Civitas Review Online

As a proud North Carolinian, I can’t recall a time where I’ve ever felt jealousy for anything in New Jersey over anything here at home.

Well, NJ Governor Chris Christie is changing my opinion.  Just check out this clip:

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Two questions for fellow North Carolinians… why can’t our own governor show this type of leadership or commitment on any issue?

And failing that, where is the NCGOP’s Chris Christie?  Who will be willing to assume the leadership mantle and have the cajones to tell the truth and tackle the tough problems?  Pat McCrory? Phil Berger? Skip Stam? Thom Tillis? Tom Fetzer?

Who will do it?

Courtesy of this report from WRAL

North Carolina will face one of the largest state deficits in the country next year, according to a new report.

The National Conference of State Legislatures surveyed 35 states to get a picture of their fiscal health heading into the 2011-12 budget year.

….

Only California, Connecticut, Minnesota, New York and Texas are projecting deeper 2011-12 budget holes than North Carolina in terms of total dollars, according to the report. When looking at the deficit as a percentage of the state budget, California, Connecticut, Hawaii, Minnesota, New York, Oregon and South Carolina are in more trouble than North Carolina, the report states.

The primary culprit in NC’s startling budget gap for next year is the structural deficit built in due to our budget writers’ short-sighted reliance on temporary taxes and federal stimulus dollars that are slated to run dry after this year - something I’ve been warning about for well over a year.

Previously, I’ve blogged about Governor Perdue’s statist desire to secure ownership of four dams in the Uwharrie region of North Carolina currently owned by Alcoa.  The General Assembly has capitulated and passed legislation, providing Perdue with a means to acquire ownership of the dams.  The legislation, HB972, creates the Uwharrie Regional Resources Commission which has all of the necessary powers to acquire the dams vested in it.

Per the News & Observer, a meeting of individuals desiring that the state acquire the dams has been planned for this week.  The report does not indicate who exactly will be in attendance but does note that Alcoa will not have a representative present because the company “doesn’t think the discussion will be balanced.”  That is a safe bet.    The meeting indicates that the Perdue Administration intends to move forward with its attempt to acquire Alcoa’s property.  Simply put, Governor Perdue would prefer the state own the dams and produce hydroelectric energy than for Alcoa to own the dams and produce hydroelectric energy – both entities would produce energy for retail use.  Nevermind that the state cannot afford to purchase the dams anyway. Alcoa provides the same public good that the state would provide if it owned the dams, so for what purpose does Perdue want state ownership?  Because she believes in a more powerful centralized state and in the state over the private sector.  That is statism.

A political fundraiser for State Senate Pro-Tem Marc Basnight (D-Dare) was advertised via a publicly funded e-mail list according to a news report.  An invitation to the event was sent to the town of Kill Devil Hills e-mail list.  Using the town e-mail list was unethical, but news reports suggest that the entire episode was a mistake.  Per the story, a junior campaign staffer was asked to ensure that all of the local elected officials be made aware of the fundraiser.  Town Clerk Mary Quidley, who appears to be a registered Democrat like Basnight, forwarded along the invitation to the public e-mail list “without giving it a world of thought.”

Even if it was a simple mistake that the e-mail was sent out, the Basnight Campaign has received at least some undue benefit from the e-mail in the way of name recognition or possible donations.  Basnight typically dishes out funds to Democrats in close elections.  On a cynical note, yet without suggesting impropriety, one might be led to believe that it was not an accident that the invitation was sent out via the public listserv.  Given the recent record politicians in Raleigh (think Jim Black, Mike Easley, Meg  Scott Phipps), the people can draw their own conclusions.

I think we’re all suppose to be giddy by yesterday’s announcement that North Carolina is a finalist in the scecond round for Federal Race to the Top Funds.  I”ve spelled out my reasons why I don’t share in the excitement.  However, now I can add another to the list. 

To improve the state’s chances of qualifying for RttT funds, the conventional wisdom was North Carolina needed to either lift the cap on charter schools or improve the climate in which charter schools operate. This reality did not sit well with the major political and educational leaders in the state, most of whom oppose charter schools.  So what did North Carolina do?

