Another state facing budget problems due to tax cuts and business giveaways

First it was Kansas, now Louisiana is in deep budget trouble. The cause? Tax cuts and subsidies for corporations that are causing a budget shortfall of 2 billion this year alone. The former governor, former Presidential candidate Bobby Jindal, now admits that it was corporate welfare. This is what's killing America, the loss of money and power to Big Business who turns around and uses it to screw everyone else.

I know some here will say that democratic states are worse due to pensions and social programs, but at least that's spending on the people of the states instead of greedy bigwigs who don't need it in the first place.

news.yahoo.com...

All big government fails.

a reply to: CB328

Someone clearly DID NOT read that article.

Falling oil prices and personal income tax cuts also played major roles in the crisis, according to state data.

I'm not by any means disputing that tax policy can cause a shortfall in budgets,but there's at least one other major factor in play. Louisiana is one of the states with a large petroleum industry. I'm sure the rapid decline in oil prices had an impact.

I'm generally a low tax person, and I firmly believe that ,except in extreme cases of need, governments should not budget more than they can reasonably expect to receive in taxes.

a reply to: CB328

Imagine what further tax cuts disguised as being for the people but benefiting the elite will do if any of these candidates wins-

More of the same....

Louisiana, is unfortunately for them, one of the US states that can legitimately claim to have run up debt because of extreme circumstances. Hurricane Katrina followed by the BP Oil Spill are two extreme circumstances at the US state level that i would consider appropriate for deficit spending, but cutting taxes before you've paid off debts incurred from the former, is unexplainable.

All three states had governors who campaigned on being conservative and applying conservatism to state budgets. They did, and the economies of all the states are now in severe turmoil because the giveaway to the rich did not match the tax receipts. I think it is one thing to want to "limit government", but I think it is more important to ensure a reasonable and stable budget than to give money to already rich people. This compulsion of modern conservatives seems to be illogical, you can't reasonably conserve a budget and ignore the ratio of income and outlay.

originally posted by: jefwane
Louisiana, is unfortunately for them, one of the US states that can legitimately claim to have run up debt because of extreme circumstances. Hurricane Katrina followed by the BP Oil Spill are two extreme circumstances at the US state level that i would consider appropriate for deficit spending, but cutting taxes before you've paid off debts incurred from the former, is unexplainable.

Sort of, sort of BS excuse too... Jindal could of halted tax cuts until the debt was paid down.

a reply to: yesyesyes

Exactly, one of largest problems with America, and the rest of the world for that matter, is deficit spending.

How in the hell we've as a race (the human race) have come to accept that spending more than you take in is acceptable over anything but the most extreme circumstances is reasonable is to me insane.I'm not really that clued in on the Louisiana budget, and I'm really just talking general common sense.

Tax cuts when you're running a surplus AND making progress on retiring debt, I'm all for.

a reply to: CB328

Sounds like they need to cut the state budget.

Simple solution used by Americans every day and more freedom for the residents of the states. Less government, more freedom...sounds good to me.

Must be taxes, not like the price of oil changed.

The Louisiana oil and gas industry is one of the leading employers in the state.

www.lmoga.com...

originally posted by: CB328
First it was Kansas, now Louisiana is in deep budget trouble. The cause? Tax cuts and subsidies for corporations that are causing a budget shortfall of 2 billion this year alone. The former governor, former Presidential candidate Bobby Jindal, now admits that it was corporate welfare. This is what's killing America, the loss of money and power to Big Business who turns around and uses it to screw everyone else.

I know some here will say that democratic states are worse due to pensions and social programs, but at least that's spending on the people of the states instead of greedy bigwigs who don't need it in the first place.

news.yahoo.com...

The first time I have ever known anyone in the US to even admit to corporate welfare let alone suggest that it has negative consequences. Wonders never cease.

OMG hurry up and build them a expensive pipeline for expensive oil sands crude that will fix the problem.

a reply to: CB328

From your linked article:

The comment resonates now as the state faces its worst budget crisis in three decades - largely because of the soaring cost of subsidies, as well as personal income tax cuts, championed by Jindal.

See, this is the problem with American mentality when it comes to taxes: The assumption is that it is the government's money from the start, and that tax cuts "cost" the government money.

No, they don't, they just stop the government from taking the income earned by the individual.

I fully understand that there has to be a balance between "needs" for with a government takes taxes and "wants" for which the government pays from tax revenue, but to blame it all on "corporate welfare" (tax "subsidies") or "personal income tax cuts" is a half-truth at best.

What this article fails to do (and I don't necessarily care about it enough to do my own research...partly because I shouldn't have to on a thread like this) is discuss ANY spending that has also contributed to the unbalanced-budget issue going on in the state. Here in Cincinnati (a few years back at this point, I think), it was discovered that if the city just outsourced its trash pick-up and street-sweeping services, it could save almost $2M per year. In a city's budget, that's a lot of money--just think of what could be done at state levels if outsourcing was considered instead of setting state-funded agencies to oversee things that the private sector can accomplish just as well and usually at a dramatically cheaper cost to the taxpayer.

But like I said, I have zero in-depth knowledge as to what spending reductions like that were accomplished under Jindal, and maybe he did his due diligence in that regard. If so, then he did need to stop thinking about a political run for the presidency and rethink his taxation policies. If he didn't do his due diligence in spending reduction, that should be the top concern in a story about state budget problems, not the issue of the state not taking enough of a citizen's or company's hard-earned money.

originally posted by: OccamsRazor04
Must be taxes, not like the price of oil changed.

The Louisiana oil and gas industry is one of the leading employers in the state.

www.lmoga.com...

That was noted in the story, if you read it, and in my opinion, it's a bigger concern than the state not taking enough of other people's money.

Plummeting oil prices dealt the latest blow to state revenues.

...

Falling oil prices ... also played major roles in the crisis, according to state data. Oil-related revenues are projected to drop by nearly $400 million this fiscal year, the data shows.

But that's really all it discusses about that...a glancing notation of something that is probably as big a contribution to the problem.

The problem is that there are never corresponding spending cuts.

The other issue is that none of these states are in a vacuum. Many states do not have diversified industries and as such as susceptible to downturns out of their control regardless of the policies implemented.

Many high tax states that liberals have run into the ground financially have not imploded mainly because those states have a diversity of industry that keeps things going IN SPITE of the high tax environment and it is harder to move out of said states. If For example, NYC is the center of finance. It is hard to be a major player without being in NYC. Just like high tech is in Bay Area. Entertainment in CA. It is hard for these industries to just pick up and move although there are signs that they are doing just that by moving to lower cost cities and states when they can.

a reply to: xuenchen

Why?

Isn't this the same State that spent the funding to upgrade it's levees on a tourism center?

originally posted by: MOMof3
a reply to: xuenchen

Why?

Because almost all governments everywhere are in big debt.

Why is that?

The longer the water boils, the higher the lid will blow.

a reply to: xuenchen

"Because almost all governments everywhere are in big debt."


Why?