During the budget process, Edwards acted as if the
state’s unemployment trust fund wasn’t hemorrhaging its balance. The Wuhan
coronavirus pandemic brought a retrenchment in economic activity worse
than any other state’s, with a dramatic increase in the state’s unemployment
rolls. Although federal policy encouraged this to an extent, Congress
compensated somewhat in its CARES Act by allowing the state to use as much of
the $1.8 billion gift as it wanted to replenish the fund.
Instead, Edwards asked for not a cent of its use
for this purpose and plowed much of CARES Act money into inflating
general fund spending by $600 million this year. Regrettably, the
Legislature went along but it had more foresight to include $275 million in grant
relief for small businesses. This would diminish the drain on the fund by
allowing more businesses to stay open and thereby employ more people that
additionally would boost the fund with payroll taxes being collected.
With the fund about to hit zero, necessitating
borrowing from the federal government that must be paid back by next November
or interest charges start accumulating, as well as within the week forcing
state government to recognize the new deficit and launch hikes in those taxes
and cuts in benefits next year, Edwards suddenly got religion. He proposed taking
$175 million from the grant program, called Main Street Recovery, to replenish
the fund.
Keep in mind that Edwards has exacerbated the problem
all along by imposing some
of the most draconian economic restrictions from the very beginning of the
pandemic in any state, even as indicators show Louisiana
has suffered more than any other state in health outcomes. With a more
science-based approach that would justify more reasonable parameters to the
economic lockdown, more jobs and economic activity would have eased pressure on
the fund.
By contrast, Edwards doesn’t want to make these
changes but sought to make matters worse by taking money away from job creation
to continue an inflated amount of transfer payments to nonworkers, which does
nothing to solve the problem of too few jobs. And the whole half-baked idea is
a ridiculous nonstarter as the Main Street Recovery administrator, Republican
Treasurer John Schroder, said
his office has forecast
the entire appropriated amount already has claims on it.
That, of course, is Edwards’ “leadership” style –
make unrealistic proposals to clean up messes he created. So, it should come as
no surprise he additionally declared a delay to what seems inevitable business
tax increases by essentially suspending these through a proclamation
the law that orders reporting of fund insolvency.
Except that this is blatantly unconstitutional.
The relevant law reads
that the governor can “[s]uspend the provisions of any regulatory statute prescribing
the procedures for conduct of state business, or the orders, rules, or
regulations of any state agency, if strict compliance with the provisions of
any statute, order, rule, or regulation would in any way prevent, hinder, or
delay necessary action in coping with the emergency (emphasis added).
A tax increase on businesses in no way prevents,
hinders, or delays “necessary” action in dealing with this pandemic. It does,
however, make the governor looks worse to the public and even less receptive to
tax increases he desires down the road to grow government, as well as sours the
public on his future electoral ambitions. Just as Edwards’ virus decision-making
places politics over science, politics here takes precedence over his duty to
act constitutionally.
Months ago, Edwards could have nipped this crisis
in the bud by putting government on a diet and using CARES Act dollars to shore
up the fund and through a nuanced application of strictures on the economy that
would
have reduced deaths and suffering. He needs to emulate Republican Florida
Gov. Ron DeSantis’ lifting of all restrictions in his state this weekend, upon
advice of medical professionals that directly indicts Edwards’ bungling: “At
this point, we know that the benefits of a lockdown are small …. All they do is
push cases off into the future; it doesn’t actually prevent the disease from
happening. And the costs are absolutely catastrophic, enormous,” said one.
But acting that wisely requires a leader; Edwards
is but a politician more beholden to an ideological agenda than to the needs
of the state’s people.
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