Louisiana rebuilding plan unveiled: slash programs, boost corporate give-aways

In Baton Rouge today, Governor Blanco and the Louisiana legislature launched the first day of a marathon 17-day special session devoted to post-hurricane rebuilding.

And if day one is any indication, the vision of reconstruction that will be pushed by state leaders -- trapped by an empty treasury and lack of federal support -- is one that will please few other than corporate interests.

Blanco opened the session with a sober reminder of the situation:

  • The state faces a $1 billion budget shortfall
  • Lack of jobs and business activity mean revenues will be miniscule
  • Of $41 billion in post-hurricane relief and rebuilding costs, the Bush Administration has told state leaders they are responsible for $3.7 billion

Given this dire reality and the absence of federal leadership, Blanco said her only option was to demand cuts -- and deep ones:

Blanco cut $431 million out of the budget Saturday, slicing from state agencies almost across the board, including a $222 million hit to health care services and a $71 million cut in spending on public colleges [...] "Some of you will consider these cuts too painful and you will try to avoid them. Let me warn you: this is just the beginning," Blanco said.

While needed services -- especially for displaced families -- are being shredded, the state is simultaneously lining up a slew of hand-outs to businesses so generous that one conservative fondly noted "it appears Louisiana Business and Industry might have written her speech." Among the give-aways:

Several tax breaks "directed at getting businesses back into the storm affected areas."

"Eliminate the sales tax on manufacturing machinery in the storm-damaged areas."

"Eliminate the corporate franchise tax on new debt incurred by businesses in the storm zone."

"Providing 20 million dollars of relief to our businesses and industries by reducing the state sales tax on electricity and natural gas."

This generosity for business coupled with stinginess for social programs caused Rep. Cedric Richmond, D-New Orleans, chairman of the Legislative Black Caucus to warn the caucus "will not allow this administration to balance the state's budget on the backs of poor people."

While Blanco is establishing her reputation as a "kinder gentler conservative pro-business bulldog," the community action group ACORN is hosting a two-day "Community Forum for Rebuilding New Orleans," also in Baton Rouge. If you can't go yourself, visit the webcast from 6 pm to 9 pm central time (so that evacuees from around the country as well as progressive allies can be involved).