Louisiana’s economic development agency is receiving criticism from the U.S. Treasury Department and startups and small business groups over its inability to distribute federal stimulus money. States across the country, on average, have distributed approximately 30% of the funds from the State Small Business Credit Initiative. But Louisiana Economic Development has only distributed 15% of the state’s allotment. The Times Picayune | Baton Rouge Advocate’s Anthony McAuley reports on the slow trickle of funds intended for underserved communities.
The U.S. Treasury Department runs the program and expects that each $1 will attract 10-times that amount in private investment. Also, the majority of the money is targeted at under-served communities, including military veterans, rural areas and Black entrepreneurs. Louisiana Economic Development, which is running the program in the state, first asked for applications from investment groups in April 2022. LED has received $33 million of its total $113 million allocation. So far, it has approved just one $287,500 equity investment and $4.7 million in loans. That means it has passed on 15% of the total received, though only 1% of money targeted at equity investment.
Changing course on the federal budget
The federal deficit – measured as a share of the overall economy – has topped levels not seen since the mid 1940s when the United States was fighting a global war and subsequently rebuilding parts of Europe and Asia. This massive debt threatens a wide-array of government services and the broader U.S. economy. But as the Washington Post’s Natasha Sarin and UCLA School of Law’s Kimberly Clausing explain, the looming expiration of the 2017 Trump Tax cuts present an opportunity to put the country on a more fiscally sustainable and fairer path.
At minimum, policymakers should commit to paying for any tax cuts they extend. But given the seriousness of our fiscal problem, their aspirations — and ours — need to be loftier: Raise enough to make a meaningful dent on the deficit, while paying for needed policy changes such as a fully refundable child tax credit to lift millions of children out of poverty. To do this, policymakers will need to find better sources of revenue for the years ahead. This means higher tax payments for well-off individuals and businesses that have the greatest ability to pay yet today are avoiding (and too often, evading) their tax liabilities. Yet one silver lining of a tax system replete with preferences is that a lot of low-hanging fruit is available in the form of tax law changes that can raise revenue while also building a fairer and more efficient system.
House leans on Democrats to avert shutdown
Congress is one step closer to avoiding a government shutdown after the U.S. House on Tuesday advanced a bipartisan spending package that keeps the federal government operating until late January. House Speaker Mike Johnson reached across the aisle for Democratic support after hard-right Republicans opposed the proposal because it didn’t cut the budget enough. The Senate has signaled it will advance Johnson’s proposal before a Friday deadline. The AP’s Lisa Mascaro and Stephen Groves report:
Johnson’s proposal puts forward a unique — critics say bizarre — two-part process that temporarily funds some federal agencies to Jan. 19 and others to Feb. 2. It’s a continuing resolution, or CR, that comes without any of the deep cuts conservatives have demanded all year. It also fails to include President Joe Biden’s request for nearly $106 billion for Ukraine, Israel, border security and other supplemental funds.
While a shutdown has been avoided, a bruising budget battle looms next year because of a previous deal on the federal debt ceiling.
All that could change in the new year when 1% cuts across the board to all departments would be triggered if Congress failed to agree to new budget terms and pass the traditional appropriation bills to fund the government by springtime. The 1% automatic cuts, which would take hold in April, are despised by all sides — Republicans say they are not enough, Democrats say they are too steep and many lawmakers prefer to boost defense funds.
Four of Louisiana’s six House members supported the deal, with Republicans Clay Higgins and Garret Graves voting no.
Climate change puts pressure on Louisiana communities
Stronger storms fueled by climate change are making Louisiana’s coast a riskier place to live. But the prospect of increased droughts, another consequence of a warming planet, will also make saltwater intrusion of drinking water more common. The New York Times’ Jacey Fortin reports from Plaquemines Parish about the increased frequency of climate disasters and a population that feels forgotten.
In a parish that has been buffeted by calamity — Hurricanes Katrina, Ike, Isaac and Ida over the last two decades, and the Deepwater Horizon oil spill in 2010 — clean water is particularly dear.… In Plaquemines Parish, however, residents feel abandoned. Gaynel Baham, pastor of the Trinity Christian Community Church in Buras, helped distribute extra water to residents this summer, including from a big tank installed on the church grounds. She’s determined to stay, but knows that some of her neighbors are tired of the adversity. “People will leave because of this,” Ms. Baham said. “This was the straw that broke the camel’s back.”
Number of the Day
58 – Median age for a repeat home buyer – someone who has bought a home before – in 2023. The median age for a repeat buyer was 36 in 1981. (Source: National Association of Realtors via the Washington Post)