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17.3.16

Edwards expansion savings claim seems questionable

In the final analysis, policy-makers should take Gov. John Bel Edwards’ surprising announcement in his state of the state speech that Medicaid expansion would save the state $100 million in fiscal year 2017 with a grain of salt, as well as understand it would predict costs, not savings, in future years.



Only two authoritative, publicly-released studies have occurred on this policy, both by the Department of Health and Hospitals prior to Edwards’ inauguration, and only the first, released in 2013, went into a year-by-year, component-by-component study of the issue. It presented four scenarios that depended upon the rates of enrollment of the uninsured population specifically newly eligible because of expansion, of increased enrollment in other Medicaid programs because of the publicity surrounding expansion, and of enrollment of the insured population from the private sector switching now eligible to switch to Medicaid. A second report a year later confirmed, utilizing data gathered from other states’ experiences, that the most costly scenario most closely fit reality. The extremely detailed report predicted for the last half of 2016, when Edwards wants to start the increased coverage, this would cost the state $38 million; by 2023, the state would pay an additional $373 million that year.



The public could access both reports – until shortly after Edwards took office. Echoing the communist world when a new regime would wipe away evidence from the previous, the reports mysteriously disappeared from the DHH website, and now locatable online only through other unrelated archiving sites.  Two months later came Edwards’ pronouncement that alleges a positive $142 million dollar swing in the forecast impact from the first for the last half of this year.

16.3.16

Abortion bills put Edwards in uncomfortable position



Even as Democrat Gov. John Bel Edwards suffered political defeat during the recently-concluded special session of the Louisiana Legislature, legislation filed during the regular session provides him an opportunity to score some political points – or maybe demonstrate fraudulence of his asserted social conservatism.



Edwards called the session ostensibly to pursue fiscal reform, but his call defined that as extremely heavy on tax hikes and very light on spending cuts, with little emphasis on altering the practices and processes of state government that a genuine effort would entail. It ended in almost balancing the current fiscal year budget but leaving a substantial gap for the next because he refused to investigate seriously spending reductions, kicking the can down the road to his discredit.



Should the Republican-controlled Legislature come up with legislation that facilitates trimming state government – the deficit amounts to about three percent of total spending – Edwards will suffer a complete rout in his first half-year in office. Supposing he gets his wish to keep inflated government by having tax increases enacted in another special session, still he takes a political hit for both instigating higher taxes and lacking the leadership to reduce the drama produced by the necessity of a last-minute reprieve when he could have gotten the job done the first time.

15.3.16

Despite tight budget, shore up indigent defense

While Louisiana’s legislators generally have turned their attention to balancing the budget in the just-commenced regular session, under the radar flies an area that deserves urgent attention and cannot afford any more reduction: that of paying for indigent defense, which if not soon resolved may prompt an influx of criminals roaming the streets.



Years ago the state supposedly solved for the chronic underfunding of indigent defense. Constitutionally, if the law defines a person as indigent, the state must provide legal representation to those accused of crimes. In the past, the system depended upon the wildly varying funding source of surcharges on convictions with a backstop of state funding doled out by need. The reform included increasing the latter component, recognizing that enforcement choices of law enforcement agencies that by definition operate independently of the system made for too much instability.



But with budgetary difficulties in the past couple of years that have reduced the state funding and with changes in enforcement patterns that have reduced the number of cases that could result in the fee payment, last year’s atmosphere that saw only a handful of the 42 (one for each judicial district) public defense agencies in difficulty and just a couple approaching a crisis point has deteriorated further. Now, before the end of the year a few agencies may have to stop taking new cases, even as currently they work with more of these per lawyer than national guidelines recommend, and many others threaten to join them in 2017.

14.3.16

Edwards' speech reaffirms that voters made mistake

Maybe he lives in a fantasy world. Maybe he’s just ticking off boxes. Maybe he’s a true believer pathologically unable to brook dissent from his prejudices. Regardless of potential explanations to understand Gov. John Bel Edwards’ State of the State speech (version 2.0, perhaps if counting his address to the Legislature prior to the just-finished special session), the clear message from it reminds Louisiana of the mistake made in his gaining the office.



In what has become nauseatingly familiar to observers, Edwards framed the presentation along the twin rhetorical principles emblazoned upon his administration to date: blaming his predecessor for every bad thing, real or imagined, under the sun; and pugnaciously defining cooperation as the endorsing of his policy preferences while conflict occurs only when others disagree with him. Expanding upon the latter, to which he also made allusions at the end, he alleged that a “Washington” politics of divisiveness interfered with getting things done (read: having his agenda enacted) and that a “Louisiana way” should prevail.



Of course, the “Louisiana way” has facilitated spending the state’s way into oblivion: in the next-to-last year data were available (2012), the state ranked 12th in spending as a proportion of state personal income. That’s high, but more remarkably growth in that measure over the previous two decades exceeded that of all states but Delaware. In Louisiana, consensus of Edwards’ type leads to overspending and a little more conflict seems in order to stop it.

