Perdue, Berger clash on jobs

Each questions other's priorities

Staff WriterApril 8, 2011 

— Despite early pledges of cooperation, the relationship between Democratic Gov. Bev Perdue and the Republican legislative leadership is growing increasingly frosty.

The strain was evident Thursday, when Perdue and Senate leader Phil Berger held dueling news conferences in which they questioned whether the other was doing all that could be done to alleviate North Carolina's persistently high unemployment rate.

Perdue admonished the legislature for spending what she called too much time on less important issues unrelated to jobs and education.

"When we finish coming out of this recession, I'll be happy to sit down with people on both sides of the aisle and argue until we are blue in the face over checking [inspection] stations and whether we need our own money system and where I should put my own campaign signs," Perdue said at a news conference at the state Department of Commerce.

"I don't mean to come across as the adult in the room," Perdue said, "but somebody has to be the adult in the room."

At his news conference earlier, Berger said that the state had shed more than 100,000 jobs during Perdue's administration and that the tax and spending policies of the Democrats had led to the current problems.

Berger belittled Perdue's two-week "jobs tour" as little more than a political show.

He called the tour and news conference "really a diversion from focusing on the failed policies that got us to this point." "It appears to me that the one job that Governor Perdue is worried about is her own. What we are looking at is her effort to raise money for her re-election."

He was referring to a political fundraiser that Perdue was scheduled to hold Thursday night in Winston-Salem after she held a town hall meeting that was part of her jobs tour.

The fraying relations could portend difficulties as the legislature and the governor attempt to agree on a way to patch together a solution to a budget shortfall, variously estimated at between $1.9 billion and $2.5 billion. Those changes could affect everything from the number of children in each public school classroom and college tuition to hours that state parks stay open.

The increasingly cool tone between the governor and the legislature comes after Perdue has vetoed two bills passed by the Republican legislature - a spending bill and a bill that would have had North Carolina join the legal challenge to the national health care overhaul passed by the Democratic Congress and supported by President Barack Obama.

Given the polarization of politics as seen in state capitals in Wisconsin, Ohio, Indiana and other states and the continuing bitter partisanship in Washington, the eroding of good will may have been inevitable. Republicans won control of the legislature in November for the first time since the 1800s.

"It was always on the cards," said Andrew Taylor, a political science professor at N.C. State University. "At the beginning of the session we had a lot of talk of cooperation. You don't want to seem narrow-minded.

"There are clear philosophical differences," Taylor said. "This is not a divided government we've had for a decade. The Republicans clearly see 2010 as a mandate to do something. They can't sit on their hands and accept status quo policy. They believe the 2010 elections were about the size and scope of government at all levels and they have been charged with reining it in. The most obvious way to do that is through cutting and spending."

What is notable, Taylor said, is that relationships have begun unraveling on early skirmishes, before the really difficult decisions have been faced on next year's budget.

The differences between Perdue and the legislature are so wide, they can't even agree to the terms of the debate.

Consider the following:

How big is the budget gap?

Perdue has been saying the budget shortfall for the fiscal year beginning July 1 is $1.9 billion. Berger puts the shortfall at $2.5 billion, citing figures from the legislature's nonpartisan Fiscal Research staff.

Did Democrats reduce spending?

Berger said the Republican legislature is now beginning to get serious about cutting spending, after years in which the Democrats refused to do so. Perdue and Democratic lawmakers say they have saved billions during the past several years of recession.

At a news conference Thursday, Berger had his staff distribute a chart showing overall spending rising from $19.6 billion in 2008-09 to $19.9 billion in 2009-10, to $20.6 billion in the current fiscal year. (Actually, spending of state taxpayer money had declined, because those figures included federal stimulus money - including $1.6 billion in the current fiscal year.)

According to the fiscal research staff, the previous legislatures closed a budget shortfall of $5.8 billion during the current fiscal year, and $4.6 billion the previous year through a combination of federal stimulus money, a $1.2 billion temporary tax increase and a series of economies such as closing of prisons, furloughs and no pay increases for state employees.

How is the state doing on jobs?

The state's approach in fostering jobs is one of failure, Republicans say. As evidence, they note that North Carolina has lost more than 100,000 jobs during Perdue's two years as governor and that the state is suffering from lingering high unemployment.

Berger says that the Republican prescription of smaller government, lower taxes, and less government regulation will help provide the best environment for job growth.

At her news conference at the Commerce Department, Perdue stood against a backdrop with corporate logos of companies that had either had announced they were opening operations in North Carolina or expanding here. Her website touts magazines such as Site Selection and Forbes naming North Carolina as one of the best states in the country to do business.

"We are a red hot state around the world," Perdue said.

North Carolina had an unemployment rate of 9.8 percent when she took office in January 2009 and now has an unemployment rate of 9.7 percent.

Perdue said that North Carolina was a victim of a global recession and that when she took office, she faced a $4.6 billion shortfall "that appeared to be caused by the meltdown of the global economy."

But Berger said bad policies, such as raising taxes, made the recession worse in North Carolina.

robc@newsobserver.com or 919-829-4532

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