Opinion: Carolina Journal Opinions

Status Quo Not OK in N.C.

My friends on the Left keep saying things aren’t so bad. We just need to spend more money to keep doing the same things, and everything will be fine.

Who are they kidding? Let’s be honest. Things aren’t so great in North Carolina.

Unemployment has been at 9 percent or higher for 41 months, one of the worst unemployment rates in the United States, and worse than in even France or Italy. We offer more generous unemployment benefits for a longer period of time than any of our neighboring states. We can’t afford it and have chalked up a $2.6 billion debt to the federal government to keep paying those generous benefits.

In a recent survey of business owners, North Carolina’s regulatory environment got a C-, the worst grade in the South and one of the worst in the country.

We are tied for 12th in the country for the highest number of occupations requiring licenses — 107 different occupations. Barbers, boxers, and even librarians have to be licensed in North Carolina.

There are 23,754 rules in the N.C. Administrative Code. We have 47 more rules than we had 16 months ago. There are more than 5,000 rules just in Health and Human Services.

Our top personal income tax rate is the 11th highest in the country, our sales tax system is the fourth worst, and our gasoline tax is the sixth highest. Compared to 23 developed nations, if North Carolina were a country, we’d have the highest corporate tax rate in the world, and one of the highest on dividends or capital gains from corporate stock.

And when there wasn’t enough in tax revenue to pay for their wish list, politicians just borrowed more. Our tax-supported debt is $7.1 billion, total bonded debt is over $53 billion, and our annual payment on reserve and debt service is over $1 billion, 4 percent of the state’s budget!

Budget decisions over the last two years have led to teacher cuts — a few hundred rather than the tens of thousands the Left claims. To put that in perspective, North Carolina employs more than 95,000 teachers. The question should not be how many teachers have we hired or fired, but how many do we need to get the job done?

Total funding for education in North Carolina is about average nationally — reflecting the fact that our K-12 spending is relatively low and our higher-education spending is relatively high. But the national comparisons also show that the level of education funding does not guarantee good results. Other countries that spend less than North Carolina does on K-12 education but get better results include South Korea, Finland, Canada, Australia, Germany, and France.

More than 20 percent of our students do not graduate from high school on time, and of those who graduate and go to community colleges, 66 percent have to take remedial classes in English or math. Only 37 percent of our eighth-graders are proficient in math, 31 percent in reading, and 26 percent in science. Fewer than 60 percent of in-state students at UNC campuses graduate within six years.

There’s bad news on the transportation front as well. Thirty percent of our bridges are rated deficient, 10th worst in the country. Sixty-one percent of our urban interstates are congested, ninth worst in the country. The American Society of Civil Engineers gave us a C- for overall infrastructure. The U.S. Chamber of Commerce ranks us seventh lowest in the country in transportation infrastructure.

Medicaid is the fastest-growing part of our state budget, $12 billion, 15 percent of state spending. Recent reports disclose millions of dollars wasted in an $851 million billing system upgrade, and estimates of fraud exceed $200 million. There are no reserves, so when costs run over they result in unexpected shortfalls we can’t pay: $94 million for the fiscal year that just ended and up to $250 million for the new one.

Sorry, friends. Things are not great in North Carolina. Good decisions from the General Assembly are turning things around, but the status quo is not OK.

Becki Gray (@beckigray) is vice president for outreach at the John Locke Foundation.