Monday, June 9, 2014

Monday, June 9, 2014

Uninsured drivers will pay heavy penalties; Fiscal Hawks didn’t fly this year; Who makes the minimum wage? And New state agency may be hobbled. $53 million – Amount, per year, Louisiana plans to raise through increased fines and penalties for people who are caught driving without insurance. (Source: Associated Press)

Uninsured drivers will pay heavy penalties
The Associated Press provides a case study in why people often are cynical about politics: As the Legislative session was in its final hours, a deal was struck behind closed doors to raise $53 million a year through new and expanded fees on drivers who fail to maintain insurance. The fee hikes were added in a House-Senate compromise committee and were approved with virtually no public debate. Most of the money will be used to give a pay raise to state troopers, with district attorney and sheriffs also receiving a cut.

Supporters said the higher fees are needed to discourage people from driving without insurance. But it’s a case they weren’t willing to make in public, as the real effect of this bill will be to make life even tougher on poor families who already struggle to pay car insurance rates that are among the highest in the country. It ignores the fact that most people who fail to keep up with their premiums do so because they can’t afford the cost, yet need their cars to get to and from work and get their kids to school. Asking this population to pay an additional $53 million a year is the epitome of short-sighted policymaking.

Fiscal Hawks didn’t fly this year
Several commentators have noted that this was one of the most “quiet” sessions in memory, absent much of the rancor that usually surrounds the state budget debate. Melinda Deslatte of the AP says that’s because the House “fiscal hawks” were largely silent, with many distracted by the debate over the Common Core state standards.

“The hush came even though the spending plan for the upcoming 2014-15 fiscal year contains similar financing as a budget that caused huge outcries in the House just last year.

“’I think this same budget two years ago, maybe even last year, it would have been a huge battle on the floor of the House to get it passed, and for whatever reason, this year that just didn’t happen,’ said House Ways and Means Committee Chairman Joel Robideaux, R-Lafayette.”

Who makes the minimum wage?
As many as 34 states could have minimum wage measures on the ballot this year, economist Jared Bernstein reports in the New York Times. But not in Louisiana, where a broad package of bills seeking to raise the pay of low-income workers failed to get out of committee. Bernstein notes that the minimum wage workforce has changed considerably in recent years, as workers today are older and more likely to have kids than in previous generations. But he also notes that 12 percent of those making minimum wage live in households with incomes above $100,000, which critics often cite as a reason to keep wages low.

“This group highlights the fact that the minimum wage is not nearly as well targeted toward poverty reduction as the earned-income tax credit, a wage subsidy whose receipt, unlike the minimum wage, is predicated on family income.

“Still, a minimum-wage increase does much more to help low- and moderate-income households than any other groups. Households that make less than $20,000 receive 5 percent of the nation’s total earnings, for instance — but would receive 26 percent of the benefit from the proposed minimum-wage increase.”

New state agency may be hobbled
There were cheers in the legislative chambers when House Bill 341 passed in the last few minutes of the Legislative session. The bill by Rep. Joe Harrison, R-Napoleonville, is a constitutional amendment that would create a new Department of Elderly Affairs in state government, which would oversee programs benefiting Louisiana seniors. But The Advocate reports that a poison-pill amendment by Sen. Neil Riser, R-Columbia, might make the whole exercise moot.

“The amendment reads: ‘Except that no department may be created that has the powers, duties and functions to perform or administer programs or services which are historically performed or administered by any other agency, office or department of the state.’

“Riser insisted he just wanted to protect the state Department of Veterans Affairs, which operates war veterans’ homes, and the state Department of Wildlife and Fisheries, which handles hunting licenses for senior citizens. The amendment has the Jindal administration’s support. Others saw the amendment as gutting the bill by basically prohibiting any new state agency from forming unless it deals with a completely new service, such as arranging commuter flights between Baton Rouge and the planet Mars.”

$53 million – Amount, per year, Louisiana plans to raise through increased fines and penalties for people who are caught driving without insurance. (Source: Associated Press)