Carolina Journal Weekly Report

March 20, 2009

Carolina Journal Weekly Report

For the week of March 20, 2009 -

Reaction of the Week

RALEIGH — The John Locke Foundation’s “Back to Basics” state budget proposal would shave 10 percent of total spending from North Carolina’s budget plan. It also would set state government on a better course for future budget decisions, according to a top JLF budget analyst.

The Locke Foundation is unveiling its ideas as Gov. Beverly Perdue prepares to submit her first budget to the General Assembly. “This alternative proposal lays out ways to meet North Carolina’s immediate fiscal challenge, reform state government, and set the state on a more responsible path,” said Joseph Coletti, JLF Fiscal and Health Care Policy Analyst. “The governor and state lawmakers can turn a major budget problem into an opportunity to rethink the way they conduct the state's business.”

In the most detailed state budget proposal the John Locke Foundation has unveiled in its history, Coletti recommends a total General Fund appropriation of $18.8 billion for the budget year that starts July 1. It would save $2.2 billion (10 percent) from the continuation budget of $21 billion.

“North Carolina’s budget exploded between the 2004 and 2008 budget years,” Coletti said. “Adjusting for inflation, spending climbed from $2,037 per person to $2,336. That’s growth of 15 percent.”

The 2008 budget was $5.8 billion higher than the budget for 2004, Coletti said.

News Features

CJ: Rising unemployment signals fears of future
RALEIGH — North Carolina’s latest rise in unemployment numbers signals businesses’ fears about the future. Uncertainty about the level of government intervention into the economy is holding back the entrepreneurs who create new jobs, according to a John Locke Foundation budget analyst.

CJ: New highway funding or Smart Growth proxy?
RALEIGH — A growing number of federal and state lawmakers are considering new types of taxes, called value pricing or direct user charges, to finance highway construction and maintenance projects to make up for a projected shortfall in fuel tax revenues as vehicles become more fuel-efficient.

CJ: UNC finds It hard to put brakes on spending
RALEIGH — The problem with letting “the good times” roll is that it is hard to stop the rolling when the economy goes downhill. During the last few years, while North Carolina’s powerful economy filled the state coffers, the University of North Carolina started many new, expensive programs. This year, with tax revenues falling, those new programs still require funding, even as the university system explores making cuts to key academic programs.

Perdue plan could jam prisons
RALEIGH — At a time when the state’s prisons desperately need new beds, Gov. Beverly Perdue wants to cut them. To help deal with the state’s budget crisis, Perdue this week proposed closing five prisons, a prison hospital and a halfway house for women because they are among the system's most inefficient.

Debate on state insurance plan delayed
RALEIGH — An overhaul of the state employee health insurance plan that’s supposed to be on the fast track keeps getting delayed as lawmakers and lobbyists try to resolve a flap over prescription drugs. For a third time this week, the Senate delayed floor debate Thursday on legislation that would reduce benefits, increase premiums and inject $625 million in taxpayer money into the State Health Plan through mid-2011. A floor vote has now been pushed to next Tuesday.

Upcoming Events

Monday, March 23, 2009 at 12:00 PM, Noon
Shaftesbury Society Luncheon
with our special guest Ramesh Ponnuru
"The Future of Conservatism"

Tuesday, March 31, 2009 at 6 p.m.
Southeastern Freedom Club Meeting
with our special guest John Hood
How To Get Involved With Your Local Freedom Club

Thursday, April 02, 2009 at 6:30 p.m.
Down East Freedom Club Meeting
with our special guest John Hood
How To Get Involved With Your Local Freedom Club

Thursday, April 16, 2009 at 6:30 p.m.
Western N.C. Freedom Club Meeting
with our special guest John Hood
How To Get Involved With Your Local Freedom Club

John Locke Foundation Carolina Journal Online
The Locker Room Carolina Journal Radio

Capital Quotes

I don’t want to be crass and call it a slush fund. But it’s there — it’s a healthy (cash) balance.
— Gov. Bev Perdue, as quoted by the Associated Press, on her proposal to balance the state budget in part by budgeting less than the full amount need to cover state salaries. Departments only very rarely ever spend the total amount budgetd for employees, using what’s leftover for needs that arise during the year.

You look at your checkbook and make sure you don’t write more checks than you can afford to.
— N.C. Revenue Secretary Ken Lay, as quoted by the Raleigh News & Observer, on the state being about two weeks slower than normal in sending out income tax refund checks.

They get all the benefits, and the state gets screwed, basically.
— Sen. Stan Bingham, R-Davidson, commenting to the Winston-Salem Journal on Alcoa’s application to renew licenses to operate four dams along the Yadkin River.

The General Assembly of North Carolina could be the best reality show ever.
Jane Pinsky, executive director of the Coalition for Lobbying and Government Reform, talking to the Associated Press about a proposal to televise General Assembly floor sessions and committees meetings.

On The Air This Week…

Carolina Journal Radio

This week on C J Radio…
JLF’s John Hood discusses the future of capitalism; William Schlesinger of the Cary Institute for Ecosystem Studies debates manmade global warming with John Christy of the University of Alabama at Huntsville; Rep. David Guice (R-Transylvania) recommends increased authority for probation officers; NC State political science chairman Andy Taylor explains why North Carolina fares worse than other states in bringing home federal pork; and JLF’s Michael Sanera explains why many local governments have themselves to blame for today's fiscal woes.

NC Spin

This week on NC Spin…
 Join moderator Tom Campbell for another week of political discussion and debate on the most intelligent television talk show in the state. Topic this week: Governor Perdue’s budget recommendations for the next two years. This week’s panelists: John Hood and Becki Gray of the John Locke Foundation; Chris Fitzsimon of NC Policy Watch;  and former legislator Gene Arnold.

At Issue

This week on At Issue…
Watch At Issue, hosted by Kim Genardo, Sunday at 9:00 a.m. Also available on the web at


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