The legislature approved — and Gov. Perdue signed – a bill (SB 704). The new law allows the state to convert low-performing schools to charter schools  (See my comments on SB 704) . This is bad for two reasons. First, since charter schools are subject to the same academic performance tests as traditional public schools, increasing the number of low-performing charter schools will not help the cause. But I guess those in power knew exactly what they were doing. Second, and more importantly, the legislation puts the local school board in charge of all low-performing charter schools.  The legislation essentially redefines charter schools.  Under this arrangement,  I wonder how it is even possible for these schools to remain charter schools.

Sorry, but it’s not a good day for people who think administrative flexibility and  innovation are two of the best ways to reform public education.

The North Carolina League of Municipalities is telling its members a collective bargaining mandate was dropped from a U.S. House appropriations bill.

The League posted an article notifying members:

Governor Perdue is pursuing the idea of asking private companies to run some of the information technology infrastructure to save money. But the State Employees Association of North Carolina (an affiliate of Service Employees Union International) is fighting the idea.

This is from a recent post of the association’s web site:

SEANC is perplexed that Gov. Bev Perdue, who says jobs are her top priority, is looking at privatizing the state’s information technology infrastructure. Privatization will surely lead to job cuts, including the state’s 600 IT employees, and most likely will ship those jobs oversees, where many IT operations are outsourced. SEANC urges the governor to keep North Carolinians working and to rely on the experts already in state government to look for efficiencies and opportunities to streamline resources.

The N&O reported recently the Governor said IT accounted for over $1 billion in expenses last year.

Senator Kay Hagan is on record now supporting continuing tax cuts set to expire if they only benefit the “middle class.” Our analysis shows all the cuts affect that population in some way. See the latest Civitas Report at the “Transparency” link above.

Economically-illiterate and authoritarian commentary on health care reform has become the norm for the Raleigh News & Observer. Consider today’s latest installment, which indicates how confused and ignorant the authors of the article are on the topic. The article’s focus is on a report claiming the ”cash reserves” held by Blue Cross and Blue Shield of North Carolina are excessive.

Like virtually every aspect of the health care industry in this country, however, the government mandates health insurance companies hold substantial reserves to cover an unexpected spike in insurance claims. 

The company responds to the report by noting that the law requires a three- to six-month reserve based on claims and administrative costs, and that BCBS is at about 3.6 months.

The issue here, however, isn’t whether the company is up to something. It’s whether the law is out of kilter in what it requires.

All of these things reflect the nature of a health care system that, unlike those in other nations of the industrialized world, is driven by profit margins and a free-market structure.

Dare I say that Governor Perdue may be on to something?  According to a recent article on WRAL.com, a good read by the way, the Governor is open to privatizing parts of the ABC System and legalizing video poker for the purpose of increasing tax revenue and allowing government to focus on its core missions of economic development and education.  In principle, Governor Perdue is on the right track.  State government should focus on its job of economic development and education; maintaining transportation infrastructure is also a priority.

Noting the contradictory stance the General Assembly has taken by allowing a state run lottery while banning privately run gambling in the form of video poker and sweepstakes games is an admission that the state’s policy on gambling is hypocritical.  Perdue, having cast the tie-breaking vote on the state lottery in 2005, knows that to prevent being a hypocrite herself she must support private gambling ventures – though tightly regulated.  Allowing video poker and sweepstakes games in addition to the state lottery, plus the tax revenues that would roll in as a result of taxing the games, would allow the state to focus on its core mission and eliminate the contradiction.

Privatization of the ABC would certainly be a hot issue if it ever received the full attention of the legislature and the public.  With an outside evaluation of the system on its way, privatization of the archaic system may yet make its way into the limelight.  If the General Assembly were to vote to privatize liquor sales, the tax revenue from such would likely rise dramatically.  Currently, the ABC System attempts to limit liquor sales, thus depressing revenue.  Proliferation of liquor availability would likely lead to even more increased sales volume and, therefore, more tax revenue.  Thus, the state would have sufficient revenue to focus on economic development, transportation infrastructure and education.

While these ideas mentioned by Governor Perdue are worthy of consideration, privatizing liquor sales and allowing video poker and sweepstakes games are by no means an exhaustive list of ideas to maximize the efficiency and effectiveness of state government and cover revenue gaps.  Furthermore, Governor Perdue may not agree with what conservatives consider to be the best economic development strategies.  However, the Governor should be given credit for understanding that our state government as it currently exists is unsustainable and in need of a shakeup.