9.3.16

Edwards throws fit at opportunity to right-size govt

More good news than bad came out of the 2016 First Extraordinary Session of the Louisiana Legislature. It didn’t advance much the cause of right-sizing state government but neither did it set up the possibility for defeat, either – an evaluation validated in reverse barometer fashion by the state’s foremost advocate of big government.



The end product raised some business taxes, some permanently so, most of which will get passed along to consumers, as well as hiked the state sales taxes a penny and escalated in minor fashion other excise taxes. It featured some modest cuts to government spending, although admittedly perhaps reducing as much as possible given the short remainder of the fiscal year. More notable for what it did not do, it rejected overtures to double the Earned Income Tax Credit and to create more progressive individual taxation, even as it left the door open for that by putting forth a constitutional amendment that could wipe out deductibility of individual income tax credits for federal taxes paid.



Naturally, that result did not sit well with Democrat Gov. John Bel Edwards, who wailed about an estimated $800 million shortfall from his preferred spending level for next fiscal year, called those legislators who did not agree with his resistance to right-sizing government derelict and not working together for the good of the state, and lied about the nature of the recurring revenue generated being ineligible for use for that purpose and also about that future cuts would have to go mostly to higher education and health care. He errantly and audaciously alleged he had intended for the session to undertake structural reform, when he really meant that agenda only entailed increasing taxes to redistribute more wealth.

Gatti, Milkovich act contrary to their party labels

Never before elected to office despite past efforts, they ran against experienced legislators and those House members’ votes for tax increases in 2015 to win Senate seats narrowly in northwest Louisiana. Yet early in their legislative careers, their paths diverged in ways belying their different partisanships.



Democrats received a small amount of cheer from their state Sen. John Milkovich having taken the long-time GOP seat in District 38. Previous runs for office had established him as a social conservative and pronouncements about reining in profligate spending in state government along with a Caddo parish base (his runoff GOP opponent coming from Desoto Parish) gave him enough support for the win. In District 36, Republican state Sen. Ryan Gatti won his contest by relentless criticism of his Republican runoff opponent’s voting record on taxes, alleging he was the “true conservative” in the contest.



However, delving deeper into Gatti’s campaign rhetoric and associations revealed him as somewhat of a Trojan Horse. He criticized state education reforms built upon accountability and school choice, a major conservative policy victory of the past few years. Further, he aided the victorious campaign of his Democrat former classmate and now Gov. John Bel Edwards, leading to fears that he could become a reliable vote for the agenda of one of the most liberal members of the House of Representatives over the previous eight years.

8.3.16

Sales tax increase only fair solution to LA deficit



White knuckle time has come to Louisiana’s policy-makers, but that should not obscure the fact that, given the inevitability of tax hikes, only the sales tax needs increasing.



Today the Legislature will take up again the budget-balancing issue. While the long term looms, what to do to solve the current year deficit remains unknown and most in need of urgent resolution. As the sun set yesterday, legislative rules prevented any more introductions of legislation on the tax side, so any moves that deal with taxation must take place within the confines of any legislation already passed by a chamber, with all matters settled by 6 PM Wednesday.



At that time, given the range of tax instruments already dealt with by at least one chamber, a gap of well over $100 million remained. Since appetites for further spending cuts seem lost, the question has boiled down to whether sales tax adjustments should take up the entire slack, or if some combination of income tax rate, deduction, and credit changes and sales tax exemptions on business also should enter the mix.

7.3.16

LA GOP voters may signal end to Trump chances

The only surprise emanating from Louisiana’s presidential preference primaries last weekend was that financier/celebrity Donald Trump did not do better among the Republican electorate, leading to the possibility Louisianans’ vote choices may play a pivotal role in the GOP nomination contest.



Trump finished with around 41 percent of the vote, only three points better than Sen. Ted Cruz and the remainder split among many others. While the closeness of the contest showed the limitations of polling – these inform only about a snapshot in time, and the electoral environment in the state appeared to change dramatically in a the few days between data collection and election day itself – it also showed some erosion of Trump’s support. The next question becomes whether this replicates and deepens across the primary landscape.



If anyplace, Louisiana is tailor-made for a candidacy like Trump’s. He is the first populist Republican to campaign seriously in the state since, well, Trump endorsee (but not “everything” about him) former state Rep. David Duke. Much mythology and distortion has come about concerning Duke’s rise to prominence, complicating a rather simple phenomenon: Duke became the first to turn the populism in the state’s political culture that always articulated big government as a friend of the people into their enemy. Populism endorses a Manichean view of the world, ratifying the notion of irreconcilable divisions existing within society that only can be solved by levelling the playing field through government intervention (liberalism; government must promote the alleged structurally disadvantaged groups, made so by societal conditions, by rigging outcomes to favor them) or by failure of government intervention (conservatism; government creates the uneven field through special interests using it to advantage themselves).