub-optimal priorities and to maintain the present size of government, (5) Democrats refused to allow legislation through that violated their desire of dysfunctional spending and love of big government.

Far from fulfilling the template of “obstructionism,” if next year during elections GOP leaders articulate the more accurate rendering of the session to voters, even a less-sophisticated electorate that typifies Louisiana will understand and will electorally grant rewards upon it while visiting punishment to the Democrats. Which if this happens, I suspect, the big, old, traditional media in Louisiana once again will misunderstand.

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