Dixieland Blues

Dixieland Blues

Southern governors’ resistance to the federal stimulus package has deep roots.


Governors across the country are clamoring for a piece of the stimulus, eager to avoid laying off state employees, hoping to put their unemployed citizens back to work and trying to avoid widespread furloughs as budgets bleed red ink. They know that their citizens want to keep libraries open, teachers in the classroom, cops on the beat and firefighters ready to protect people and property.

Except in the South. Southern governors–Bobby Jindal of Louisiana, Mark Sanford of South Carolina, Haley Barbour of Mississippi–have been pressing the case that the federal stimulus bill is a mistake; they argue the emerging Republican orthodoxy that tax cuts are the only effective way to pull the country out of an economic black hole.

With 11 percent unemployment, South Carolina trails only hard-hit Michigan. Nonetheless, Governor Sanford plans to reject funds that would extend unemployment insurance, not to mention federal fiscal stabilization monies slated for schools and public safety, unless he receives assurance that he may use it instead to pay down the state’s debt. As ProPublica reports, the state is about to lay off teachers in large numbers as a consequence.

Not to be outdone, Jindal–who, like Sanford, is being eyed as an early contender for the 2012 GOP nomination–has announced plans to reject the unemployment money and $9.5 million in Medicaid funds that would cover health insurance for the recently unemployed in his state.

With the exception of Florida’s Charlie Crist, who joined President Obama in pushing for the stimulus package, the Southern governors are campaigning against their poorest citizens on the grounds that when the federal money runs out, they will be forced to raise local taxes.

Of course, these pronouncements are mostly bluster. Jindal is willing to accept $3.7 billion of the $3.8 billion slated for his state, but he steadfastly refuses to take the $98 million on offer to extend unemployment insurance. He and others who share his views seem particularly eager to deny the least fortunate of their own states the help they desperately need as the job market melts down around their ankles.

This hardhearted pattern is not new. It is a replay of the Southern rejection of Roosevelt’s New Deal. During the bleak years of the Depression, politicians below the Mason-Dixon line refused to provide relief to the poor and rebelled against federal intrusion into social policy. When most state governments were hemorrhaging, local and state governments across the South actually ran surpluses. How? They fired government workers and slashed funds for education and healthcare.

New Orleans, Jindal’s pride and joy, ranked last among the nation’s thirty-one largest metropolitan areas in the amount spent on relief in 1932–and was proud of it. It was the only city that made no provision for family welfare and offered no aid for needy mothers. Historian Roger Biles has pointed out that at the same time, the city council gave $10,000 (an enormous sum then) to the Chamber of Commerce to advertise nationally that the Big Easy was the “home of cheap and docile labor.”

As FDR pressed the states to join the federal government in providing for the millions who were unemployed, many politicians across the South said they couldn’t–or wouldn’t–do more for the indigent. Instead, governors accepted funds from the Federal Emergency Relief Administration while cutting the relief rolls or slashing the benefits provided to their most vulnerable citizens. Southern representatives in Congress abetted the governors and were so good at it that by 1939 the region had received only one-sixth of the federal dollars spent in the major New Deal programs, even though they had a quarter of the population. Southerners in Congress also fought for state power to determine who gets benefits and at what level–resulting in tremendous regional variations in the adequacy of public assistance that continue today.

These ideologically driven crusades are not merely historical artifacts. They have left their traces in the economic profile of the Southern states, which contain some of the poorest and least developed regions of the country. We hear a lot about Atlanta and Nashville, but the small-town and rural areas of the Deep South bear more resemblance to a Third World country than we like to acknowledge. That is owing to decades (and even centuries) of allergic reactions to the taxation required to fund the human capital every state needs for quality public school systems, hospitals, colleges and universities.

Politicians who refuse to raise business or property taxes are adding to the thin quality of the region’s public sector and have burdened the poor even more because the only instruments left for raising revenue are the most regressive consumption taxes. In Alabama today, an essential fiscal building block for municipal and state government is a highly regressive food tax (in excess of 10 percent in some localities), which makes the most basic commodities more expensive for the people who can least afford them.

This is about more than basic equity: it hurts the South at the bottom line of workforce productivity and health, which fuels inequality. Southern states continue to post some of the nation’s lowest rates of high school graduation as well as the lowest life expectancy–children born in Mississippi and Louisiana can expect to die five years sooner than those born in Massachusetts.

These social facts leave the Southern states poorly equipped to attract high-skilled, high-wage industry, and that, in turn, limits the tax base to support a modern infrastructure. Hence, unlike other regions of the country, the states of the Deep South have a hard time raising funds–even when they want to, which is not often–to match federal investments in education or poverty alleviation. The comparative advantage the Southern states offer to industry is mainly a low-wage labor force. And while that has helped to keep unemployment lower than in many other regions, it also swells the ranks of the working poor.

The history of the Great Depression in the Deep South has led directly to the problems we see in these states today. Since they are home to more than 25 percent of the nation’s poor, and nearly 5 million of our poor children, what happens in Louisiana, Mississippi, Alabama and Texas matters to the rest of the country. FDR spoke of the “millstone” the region represented in his day and moved to create the Tennessee Valley Authority to bring electricity to rural hamlets so that they could join the twentieth century. The region, more than any other part of the country, needs that kind of farsighted investment, but instead it is treated to the shortsighted policies of the Southern politicians of the past.

Its people deserve better. Indeed, they deserve to be spared the jockeying of presidential contenders like Sarah Palin, who crows about rejecting more federal funds than any of her Southern rivals (45 percent of the funds that could come to Alaska will be turned back if the governor has her way). Playing politics at a time when millions are feeling the brunt of this recession is inexcusable–but it’s also nothing new.

Ad Policy