On Raising the Debt Limit

In 2005, Hurricanes Katrin and Rita devastated south Louisiana.  While a number of austerity measures were undertaken in a special session in November of 2005,  the predicted severe drop in state revenues was woefully mistaken.  Instead, the flurry of rebuilding activity throughout the storm-damaged areas resulted in more than $1 billion in un-appropriated revenues.

Interestingly enough, the state had adopted into the constitution a package of fiscal reforms in the early 1990′s which required the legislature to pass a balanced budget, based on realistic anticipated revenues.  It limited where the state could spend surplus dollars to highways, paying down debt, and a couple more.  It created a budget stabilization fund, which was designed to force the government to deal responsibly with volitile mineral revenues.  And, relative to the subject matter at hand, it created an expenditure limit.

This expendure limit was designed to limit the growth of state government to the growth of personal income.  Naturally, the legislature had set up a formula they thought would never actually come into play.  However, the flood of revenues flowing into the state coffers after the storms set up an interesting situation:  in order for the legislature to spend the extra money, a resolution allowing them to exceed the expenditure limit had to pass both chambers of the legislature with a 2/3 vote in each.

Governor Blanco called a special session in late 2006, referred to by many conservatives as the “Santa Claus” session.  She and her allies in the legislature wanted to spend every nickel of the money, and while a lot of it would have gone to good purposes, a lot of it would not. 

House Republicans, led by stalwart conservative Jim Tucker (whose leadership on this issue contributed to his subsequent election as Speaker of the House) were in the minority, but I think they had 37 out of 105 seats.  The Republicans were noticeably nervous about standing in the way of $1 billion in goodies for their contituents, but enough of them stood firm that, when joined by several conservative Democrats, the resolution to increase the expenditure limit failed on two votes in the House.  They fell 11 votes shy the first time, and 13 votes shy the next.   

Noone who voted against the resolution was defeated for re-election.  Congressional Republicans should take note.  If they are worried, they should spend a few minutes with Steve Scalise (R-LA-01).  He was there.

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