Add another negative to the list for Louisiana.
While Gov. Piyush Jindal trots all over the country telling everyone who will listen about the state’s robust economy, the low unemployment rate and the incredibly favorable business climate, a national study has revealed that Louisiana has the third widest gap between rich and poor, roughly equivalent to some Third World countries.
The report, by 24/7 Wall Street, employs the widely accepted Gini coefficient which measures income inequality to arrive at its results. The Gini coefficient is a number between zero and one with zero representing perfect income equality and a place with a score of one would have only extremely wealthy and extremely poor people, with no middle class.
The state Gini coefficients range from .419 in Utah to .499 in New York, indicating that all 50 states have relatively high income inequality compared to the rest of the world.
The most alarming aspect of the latest results is the trend toward a widening gap, the report indicates. In 1967, the Gini coefficient for the U.S. was .397. Today, it is .469, evidence that America’s income divide has become greater.
The widening gap between rich and poor has been a growing issue between Republicans and Democrats on both the national and state levels.
Many of Jindal’s proposed programs, critics say, would do much toward widening that breach even further. The privatization of state agencies would result in layoffs of state employees and Jindal’s proposed retirement reforms would have sharply reduced state pensions. Cuts to higher education have resulted in further layoffs.
New York, with a Gini coefficient of .499, had the largest disparity between rich and poor despite having the sixth highest (7.4 percent) percentage of households earning $200,000 or more per year. At the same time, New York’s 14.1 percent of population living below the poverty line was 21st highest in the nation.
Louisiana, with a Gini coefficient of .475, was third behind Connecticut’s .486.
Even though the state’s unemployment rate was lower than the national average and the lowest on the list, Louisianans are limited in other areas that limit upward mobility, the report says. Only 82.5 percent of Louisiana residents older than 25 had a high school diploma and only 21.8 percent had a college degree.
And while the unemployment rate is comparatively low, 15.3 percent of the state’s residents received food stamps and the Louisiana median income is 10th lowest in the nation. The 17.7 percent of the state’s population living below the poverty line was fifth lowest in the U.S., the report shows.
Louisiana’s Gini coefficient of .475 is comparable to those of Ecuador (.469), Madagascar (.475), Nepal (.472) and Rwanda (.468), according to a worldwide ranking of Gini coefficients by the CIA.
Any comparison of Louisiana to those countries in misleading, however, because the Gini coefficient takes into account only the disparity between rich and poor and not median or household income.
Other states named as having income large gaps between rich and poor in the report, in order, include:
• Massachusetts (.475);
• Florida (.474);
• Alabama (.472);
• California (.471);
• Texas (.469);
• Georgia (.468);
• Mississippi (.468)
Louisiana Voice 
As much as I agree with you on many of your criticisms about Jindal, I don’t think we can blame him for the income disparity in this state, which has a multifactorial etiology. One cannot attribute this regrettable situation to Jindal’s political philosophy any more convincingly than a conservative can to the prevailing ilk of Democrats that support maintaining failed welfare programs that reinforce a stagnant underclass. My hope is that you will stick to diligent investigative journalism, your forte, though you are certainly entitled to publish anything you want on your blog. It is yours, after all. But this particular entry, in my humble opinion, borders on yellow journalism. You are much too intelligent and talented, as evidenced by the vast majority of your postings, to slough to the level of banal class warfare tactics employed by mainstream media types.
I guess this really hit me differently than it did you. I didn’t really see the substance of the post as blaming the governor for the gap in income levels. What struck me was the misrepresentation of the health of our economy as he “trots” around the country building on his resume as Chief Reform Savior. There is a disconnect with reality if you compare the testimony on HB1 and the retirement legislation with the political rhetoric offered elsewhere. The robust economy/favorable business climate speech would have been interesting as the legislators wrestled with budget cuts.
It has a lot to do with Jindal when it comes to state employees. Some have not had raises for over three years. Couple that with the low wages paid state employees, he is right on target.
I agree with you there, Midnight 2. I simply felt Headshrinker’s “yellow journalism” comment about Tom was harsh and missing the point of what was said.
