The year 2010 was a good one for North Carolina’s Republican lawmakers. Apparently, they’ve decided to stay there.
That’s the message in the state budget’s bottom line announced this week by state House and Senate leaders. They have agreed to a $21.75 billion budget cap that keeps state spending essentially locked at the level of the Great Recession when unemployment soared, businesses suffered and state tax revenue decreased sharply.
The recession forced an austerity budget – even when supplemented by federal stimulus money – that totaled $19 billion in 2009-10, a sharp drop from the 2008-09 budget of $21.2 billion. In 2010, of course, Republicans rode discontent over job losses and fed hysteria about the coming calamity of “Obamacare” to take control of the General Assembly for the first time in over a century.
Now they want to keep the state budget suspended in that gloomy economic period of salary freezes and spending cuts. In most states, legislatures are restoring spending to at least pre-recession levels. Some are working with large budget surpluses. But in North Carolina, Republican-backed tax cuts have made it impossible for state spending to return to its historic norm.
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Even House leaders originally agreed that it was time for the state to catch up after years of austerity and proposed a budget increase of 5 percent. But in negotiations with the Senate, House leaders agreed to cut $415 million from their proposal and limit the state budget increase to 3.1 percent, essentially a freeze after accounting for inflation and population growth.
After adjusting for inflation, the General Assembly has not increased spending since the 2007-2008 budget despite a state population increase of more than 900,000 people. The N.C. Budget and Tax Center, which advocates fairness in state taxes and spending, reports that state spending per capita has fallen sharply. In real dollars, state spending in 2008 was $379 more than is proposed for fiscal year 2016, a drop from $2,541 to $2,162 per capita.
That decline is not worrisome to the state’s Republican leaders. Most regard tight funding as a way of squeezing out wasteful and unproductive spending. But it’s clearly doing more than that. This level of funding means state employees will continue to go without raises, teacher pay will not move up from the bottom of national rankings; thousands of teacher assistants could lose their jobs; state buildings, parks and transportation systems will continue to defer maintenance; and North Carolina’s quality of life and its economic vitality will be diminished.