by Dr. Roy Cordato
Senior Economist, Emeritas
Earlier this week The Washington Post published an article written by a reporter named Todd Frankel, misleadingly titled “What Happened When North Carolina Cut Taxes Like the GOP Plans to for the Country.” I won’t review the article here. You can go to the link above and read it for yourself. With a title like the one used by the Post I would expect to see some real information like, state GDP growth went from X to Y, or the state’s unemployment rate went up or down by X amount, or state spending and deficits (surpluses) were impacted by this or that amount. But alas, none of that information was to be found.
Oddly enough the article did, to some degree, note some of these results for Kansas, who also implemented tax reform, but whose experience was quite different than North Carolina’s. For anyone who reads the article and knows what actually happened, it is quite clear that the author, Mr. Frankel, had his narrative in place before he even embarked on researching the piece and he wasn’t going to be deterred by the facts. Some of those fact are laid out nicely by Senator Thom Tillis in this Tweet.
My point, though is to relay my personal, but brief, interview with Frankel and the Post as it relates to this article. He started by asking me about the economic impact on the state, after all I’m an economist. I mentioned that NC experienced growth greater than the national average and the state budget has had surpluses every year since the reforms/cuts were passed. I also noted the large increases in NC’s rainy day fund. My impression was that he was suspicious of what I was telling him–like that can’t be right. After a brief couple minutes on the economics he wanted to switch to politics. My guess is that I wasn’t giving him the ammunition he was looking for. Frankel started pressing me on why, if the tax reform was such a success, did McCrory lose. First I explained to him that I was an economist and probably not the best person to talk to about the politics of last year’s election, but I told him that the campaign was mostly about other issues and Cooper, in offering his first budget, once he took office, did not propose to raise taxes or overturn the 2013 changes. Again, there was clear skepticism on his part. My sense is that he believed that the tax overhaul was quite unpopular and that the new Governor would have certainly put in his bid to overturn it.
While this might sound like a lot, the entire conversation probably took under 10 minutes. The bottom line is that none of what I told him about what actually “happened when North Carolina cut taxes” ended up in the article. I guess the Post’s motto should be, “if the facts don’t fit, you must omit.”