https://www.washingtonpost.com/news...mic-disaster-louisianas-governor-left-behind/
BATON ROUGE, La. — Already, the state of Louisiana had gutted university spending and depleted its rainy-day funds. It had cut 30,000 employees and furloughed others. It had slashed the number of child services staffers, including those devoted to foster family recruitment, and young abuse victims for the first time were spending nights at government offices.
And then, the state’s new governor, John Bel Edwards (D), came on TV and said the worst was yet to come.
Edwards, in a prime-time address on Feb. 11, said he’d learned of “devastating facts” about the extent of the state’s budget shortfall and said that Louisiana was plunging into a “historic fiscal crisis.” Despite all the cuts of the previous years, the nation’s second-poorest state still needed nearly $3 billion — almost $650 per person — just to maintain its regular services over the next 16 months. Edwards gave the state’s lawmakers three weeks to figure out a solution, a period that expires March 9 with no clear answer in reach.
Louisiana stands at the brink of economic disaster. Without sharp and painful tax increases in the coming weeks, the government will cease to offer many of its vital services, including education opportunities and certain programs for the needy. A few universities will shut down and declare bankruptcy. Graduations will be canceled. Students will lose scholarships. Select hospitals will close. Patients will lose funding for treatment of disabilities. Some reports of child abuse will go uninvestigated.
“Doomsday,” said Marketa Garner Walters, the head of Louisiana’s Department of Children and Family Services. If the state can’t raise any new revenue, her agency’s budget, like several others, will be slashed 60 percent.
“At that level,” she said in an interview, “the agency is unsustainable.”
But even if Louisiana’s Republican-dominated legislature approves certain tax increases, as most expect, the state still would grapple with problems. The taxes — which could include hikes on everything from groceries to salaries — would dig into the pockets of citizens in a state where 18 percent live in poverty and where the median income is 20 percent below the national average. And the taxes alone won’t close the gap. Nasty cuts will still be necessary, meaning Louisiana will be taking more from its 4.6 million people while offering them less.
“I’m feeling kind of disrespected,” said Christian Washington, 18, a sophomore at Southern University who could lose a state-funded scholarship. “This was an incentive for me. I worked extremely hard. And now they’re trying to strip me of my work.”
Many of the state’s economic analysts say a structural budget deficit emerged and then grew under former governor Bobby Jindal, who, during his eight years in office, reduced the state’s revenue by offering tax breaks to the middle class and wealthy. He also created new subsidies aimed at luring and keeping businesses. Those policies, state data show, didn’t deliver the desired economic growth. This year, Louisiana has doled out $210 million more to corporations in the form of credits and subsidies than it has collected from them in taxes.
Through a longtime adviser, Jindal declined comment for this story. The adviser, Curt Anderson, who was Jindal’s chief campaign strategist, said that the former governor had been “on a mission to grow the Louisiana economy, and he did it, and it required big changes,” including trimming government waste. Anderson said that the state’s population and the wages of workers are higher than they’ve ever been.
Initially, Jindal had been able to cut taxes because Louisiana was buoyed by billions in federal money, an influx to help with the recovery from Hurricane Katrina, which struck in 2005. But as that money ran dry, Jindal said he would veto any bills that would push taxes back to where they had been. Instead, to plug budget gaps, Jindal relied not just on cuts but also on controversial, one-off fundraising methods. The state sold off assets, including parking lots and farmland. It cleaned out money from hundreds of trust funds — among them, one intended to build reefs for marine wildlife. It pieced together money from legal settlements.
For Jindal’s supporters, this was creative problem-solving that helped the state endure without crisis through his term, which ended in January. But in the eyes of Jindal’s opponents, the governor was resisting a more sustainable option — tax increases — that would have proven unpopular nationally among Republicans, whom Jindal was courting in a presidential bid.
Then, as Jindal was on the campaign trail last year, fossil-fuel-rich Louisiana was hit with one more obstacle: The price of oil and natural gas fell off a cliff, causing a retrenchment in an industry that provided the state with jobs and royalties.
When Edwards took office, new estimates from state economists showed that an already large budget gap was $500 million bigger than they had anticipated. Greg Albrecht, Louisiana’s official chief economist, said the state has been “basically taken into a recession.”