Louisiana's `good-times' politics vs. its hard-times economy

Finishing her break, the restaurant hostess in a New Orleans hotel assessed the reelection prospects of Louisiana's Gov. Edwin Edwards. ``I don't know anyone who'll admit to voting for him, but I won't be surprised if he wins. The middle class doesn't vote, and the poor aren't ready to give up their perks. People are afraid of losing what they've got from the system.''

The Democratic governor's bid for an unprecedented fourth term in a field of at least four other serious contenders is framing a growing debate. On one side is Louisiana's time-honored system of populist business bashing and political chicanery. On the other side is a still developing philosopy of reform, supporting government accountability, a tax-system overhaul, and an improved climate for business.

Although dissatisfaction with the flamboyant Mr. Edwards and the system he stands for appears to run high, the fact that no one is ready to count him out of the running for the Oct. 24 election points up the tenacity of the state's old ways. That no alternative candidate has yet captured a grumbling electorate's imagination indicates the public's ambivalence toward real reform.

Many political analysts here agree that a souring of the state's economy is the major catalyst behind this debate. But there is also a feeling that voters may still be unwilling to discard a system that includes major benefits for every income group, at the expense of business.

For decades, the Louisiana political system has been characterized, for politicians and voters alike, by the old French expression, ``Laissez les bons temps rouler'' - let the good times roll.

Mr. Edwards, Cajun on his mother's side, has embodied that tradition, building a reputation for high-stakes gambling, high living, charisma - and graft. That reputation has survived, even though he has toned down his style and was acquitted last year of federal racketeering and fraud charges.

The problem is, Louisiana's good times stopped rolling a few years ago. The system of high public employment, extensive state health and welfare services, very low taxation of individuals - and a wink at public officials found to have their fingers either in the public pie or deep in favor-seekers' pockets - depended on ever-mounting tax dollars primarily from one source, the oil and gas industry.

With the decline in oil prices, however, Louisiana has been left with empty coffers, double-digit unemployment - the highest of any state - and a public increasingly dissatisfied with the state's sluggish economy.

Edwards's response to the downturn in oil revenue has been proposals for casino gambling in New Orleans and a state lottery. Having had little sway on the issue with the state Legislature, however, he has turned to the voters as he campaigns toward October's open gubernatorial primary.

Yet others say what the state really needs is an overhaul of policies that make Louisiana unattractive to business.

``The governor is branding himself as an old-time politician way out of touch with what Louisiana really wants,'' says Democratic state Rep. Kevin Reilly, who believes the public supports major changes in taxation, the costs business pays to operate in the state, and the way state government operates.

``There's growing public interest'' in state spending and economic development, Mr. Reilly says, ``and it makes sense. When someone else is paying your bills to the tune of 45 percent - which is where all income from oil and gas was as recently as 1982 - you tend not to be too concerned about how the money is spent.''

Oil's share of state revenues is now down to 22 percent. But business nevertheless pays a large share of state taxes, as a homestead exemption leaves most homeowners paying little or no property taxes. Other business costs, such as for workers' compensation and unemployment benefits, average several hundred dollars per worker more in Louisiana than the national average.

``The bottom line is that it costs more to do business in Louisiana than in neighboring states,'' says Ed Steimel, president of the Louisiana Association of Business and Industry.

The oil slump has forced the state to cut spending by hundreds of millions of dollars, but studies have shown Louisiana - with an annual budget of $7 billion for a population of 4 million - still spending above state averages.

``Yet we do not receive the level of quality we should for that amount of money,'' says Eamon Kelly, president of Tulane University in New Orleans. Dr. Kelly, who served as chairman of the governor's Economic Development Commission until last fall, says the public is ready for major changes in Louisiana's ``anachronistic'' tax and services-delivery systems. ``The problem,'' he adds, ``is that the politicians are about a dozen miles behind the public in realizing this.''

Kelly resigned as the commission's chairman, telling Edwards there was no longer a question of what was wrong with Louisiana's economy, but whether political leaders had the will to implement the needed changes.

State polls show Edwards receiving very negative ratings from voters, yet most political observers say he would make it to a runoff if voting were held today. They add that, despite a consensus that change is needed, it will not come soon.

John Maginnis, a political writer who publishes a monthly newspaper here in the capital, says change will be slow because the middle class, normally a necessary part of any reform movement, has been ``bought off'' by the state's homestead exemption on property taxes.

In a state accustomed to a strong governor setting the agenda, Mr. Maginnis says it will take a clean, popular governor ``who doesn't stray far from the populist line'' to bring about fiscal changes.

Wayne Parent, a political science professor at Louisiana State University, says the public wants a reform-minded leader to rally around but has not found that individual. ``The sentiment is there for change, but no one knows where to turn,'' he says. ``Right now the public officials seem unable to harness that motivation.''