A Candidate's Guide to Key Issues
in North Carolina Public Policy

The Entire Policy Report, Agenda 2008, is available for download as a 2.7MB Adobe Acrobat file.
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By Roy Cordato, John Locke Foundation Vice President for Research More »


The John Locke Foundation analysts, researchers, scholars and interns who worked on Agenda 2008. More »

Budget and Taxation

The State Budget
The state budget is out of control. Gov. Mike Easley and the General Assembly call it "fiscal restraint" to spend the tax surplus when the economy is good and raise taxes when the economy is bad. Until state leaders learn to exercise real fiscal discipline or to impose discipline on themselves through an expenditure limit, the "spend and tax" pattern of budgeting from the past decade will continue. More »

The State Tax Burden
Taxes are the price we pay for government, so a reasonable tax burden is of benefit to the citizens who consume the services those taxes fund. Unfortunately, the price of government in North Carolina has grown dramatically over the past two decades and is no longer reasonable. Even with the expiration of some of the 2001 temporary tax hikes, state taxes have climbed more than $1.3 billion under Gov. Mike Easley. More »

State Tax Reform
North Carolina has a high tax burden by regional standards, and its top marginal tax rates of 7.75 percent for individual income and 6.9 percent for corporate income are among the highest in the United States. Tax cuts in the late 1990s did not fully make up for tax increases earlier in the decade, and the General Assembly has raised taxes by more than $1.5 billion since 2001. More »

Transparency and Accountability
Transparency in government is critical to a free society. In addition to providing services to the citizenry, governments should also allow citizens to understand how they pay for those services. As budgets have become increasingly complex, however, citizens are less able to monitor how their taxes are spent. More »

State Agency Consolidation
The constitutional offices of North Carolina state government have changed little since 1900. As a reaction first to the tyranny of royal governors and then to the Civil War, the state has divided executive power among a number of separately elected offices. At the same time, governors and legislators have created many agencies under their direct control. The result has been a lack of coordination and focus on major functions, wasteful administrative spending, and a lack of accountability to the public. More »


School Standards and Testing
With the implementation of the ABCs of Public Education, the Excellent Schools Act, charter school legislation, and other reforms, North Carolina lawmakers have put education at the top of the priority list. But even after some recent progress, repeated problems with the state testing program and disappointing performance from our high school students suggest that more fundamental changes are needed. More »

School Choice and Competition
Public education is a core function of state and local government. The state constitution, in the words of the N.C. Supreme Court, recognizes the right to a "sound, basic education" for every child in the state. But public education need not and should not be delivered by government monopolies, as diverse magnet, charter, and private schools are demonstrating across the country and here in North Carolina. More »

Education Spending
Will Rogers said, "Lord, the money we do spend on Government and it's not one bit better than the government we got for one-third the money twenty years ago." This is especially true for money that we spend on public education. Despite billion-dollar increases in education spending, it has become clear that more money alone will not yield better results. More »

Child Care and Early Childhood Education
One of the most controversial issues in the past few years has been the proper role of the state in providing child care and preschool opportunities to North Carolina children. The Smart Start program was intended to be an innovative public-private partnership to facilitate local coordination of children's services, but the program is mostly state-funded and focuses mainly on the minority of preschoolers in paid child care. More »

Education Lottery
The North Carolina Education Lottery was born of corruption, from its inception as a bill, to its lobbying, to its rushed enactment in the N.C. House and Senate in the face of the state's constitutional requirement that revenue bills face multiple votes on successive days, to its false promise to and exploitation of the state's poorest citizens. More »

Higher Education Policy
North Carolina's system of public higher education absorbs a substantial part of the state's budget — in Gov. Easley's 2007 budget recommendations, almost 18 percent went to higher education. State spending on higher education is usually justified on public-benefit grounds, namely that increased education and training for those who attend colleges and universities actually benefit everyone because the graduates will add so much to the economy and culture. More »

Job Training
For state and local policymakers, the issue of job training requires a significant amount of rethinking. In 2005-06, total expenditures for job training and placement services in North Carolina exceeded $476 million, including federal and local grants. The state budget of 2008-09 included more than $49.2 million's worth of appropriations for job training and placement programs. More »

Government Regulation

Economic Development
While economic development has dominated the agendas of many governors, legislators, and local elected officials in North Carolina, it is one of the most misunderstood activities that governments undertake. Politicians love to attract attention to themselves through job announcements and ribbon cutting, but those are a poor substitute for less glamorous policies that promote free markets, entrepreneurship, and overall economic growth. More »

Regulatory Reform
Regulation is the "hidden tax" that governments impose on families and private firms. While state and local governments clearly have an interest in developing sensible regulation, regulations often are developed without examining their costs and their impact on all regulated entities. More »

