Edwards mess grows with invalid decree
Louisiana Democrat Gov. John Bel Edwards has moved onto a new section of his party’s playbook. Not only does his policy create a problem that he proposes to solve by doing more of the same, but also he now has taken to proposing for it unconstitutional solutions.
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.
Posted by Jeff Sadow at 11:05