RALEIGH – I think North Carolina’s governors ought to have a stronger veto power over state budgets – the power to reduce spending on individual line items, not just to say no to the whole thing.

According to a recent literature survey by Matthew Mitchell and Nick Tuszynski of George Mason University’s Mercatus Center, studies of state budgetary policies have found that the 12 states with line-reduction veto have experienced lower spending growth than the states denying their governors such power.

In fact, Mitchell and Tuszynski paper show that the item-reduction veto is the second-strongest constraint on state spending growth, as measured by dollars saved per capita. The strongest constraint, they found, is making sure that state legislatures keep their Appropriations committees separate from the Revenue committees.

North Carolina already does that, at least on paper. But Mitchell and Tuszynski’s research addresses quite a few other budgetary policies that ought to be of interest to North Carolina policymakers. As previously observed, you might think of them as current or prospective tools in the state’s fiscal toolbox. In some cases, state policymakers already possess them, but the tools need to be sharpened. In other cases, they are new tools we need to acquire.

Here are some of the existing tools that North Carolina needs to take out and sharpen:

• Constraints on State Borrowing. While the state constitution appears to require a vote of the people before saddling them with significant long-term debts, this protection is rapidly eroding. The state of North Carolina hasn’t held a bond referendum since 2000. Localities are also moving away from them. Instead, governments are using certificates of participation (COPs) and other special-obligation debt, because they don’t technically require referenda. In practice, COPs are just backdoor ways of putting North Carolinians in debt without their consent, contravening the clear intent of the constitution. These loopholes should be closed.

• Legislative Procedures. State law already take steps to avoid budgeting based on rosy revenue scenarios. During the 2011 session of the General Assembly, legislative leaders also did a much better job of releasing the final budget bill early enough for lawmakers and the general public to read and digest them before floor votes were taken.

Still, lawmakers might want to consider two additional procedural changes discussed in the Mercatus Center study: approving annual rather than biennial budgets, and using past-year spending rather than a “current services” model as the baseline for fashioning new budgets. Also, the study provides a good reason to protect and restore North Carolina’s tradition of a citizen legislature. The more “professional” a state legislature gets – i.e. the more lawmakers are paid, the larger their staffs are, and the longer their legislative sessions last – the more that legislature will increase state spending.

• Tax Limitation. It will come as a surprise to most citizens, and probably even to many state lawmakers, that North Carolina already has a legal limitation on state taxation. But it is far too loose. Article V, Section 2 of the state constitution set a maximum income-tax rate of 10 percent. That’s so high a cap as to be irrelevant, however.

Rather than attempt to cap tax rates, the constitution should require a three-fifths majority of the General Assembly to approve tax increases. Fifteen states already operate under such supermajority requirements, and their tax burdens and spending levels tend to be significantly lower than in states without them.

In addition to improving our existing budgeting tools, North Carolina needs at least one new one:

• Spending Limitation. A Taxpayer Bill of Rights amendment should be added to North Carolina’s constitution to limit annual state spending growth to inflation plus population growth. Critics of spending caps typically claim that they are unrealistic and draconian, but in fact North Carolina’s real, per-capita spending is slightly lower today than it was 10 years ago. Did our world come to an end? Of course not.

If state politicians had been required to budget under a TABOR cap over the past decade, government spending would have ended up at about the same place – but we would have avoided the painful boom-and-bust cycle in state budgeting that North Carolina experienced during the period.

Slow and steady wins the race, or at least produces fewer heart attacks.

Hood is president of the John Locke Foundation.