Louisiana legislators will soon be called to Baton Rouge for their third special session of the year and the seventh one in the Governor John Bel Edwards era. Primary blame for this fiasco must rest with the Governor. He is the most powerful politician in the state and he certainly must be held responsible for not bringing together legislative leaders to solve the problem.
While Governor Edwards believes tax increases are the answer, in actuality, it is the worst possible course of action. Unlike neighboring states of Texas and Florida, Louisiana has an income tax. Both of those states are doing very well. Florida’s Republican Governor, Rick Scott, has visited Louisiana to entice our business leaders to move to his state. Whereas Texas has continued its longstanding trend of poaching our corporate headquarters. For example, in the past few months, two thriving corporations, Smoothie King and Tidewater, announced they were moving their headquarters to Texas.
What is the Governor’s plan to counteract this trend and retain and recruit new business to Louisiana? Obviously, he believes tax increases are the answer. This year, Governor Edwards was fortunately rebuffed by Republican legislators when he tried to raise gasoline taxes by $510 million or 17 cents per gallon to pay for road projects. While many of these projects are probably important, raising taxes in the current economic climate is a horrible idea.
According to a new WalletHub study, Louisiana has the worst economy in the nation with the slowest GDP growth. Governor Edwards and his liberal legislative supporters need to realize that raising taxes does not improve economic growth, it is a major impediment.
Louisiana needs to create massive incentives to grow our economy. It is time to seriously cut our state government and grow our private sector. Instead we have seen more of the same, liberal tax and spend policies. For the past two years, Louisiana has been saddled with the highest sales tax rate in the nation. At a minimum, it has been a disincentive for businesses to move to Louisiana. It has also not helped retain businesses in Louisiana.
While our state languishes in last place economically, Governing Magazine ranks Louisiana with the 7th highest number of full time state and local employees, 284, per 10,000 residents, while the national average is only 232. Not surprisingly, Florida and Texas, states that Louisiana should try to emulate, are well below the national average.
It is time for Governor Edwards and legislative leaders to start benchmarking. We should follow the example of states that have growing economies and stop doing the same “tax and spend” policies that have never worked for Louisiana and are certainly not working today.