RALEIGH – North Carolinians keep too much of their own money.

That’s why a consortium of large-city mayors in North Carolina are calling for new “local-option taxes” to help fund highway and mass-transit projects in their areas. Frustrated – and properly so – at a funding formula for state highway expenditures that puts politics and economic-development dreams above demonstrable traffic needs, urban leaders are drawing the erroneous conclusion that the only solution is to suck more money into the system.

I agree that the state needs to continue to be in the highway business, big time, but we motorists already pay hundreds of millions of dollars in gas and car taxes to the state that do not get spent on highways. Some of the money that is spent is wasted. Shouldn’t policymakers address these issues before considering new exactions?

No. Again, North Carolinians keep too much of their own money.

That’s why Gov. Mike Easley is reportedly going to include a cigarette-tax increase, possibly upwards of 50 cents a pack, in his state budget proposal next week. The governor’s budget will allow state spending to grow by as much as 5.6 percent in FY 2005-06, despite the existence of a $1.3 billion gap between projected revenues and desired spending. The plan will probably rely on other new or extended tax increases, though officials aren’t saying yet what they’ll be.

Does state government really need to grow by nearly 6 percent in the face of another big deficit? Couldn’t it grow at a slower rate, thus avoiding the need for new taxes?

No. I keep forgetting this. North Carolinians keep too much of their own money.

For example, way too many of them are shopping online for goods they used to buy from brick-and-mortar retailers. While they may actually owe a tax on these items, few will bother to pay it. Not surprisingly, local retailers aren’t happy about the resulting price differential, and state and local politicians aren’t happy about the “revenue loss.” They are trying to figure out a way to “reform” the tax code to make Internet shopping more expensive.

Of course, buying online imposing less of an uncompensated cost on state and local government – less infrastructure used, fewer local employees to educate and train, etc. – but since when do policymakers really care about public-finance theory?

North Carolinians keep too much of their own money, those greedy helots. So rectifying the situation becomes a paramount goal. It’s really just that simple to the like-minded.

Really. Simple. Minded.

Hood is president of the John Locke Foundation and publisher of Carolina Journal.