Carolina Journal Weekly Report

July 16, 2009

Carolina Journal Weekly Report

For the week of July 16, 2009 -

Reaction of the Week

RALEIGH — Two new personal income tax brackets included in the N.C. House budget could “destroy” more than 2,800 private-sector jobs in the state, according to a report (pdf link) from Boston-based economists who analyzed the tax plan.

“Since the federal government considers any loss of 50 jobs to be a ‘mass layoff,’ these income tax increases could produce the same effect as 56 mass layoffs in North Carolina,” said Dr. Roy Cordato, John Locke Foundation Vice President for Research and Resident Scholar. “The state already has the nation’s No. 7 unemployment rate — a record-breaking 11.1 percent — and it would border on insanity for lawmakers to consider a tax increase that would do this much damage to the state's slumping economy.”

In addition to the lost private-sector jobs, the income tax increases would reduce North Carolinians’ real after-tax income by $101 million, cut the Gross State Product by almost $36 million, and cost local governments $12 million in tax revenue. That’s according to the analysis from economists at the Beacon Hill Institute, the research arm of the economics department at Bostons Suffolk University.

“In addition to these negative impacts, these tax increases would likely bring in about $40 million less to the state government coffers than the House anticipated,” Cordato said. “Once you look beyond the House budget's projections, you see that these income tax increases would do much more harm than good for the state.”

News Features

CJ: “Welfare for local pols” bill stuck In neutral
RALEIGH — It’s certainly a detour if not the end of the road for a bill that’s been called “welfare for local politicians,” resulting from a grass-roots effort to defeat the legislation. House Bill 120, which called for taxpayer-funded political campaigns at the city level, is stuck in committee for the time being, with General Assembly watchers predicting that it won’t be seen again before the legislature adjourns.

CJ: Did politics play role in N.C. auto dealer closings?
RALEIGH — As the restructuring of the American auto industry proceeds, both Chrysler and General Motors have begun widespread cancellation of franchise agreements with local dealerships. A total of 789 Chrysler dealers were scheduled to close on June 9, with 1,100 GM dealers scheduled for shutdown by 2010.

CJ: Wake parents look elsewhere for educational alternatives
RALEIGH — Frustrated by what they consider the destabilizing and disruptive effects of busing, reassignment, and mandatory year-round calendar policies, some Wake County parents are pushing school officials to consider alternative ways to address students’ flagging academic performance.

Beach insurance plan fix breezes to House vote
RALEIGH — A plan to fix an underfunded coastal insurance program appeared ready to breeze through the state House after lawmakers concerned about balancing the interests of consumers and insurers refused to double the industry’s maximum liability from a catastrophic hurricane to $2 billion. The House on Tuesday voted 89-27 to tentatively approve Beach Plan reforms.

Perdue signs new budget extension
RALEIGH — The General Assembly worked out Wednesday a stopgap spending measure to keep state government operating for another two weeks because a final budget remains out of reach. Gov. Beverly Perdue quickly signed the measure. Democratic leaders agreed to extend through July 31 a so-called “continuing resolution” that would have expired at midnight.

Upcoming Events

Monday, July 20, 2009 at 12:00 PM, Noon
A meeting of the Shaftesbury Society
with our special guest Leigh Bortins
The Classical Mind: A Political Revolution within Education

Friday, July 31, 2009 at Noon
Friedman Legacy Freedom Lecture
with our special guest Dr. Jennis Biser
"Milton Friedman and the Public Choice Revolution."

Monday, August 03, 2009 at August 3-August 7
Appalachian Institution Retreat
with our special guest Dr. Michael A. Gillespie
"The Noble, The Good and The Free"

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

Capital Quotes

Believe me, if we could charge 7 percent more and do the same volume, we would already be doing it.
Del Radcliffe, president of the N.C. Golf Course Owners Association and owner of five Charlotte-area golf courses, commenting to the Charlotte Observer on a proposal that the state start assessing sales tax on certain services, including rounds of golf.

It’s shameful. It is disheartening. And I don’t understand how they didn’t see it.
— Senate leader Marc Basnight, D-Dare, commenting to the News & Observer of Raleigh on the newspaper’s discovery that the state courts made paying restitution to crime victims the sixth priority for funds received from criminals, not the first priority as required by a 1998 law.

It’s all hype.
Bob Orr, executive director of the N.C. Institute for Constitutional Law, commenting to the Raleigh News & Observer on  N.C. Department of Commerce estimates of the number of jobs resulting from the data center Apple plans to build in western North Carolina. Apple has said the data center will employ 50 people; the Department of Commerce claims that the data center will create  “more than 3,000 jobs in the regional economy.”

It was premature aging, so to speak.
Ray Carnecki, a retired paving executive and consultant to the N.C. Department of Transportation, talking to the Raleigh News & Observer about the condition of Interstate 795 between Goldsboro and Wilson. The road’s pavement should have been good for 15 years. Instead the state will spend $13 million to resurface it after only three years.

On The Air This Week…

Carolina Journal Radio

This week on C J Radio…
JLF’s Roy Cordato explains why the cap and trade bill would result in a federal takeover of the energy sector; Reps. Ruth Samuelson, Phil Haire, and Ric Killian debate giving holders of conservation easements new protections against seizure by eminent domain; Reps. Laura Wiley and Larry Womble, DPI’s Mary Watson, and JLF’s Terry Stoops debate tax credits for kids with special needs; and JLF’s Michael Sanera discusses local governments’ misguided efforts at owning golf courses and entertainment facilities.

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: The ongoing budget battles; the need for more ethics legislation; more mental health reforms; and Senator Hagan’s nominations for U.S. jobs. This week’s panelists: John Hood, president of the John Locke Foundation; Chris Fitzsimon of NC Policy Watch; former Attorney General and Secretary of State Rufus Edmisten; and lobbyist Theresa Kostrzewa.

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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