The Louisiana Legislature convenes today at noon for a five-day special session aimed at addressing the state’s property insurance crisis by providing $45 million in state incentives to lure private companies into the state. The Advocate’s Michael Finch II looks back at the last time Insurance Commissioner Jim Donelon tried a similar tactic – in the days after Hurricane Katrina. It had decidedly mixed results, and one independent observer says there’s a better way.
“I am not a big fan of paying companies to take policies out. I don’t think that’s an optimal use of state resources,” said Charles Nyce, an insurance professor at Florida State University. “I don’t think you subsidize the private market that way.” Instead, Nyce recommended direct subsidies for consumers based on their ability to pay, if affordability is the goal. “Be upfront about it,” Nyce said. “If you want to look and see if people meet some income requirement and subsidize it at the state level, go ahead and do that, but do it means-tested.”
The Advocate editorializes in support of the incentive payment, which has bipartisan political support, while acknowledging that it won’t solve the crisis of spiraling insurance costs as companies flee the state or go belly-up.
The three main drivers of this crisis are history, geography and climate. Over the past 100 years, Louisiana has experienced more hurricane landfalls per capita than any other state. Our state’s location at the center of the northern Gulf of Mexico puts us in or near the path of practically every storm that enters the Gulf.
The big British decline
In 1939, Great Britain declared war on Nazi Germany in response to Hitler’s invasion of the newly formed eastern European country of Poland. Fast forward to the end of this year, and the average Polish family will have a higher standard of living than their British counterparts. While some blame the recent “Brexit,” The New York Times’ David Wallace-Wells explains that government austerity measures are a major reason behind the country’s long economic slump:
In the aftermath of the 2008 global financial crisis, and in the name of rebalancing budgets, the Tory-led government set about cutting annual public spending, as a proportion of G.D.P., to 39 percent from 46 percent. The cuts were far larger and more consistent than nearly all of Britain’s peer countries managed to enact; spending on new physical and digital health infrastructure, for instance, fell by half over the decade. … The consequences have been remarkable: a very different Britain from the one that reached the turn of the millennium as Tony Blair’s “Cool Britannia.” Real wages have actually declined, on average, over the last 15 years, making America’s wage stagnation over the same period seem appealing by comparison.
Violence close to home
The recent mass shooting outside a Baton Rouge nightclub hit especially close to home for a newly elected state legislator. One of the people who was seriously wounded is the nephew of Rep. Vanessa Caston LaFleur, who said crime and education were the top two issues that people asked her to focus on as she sought office in a special election last spring. Columnist Ed Pratt of The Advocate writes that curbing crime means focusing on much more than just law enforcement.
Even if more law enforcement would be available that would not be a solution, she said: “You can’t lock everyone up.” LaFleur said she and others believe there should be a push to finance more afterschool and parenting programs, along with additional funding to expand mental health care. She says she wants her fellow legislators along with local government and community officials to meet to develop long-range plans to fight the problem. “I want to be at that table,” she said.
While America is as divided as ever over firearms policy, New York Times columnist Nicholas Kristof believes progress is possible if the country were to take a “harm reduction” approach to the problem of gun violence.
If we want to keep dangerous products from people prone to impulsiveness and poor judgment, one screening tool is obvious: age. We already bar people from buying alcohol or cigarettes before they turn 21, because this saves lives. The same would be true of imposing a minimum age of 21 to buy a firearm, even in private sales.
A reality check on budget brinkmanship
Republicans in the U.S. House, led by Speaker Kevin McCarthy and Louisiana’s own Steve Scalise, are threatening to torpedo financial markets by refusing to raise the federal borrowing limit unless President Joe Biden agrees to a series of unspecified cuts to federal programs. The Advocate’s Mark Ballard speaks with another prominent Louisianan, Office of Management and Budget Director Shalanda Young, who explains that the devil is in the details.
Young noted that changing the budget is a line-by-line affair. Republicans have to specifically target the programs they want eliminated. “You would have to pass another law that cuts specific programs,” Young said. “It’s easy to say, but what would that be? Are you talking about cutting housing? Head Start? Childcare? You got to tell people what benefits are going to be cut.”
Number of the Day
41% – Percentage of Black public-school students in Louisiana that attend D or F rated schools. Black students were more than five times as likely to attend failing schools compared to white students. (Source: Louisiana Legislative Auditor)