Upon pondering about the fiscal impact of the
recent floods striking the Baton Rouge area, my Advocate colleagues got
it half right and half wrong. Through an editorial correcting
the misimpressions of some, they argued that, no, the volume of recovery
money shoved through the economic system will not produce a “bonus” that will
solve a looming budget deficit, but missed the mark in neither will it also exact
a significant penalty that could worsen the fiscal situation further.
When the hurricane disasters of 2005 occurred, at
first policy-makers believed the massive scale of devastation would put a
serious crimp into the state’s economy, driving down collected tax revenues. Two months
after the levees failed in New Orleans, the Revenue Estimating Conference
convened to slice nearly $1 billion out of budgeted general fund collections
for fiscal year 2006, and a subsequent special session of the Legislature went
out to chop around that much out of the budget.
What they did not figure was that exact extreme destruction
would prompt so much recovery spending coming from sources outside of the state
– the federal government and private insurers – that this produced a surge in
general tax collections. In the decade afterwards, the federal government would
spend $18.2
billion on various aspects related to the storms, its flood insurance would
pay claims of $13
billion, and private insurers would pay out around $25.9
billion, almost all of these coming in the first five years.
Perhaps Louisiana Education Superintendent John
White has outfoxed Democrat Gov. John Bel Edwards in
the struggle to keep the Student Scholarships for Educational Excellence Program
from attenuation.
When the budget process shook out, the program
that provides funding for students that attend or would attend subpar schools
to enroll in an eligible private or public school took a funding hit of over 5
percent. This meant that several hundred families already accepted into the program
would not receive vouchers, a program first.
But behind the scenes White
formulated a deal with providers to take on the wait-listed students. He said,
with the blessing of the Board of Elementary and Secondary Education, that the state
could give through the families to schools enrolling these children around $100
guaranteed for each enrollee – more than $5,000 below the typical tuition the schools
could charge the program participants – in the hopes that perhaps the
Legislature in the spring would create a supplemental appropriation to pay off
the balance.
So much anxiety over what kind of relief Louisiana
can expect in response to the flood disaster surrounding Baton Rouge earlier
this month would disperse by wringing the politics out of the disaster funding
process.
Observers
fret about the relative lack of seniority of Louisiana’s members of
Congress, that at least two and possibly three of the most senior will not
return, that the most powerful Majority Whip Rep. Steve Scalise must
balance state and party interests, and that past votes against sending money to
other locations may come back to haunt the state when discussing the state’s chances
of landing a decent sum to assist in paying for cleanup. Without a system so infused
with politics, these questions would matter little.
In brief, current
law centralizes most disaster recovery funding in federal hands. Essentially,
when
hitting a small trigger amount – about $6 million in the case of Louisiana –
federal aid of at least 75 percent of costs kicks in for almost every kind of
recovery spending, with some of an emergency nature paid fully by the federal
government. Potentially, by law federal policy-makers could pay for it all. Moreover,
the process for making states eligible – a disaster declaration of any of
several kinds – relies on almost total subjectivity. This low threshold and
leaving a declaration ultimately in the hands of an elected official, the president,
has led to an exponential
increase over the past nearly quarter-century in declarations and amount
paid out. From typically two or three dozen declarations a year under Pres. Ronald Reagan,
Pres. Barack
Obama now issues hundreds a year.
Although invited, last week Louisiana Fourth
Congressional District hopeful Democrat Marshall Jones did not attend
a candidate
forum at Bossier Parish Community College. Nor will he attend many, if any,
of these kinds of events throughout the election season.
In this instance, as besides BPCC both the Bossier
and Caddo Parish Republican Parties sponsored the gathering, perhaps Jones, the
only Democrat in the contest and who declined participation, could have an
excuse not to appear. But throughout the campaign expect him to dodge as many
as he can unscripted events that could feature inconvenient questions.
This is because state Democrats have had their hearts
fluttering thinking they can replicate the success of Democrat Gov. John Bel Edwards given
his surprising victory last year. They see a formula to create a winning
coalition: have a Democrat express social conservatism on God, guns, and the
unborn as loudly and as often as possible while infrequently mumbling liberal
economic bromides and other issue preferences of the left they figure will
reassure enough of the hard left base while conning enough of the center-right
electorate into thinking such as candidate acceptable, aided by a multitude of
quality Republican candidates not paying attention to him in the rush to bash
each other.
