Good GOP Senate week capped by unity with Cassidy

The Republican scenario to knock off Sen. Mary Landrieu  in 2014 had a dream week, closing with affirmation of a strong candidate with the promise of undivided attention in the quest with her receiving more bad polling news.

Yesterday, Rep. Bill Cassidy formally announced his intentions to contest the seat, perhaps coordinated with Rep. John Fleming who, after letting the Cassidy announcement get covered for a day, then offered his declination. Fleming would have been a competitive candidate but faced a significant disadvantage compared to Cassidy: many fewer dollars currently in the bank with the need to raise a ton of them.

While Fleming is the wealthiest member of the state’s congressional delegation – even including Landrieu – past elections show she will move mountains to spend to stay in office. For the two-year election cycle ending in her reelection 2008, she outspent her main opponent $10.144 million to $4.795 million and in the cycle ending in 2002 she outspent her main opponent $7.540 million to $3.721 million. Having the ability to bludgeon the opposition, which reflects both her fundraising prowess and the relative weakness of the other candidates, has been key to her narrow wins.

Poll results bring smiles to Vitter, troubles to Landrieu

While Gov. Bobby Jindal’s centerpiece tax reform plan looks set to encounter tough sledding on the basis of a recent poll, one of Louisiana’s U.S. senators got similar news from it and another received the exact opposite as they appear to embark on their next elections.

The survey by Baton Rouge businessman Lane Grigsby did not have heartening news for Sen. Mary Landrieu. She received an overall favorable approval rate of 56 percent, but when considering reelection, more crucial to understanding those chances comes from evaluating her against a field and not in isolation. Even with a sample tilted a bit towards Democrat candidates, against any generic candidate more than a third of the sample said straight out it would not vote for her, barely fewer than said they would definitely vote for her reelection in 2014 (and a small improvement over her worse numbers two years ago).

Five years ago, against a weak liberal-Democrat-turned-populist-conservative-Republican state Treasurer John Kennedy, she managed to pull out a five-point win with polls in the months prior to the election averaging her vote to reelect rate around 45 percent in a favorable electoral climate. Neither condition exists at this time.

Time running out for Jindal to transform LA political culture?

As is typical, the clash between the transformative ideas of Gov. Bobby Jindal and Louisiana’s political culture makes the voting public appear schizophrenic, with implications for his agenda going forward.

Prior to each legislative session, over the past several years it has become a rite of Baton Rouge businessman Lane Grigsby to commission a survey concerning prominent politicians and issues. However, it must be noted that the sampling of 600 registered voters, not actual intended voters for a future election, did a substandard job in a couple of ways, making some of its conclusions problematic in presenting a valid reading of them.

It did have a tilt in favor of interests that might be expected to support Democrats, given results gathered from the kinds of candidates they typically vote for compared to 2012 election results. More disturbingly, it oversampled tremendously in one way in that one in nine reported having a household member working as a public school teacher when only about 50,000 are employed as public school teachers statewide out of about 2.9 million registered voters or a an actual ratio (assuming the proportion of registered voters of adults at 82 percent is reflected in households, or 1.37 million) of 3.6 percent, meaning the sample actually contained three times the proportion of public school teachers in a household than actually exists in the population.

Unlike Shreveporters, Bossier voters can punish politicians

A month after red-faced as Bossier City officials announced the distinctly unfavorable settlement in a needless lawsuit their actions created, Shreveport officials could have matched that when they announced the city finally was throwing in the towel on its notorious Bioset deal – even if they, unlike most of their Bossier City counterparts, had no direct complicity in the mess.

This saga began a dozen years ago during the first administration of former Mayor Keith Hightower as a response to Environmental Protection Agency concerns over the city’s waste treatment. One alternative was to buy technology to deal with it at a cost of $26 million. But another was to make a deal with Bioset, as the firm had a process by which sludge could be turned into sod.

