Louisiana was less prepared for a recession than any other state in the nation before the Covid-19 pandemic. And because Louisiana relies heavily on tourism and the oil and gas industry to drive its economy, our state has also been hit particularly hard in the ensuing economic crisis. The Washington Post’s David Montgomery and Richard A. Webster profile the Pelican State’s perilous situation.
“The virus has crushed the broader economy, but nowhere has the damage been more severe than in travel, tourism and energy,” said Mark Zandi, chief economist for Moody’s Analytics. He called the pandemic “a two-black-swan event” for Louisiana, with New Orleans also being one of the earliest hot spots of coronavirus infections in the United States. “A lot of infections, on top of a collapse in tourism/travel, and the complete wipeout in the energy sector — that’s pretty cataclysmic,” Zandi said. “I can’t think of another place that’s been nailed that hard.”
You don’t build a rainy day fund when it’s pouring
Gov. John Bel Edwards and state House leaders disagreed on Monday on how to use Louisiana’s $534 million surplus left over from last year: Rep. Stuart Bishop, who recently proposed more than $1 billion in tax giveaways to large corporations and the oil and gas industry, wants to sock the money away in the state’s savings account and pay down debt, while the governor wants to steer much of the money to state building repairs, road and bridge work, coastal protection projects and levee work. The AP’s Melinda Deslatte reports:
(Commissioner of Administration Jay) Dardenne said “it would be foolhardy” to use the surplus to pay off early a year of borrowing for construction work because interest rates are so low that borrowing is cheap. Transportation and Development Secretary Shawn Wilson said without the surplus dollars, Louisiana won’t be able to draw down all its available federal money for road and bridge work. Chip Kline, head of the Coastal Protection and Restoration Authority, said the levee work the governor proposed would assist with public safety and protect livelihoods. “These are projects that are shovel-ready that will create jobs,” he said.
As the Advocate’s Sam Karlin explains, the tax cuts that Bishop and his allies in the legislature have proposed would almost certainly harm Louisiana residents’ access to quality education and medical care:
Edwards, whose administration has cobbled together a state budget plan hammered by a $1 billion loss in revenues caused by the pandemic, said efforts to cut taxes would further hurt the state’s ability to fund services like health care, which is especially important during a public health emergency. If Louisiana’s revenues are short of expenses, health care and higher education have historically taken the brunt of budget cuts because of the way the budget is structured, though agencies would take only a 2% cut under Edwards’ plan because of more than $1 billion in federal aid.
Separate and unequal: Education and technology in a pandemic
Sunday marked the 66th anniversary of the U.S. Supreme Court’s unanimous ruling in Brown v. Board of Education of Topeka that racial segregation in America’s public schools was unconstitutional. Unfortunately, inequalities still exist in Louisiana. LBP’s Neva Butkus explains how the Covid-19 pandemic has highlighted racial inequities in access to educational technology.
According to the 2018 U.S. Census American Community Survey, nearly 150,000 children in Louisiana have no access to high speed internet in their household, and 47,000 have no computer at all. Students of color are the least likely to have any form of broadband access in their household. Only 73% of black and Hispanic school-age children live in a household with some type of access to broadband internet, compared to 78% of white children.
Medicaid expansion vital to our state’s recovery
Louisiana’s economy has gotten off track, but the state could be in a much worse situation if not for Medicaid expansion. Many Louisianans have been laid off and cut off from their employment-based health insurance. But 32,000 residents have been able to access health care during the pandemic because of Gov. John Bel Edwards’ decision to expand Medicaid. The Advocate’s editorial board explains the other invaluable benefits of the decision to expand Medicaid.
Medicaid expansion has given its customers a way to seek health care outside emergency rooms, which has helped reduce the burden at a time when they’re understandably focused on potential COVID-19 cases. “Imagine having the situation we have with COVID, and having emergency rooms flooded with primary care complaints other than COVID,” said Rebekah Gee, the former state health secretary who oversaw the expansion and who now heads LSU’s Health Care Services Division. Gee said that Medicaid expansion has also helped the state build a behind-the-scenes infrastructure to handle the virus’s quick spread.
Number of the Day
73% – Percent of black and Hispanic school-age children live in a household with some type of access to broadband internet, compared to 78% of white children. (Source: LBP via U.S. Census Bureau)