“Bad Tux in Exile”

In reaction to my post yesterday on Federalism and "Reconstruction,"  Bad Tux wrote this thoughtful response.  Since he IS a Pelican, I thought to post it here.  Pat Lang

"My fear, as a Louisianian, is that this refusal to become Federal vassals is going to be used as an excuse by the Bush Administration to withhold funding to rebuild the majority of New Orleans.

New Orleans, and Louisiana as a whole, are rather unique in that they are important to the entire nation (as the largest-by-volume port in the United States and largest refiner of crude) yet receive very little direct tax revenue from that fact. New Orleans is prohibited from taxing the goods flowing through its port (interstate commerce, y’know), just as Louisiana is prohibited from taxing the oil flowing in the pipelines to those refineries and the gasoline flowing out of the pipelines from those refineries. While they can raise some tax revenue from property taxes on the infrastructure itself (pipelines, refineries, etc.), Louisiana is in the unenviable position of being a key linchpin of the U.S. economy, yet not itself able to gain much advantage from that fact. Mechanization has made this worse. It now only takes a few thousand workers to run the entire Port of New Orleans thus they don’t even get much payroll advantage out of it. Similarly, today’s refineries are so computerized that you might have a dozen people total running a billion-dollar refinery. (Usually there’s more people than that out there — there’s always light bulbs to replace, instruments to calibrate, chemical nozzles to replace to keep the cooling towers Ph-balanced, etc. etc. — but definitely not a big payroll). And the companies themselves conveniently headquarter themselves in states that have no income tax, so Louisiana cannot even tax their income.

The answer is economic diversification. But Louisiana is a very conservative state, conservative in the old meaning of the word — they do not embrace change swiftly nor easily, one reason why New Orleans had such an old-world charm (they just never bothered changing). As late as the late 1980’s, Louisiana was trying to attract heavy industry (such as, e.g., the GM pickup truck plant in Shreveport) at the same time that the U.S. economy as a whole was discarding industrial jobs in favor of services and intellectual property based jobs. A state which embraces change only reluctantly was in a poor position to, e.g., respond to the computer and semiconductor revolutions of the 1980’s and 1990’s by attracting semiconductor and computer companies to Louisiana, and indeed did rather poorly at doing so (and what few were attracted ended up at the bottom of Lake George, since they came here for New Orleans).

The end result is that Louisiana simply does not have the resources to rebuild from this natural disaster, and is reliant upon the "charity" of those who are reliant upon its ports and oil and gas industry.

In the end, that is sort of what federalism is all about — i.e., that in exchange for getting the benefits of Louisiana, the other states agree to help Louisiana when it is in need — but the Busheviks dismiss any notion of a "social contract." As far as they’re concerned, Louisiana is just some place to be looted for their benefit.

My fear is that, if we go to New Orleans ten years from now, what we will find is a typical third world scene with people living in the ruins of their houses due to lack of funds to repair them while the only parts rebuilt are whatever is necessary to keep the port and refineries running. My fear is that Louisiana is, in effect, being abandoned by the United States. In which case it might as well go all the way and simply withdraw from the United States, and charge tariffs on all that oil and gas and cargo going through the state in order to pay for the necessary repairs to its infrastructure. Of course, they already tried that once, and it didn’t work out too well…

– Badtux the Louisianian in Exile"