Opinion: Daily Journal

Not Enough Money for Everything

RALEIGH – “There wasn’t enough money for everything,” said Sen. Kay Hagan. The Guilford County Democrat and appropriations co-chair was explaining the details a 2006-07 budget plan the Senate approved a couple of weeks ago.

The sentence prompted a double-take. Seemingly a simple statement, it could actually be read in a variety of ways, I thought.

If by “everything” Sen. Hagan was referring to worthy spending items, then her statement could be understood as a complaint that the state of North Carolina had not yet taken enough of the taxpayers’ money to accomplish the state’s legitimate functions. Many, many denizens of government buildings and lobbying shops in Raleigh believe this to be true, but it is considered politically unwise or socially gauche to admit it. They equate progress with expanding government – I kid you not. They believe they can spend your money more effectively than you can (that is quite literally the meaning of the proposition that North Carolina’s taxes are inadequate). When told that North Carolina’s average tax burden is near the top of the list regionally, and 23rd in the nation, they wonder why North Carolina shouldn’t rank 20th, or 15th, or 10th in the nation. Boy, that would show how “progressive” we are in “investing” in our future!

Since Hagan is on record as supporting a lower corporate-income tax, and has not publicly endorsed maintaining the “temporary” sales and income taxes scheduled to go off the books next year, I’ll assume that she had a different meaning in mind.

If by “everything” she instead meant to describe the entire universe of spending requests the General Assembly has received this year, as distinguished from the smaller number of items that deserved to be included in the Senate’s budget, then I’m a little confused about the decision rule used to determine the worth of budget requests.

As my touchstone, I’ll use the near-universal support among local officials, business and trade associations, public-policy organizations, and editorialists for the idea of removing counties from the burden of paying a share of Medicaid expenses. It would take about half a billion state dollars to accomplish this funding shift. The Senate budget didn’t come close. That means that all the items in the Senate budget were deemed by Hagan and other supporters to claim a higher priority than allowing counties, via Medicaid restructuring, to use their local taxes for pressing needs such as road improvements and school construction. Examples of such indispensable items in the Senate budget include:

• At least $25 million to encourage North Carolina teachers to obtain national board certification, even though a study commissioned by the board demonstrated that its educational value is negligible.

• Nearly $10 million in corporate welfare for a new research facility in Kannapolis to be affiliated with UNC and community colleges.

• $200,000 for the “North Carolina in the World Project.”

• $5 million to subsidize selected small businesses.

• $10 million more to subsidize selected large businesses.

• $15 million to subsidize biotechnology businesses.

• $12 million to dole out to economic-development programs and partnerships of dubious effectiveness.

• $25 million to subsidize the Rural Economic Development Center, a nonprofit that essentially acts as an arm of the state.

• $275,000 to expand the “21st Century Communities Program.”

• Nearly $2 million to subsidize the furniture market at High Point.

• $1.1 million to subsidize the tourism and motor-sports industries.

• $2 million in additional funding to upgrade rural airports without scheduled passenger service.

And that’s just for starters. No, the Senate’s budget, which jacked up spending by 10 percent in a single year, didn’t include funding for everything it theoretically could have. My goodness, is that really the test?

Hood is president of the John Locke Foundation.