If North Carolina were a separate country, its economy would be one of the weakest in the developed world based on average employment rates, and its tax climate for economic growth would be nothing short of “horrendous.”
“In a 21st-century economy based on worldwide markets, North Carolina isn’t just competing with other states,” Hood said. “We are competing with other nations. Our political leaders have long recognized this fact. They have talked about making North Carolina a hot spot for investors, executives, and entrepreneurs from other lands. Our current economy falls short of that mark.”
Over the course of nearly 200 pages, Hood documents North Carolina’s current economic woes, then spells out an investment plan to help the state change course. That plan features a 10-point “Carolina Manifesto for Growth.”
“In this book, you will not read a thoroughgoing indictment of all government,” Hood explains. “Government performs indispensable tasks that make economic success possible. But many government programs don’t function as intended. Our Best Foot Forward presents a plan for promoting effective investment in the state’s economy and thus making the state more competitive.”
Hood’s Carolina Manifesto draws its name from the 75-year-old Conservative Manifesto. Democratic U.S. Sen. Josiah Bailey of North Carolina played a key role in drafting that document to fight federal government overreach during the New Deal era. Like Bailey and his conservative colleagues, Hood spells out his manifesto in 10 points.
“First, rewrite North Carolina’s tax code to make it simpler, fairer, and more efficient, while reducing the bias against savings and investment,” Hood said. “Second, enact a Taxpayer Bill of Rights at both the state and local levels of government to cap annual spending growth. Require supermajority votes or public referenda to increase tax rates. Set aside larger rainy-day reserves.”
Hood also addresses key drivers of government spending increases, including growing debt and rising Medicaid bills. “We need to repair North Carolina’s public balance sheet by speeding up the payment of existing debt and building assets to cover future liabilities,” he said. “Reform Medicaid and other public-assistance programs to free up resources for both private and public investment in North Carolina.”
North Carolina needs a reduced regulatory burden, Hood said. “Cut red tape for small businesses, repeal all rules that fail to meet a cost-benefit test, and rewrite state laws that impose costly regulations on entrepreneurs.”
State leaders should change course on their energy policy, Hood added. “Improve the state’s business climate by abolishing all mandates to purchase high-cost energy and allowing offshore and onshore development of North Carolina’s energy reserves.”
Two planks of Hood’s Carolina Manifesto focus on infrastructure. “Increase effective investment in North Carolina highways to relieve congestion, reduce cost, and increase the productivity of the state’s economy,” he said. “Encourage private investment in North Carolina infrastructure through competitive contracting, asset sales, and public-private partnerships.”
North Carolina deserves more bang for the buck from public education, Hood said.
“Increase return on investment in North Carolina public schools, colleges, and universities by hiring and paying teachers on the basis of performance, setting higher academic standards, and expanding options for distance learning and career education,” he said. “Encourage competition, innovation, and private investment in human capital by offering education tax relief and scholarships so North Carolina families and workers can obtain the education and training services of their choice.”
Hood backs up the Carolina Manifesto’s 10 planks with pages of data, history, research, and analysis. “This book offers ideas that will make North Carolina a better place to live, work, invest, and create jobs,” he said. “Most of these ideas already have proven themselves successful in other states or nations. They may sound good, and reflect the principles of free enterprise and constitutional government, but that’s not why I’m recommending them. These ideas work.”
“They will strengthen our economic foundations and encourage invention, innovation, and profitable investment,” Hood added. “This is not a hope. It is a prediction, based on hard evidence from other economies and from North Carolina’s own past.”
Copies of Our Best Foot Forward: An Investment Plan for North Carolina’s Economic Recovery are available at the John Locke Foundation’s online store.