If there is one easy talking point that ought to illustrate shallow thinking about Louisiana’s finances, it is the notion that the state budget’s new annual surpluses are a sign of overly high taxes.
One example of this problem of mathematics comprehension is the state’s own treasurer, John Schroder, a former state legislator himself.
“The real question is,” Schroder told reporters, “are the hardworking people of Louisiana paying too much in taxes?”
Sounds like a good question, if you do no research on the issue at all.
The experts on this subject are not those allied with Gov. John Bel Edwards or his administration. Rather, the nonpartisan and generally conservative Tax Foundation has consistently found that Louisiana’s state and local tax burden is one of the lowest in the country, akin to that of bigger states like Texas and Florida, although collected in different ways.
For critics of surpluses, including many like Schroder who backed the disastrous budget policies of then-Gov. Bobby Jindal over eight years, any surplus would be too high. In fact, almost any tax level would be too much. That’s political rhetoric of a profoundly simplistic level.
But in the real world, the notion that Louisiana’s taxpayers are overburdened would be laughed out of court because of statistical reality.
The real question is whether Louisiana’s taxes are fair, and that gives Schroder and critics much more to work with. As the treasurer and others, including the Tax Foundation, have pointed out for a long time, our tax system is not working very well at all.
Despite extensive studies, including one panel commissioned by legislators including Schroder, there are still tough problems to be fixed in the tax code, and legislators during Edwards’ four-year term have been very reluctant to do much of anything about the hard challenges.
Some of that is the politics of Republicans in the Legislature opposing Edwards, a Democrat. Some of it is legislators being afraid of any vote that raises revenue, because that decision would be seized upon by malcontents, even if the money replaces reductions in tax rates elsewhere.
But what Louisiana can no longer afford is Jindal-like opposition to all taxes all the time, the reflexive anti-tax attitudes illustrated in the reaction to the recent surpluses.
Taxes are the price we pay for civilization, the late Oliver Wendell Holmes Jr. opined rather grandly. For Louisiana, our goals should be more basic: Support for schools and colleges that educate young people. More money for roads and other transportation challenges.
Institutions that work aren’t purely a matter of funding. But adequate funding, even at a lower level than most of the states of the Union, requires money.
That’s the real world.