View in your browser.

The final days of this year’s session of the General Assembly have yielded several reforms and several controversial items. As of this writing, the fate of regulatory reform — including especially a sunset provision with periodic review, a proposal that research has shown to bear significant positive effects in reducing a state’s regulatory burden — depends upon the governor’s whim. This newsletter will highlight a few important measures that have perhaps gotten lost among the more sensationalized proposals.

Compensating the victims of North Carolina’s forced-sterilization program

First highlighted by Daren Bakst, my friend and former colleague here at John Locke, North Carolina’s forced-sterilization program was a complete failure by all three branches of government to protect citizens. The legislature approved it, the executive branch implemented it, and the judiciary deemed it constitutional (the ruling in In Re Moore of 1976 is especially atrocious; it declared it the legislature’s "duty" to enact sterilization laws and "limit a class of citizens in its right to bear or beget children with an inherited tendency to mental deficiency, including feeblemindedness, idiocy, or imbecility," so as to "protect the public and preserve the race from the known effects of the procreation").

The eugenics program, which spanned five decades, from 1929 to 1977, was an idea pushed by "progressives" whose intent was to further human evolution by preventing "undesirables" from reproducing, leaving reproduction to "desirable" members of society. North Carolina wasn’t alone, as we were joined by 30 other states in an idea that also fascinated and occupied Nazi Germany.

North Carolina’s forced-sterilization program began before the Nazis’, and it lasted longer — in fact, over three-fourths of the approximately 7,600 victims were sterilized after 1945. The eugenics campaign included campaign literature that would sicken anyone with a healthy appreciation of human rights and liberty. The appendices of Bakst’s report offer a couple of examples. For sheer creepiness, nothing beats the pupil-less blue eyes of what I dubbed "Baby Eugene" in the "You Wouldn’t Expect…" cartoon booklet of 1950. And then there is "The Lucky Morons" poem by Dr. Charles Gamble, a prominent member of the Human Betterment League of North Carolina, which concludes:

… And there weren’t any children’s
mouths to feed — although
they wouldn’t have
known why if
the operation hadn’t
been explained to them.
And with just the two in the
Family, they kept on
and they were very thankful they lived
DIDN’T have to feed them
and the SCHOOLS didn’t
have to waste their efforts on
any of their children who weren’t very bright.
And because they had been
STERILIZED, the taxpayers of
North Carolina had
and the North Carolina MORONS LIVED

As Bakst and others have argued, because the forced-sterilization program was a government-wide abuse of her own citizens by the State of North Carolina, it was incumbent upon the state to acknowledge its wrong and take steps to address it. Compensating the living victims of the forced-sterilization program is a proper response, but getting the state to that point hasn’t been easy. It was a late casualty of budget negotiations last year, for example.

Not this year. The state budget bill recently finalized sets aside $10 million in a reserve fund for compensating victims of the state’s forced-sterilization program, to be divided equally among qualified recipients. This compensation would be excluded from consideration as income, resources, or assets. Also, the state would guard the confidentiality of claimants, whether or not they are proven qualified to receive compensation.

The end of sneaky, off-time special elections for tax hikes

Most of the news about House Bill 589 centers on its voter ID provisions, end of straight-ticket voting and same-day registration, and trimming the early-voting period from 17 days to 10.

One overlooked provision in the bill affects when local governments could set special elections. Carolina Journal reports that the bill also requires

local special election dates to coincide with state, county, or municipal general elections, except for elections related to the public health or safety, or municipal incorporation. Specified recall elections would be allowed on other dates also, as would new elections ordered by the courts or State Board of Elections.

This reform removes a sneaky tool in local governments’ tax-raising kit. A county or municipal vote held in an "off" time poses an additional time cost to prospective voters. It results in a much smaller turnout (sometimes in the single digits, in terms of percent of registered voters participating). Those who do turn out, however, tend disproportionately to be the ones who would benefit from the tax increase, which would affect everyone in the county whether he voted or not. Holding the special election in the summer, when many voters not in the know are more likely to be away on vacation, is a way to embellish this effect even further.

So a local referendum to increase taxes is more likely to pass when held on a "special" date, one that doesn’t coincide with state and national elections that draw more voters.

JLF’s City and County Issue Guide 2011 explained:

As part of a 2007 deal that swapped sales tax revenue for Medicaid payment obligations, counties also received the right to seek approval from their citizens to impose a new tax. The tax could be either a 0.25-cent increase on the 2.0-cent local sales tax (6.75 cents total) or a 0.04-percentage point increase on the 0.02-percent tax (to a 0.06-percent tax) on land transfers.

Sixty-five counties have sought one or both tax increases since 2007. Before giving up on the land-transfer tax in early 2009, counties invariably chose whichever increase had the higher projected revenue even though the land-transfer tax increase never won in 23 attempts. Voters rejected a sales-tax hike 57 of 69 times it was on the ballot during a primary or general election. County commissioners have won sales-tax hikes seven of nine times a vote was held at other times, including a May 17, 2011, vote in Cabarrus County that had a 3.5 percent turnout.

The guide included this handy visual of the effect (click on the graph for the full size):

The repeal of North Carolina’s unconstitutional taxpayer-financed campaign system

H.B. 589 also repeals the state’s taxpayer financing of campaigns. Such a move should take place given recent Supreme Court and federal court rulings, and in recent years no additional money was directed to taxpayer campaign-financing funds. Nevertheless, as discussed in JLF’s Agenda 2012, taxpayer campaign-finance schemes violate taxpayers’ rights of free speech and association and have various other unintended negative consequences.

Daren Bakst’s report from 2009 explored those problems and the clear unconstitutionality of the taxpayer-financing system.

Click here for the Rights & Regulation Update archive.