Carolina Journal Weekly Report

June 26, 2009

Carolina Journal Weekly Report

For the week of June 26, 2009 -

Reaction of the Week

RALEIGH — North Carolina lawmakers would do nothing to help the state’s unemployment problem, if they move forward with proposed tax hikes in the final state budget. That’s the assessment of a John Locke Foundation expert analyzing May unemployment data.

The N.C. Employment Security Commission’s latest report lists the state’s unemployment rate at 11.1 percent for May, up 0.4 percentage points from the adjusted April rate of 10.7 percent. After a one-month dip, the rate continued the month-by-month climb that’s been documented for more than a year. The latest unemployment rate is the highest North Carolina has recorded since the state started keeping seasonally adjusted data, according to the ESC. North Carolina ranks No. 7 among the 50 states in unemployment.

“The latest numbers remind us that North Carolina needs jobs,” said Joseph Coletti, JLF Fiscal Policy Analyst. “It’s unfortunate that legislators are considering up to $1 billion in tax and fee increases next year. Gov. Bev Perdue apparently wants them to consider even larger increases. Higher taxes would hurt the state’s opportunities for improving job growth.”

Two new personal income tax brackets cause special concerns for job creation purposes, Coletti said. Taxpayers who earn more than $200,000 a year would face additional state income taxes. “North Carolina already has the highest marginal personal income tax rate in the Southeast and one of the highest rates in the nation,” Coletti said. “If the General Assembly’s negotiators adopt the new income tax hikes included in the House budget plan, North Carolina would stand out from its neighbors for the wrong reasons.”

News Features

CJ: Questions surround Black property settlement
RALEIGH — Wake County officials say imprisoned former North Carolina House Speaker Jim Black satisfied a court-ordered $1 million fine recently by surrendering some Mecklenburg County real estate, but questions remain about the real market value of the property, who owns the parcels, and whether the transfer was legitimate.

CJ: Will More at Four or Smart Start survive?
RALEIGH — Facing pressure to cut redundancies and scale back its budget, the General Assembly has been seeking ways to reduce funding to North Carolina’s pre-kindergarten programs. It’s unclear whether the state’s two principal pre-K programs will survive the conference committee that will iron out the state’s 2009-10 budget or if a single program will emerge.

Hurricane costs could affect entire state
RALEIGH — Legislators started grappling Thursday with how to beef up the state-created but underfunded insurance program for coastal property, and immediately confronted the possibility that all of the state’s insured property owners could pay more after a catastrophic hurricane season. Legislation aimed at fixing the Beach Plan was introduced in the House Insurance Committee, which will take it up again next week.

House committee approves annexation reforms
RALEIGH — Opponents of involuntary annexation were angered Thursday when a Democrat-controlled state House committee rebuffed Republican efforts to give residents a vote on the matter. The House Judiciary II Committee approved 31 pages of reforms to North Carolina’s 50-year-old annexation law. The changes include provisions to require cities to annex impoverished bordering communities if they request it, and to pressure cities to provide services quickly to annexed residents.

Sex-education bill ready for Perdue to sign
RALEIGH — Starting next year, seventh-, eighth- and ninth-graders across North Carolina will be given more information about contraceptives and sexually transmitted diseases. They will also be told that they are expected to abstain from sex until marriage. Those are the dual priorities of a bill that will retool the way that sex education is taught in the state’s public schools.

Upcoming Events

Monday, June 29, 2009 at 12:00 PM, Noon
A meeting of the Shaftesbury Society
with our special guest Daren Bakst & Dr. Troy Kickler
Eugenics in NC: Its History and the Case for Compensating the Victims

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

Capital Quotes

That’s going to help the slightest bit.
— Sen. Linda Garrou, D-Forsyth, commenting to the Associated Press on word that state corporate tax collections are coming in $150 million higher than expected.

Can you really expect to spend more and more money and expect to get more and more back? That’s what I call Madoff math.
— Senate Minority Leader Phil Berger, R-Rockingham, as quoted by the Raleigh News & Observer, questioning the logic of offering bigger incentives to the film industry in the hope of getting even greater tax revenues in return.

We’re still losing jobs hand over fist.
Mark Vitner, senior economist for Wachovia Securities, talking to the Winston-Salem Journal about the state’s unemployment rate, which rose to 11.1 percent in May. Vitner expects the situation to get worse before it gets better.

Nobody’s going to vote to take away money from (their districts), so all this stuff is just a show.
— Rep. Mitch Gillespie, R-McDowell, commenting to the Asheville Citizen-Times on the likelihood that a study committee will lead to changes in how the state distributes lottery proceeds to school systems throughout the state.

On The Air This Week…

Carolina Journal Radio

This week on C J Radio…
JLF’s Roy Cordato explains the impact of massive federal interventions into the economy; JLF’s John Hood makes the case against forced annexation; advocates debate the so-called bullying bill; NCSU’s Andy Taylor discusses his view that legislative session limits cause more harm than good; and Jenna Ashley Robinson of the Pope Center for Higher Education Policy offers viable options to traditional college.

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. Topics this week: Te staggering rate of unemployment in our state; the health care debate and how it has ramifications in North Carolina, community colleges and illegal immigrants; and whether or not Jim Black’s sentence should be commuted. This week’s panelists: John Hood, president of the John Locke Foundation; Chris Fitzsimon of NC Policy Watch; Elaine Mejia, Director of the NC Budget and Tax Center; and Eszter Vajda, Senior Legislative Correspondent for UNC-TV.

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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