RALEIGH – Legislative negotiators are about to begin working out the differences between the two 2010-11 budget plans passed by the Senate and House in as many weeks. There’s lot of big talk around the General Assembly about “dramatic differences” between the two budgets, and how the 2010 fiscal situation presented “the hardest year ever in our modern era.”

Oh, c’mon folks, give me a break.

First of all, describing the difference between a $20.6 billion Senate budget and a $20.5 billion House budget as “dramatic” is rather melodramatic. Even when you bore down into the details of agency funding, the differences between the Senate and House budgets don’t exactly bring to mind images of Hatfields vs. McCoys or Blue Devils vs. Tar Heels.

Speaking of which, the two budgets do indeed disagree on funding amounts for the University of North Carolina system. But hearing only the extravagant claims of legislators and lobbyists, the public might well conclude that the disagreement is a fundamental one.

Depends on your definition of “fundamental,” I guess. The Senate appropriated $2.8 billion in General Funds to UNC. The House appropriated $2.7 billion. We’re talking a difference of four percentage points.

More generally, the Senate appropriated nearly $11.4 billion in general revenues and bailout funds to education. The House appropriated $11.2 billion. The difference, $186 million, comes to about two percentage points. Yes, spending $186 million less on education may adversely affect the lives of some education employees, vendors, and students. But spending $186 million more on education may adversely affect the lives of other state employees, vendors, beneficiaries, and taxpayers from whom those resources would be extracted.

In other words, let’s keep things in perspective here. If the House budget were enacted directly into law, without modification, the operations of North Carolina’s public schools, colleges, and universities would be virtually indistinguishable from what would happen under the Senate budget.

On the flip side, the House spends $51 million more on health and human services, $7.5 million more on justice and public safety, and $12 million on other line items. Again, if the lower Senate totals were enacted directly into law, state government would not look dramatically different from the House scenario, not unless we’re using the term “dramatic” loosely.

In fact, there’s a good idea embedded in these speculations. Typically, when House and Senate budget conferees get together to hash out their differences, the final budget spends more than either of the chamber’s initial plans. That’s because both sides care more about preserving their higher agency totals than they do about preserving their lower ones. This is the fiscal equivalent of logrolling – you support my favorite spending and I’ll support yours.

Another way to think about the matter is that if either the House or Senate passed a budget with a lower spending total, legislators must have believed that the lower spending total was reasonable. Given North Carolina’s continuing budget woes, it would make sense to accept this lower figure in each case, rather than the higher one, a technique that JLF has in the past called “reverse logrolling.”

If the technique were applied in the case of the 2010-11 budget, here’s what would happen: the final deal would include the House’s lower spending totals on education and the Senate’s lower spending totals on virtually everything else. Instead of yielding a 2010-11 authorization of at least $20.6 billion, the final deal would spend about $300 million less.

That would be better – spend less, bank the difference, and be a little bit better off for the 2011 legislative session, when Gov. Beverly Perdue and the General Assembly will be facing a truly dramatic budget crisis.

Hood is president of the John Locke Foundation.