Hightower did the latter – but on distinctly unfavorable terms for the city. In a total contract of $32 million over 20 years, along with the city backing a $10 million loan, low interest and tax exempt, of then-available small-issue Industrial Development Revenue Bonds from the state’s Louisiana Community Development Authority to build facilities, for an estimated value of $700,000 the city would get sod from Bioset for its use on various city properties. Over time, rumors surfaced that this had been a sweetheart deal for associates of Hightower and/or a result of campaign contributions; certainly it made little economic sense as, in this particular instance, the cost of the city doing this itself actually would have been lower and would have left it with a permanent facility to do it with.

Even if swap fails, Jindal succeeds with transformation

Perhaps Gov. Bobby Jindal has bitten off more than he could chew. Or maybe people have assumed the wrong agenda for him all along.

With criticism from a number of corners, some of it with merit, much of it driven by political calculation, over his tax swap plan that essentially replaces income taxes with (increasingly) higher and broader sales taxation that simplifies the system which together produce greater economic growth, chances are fading that it will make its way into law as he intends it. They are reduced further by distracting sideshows left over from previous bold initiatives of the past year – attempts to have declared the ways in which education reform were enacted unconstitutional and the restructuring of health care delivery with the backdrop of ruinous federal policy, and in this area an investigation apparently into one of the largest contracts let by the state. So much so far so fast may mean some of it gets left behind for the lack of enough political resources to get it into law.

The prevailing assumption, often explicated in cynical and condescending tones, is that Jindal’s public policy is driven primarily by a desire to achieve higher office. Those with little understanding of the philosophy behind his general policy prescriptions – privatizing state functions where it’s best to do so, improving delivery where they should remain operated by the state, or using both approaches by encouraging private provision to compete with and improve public sector delivery, and all against a backdrop of fiscal policy designed to get government out of the way to unleash the fruits of individual autonomy – assign the specific policies from this as props solely created to further political ambitions. This entirely misunderstands.

Study confirms Medicaid expansion costs LA more

Earlier this week, Louisiana’s Department of Health and Hospitals issued an updated report concerning eligibility expansion under the Patient Protection and Affordable Care Act (“Obamacare”). Utilized changed standards over the past three years in the analysis, while more optimistic than the report issued then, it still points to the wisdom of rejection of expansion.

According to it, in the scenario most closely matching the existing policy environment, the state is expected to spend from $197 million to $367 million less over that decade. In another scenario, which depends upon a very unrealistic rise in provider rates of 90-100 percent, costs were $1.7 billion greater over the decade. However, importantly any “savings” realized occur only in the first six years of the continued reimbursement rate and from thereon out the state pays increasingly more.

Besides a few procedural rulings that have changed since the law’s passage and its imperfectly reasoned reaffirmation by the U.S. Supreme Court, the most prominent factor in adjusting the estimates ironically has been the state’s implementation of its Bayou Health plan, a premium support plan with a substantial managed capitation program for those currently eligible for Medicaid that saved the state about $136 million (about 10.88 cents per enrollee) in its initial year of operation. In essence, it has made it cheaper to enroll incremental members into Medicaid and without that, given the projected number of enrollees under expansion in the realistic scenario (577,000) compared to existing enrollments (1.25 million), another $63 million annually would be saved or almost twice the optimistic realistic scenario.

Report confirms swap's value, but it might need altering

The Gov. Bobby Jindal Administration was back in front of the most important legislative committee yesterday to the fate of the passage of its tax swap plan, energized by a new study that demonstrates the utility of the idea. But as the clock continues to tick to the start of the session, some major modifications may be in order despite the affirmation of the plan’s desirability.

