The gorilla on the state’s back is getting heavy
Government at all levels needs to spend money judiciously. It is, after all, our money. I’m not convinced either major political party is doing that very well right now. What we get is competing priorities, which is why voters need to make choices. That’s where things sometimes get complicated.
North Carolina House Speaker Pro Tem Dale Folwell, a Winston-Salem Republican, makes a strong case for taking relatively drastic and perhaps painful steps to get the state’s fiscal house in order. In a talk he gave last week at a meeting of the North Carolina Press Association in Chapel Hill, the candidate for lieutenant governor revealed a policy wonk mentality and knowledge of issues that left me impressed.
Folwell is part of the new General Assembly leadership that took over in the last session and went right to work to make changes. I’ve criticized some of those moves, as have many other newspaper editors, and continue to disagree with many of them.
Folwell and Senate President Pro Tem Phil Berger, however, both made the case that the moves taken by the new Republican leadership will help North Carolina. Whatever one’s political stripes, what happens in Raleigh is important, and Folwell did a good job of using statistical data to shed light on a few important issues that are flying under the radar of most voters.
Folwell was blunt and matter of fact. He proclaimed that there are “four ‘invisible costs’ that will drive all the legislative issues North Carolina faces through the next generation. Those invisible costs are state debt, public retiree health care costs, state employee pensions and unemployment.”
Without getting into all the numbers, Folwell’s presentation shows that North Carolina’s pension system has not met its investment goals. That means the system will not pay for itself and will need tax dollars to keep it solvent unless things improve dramatically. The state also has obligations toward the cost of retiree health benefits and a huge debt to the federal government for unemployment benefits sent our way during this recession.
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Right now the state keeps 4.75 cents of the sales tax on every dollar. To meet the obligations outlined above, Folwell says the state would need to more than double the sales tax to 10 cents. Ouch.
These are obligations to teachers and other state employees that we have to keep. Neither party has yet laid out a plan to solve this problem. As we struggle during this recession to adequately fund current public services — education, health care for the poor and elderly, roads, public safety, economic development, etc. — there is a bit of a monkey on our backs. Better yet, a gorilla.
Elections are coming up. We voters better pay attention, or they’ll be hell to pay a few years down the road.
(Scott McLeod can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..)
