Former President Barack Obama built a huge dam designed to squash and limit the growth inherent with capitalism. The dam was fortified with higher taxes, pages and pages of oppressive, anti-growth regulation, and policies incentivizing corporations to invest abroad. Donald Trump blew a big hole in Obama’s dam. The Republican president and former businessman lowered and reformed taxes and gutted regulation. The drastic policy shift brought in a flood of unprecedented prosperity for most Americans. This was especially true for black and Hispanic Americans.
John Bel Edwards, a Democrat, has also constructed quite an impressive anti-capitalism dam as governor by raising billions in new taxes, gutting investment incentives, and enabling and encouraging plaintiff attorneys’ shakedown of Louisiana’s oil industry. Under Edwards, Louisiana fell behind the rest of the country with tens of thousands forced to leave the state, stale economic growth, and some of the nation’s highest unemployment rates.
But it could have been a lot worse. The booming Trump economy softened the blow of Edwards’ anti-capitalist policies. Even though Edwards took us in a different direction than Trump, the national economy was so strong, it spilled a little prosperity over on us. But now, the party’s over.
COVID-19, the deadly and highly contagious virus has changed everything. Harsh restrictions in place to slow the spread of the virus has put our national economy on life support. Who knows how long it will take to recover? We can no longer count on a red-hot national economy to bail out Louisiana’s anti-growth ways. It is time to get our act together.
Under Edwards, the private sector has taken a back seat to special interests like labor union bosses, personal injury lawyers, lobbyists, and deep-state types that benefit from a bloated government sector. But the government only redistributes wealth. It doesn’t create it. It cannot save the day when times are tough. Entrepreneurs and the workers they employ is where wealth is created. If we are to shorten the pain, suffering, and poverty in the days ahead, Edwards will have to abandon his war on capitalism.
It is possible in the coming months our state and nation could experience poverty on a scale not seen since the Great Depression in 1929. Thomas Sowell, an economist at the Hoover Institute at Stanford University, often writes about the Great Depression and the stock market crash of 1929. He argues it took us much longer to recover from the crash of 1929 than it did from a similar crash in 1987.
“The 1929 stock market crash was followed by the most catastrophic depression in American history, with as many as one-fourth of all-American workers being unemployed. The 1987 stock market crash was followed by two decades of economic growth with low unemployment,” writes Sowell.
“The other big difference was that the Reagan administration did not intervene in the economy after the 1987 stock market crash — despite many outcries in the media that the government should do something."
What the government did to elongate the Great Depression was raise taxes and implement new regulations. It is clear based on his record; Edwards falls into the government must “do something” category.
Edwards’ insatiable appetite for new taxes defined his first term. He concocted one crisis after another trying to convince us the government needed more of our money. Now the government does indeed need more money to maintain its current size. Tax revenues are sure to plummet in the months ahead. The problem is we too need our money now more than ever. Since the COVID-19 crisis, close to 300,000 have lost their jobs in the state. Now is not the time for the governor to hit us up for more cash.
Once we get back to work and things begin to return to something resembling normal, expect Edwards to once again pull out his long list of sob stories and manufactured crises, using them to convince us he needs our money more than we do. We cannot afford to play his game this time. Times are too tough. Edwards must realize the government will have to live within its means. Much like the rest of us must do.
Email Dan Fagan at Faganshow@gmail.com.