Property Rights
Property rights have received renewed attention in large part because of the Kelo v. City of New London case and the resulting public outcry. In that case, the United States Supreme Court held that the government could seize private property solely for economic development reasons. In other words, if the government can find a better economic use for your house, it can seize it and transfer the property to a private developer. More »

Transportation Policy
Highways and transportation facilities are some of the most visible programs that state and local governments operate. But they are not without controversy. Some believe that North Carolina has invested too much money in highways and not enough in mass transit, but others observe continuing declines in road conditions, rising congestion, controversial project selection, and directionless system management.More »

Tort Reform
There is a legitimate need for lawsuits. Citizens should be able to go to court and get fairly compensated for the harm caused by negligent acts of individuals or businesses. However, the civil justice system is being abused. Plaintiffs receive damages beyond what is necessary or appropriate. Individuals and businesses that should never be sued find themselves paying large attorneys' fees to defend against frivolous lawsuits. More »


Energy Policy
Energy is not only critical to the economy, but also to our health, safety, and general welfare. Energy is an input into every good and service. Our hospitals need electricity to operate the high-tech machines that provide us medical care. Fuel provides us the means to drive vehicles that give us the mobility that has transformed the nation. More »

Climate Change
The most significant environmental policy initiatives that legislators will face in North Carolina in the coming two years will be related to attempts to reduce carbon dioxide (CO2) emissions ostensibly to ward off future global warming. More »

Water and Drought
North Carolina's drought in 2007 and 2008 may have been the worst on record, but droughts of some kind have been a fairly regular occurrence since 2000. This latest drought led to a number of local restrictions on water usage, proposals for the state to take, a manipulative public service announcement from the governor's office, and two of the goofiest mascots this side of the Olympics. More »

Health and Human Services

Health Care Reform
Rapidly rising medical costs are making health care insurance more expensive and less available to individuals. Workers are less likely to find insurance through their employers, and those who receive coverage face higher premiums, copays, and deductibles. It should be no surprise, then, that health care is a top concern among voters nationally and in North Carolina. More »

Medicaid and Health Choice
State and federal expansions of Medicaid since 1989 have helped make North Carolina's Department of Health and Human Services one of the state's fastest growing institutions. With one of the most expensive Medicaid programs in the region, North Carolina desperately needs to inject large doses of market competition and common sense into its medical assistance efforts. More »

Mental Health
Mental health reform began in 2001 with a goal of moving from a hospital-based public system to a community-based public system, but has had disappointing results. Despite claims to the contrary, privatization is not the problem. The main problem is hubris among reformers who too often have forgotten the first rule of medicine — do no harm. More »

Other Issues

Competitive Sourcing
Throughout North Carolina, state and local governments struggle with two conflicting demands: a plea for lower taxes and a desire for better services. However, under the traditional model of public sector management, these two goals are diametrically opposed. More »

TIF Reform
In 2004, North Carolina voters narrowly approved a constitutional amendment referred to as Amendment One. This amendment permits local governments to use a form of public debt financing called tax increment financing (TIF). The stated purpose of TIF is to promote private economic development in designated districts through the development of public improvement projects. More »

Crime and Punishment
Preventing crime is the most basic of government functions. It's one in which North Carolina governments have made some important progress recently but still have far to go. From 1991 to 2006, the crime rate in North Carolina fell 22 percent. Despite this recent decline, the crime rate — the number of reported crimes per 100,000 in population — is nearly three times higher (273 percent) than what it was in 1961. More »

Civil Rights and Equal Opportunity
Civil rights and discrimination are among the most controversial subjects that state and local leaders must discuss. But they are also crucial issues that involve the core values of our political system: equality before the law, personal freedom, and the dignity of the individual. Affirmative action, originally proposed as a device for extending educational and employment opportunities to minorities and women previously excluded from fair and open competition, has in far too many cases become discrimination itself. More »

Campaign Finance Reform
While the issue of campaign finance reform barely registers in public opinion polls, many politicians and the media tell us reform is critical to the future of democracy in America. It is clear, however, that they believe that is true only insofar as we accept the version of reform demanded by these same politicians and the media — public financing, contribution and expenditure limits, extensive regulation, and even prohibitions on issue advocacy and independent expenditures.
More »

Suggested Resources
The brevity of this briefing book obviously precludes lengthy discussion of many of the important and complicated issues that face state and local policymakers. We recommend that interested North Carolinians visit the following Locke Foundation Policy Reports and Spotlights, and that they contact one of the public policy research organizations in the next section for additional information. More »

Vital Statistics at a Glance
Twenty Years of Vital Statistics on North Carolina Public Policy. More »

About the John Locke Foundation
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The John Locke Foundation is a 501(c)(3) nonprofit, nonpartisan research institute dedicated to improving public policy debate in North Carolina. Viewpoints expressed by authors do not necessarily reflect those of the staff or board of the Locke Foundation.