Wednesday, July 28, 2010

North Carolina's Castle Built on Sand

What do you get when you cross a current state budget shortfall with increased spending, hundreds of new full-time state employees, dependence on federal money that may never show, and increased debt?

North Carolina's 2010-2011 budget disaster.

Brian Balfour of the highlights some of the most ridiculous and insulting components of the new North Carolina budget, and it ain't pretty.

  • Total Spending Up Again, Contingency Plan in Place for Federal Funds Not Yet Approved
  • Ineffective Attempt at Small Business Relief
  • Lawmakers Pile on More Unauthorized Debt
  • Setting the Stage for an Even Worse Crisis in 2011-12

Right now there is a projected budget shortfall of about $3 billion and the NC legislature voted to increase spending by 4.8 percent, almost a billion dollars. The budget also adds over 800 new full-time employees to the state payroll, which of course will include their salaries, benefits, and pensions. They are also making a grave mistake by using one-time federal stimulus dollars and not yet existent federal Medicaid dollars to backfill parts of the budget. As if this is not bad enough, their "contingency" budget, in the event the federal funds don't come through, has not been approved yet and relies on even sketchier transfers and gimmicks.

The legislature threw in some almost meaningless tax cuts for small businesses but it's apparently so narrowly focused that the consensus in the business world, a.k.a. the real world, is that it will do little to inspire confidence in business owners to grow their businesses. They also not only increased NC's debt, ignoring the State Treasurer's recommendations, but also raised it without going to the voters even though the state Constitution requires new debt to be approved by the voters.

NC politicians should be ashamed of themselves for acting so irresponsibly with taxpayers' money. They were hired to do a very simple job and they again have turned it into a bloated mess that threatens the economic survival of the people and business owners of North Carolina. Not only did they maliciously neglect their responsibilities to taxpayers, they kicked the can down the road and have succeeded in assuring that next year's budget crisis will be even worse. Unfortunately, North Carolina is not alone in their downward spiral, as other state legislatures and Governors are employing the same gimmicks and tricks for the same reasons: they are spineless cowards.

Note to North Carolina voters: it's time for change. This is a good place to start.

Cross posted at State Budget Solutions


  1. my sister lives in NC but thankfully not as a resident but rather as military. If she were a resident, she'd probably join the rest of them in poverty-- taxes are ridiculous!!!

  2. Well said, Liberty Belle. As a lifelong resident of NC, I am disgusted with the way the legislature does things here. I wasn't political until about 2 - 3 years ago, but you can bet your bottom dollar I'm involved now! I only hope my fellow Carolinians will wake up and smell the coffee before it's too late.


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