The rhetoric problem

By: - June 15, 2005 5:50 am

The House Appropriations Committee passed the budget Wednesday afternoon after considering more than 50 amendments. There were few surprises and the full House will take up the budget Wednesday night.

The budget has its problems, especially in the lack of investments in human service programs and other initiatives that create jobs and help people who are struggling.

But just as troubling is the rhetoric of the anti-taxers that always seems to nudge the debate rightward and strike fear in lawmakers who want to do the right thing, the claims from the backward thinking tanks and the lawmakers who parrot their lines that somehow the state budget is out of control, that the General Assembly is on a spending binge.

They use the fact that the House budget spends a billion dollars more than last year’s budget to try to convince us that their worn out claim is true, that the state has a spending problem.

The House budget would increase spending by $1.2 billion dollars, but does that mean we have a spending problem?  Hardly. Here are some of the biggest items in the House budget this year.

The pay raise for teachers and state employees cost $237 million. State workers will get an increase of 2.5 percent or $500, whichever is greater.  Adjustments to the state employees health plan cost $137 million even after increasing the premiums for family coverage by 15 percent.

Paying for enrollment increases in public schools, community colleges and most of the increase at UNC costs roughly $200 million. Bonuses for teachers as part of the ABCs of education cost $100 million. Rising Medicaid costs add up to another $200 million even after unwisely lowering reimbursement rates and reducing some services.

The House puts $170 million into the state’s rainy day fund, and spends $100 million on repairs and renovations to state buildings, both actions that are always praised by fiscal conservatives. The House leaves $150 million unspent.

That adds up to $1.29 billion, just enough to keep some education and human service programs at current levels, give state workers a raise and put money in the savings account. Some spending spree.

Wonder which of these programs the critics are proposing to cut? The backward thinking tanks have a plan of course, ending Smart Start, eliminating Heath Choice, cutting off basic health care services to the poor, but not even the most vitriolic anti-government lawmakers are not proposing that.

And remember the list of House spending items above does not include hundreds of other important programs, some of which the House funds, paying for them with budget cuts and tax increases, programs like More at Four, mental health services, early childhood programs, etc.

The House budget ignores many other vital needs including the growing number of people without health insurance and the HIV/AIDS epidemic.

No matter. The anti-everything crowd has already started making speeches listing the taxes that the House is raising, from candy to satellite television to concert tickets. You can almost see the visions of television attack ads dancing in their heads.

What they don’t generally tell you is that North Carolina is part of a multi-state agreement to make sales taxes consistent from state to state.

Once enough states have simplified their tax rates, the states will then be able to collect taxes on Internet sales, bringing in millions of dollars. Hard to argue that it’s fair to local booksellers if they have to charge you tax and doesn’t.

The items that are not part of the agreement, like candy, will be taxed as the same rate as other nonfood items, which only makes sense. Why should candy be taxed less than laundry detergent or toilet paper?

At some point we need a real discussion of the state’s priorities, a plan for the future that includes help for people who need it.  It must include the consideration of a progressive revenue package, closing corporate loopholes, expanding the tax base to include services, etc.

The first step toward that debate is to brush aside the shrilly-delivered clichés that misrepresent the state’s budget reality.

We don’t have a spending problem in North Carolina, we have a demagogue problem.

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Chris Fitzsimon

Chris Fitzsimon, Founder and Executive Director of N.C. Policy Watch, writes the Fitzsimon File, delivers a radio commentary broadcast on WRAL-FM and hosts "News and Views," a weekly radio news magazine that airs on multiple stations across North Carolina. [email protected] 919-861-2066