RALEIGH – I thought about beginning this column by comparing the spendthrifts in the North Carolina General Assembly to drunken sailors, but then I had second thoughts about the fairness of the comparison. After all, they do deserve to let go every now and then, given the arduous drudgery of their daily work and how long they must spend away from their homes and families.
The sailors, I mean. And at least when they descend on some luckless port, careening and carousing, they usually squander their own money. No fair likening them to state lawmakers.
The point has already been made, repeatedly by now, that the state budget the legislature is poised to approve for FY 2006-07 will jack up spending by 10 percent and create new recurring obligations without recurring revenues to finance them. Unfortunately, the damage may not be complete. After the House and Senate work out the (fairly minor) differences between their two budget plans, we may see another round of fiscal folly as the General Assembly considers a series of bond-referendum bills.
The numbers get pretty big pretty fast. Here’s a sampling of the potential damage:
• $1 billion for water and sewer projects
• $1 billion for land preservation (and much, much more, see below).
• $250 million for housing subsidies.
• $5 billion for public-school construction.
• $1 billion for road construction.
These ideas won’t all get a hearing this year, much less action by both chambers and a statewide vote in November. But I’m hearing that legislative leaders strongly believe in at least some of these bills, and many politicians and spending lobbies realize the getting might be good this year – with all the talk of budget surpluses and tax relief – compared with what it will be later on when taxpayers get the bill for this election-year spending spree.
There’s nothing inherently wrong with using bonded debt to finance legitimate state functions and infrastructure, of course, but North Carolina has already added billions of dollars to its debt load in just the past decade – for water and sewer projects, roads, schools, and most especially for colleges and universities. The State Treasurer’s office has warned lawmakers that reasonable guidelines for keeping state debt under control would allow only a fraction of these bond issuances over the next five years.
Just to give you a sense of how slipshod and ridiculous some of these proposals are, consider the $1 billion for “open space.” It’s attracted plenty of sponsors, editorial support, and the prominent endorsement of none other than former Gov. Jim Hunt. And yet, it is a mess. For example, $150 million of the proceeds would go to something called the Landing Jobs Initiative, to be administered in part by the North Carolina Community Development Initiative, a state-funded nonprofit. The money would be used for, among other things, “planning grants,” “sustainable tourism development,” and the “start-up, support, and expansion of entrepreneurial enterprises that utilize the State’s natural, cultural, and historic heritage.”
The state of North Carolina would issue 20-year bonds and then let a private group fund planning grants, tourism development, and business subsidies with the funds? Liquor up the craziest crew of swaggering swabs on the seven seas, and you’d never get them to buy that one.
Hood is president of the John Locke Foundation.