On the campaign trail in 2010, Republicans who wanted to take over the North Carolina General Assembly promised to help create jobs by pursuing policies friendlier to business. They won, and they’ve had a year to follow through on those promises. John Rustin, executive director of the N.C. Free Enterprise Foundation, recently rated the General Assembly on business-friendly measures. Rustin discussed the NCFEF ratings with Mitch Kokai for Carolina Journal Radio. (Click here to find a station near you or to learn about the weekly CJ Radio podcast.)
Kokai: First of all, let’s remind folks — the North Carolina Free Enterprise Foundation — who are you?
Rustin: Well, we are a statewide nonpartisan — and I stress nonpartisan — nonprofit organization that conducts extensive research and analysis of the state’s political arena, primarily for the business community, but also for the public at large. And with the focus and concern over the state of our economy, job creation, and those types of things, not only on the minds of our legislative leaders but also citizens across the state, we believe this is a really important venture that we’re doing, and we’re working to spread the word about how lawmakers have responded to the concerns and interest of the business community during this most recent legislative session.
Kokai: Now your organization has been looking at whether the General Assembly is business-friendly for years, but we’ve had major changes in 2011 with the new General Assembly. So how did that affect what you found in your ratings?
Rustin: Well, it affected things quite substantially, and primarily in the context of what legislation actually passed — the new laws that will be in effect and a lot of the policy changes that were made by the General Assembly. What we saw, particularly in comparing [the 2011] legislature to prior years’ legislatures, and especially the one that just immediately preceded it, was a leadership in both chambers that came into the legislative session with a real focus on considering and passing business-friendly legislation, and really responding to the concerns of the citizenry and business leaders across the state, to enact new laws that would help to create a more business-friendly climate in North Carolina. And from what we have seen, that certainly seems to be the case with what they did.
Kokai: When we’re talking about business-friendly legislation, what are the types of things that encompasses?
Rustin: Well, if you look at the policy issues, first of all, things like tort reform, medical liability reforms, environmental reforms, regulatory reforms — removing and limiting in a thoughtful way, in a meaningful way, restrictions that hamper the ability of businesses to be productive, to be profitable, to create jobs, and those types of things. And so we saw a number of major initiatives, particularly in the arena of tort reform, environmental regulatory reform, and those types of things that were passed by the General Assembly. And then, secondly, just generally, the attitudes and actions of lawmakers toward the concerns and interests of the business community — are they responsive to those things. Will they, at the very least, listen? And then, will they respond favorably to create a more business-friendly climate in North Carolina.
Kokai: Now you mentioned that there was quite a contrast between this General Assembly — the one that has been in effect for 2011 — and the General Assembly that immediately preceded it. In what ways do we see major differences?
Rustin: Well, when we produced the business ratings, we survey after the long legislative session has ended. We survey the business community, business leaders across the state, and ask them to identify for us the key votes on business legislation that were most important during the session. And as we get that information back, we have a committee that really gives a lot of attention to those bills and works to identify a group of bills, and specifically a group of votes, that are representative of the overall business interests. And we also ask business leaders, government affairs professionals, and folks that know these lawmakers well enough to have an informed opinion about their actions and attitudes, how they believe that these lawmakers responded to, again, the concerns and interests of the business community. And we compile all that feedback into the business ratings.
And when you look at the ratings from this most recent legislative session compared to the 2009 legislative session, you see a pretty stark difference. Not necessarily in, say, the average business rating of members of the legislature overall, but particularly when you look at the leadership, and the perspective of the leadership toward business legislation, and the perspectives of the business community toward those legislative leaders — how responsive are they to the interests and concerns of the business community — you see a very significant difference.
For example, in 2009, the average rating of the leadership of the Senate — the president pro tem of the Senate, the chairs of the major committees through which most of the business legislation passes — you would see an average business rating around 56 on a 100-point scale. So kind of in the middle of the range — not terribly business friendly. This year, however, based on the business ratings that we conducted, the average rating of the Senate leadership was an 87.4 — so quite a stark difference there.
When you look at the House, the difference is even greater. In 2009, the legislative leadership in the House had an average rating of 44.6, which is very low on the scale. We would consider that to be in what we call our “occasional” category, or legislators who occasionally support free-enterprise principles and the interest and concerns of the business community. However, this legislative session, the average rating of the leadership was an 87.5 — so almost double on a 100-point scale what the prior leadership’s business perspective was.
And so I think that’s indicative of the type of legislation that we saw not only considered this year — and a lot of the bills that were considered this year were not even considered, brought up for discussion during prior sessions — but we not only saw those brought up for consideration, but they passed committees and passed the floor of both the House and the Senate. And so, again, a very different result when you look at the types of legislation that this General Assembly considered and passed.
Kokai: Some people will hear this and say, “That sounds great for business, but why is this good for the state?” Why would you say that a more business-friendly General Assembly is good for all of North Carolina?
Rustin: Well, that’s a great question. Business is the engine that drives North Carolina’s economy, that provides jobs for our citizens, and it is critically important, especially at this time, with the economy continuing on in a challenging situation, and our unemployment rate high — especially when you compare it to the national unemployment rates and so forth — and so it was really a top priority of our legislative leaders when they came in this session, and most of the members of the General Assembly, that they take some significant action that would help to improve our economic circumstances, that would help to encourage job creation and job growth in North Carolina.
And so, it’s yet to be seen actually what is going to result from this, but we certainly believe that with the types of legislation that was approved by the General Assembly, that it is highly likely to create a more business-friendly climate in North Carolina, and really help to encourage job creation here.