Economic, State Budget Concerns Weigh on Minds of Louisianians
LSU's Public Policy Research Lab Announces Results of 2009 Louisiana Survey
Louisiana may have avoided the full brunt of a national economic recession so far but economic concerns are clearly on the rise, according to the 2009 Louisiana Survey, released today in a presentation to the Rotary Club of Baton Rouge by Kirby Goidel, director of LSU’s Public Policy Research Lab.
Since 2008, the percentage of Louisianians saying state business conditions have gotten worse has increased by 26 points to 52 percent, while the percentage saying national business conditions have gotten worse increased by 40 points to 81 percent.
Other signs of economic concern are evident. Since 2008, the percent of Louisiana residents identifying the economy as one of their top concerns increased by 12 points to 57 percent. And two-thirds of Louisiana residents believe the worst of the economic downturn is yet to come.
Goidel likened the current mood to an approaching storm.
"Even if Louisiana has not felt the full effect of the economic downturn," he said, "residents see the storm on the horizon and are worried about how it will affect the future of the state and the nation."
The most immediate effect of the economic downturn locally is on the state budget currently projected to have an approximate $1.3 billion shortfall for the next fiscal year. When it comes to addressing the shortfall, a plurality of citizens – 48 percent compared to six percent – prefer spending cuts over tax increases. Forty percent prefer some combination of tax increases and spending cuts, and five percent were unsure on how to fix the shortfall.Goidel cautions that an answer to a single survey question can be misleading.
When asked if they preferred major cuts, minor cuts or no spending cuts across a variety of spending areas, residents generally opted for minor cuts. Residents were most willing to make major cuts in economic development incentives and environmental regulation, though even here only a small number of Louisianians – 22 percent – were willing to make major cuts.
Citizens were even more reluctant to make major cuts in primary and secondary education, health care and higher education. Only five percent of respondents supported making major cuts to primary and secondary education; six percent to health care for the poor, elderly and disabled; and ten percent to higher education
Because of constitutional and statutory dedications, budget cuts during economic downturns fall disproportionately on higher education and health care. According to the survey results, Louisiana residents are open to changing the state constitution so that budget cuts are not focused on these two areas of spending. Seventy-two percent of respondents said they support changing the constitution so that budget cuts do not fall primarily on higher education and health care, while 21 percent opposed such a change and seven percent said they did not know or were unsure.
When it comes to taxes, Louisiana residents are opposed to tax increases in general, but support specific taxes depending on who is being taxed and why.
The survey reveals overwhelming support for so-called "sin taxes" on gaming, tobacco, and alcohol. Eighty-four percent of respondents support a tax increase on gaming, 78 percent on beer, wine and other alcoholic beverages, and 75 percent on tobacco. A majority of respondents – 58 percent – support increasing taxes on higher income households, which were defined in the survey as individuals earning more than $100,000 or households earning more than $150,000. Support for income tax increases on higher income households declines precipitously as income increases.
Louisiana residents also express uncertainty about the repeal of income tax increases under the Stelly Plan. Adopted in 2002, the Stelly Plan swapped state sales taxes on food and utilities for tax increases on higher income households. The income tax increase was repealed in the most recent legislative session. When asked whether the repeal of the Stelly Plan was a good idea because it reduced income taxes or a bad idea because it reduced state tax revenues, a plurality of respondents – 42 percent – said they were not sure. The remainder split almost evenly between those saying the repeal of the Stelly Plan was a good idea because it reduced taxes and those who said it was bad idea because it reduced state revenues, with 26 percent supporting the plan and 32 percent saying it was a bad idea.
Louisiana residents express less support for increasing sales taxes by one or two cents, increasing taxes on oil and gas or reducing or eliminating the homestead exemption. The more widespread the tax, the less popular support it generates.
More generally, the percent of Louisianians saying that state income taxes are too high and need to be reduced, decreased by 13 points from 45 percent to 32 percent, while the percentage of Louisianians saying state sales taxes were too high decreased by nine points from 52 percent to 43 percent. There was a slight increase – 3 points – in the percentage of Louisianians saying property taxes are too high. Looking at the long-term trend, the percent of Louisianians saying property taxes are too high has increased from 35 percent in 2006 to 48 percent in 2009.
Given the difficult economic climate facing state colleges and universities, the 2009 Louisiana Survey included a number of questions about higher education.
"Higher education finds itself in a curious position with respect to public opinion," said Goidel.
Louisianians do not support major cuts to colleges and universities. They consistently give state colleges and universities the highest grades of state government service and recognize the value of a college education to individual success and economic development.
Despite this strong support for colleges and universities, a majority of Louisianians – 53 percent – agree that state colleges and universities can absorb significant cuts without affecting the quality of academic programs. Even so, they are largely unwilling to allow state colleges and universities to consolidate programs by closing branch campuses or raising tuition and fees to offset spending cuts. Forty percent of respondents agree that state colleges and universities should be able to offset budget cuts with increases in tuition and fees, while 26 percent agree that to reduce costs the state should consolidate programs by closing some branch campuses.
Louisianians are generally supportive of changing the funding formula for higher education to reward performance rather than enrollments. Sixty-five percent of respondents supported changing the funding formula for higher education, with 29 percent opposed and six percent unsure.
Another topic covered by the survey was the teaching of evolution versus creationism in schools. Approximately 57 percent of respondents favor teaching creationism, with 31 percent opposing it. Generally, there is a lack of understanding of the scientific support for evolution. Forty-percent of respondents said that evolution is not well supported by evidence or generally accepted within the scientific community. Thirty-nine percent said that evolution is well supported by evidence and 21 percent said they did not know.
A positive note from the 2009 Louisiana Survey was that the public perceives less corruption in the state than in 2008. Since 2008, the percent of Louisianians saying the state is less corrupt has increased by 10 points – from 23 percent in 2008 to 33 percent in 2009. Looking at the long-term trends, perceptions of corruption are now approximately the same as they were prior to Hurricane Katrina.
The survey, sponsored by the LSU Manship School of Mass Communication’s Reilly Center for Media & Public Affairs, was conducted by the school’s Public Policy Research Lab. The 2009 Louisiana Survey includes a traditional landline telephone survey using random digit dialing combined with a survey of randomly selected Louisiana cell phone users. Telephone interviews were conducted between Feb. 9 and March 10, 2009. The data has been carefully weighted to account for dual users, respondents with both a cell and landline telephone and to approximate state demographics as reflected in the 2007 American Community Survey and telephone usage patterns as estimated by the National Health Interview Survey. The combined survey includes 993 respondents including 567 respondents selected from the traditional landline telephone survey and 426 respondents selected from available blocks of cell phone numbers. The combined survey has a margin of error of +/- 3.1 percentage points at a 95 percent confidence interval, and the landline survey has a margin of error of +/- 4.1 percentage points.
To view the complete survey, visit www.survey.lsu.edu. For more information on the questions and responses, contact Kirby Goidel at 225-578-7588 or email@example.com.
Billy Gomila | Editor | Office of Communications & University Relations