RALEIGH – Gov. Bev Perdue is reportedly planning a major new restructuring of North Carolina government, including the possibility of merging departments and agencies, adjusting the mix of responsibilities between localities and the state, and selling off government assets such as the Alcohol Beverage Control system.

Great!

The governor has declined to share any of the details of her plan with the public until November, however, saying that she doesn’t want to politicize any proposals before the legislative elections.

Not so great!

Past attempts at fundamental restructuring of North Carolina government accomplished little in part because the interest groups who feared they’d be adversely affected were paying close attention to the process. The taxpaying public wasn’t. Making a political issue out of government restructuring would be a good thing. It would give elected lawmakers of both parties the sense that North Carolinians know about and endorse what Gov. Perdue would be asking them to do.

Oh, well. At least we know that a major debate about the size, scope, and organization of North Carolina may be coming in the not-too-distant future. Now would be a good time to study up on the issue. Here’s some information to get you started.

As you can read in JLF’s Agenda 2010 briefing book, the cost of state and local government in North Carolina is above the national average, though not by much. Our state tax burden is significant higher than average, but that’s somewhat offset by North Carolina’s relatively low property taxes.

Politicians and political analysts often focus on these overall comparisons in government costs – and they should. I think it’s equally important, however, to push past the totals and look at how North Carolina compares to other states in government expenditures on education, health care, transportation, and other services.

Here are some interesting facts to keep in mind as we go into the homestretch of the campaign season and approach the start of the pivotal 2011 session of the North Carolina General Assembly:

• According to data from the U.S. Census Bureau, spending by state and local governments in North Carolina – including taxes collected by these agencies as well as federal funds and other revenues – accounted for nearly 16 percent of the state’s gross state product in 2008, the latest year for which comparable data are reported. That’s up from about 14 percent in 1992.

• A little over half of this increase is attributable to higher levels of federal grants to North Carolina governments. The remainder reflects an increase in state and local taxes and fees.

• North Carolina spends nearly the same percentage of GDP on education as the national average. But the particulars differ markedly. Our state spends significantly less than the national average on public schools but significantly more than the national average on public colleges and universities. Unfortunately, our generous subsidy for the University of North Carolina has not led to higher-than-average rates of college completion or even high-tech job creation. (More generally, North Carolina taxpayers don’t get a good return on their investment in state government.)

• North Carolina spends more than the national average on health care programs. Several factors are in play here, including relatively high Medicaid costs, at least for our region, and higher public expenditures attributable to major government-owned hospital systems in Charlotte and the Triangle.

• North Carolina spends less than the national average on other public-assistance programs, as well as on transportation, public safety, and utility services. The next time you hear someone attribute most of our fiscal problems to excessive road and prison construction, you should disbelieve them – by which I don’t mean to suggest we shouldn’t try to economize on road and prison construction.

You can read much more about these issues in other sections of Agenda 2010 It’s a good read, not that I’m biased or anything.

Hood is president of the John Locke Foundation.