The spirit of Wilkins Micawber, the Dickensian character whose watchword in financial matters was “something will turn up,” has long informed the Louisiana state budget, but the hope is looking particularly forlorn this year.
When Gov. Bobby Jindal signed the budget in June, he proclaimed it contained no tax increases “while strengthening the state’s health care system and protecting higher education” after eliminating a $1.6 billion deficit. Even by Jindal’s standards, that was a lot of lies to cram into one sentence, and no clairvoyant powers were required to predict massive cuts as the fiscal year staggered on. That is what happens every year, and this one was bound to be a doozy.
Cracks have never appeared so early as they did this time. Barely six weeks after Jindal claimed to have achieved the impossible, legislators were forced to trim the budget by $4.6 million, with higher education, once again, taking the biggest hit, this time to the tune of $3.8 million. Then it turned that TOPS, the program that picks up the tab for college tuition, had been shorted by $17 million. Now the Legislative Fiscal Office finds that the budget failed to provide $335 million of anticipated Medicaid expenditures.
Meanwhile, much of the revenue on which the budget relies may well not materialize. Several tax hikes were passed by a simple majority vote, whereas the Constitution clearly requires two-thirds of each chamber. A lawsuit that seeks to nullify one tax worth more than $100 million is already pending, and more similar challenges may yet be filed. It was pure fantasy for Jindal to claim taxes were not increased on his watch, but, by the time all this litigation plays out, he could wind up closer to the truth than he knew.
Further budget turmoil followed the decline in oil prices, which the Revenue Estimating Conference had pegged at $62 a barrel. It is currently trading at around $40. At that level, the state treasury is out more than $200 million.
Experience leaves no doubt that fresh disasters lie around the corner. The way the numbers are piling up raises a droll possibility. We must keep count to see if, by the end of the fiscal year, the cuts will match the $1.6 billion that Jindal and the legislature purportedly found to plug that hole.
Well, it wouldn’t be that droll amid the hardships attendant on the collapse of public services, and surely it is about time our bold leaders showed some sense of urgency. Micawber himself could not be more blasé in the face of impending disaster.
Legislators and administration officials seek to reassure us by suggesting the economy might boom and bring in extra revenues to save our bacon. But when Jindal’s Commissioner of Administration Kristy Nichols says she is optimistic that cuts may be restored, she offers no evidence that it is likely to happen. Wishful thinking will only make our predicament worse because the longer we wait to take action, the more savage the cuts will eventually be.
A turn-up in the price of oil would help, but the current global trend is for demand to decline.
In any case, we’d probably need at least $200 a barrel to put us on an even keel. With oil companies laying off staff in Louisiana, salvation must be sought elsewhere.
Jindal is certainly seeking his salvation elsewhere, and Iowa is his first choice now that the race is on. That would be the race to see if he completes his gubernatorial term before the state budget implodes to reveal the full extent of his ineptitude and chicanery. Not that his stock could get much lower after the transparent fraud whereby he created a student fee that was never meant to be collected so he could abolish it as an imaginary offset to taxes imposed in the last session. Thus did the would-be leader of the free world ask us to believe there had been no net increase.
No wonder that Jindal still hovers around one or two percent in the presidential polls. He had better hope something turns up.
James Gill’s email address is firstname.lastname@example.org.