RALEIGH – In recent years, North Carolina has not been an economic leader. It’s an economic follower.
By now, one would think that this basic truth would be widely understood and appreciated across the political class. North Carolina has had a higher-than-average unemployment rate for more than two years. While the state has attracted significant population growth over the past decade, its performance on virtually every other measure of economic momentum has been subpar.
Still, I’m seeing quotes and advertising messages from political incumbents early in the campaign season seeking to credit for North Carolina’s economic gains. Really? I wonder what gains they are referring to.
Are they referring to the fact that from 1998 to 2008, North Carolina’s gross state product grew slower than the national average?
Are they referring to the fact that from 1998 to 2008, North Carolina’s per-capita income grew only 39 percent (in nominal dollars) while the nation’s per-capita income grew 51 percent?
Are they referring to the fact that from March 2008 to March 2010, North Carolina’s net job loss was higher than the average for the Southern states and for the nation as a whole?
Are they referring to the fact that North Carolina’s tax system is more biased against entrepreneurs than that of most other states in the union?
Are they referring to the fact that North Carolina had a worse-than-average experience during the 2000-01 recession, then a worse-than-average recovery from that recession, and now a worse-than-average experience in the current recession?
I can understand a political desire to put the best possible spins on things. I can understand a marketing effort to accentuate the positive. But when it comes to discussing North Carolina’s competitiveness problem, trying to explain it away with extravagant claims and tendentious manipulation of the data is wrongheaded.
As I explained yesterday, I think that our state’s lackluster economic performance reflects poorly on the policy decisions of past elected officials. It shows that raising taxes and maintaining higher-than-average government costs in areas such as health care, human services, and higher education make our economy weaker, not stronger. It shows that North Carolina needs to rethink its approach to business regulation, and get a far better rate-of-return on tax dollars expended in core public services such as public safety, education, and highways.
But even if you don’t agree with my views about the cause of the state’s economic problems, at least we should be able to agree on the size and scope of those economic problems. Still, some continue to fool themselves into thinking that the fundamentals of North Carolina’s economy are strong, our growth prospects are stellar, and our citizens feel good about the direction of the state.
It’s their own business if they want to continue to reside in fantasyland – as long as they stay far out of the way and let North Carolina’s reality-based community get on with addressing the state’s manifest economic problems.
Hood is president of the John Locke Foundation.