We’ve all heard it before. Elections have consequences.
So do decisions made under the guise of protecting the general public from itself. Or from a virus that was most likely concocted in a laboratory on the other side of the world.
Regardless, we got a snippet of at least one consequence that can rear its ugly head when a governor orders working people and business owners to abandon their livelihoods for more than a month. The consequence, you may wonder, concerns the lack of money to fund state government for the next year, beginning July 1.
Thanks to the assessment offered by a cadre of economists, the jury is still out in determining the exact dollar figure the Louisiana Legislature will have at its disposal to appropriate for state government to operate on in the 2020-2021 fiscal year. Nope, we won’t get the skinny, or learn the projected revenue figures, until later this month when the Revenue Estimating Conference gets together to offer its learned opinion on the state of the state’s income. It promises to be brutally ugly.
That’s the least we could infer from testimony offered by three economists who took turns in telling the House Appropriations Committee on Monday that the state’s financial outlook is bleak. And that’s putting it mildly.
Since Louisiana is still woefully too dependent on severance taxes generated by the oil and gas industry, state government should expect far less income from the oil patch in the year ahead, according to the economists, because for every $1 drop in the price of oil, state government realizes a $12 million decline in income. For example, the current fiscal year budget was based on oil trading at $60 a barrel, but earlier this week, oil was hovering at around $20 a barrel. In other words, the state should bank on collecting $450 million to $500 million in fewer severance taxes in the new fiscal year. Ouch.
At least that’s one revenue projection lawmakers can set their sights on since the REC won’t unveil its revenue handicapping until mid-month. Even then, the REC will offer nothing more than an educated guess because no one can accurately predict how badly Gov. John Bel Edwards’ orders to keep the state’s economy on ice has impacted sales and income tax collections. You can rest assured the decline will be in the hundreds of millions of dollars, and no one — not even a learned economist — can project when tax collections will return to normal, assuming they ever will again.
That’s another consequence in all of this shutdown madness.
For weeks we’ve been told to stay indoors and do nothing but if we venture out and about, we should do so with great caution. The question is, will the general public ever feel comfortable again in moving about and spending money as it did prior to the Chinese virus craze?
Over the weekend yours truly paid a visit to a few retail establishments. Shoppers were everywhere. It was reminiscent of the Christmas holiday shopping season.
What are we to make of people openly ignoring a governor’s orders to remain at home?
It can only be one of two things: Either they don’t respect the governor’s wishes or they don’t believe the propaganda they’re being fed.
Either way, the consent of the governed has been withdrawn.
Sam Hanna Jr. can be reached by phone at 318-805-8158 or e-mail at email@example.com.