Jindal is not personally to blame, but the shift from “welfare to the poor” to “welfare for companies” very much is, and it is a shift that is national, not local. Jindal’s economic policies simply reflect this national trend. Pointing out a fact, “Headshrinker,” is not engaging in class warfare. In point of fact, this increasing gap will result in long-term weakening of the US economy.
Unfortunately, state government has historically been the largest single “white collar” employer in this state. (This is lamentable, but this is a state that has failed historically to invest in its infrastructure and its human resources and thus we are state with a large population dependent upon state services.)
Jindal’s economic strategy has continued to focus on bringing low-wage, blue-collar jobs to this state (chicken plants, call centers, retail hubs) instead of investing that tax money in education and infrastructure–such a long-term investment being more likely to attract more businesses needing better educated workforce. Such actions such as killing the federal money to bring broad-band to rural areas demonstrates Jindal’s short-sightedness, as does his rejection of high-rail connectors between Lafayette, BR, and NO. He has gone for the short-term public relations coups instead of the long-term investments needed for the long-term improvement of this state.
He had enough public support, but chose instead to focus on “privatizing” government services. He hasn’t altered the shape of the Louisiana economy; he has simply shifted the recipients of the taxpayers’ money. Instead of going directly to “government workers”–and thus directly shoring up a middle class–it’s now going to private companies, who will siphon the bulk of the taxpayer contract money to profits and shareholders, and reduce the direct benefit to salaries (and ergo, increasing the income gap).
And looking at employment numbers alone is pointless unless you also examine the quality of the jobs as well as the number of people who are permanently out of the workforce and thus not counted (disabled, “unemployables,” retirees, etc.).
I’d have to disagree with you headshrinker. I took the article to only point out the failed policies of Jindal that will only place the state in higher ranks of the worst categories. I’m not political or economic guru by any chance (far from it) however, I can’t understand the rationale to give more money to those that have money will somehow “help” the state (we the people). Another thing that disturbs me is that it seems as if when we speak of State, Nation, Washington, etc. we are talking about brick & mortar and not people.
It’s the “Us & Them” mentality that continues to thwarp the southern states.
The “theory” is that if you funnel cash to the investor class, they’ll invest in companies and create jobs. The tax cuts for the rich are supposed to create incentives to hire more people as these people funnel cash into companies. However, these tax cuts have been in place for 10 years now and new jobs are NOT being added–at least not at a decent pace. How much time are taxpayers supposed to wait for all our largesse to the well-to-do to “trickle down” into actual jobs? Now politicians are clamoring to extend or make permanent the tax cuts.
Again, how long before the existing tax cuts help? At the moment, companies are sitting on cash, not investing. Locally, we see companies come in, take advantage of economic incentives funded by taxpayers, and then pull out when it comes time to pay up (e.g., the call center out at Bon Marche). If I were more conspiracy minded, I’d say companies are waiting until November to make decisions, intentionally attempting to influence the election by maintaining a damper on the economy. Add to that people like me who are sitting on my money because of uncertainty about my pension, my job, my future remuneration, and you get a very demoralized and weak state and local economy.
I think you are right about a conspiracy to influence the elections. If they have their way in November, money will flow again and they will take credit for saving the economy.
http://m.aol.com/dailyfinance/default/articleStory.do?category=main&url=http://www.dailyfinance.com/2012/06/05/hidden-401k-fees-retirement-plan-ripoff/&icid=dsk_df_news says what we have known all along, namely that your getting robbed if you use a 401k. Which all new state employees have to use…. and can’t contribute to SS. Gee thanks Jindal.
Touche to all of the above posters. These are all thoughtful comments. I humbly apologize to you and our host, Tom, for what was probably a knee jerk reaction on my part. Regrettably, I honed in on only one aspect of the article, and lost the gestalt as a result. Thank you for enlightening me as well as confronting my myopic shortcomings.
No apology necessary. I welcome, indeed, encourage feedback from my readers. It is the healthy exchange of ideas that leads to enlightenment and understanding. Regrettably, our governor does not seem to share that ideology.