Times Picayune writer Julia O'Donoghue in the issue of 2/14 wrote a long article titled, "How Louisiana got into this financial mess" and opined the same story her editorial department likes to talk about seven years too late. Her story never got around to satisfy her story's title. The answer escapes Julia and the news media because they lack the courage to tell the real story.
The answer how Louisiana got into this financial mess is really basic, that is Louisiana governor Jindal, a republican who lives a conservative ideology and believes the state can give away its fundamental revenue base, plus $8 billion a year in tax breaks to business, cut spending and balance the state budget and every thing will work out. Yet all of his budgets were out of balance and now the state faces an almost $3 billion deficit, $943 million before the end of this fiscal year that ends 6/30/16 and a $2 Billion projected state deficit for next fiscal year beginning July 1, 2016.
Jindal inherited a $787 million surplus from former governor Kathleen Blanco and blew it big time as George W. Bush blew President Clinton's balanced budgets and surpluses into deficit spending in his very first fiscal year and all 8 years that he served. Jindal and Bush were brothers in deficit spending. Julia in her article is silent about the $8 billion in business tax breaks. Those tax breaks have not created a growing economy, new jobs, lowered the unemployment rate(it was 3.8% when Jindal took office) or balanced the budget. The $8 billion of tax give away to business represents 32% of the states yearly budget. Louisiana can not afford to give up that much revenue and balance the budget.
State treasurer John Kennedy still says the state has a spending problem and not a revenue problem and continues the conservative ideology that has failed on the state and national level. J.R. Ball, a conservative writer who's articles usually appear in the Times Picayune editorial section and a supporter of Jindal has swallowed the koolaid of the state having a spending problem and has no credibility on the state's budget problem. Nor does he have any answers. His editorial opinion in the TP of 2/19 is so childish.
This writers state representative in 2012 sent a news letter to all in his district recapping what took place at the state legislative session of 2012 and one of the many things he reported is as follows and I quote: ONE NOTE ON BALANCING THE BUDGET; AN INTERIM STUDY OF TAX EXPENDITURES WILL BE CONDUCTED TO INVESTIGATE THE $8 BILLION DOLLARS LOST IN REVENUE BECAUSE OF TAX EXEMPTIONS, CREDITS AND REBATES, SOME OF WHICH MAY BE OUT OF DATE. (end of quote)
Well, it is now 2016, four years later and I have received no notice what that study reported or if it was ever done. I wonder if Julia knows and if the study was done and completed what were the results. The news media never talks about this $8 billion drain on the state's revenue. Neither does business or those who support this massive tax give away to business. By the way, this writer still has a copy of the news letter in his possession if Julia would like to see it.
The bottom line is if business needs special tax breaks out side the ones that apply to business, such as depreciation and etc., then the business is not a sound one and have no business being in a system of free enterprise. There is no such thing as free enterprise when states and the federal government have to give out special and extra tax favors to business.
Let me ask this question. Is there any one out there that thinks business can afford to give away to charity 32% of its revenue and survive? Every one knows the answer is no. Well, Louisiana can not afford to do that either and service the needs of the state and its people. It is time for the state legislature to bring an end to this silly notion of corporate welfare. It is also time for state and the federal government to shed the fairy tale that business needs special tax breaks and tax loop holes to survive in the business world.
This commentary written by Joe Lorio
