Louisiana Governor Bobby Jindal appeared on NBC's "Meet the Press" Sunday. He explained his decision to turn down $100 million in federal stimulus money for his state.
DAVID GREGORY: You have a budget shortfall in Louisiana of $2 billion. Now, under the stimulus plan by the Obama administration, you would get a cut of that. You'd get $4 billion in federal stimulus. But this is what you said on Monday about the stimulus plan: "We're going to have to review each program, each new dollar to make sure that we understand what are the conditions, what are the strings and see whether it's beneficial for Louisiana to use those dollars." And just Friday you made good on that pledge not necessarily to take the federal money, saying that you would reject almost $100 million in federal unemployment assistance. Why would you turn this money down?
GOV. JINDAL: Well, let's be clear. The best thing that Washington could do to help Louisiana and all of our states with our budgets is to get this economy moving again. I think we just have a fundamental disagreement here. I don't think the best way to do that is for the government to tax and borrow more money. I think the best thing they could've done, for example, was to cut taxes on things like capital gains, the lower tax brackets, to get the private sector spending again. I think they had a provision the net operating losses to help small businesses. Unfortunately, they slimmed that down. They could've done some things on a real energy policy. If all they do is borrow federal money and give it to the states, all we're really doing is delaying the inevitable. We're eventually going to have to make these hard choices anyway. In Louisiana we made midyear reductions, $241 million. We're going to have to do more with less. What would be more helpful from Washington is less unnecessary spending. How does $300 million for federal cars, $50 million for the National Endowment for the Arts, how is spending like that going to help our economy? How's that stimulus?
MR. GREGORY: All right, but let's focus on--because I want to get to some of those larger issues in just a moment. But let's focus on this. Why would you turn down $100 million for federal unemployment assistance for your state?
GOV. JINDAL: Well, let's look at the programs we turned down.
MR. GREGORY: Yeah.
GOV. JINDAL: You're talking about temporary federal money that would require a permanent change in state law.
MR. GREGORY: But it is--it's a tax break.
GOV. JINDAL: Well, it, it's--no. The $100 million we turned down was temporary federal dollars that would require us to change our unemployment laws. That would've actually raised taxes on Louisiana businesses. We as a state would've been responsible for paying for those benefits after the federal money disappeared.
MR. GREGORY: All right, but the Democratic senator from Louisiana, Mary Landrieu, says you're wrong. This is how it was reported in The Times-Picayune Saturday: "Senator Landrieu disputed the governor's interpretation and said the new unemployment benefits are designed to be temporary. `The bill is an emergency measure designed to provide extra help during these extraordinarily tough times,' Landrieu said. `To characterize this provision as a "tax increase on Louisiana businesses" is inaccurate.'" Her point being, you could insert a sunset clause when this has to go away, but it would certainly be beneficial at a time when you're in economic stress.
GOV. JINDAL: That's great, except the federal law, if you actually read the bill--and I know it was 1,000 pages, and I know they got it, you know, at midnight, or hours before they voted on it--if you actually read the bill, there's one problem with that. The word permanent is in the bill. It requires the state to make a permanent change in our law. Law B--our employer group agrees with me. They say, "Yes, this will result an increase in taxes on our businesses, this will result in a permanent obligation on the state of Louisiana." It would be like spending $1 to get a dime. Why would we take temporary federal dollars if we're going to end up having a permanent program?
And here's the problem. So many of these things that are called temporary programs end up being permanent government programs. But this one's crystal clear, black and white letter law. The federal stimulus bill says it has to be a permanent change in state law if you take this state money. And so within three years the federal money's gone, we've got now a permanent change in our laws, we have to pay for it, our businesses pay for it. I don't think it makes sense to be raising taxes on Louisiana businesses during these economically challenging times. And what it shows is what we're going to do in the stimulus is we're going to look at every program, every dollar. If it makes sense for Louisiana, makes sense for our taxpayers, we'll use those programs and dollars. If it doesn't, like on Friday we said, "This doesn't make sense for us. This is not a good deal for us." It makes--my job is to represent Louisiana's taxpayers. Makes no sense for us to take temporary federal dollars and create permanent state obligations.
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