by Greg Petty
July 2011

This Spring residents of our state have witnessed a deluge of information regarding the newly elected legislature’s priorities in the face of a $2.6 billion dollar deficit.

Republicans took immediate action to implement a host of laws that break with past Governors—Republican and Democrat—regarding education, the environment, gun laws and voting rights. Rather than sensibly work with Democrats to make up the shortfall with both cuts and seeking creative revenue enhancements, their rigid ideological stance prohibited them from retaining the temporary one cent sales tax that would have saved many jobs and brought the deficit shortfall to $1.6 billion. Like national Republican leaders, they still refuse to consider any tax as a means to reduce a deficit. Instead of making sure North Carolina received all the corporate income tax due it from sales in the state, this group passed HB 619 which ties the states’ hand in enforcing taxes from corporations that shift income between subsidiaries to avoid NC taxes. North Carolina just won a court case and $30 million from Wal-Mart for such shifting. We have now, in these tough economic times for our state, just given it back. This is going to help our future state revenues how?

I thought that the message from the people in the 2008 elections was Jobs, Jobs, Jobs. The budget presented to Gov. Perdue reduced funding to allow school districts to retain educators, reductions for the care of our air and water, fewer regulation of business in an already business friendly state, job elimination not job creation. These and a host of other issues forced Perdue to veto the budget. The budget veto was then overridden. In my opinion, North Carolinians will eventually come to see this shortsighted budget and the resulting change in priorities, to be big mistakes that will hurt our state for some time. The sum total of the bills passed will result in fewer jobs and less revenue to provide for the common good. Our per-pupil spending for education will now fall to 49th out of 50 states! This budget puts us firmly in the lead for the race to the bottom.

In her veto message Perdue stated, “For generations, we North Carolinians have distinguished ourselves from other southern states as a place of opportunity, and a place that understands the value of investing in our people. Education has been our hallmark—the one area that set us apart from our neighbors and propelled our economic success… We have lived our values—until now. This budget will result in generational damage. It tears at the very fibers that make North Carolina strong—not only our schools, but also our communities, our environment, our public safety system and our ability to care for those who need us most.”

So while the Republicans are basking in the glow of their reputed “successes” in this session, time will show whether the majority of North Carolinians consider their actions to be wise. The citizens of North Carolina will have their opportunity to speak at the next election.

The current group of legislators just might look back on their rush to implement this shortsighted budget and some of the laws passed as acts they wished they could take back. Perhaps wiser to have protected our resources, retained existing taxes, refrained  from giving away revenue, made sensible cuts working with more than five Democrats (to override the budget veto) to balance yearly budgets. I am an optimist, the economy will eventually improve, and with it increased sales revenues will provide budget relief and the ability to rebuild our rainy day fund. Until all that occurs, we cannot just cut and hack our way out of a budget deficit. But the die is now cast—we will have to live with the laws and policies this legislature has enacted over Gov. Perdue’s veto.

Next up—the battle over the fair redistricting of congressional districts. At this juncture, I am not sure how much confidence I have in this legislature’s determination of what is “fair,” but we will soon find out.

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