The proposal features increasing sales taxes for existing businesses that must pay it by 1.88 percent, adding new businesses in the service sector paying 5.88 percent, eliminating half of mineral resources exemptions, increasing the cigarette tax, and eliminating all income taxes. The House Ways and Means Committee heard about how the plan would shift more taxation to business by an increase in the sales tax, theoretically by having to absorb some of it, and also would be hurt by depressed demand by passing some to taxpayers. However, with no income taxes paid by either businesses or consumers, individuals should pay an overall lower rate and the overall tax blow on businesses would be softened. In addition, individuals not now paying income taxes would receive rebates to make up for increased sales taxes presumably paid.

In short, the plan is designed to increase the overall burden on businesses, but individuals including business owners would have reduced tax burdens, while only mineral extractors and smokers definitely would see higher taxes. The benefit is this would create a more efficient fiscal structure that does a better job of collecting taxes and spurs economic growth better than the current system – in theory. That conclusion was verified by the report put out by Louisiana’s Pelican Institute of Public Policy and the Beacon Hill Institute of Suffolk University.

Pique, not good sense, behind electing superintendent

Why not? If you’re a Louisiana legislator and have a grudge, why not salve that bruised ego by trying to foist on the state a proven bad idea?

That appears to be the motivation and agenda by state Sen. Bob Kostelka with his introduction of SB 41 that would make the state superintendent of schools an elective position, as it had been prior to 1988. This would be in addition to the Board of Elementary and Secondary Education, which currently chooses this officer, eight of whose members are elected from single-member districts and another three appointed by the governor.

Kostelka has managed to get himself on the outs with the Gov. Bobby Jindal Administration, which has led to his demotion in the Senate’s power hierarchy such as being stripped of a committee chairmanship, by steadfastly refusing to go along with most of Jindal’s reform agenda. This includes in education, where Jindal and most of the elected members of BESE agree on policy.

Investigation excuse to get out of unfavorable contract?

The Gov. Bobby Jindal Administration better be pretty sure of its information by cancelling a state contract, or else what looks to be a tempest in a teapot might cost the state some real money. And if there are any political reasons behind it, they’re likely to disappoint equally Jindal-haters and those loving lurid stories of rampant government corruption.

Last week, the state took the unusual step of terminating this contract to process Medicaid claims, citing recently-revealed state and federal investigations into the process of how the contract was won. Controversy had followed the awarding of the contract, which had led to its appeal and a declaration by Atty. Gen. Buddy Caldwell’s office that it should not have been awarded to winner CNSI.

Several aspects initially raised cause for concern. Department of Health and Hospitals Secretary Bruce Greenstein years ago had worked for CNSI and in the initial phases of the process had made changes to the original contract parameters that would allow CNSI to qualify for bidding. He also met with former colleagues once prior to awarding. But no apparent impropriety was attached to this: Greenstein has no known current connection to the company, the reconfiguring of parameters opened eligibility to a number of firms, and other competing firms had no complaints about the restatement at the time.

Chicken hawks on the verge of becoming real budget hawks?

Perhaps a group of mostly Republican state representatives who style themselves as purists for sound state budgetary practices and results finally are evolving from a politicized, “chicken hawk” approach to a true “budget hawk” position that genuinely can improve Louisiana’s fiscal situation.

Formally organizing their enthusiasms as the Louisiana Budget Reform Coalition in the past few months, more than a year prior to that various group members have criticized some long-standing budgetary tactics employed in the executive budget and ratified by the Legislature. Drawing their special scorn has been the practice of using “one-time” money to provide some funding, generally in the range of 1-2 percent, of operating expenses. “One-time money” has come to mean a lot of things, but generally as used it includes funds from one-off transactions such as sale of government assets or a windfall of some kind and monies dedicated for a certain purpose that gets used for another courtesy of a supplemental appropriations bill called a “funds sweep.”

But their problem to date has been they have used the idea mostly as a political cudgel that sounds great and scores points for election purposes, but actually prevented any real progress in improving the state’s fiscal structure. Their great bane, one-time money, they declared a pox upon in advocating it never be used to fund operating expenses, but never seemed to grasp it was just a symptom of the real disease wherein lay the true cause of budgeting distress.