VIEWPOINT
RANDOM THOUGHTS
The Louisiana curse of abundance
JR BALL WHO’S TO BLAME for Louisiana being in the state it’s in? In an age when finger-pointing is all the rage, who can we tear into for our state trolling the bottom in all the good listicles while pushing for No. 1 in the bad ones? Who can we annihilate for our substandard public education system? Our disdain for higher education? Our tragically high poverty rate? Our morbidly poor health? Who can we stare down with the rage of a thousand suns over this state’s putrid economic rankings? Our dismal business environment? Our bottom-10 business tax climate. Our sluggish employment. Our laggard economic growth? If transferral of blame is America’s favorite pastime, as former LSU baseball legend Skip Bertman once told me, then who among our confederacy of dunces can we shame for this comedy of errors? Seriously, why is a state so rich in natural resources so pathetic in pretty much everything else? Too harsh? The numbers don’t lie. According to U.S. News &
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World Report’s 2021 Best States Rankings, determined by weighted evaluations of 71 metrics across eight categories, Louisiana is dead last among the 50 states. No longer can we say, “At least we’re better than Mississippi.” Among the ranking’s eight main categories, our state ranks 46th or worse in seven: health care (46), education (48), economy (47), infrastructure (47), opportunity/equality (48), crime and corrections (50), and natural environment (49). Louisiana’s shining light is fiscal stability, which checks in at No. 42. Now, back to who can we eviscerate. Remember Huey Long, the populist governor, who launched his political career by waging war on the big oil companies? The boisterous, every-man-a-king, quasi-socialist declared in 1929 that he’d rather suffer “a thousand impeachments” than “not dare to call the Standard Oil Company [now ExxonMobil] to account.” Perhaps, but just five years later, while he was a senator, Long and his political cronies, had the chutzpah to form a company that bought up state mineral leases and resold them to oil companies at an eye-popping profit—keeping a tidy sum for themselves. Long died a year later in 1935, but the royalty money rolled to family and friends for decades. The wealth Long and his associates made for themselves came at a steep price for the rest of Louisiana. Not only were most of those sold leases in wetlands—requiring the building of
a sprawling network of roads and canals through the bayous—but the deals also sparked others to get into the game. After the wells and rigs came the refineries and plants, and then came the port facilities. It was a price we’ve been willing to pay. Louisiana tethered its economy to oil and gas and hasn’t looked back. All that may have been fine, but this deal with the devil cast the state under what’s known as “the resource curse”: the paradox that countries rich in a natural resource tend to grow more slowly and have lower living standards than other nations. Bottom line, Louisiana is America’s petro-state. No doubt, a lot of people made serious money off oil and gas, but the state didn’t prosper. Instead, our fossil fuel alliance fostered dependency, corruption, indifference to the environmental cost and ambivalence about such things as education. And it only got worse in the 1970s when the corporate offices for these oil and gas companies began a mass exodus for Texas, taking with them the huge profits sucked from the Louisiana ground. Oil and gas didn’t create Louisiana’s problems, but our willingness to trade—straight up—an agricultural plantation culture for an oil and gas culture has made it impossible for us to adapt to an evolving economy. As bad, when the money was rolling into state and local government coffers, none of it was saved for investments or rainy days. Instead, we cut taxes.
Efforts to diversify the Louisiana economy have been ineffective. GMFS was to be our Research Triangle, but politics killed it. The Silicon Bayou effort has been a failure and we continue to largely ignore medical research opportunities. Meanwhile, places like northern Virginia built tech corridors, attracting more than a dozen Fortune 500 companies and a massive Amazon corporate complex. Here, in Baton Rouge, Albemarle skipped town as soon as the subsidies ran dry, and our Amazon score is an on-the-way regional distribution center. This isn’t to suggest the oil and gas industry should go away, but it’s long past due for the state to cut the umbilical cord. Today’s economy is driven by innovation, technology and research. Education and quality of life, not what’s in the ground, determines the winners. Our leaders need to focus on the titanic shift that’s urgently necessary, rather than making it easier to own a gun, harder to vote or demanding that we teach our children the “good stuff” about slavery—as well as “the bad and the ugly.” Louisiana is the national equivalent of those panhandlers at the College Drive interstate exit, yet we’re scrambling to stop a hypothetical transgendered child from joining the girl’s track team? If we don’t end this curse, then Louisiana will forever remain the banana republic that it’s been ever since that infamous day in 1901 when a farmer near Jennings discovered oil in his rice field.
BUSINESS REPORT, May 2021 | BusinessReport.com
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4/29/21 4:59 PM
