Opinion

More state spending won’t help; a check in the mail will

Moore, Berger announce refund to NC taxpayers

House Speaker Tim Moore and Senate Leader Phil Berger talk about the Taxpayer Refund Act, a bill that will give up to $125 individual or $250 joint filing to 5.1 million North Carolina taxpayers, if it passes.
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House Speaker Tim Moore and Senate Leader Phil Berger talk about the Taxpayer Refund Act, a bill that will give up to $125 individual or $250 joint filing to 5.1 million North Carolina taxpayers, if it passes.

The same folks who kept crying wolf about how GOP tax policies were going to send the state’s finances into the ditch are now trying to tell us how to spend North Carolina’s latest budget surplus.

No surprise they oppose the Republican’s plan to return about most of that $896 million bounty to taxpayers — $125 to single filers and $250 to joint filers.

Instead, they are sounding the same old call for more spending on teacher salaries and the university system, on infrastructure, the criminal justice system and, of course, Medicaid expansion.

The state can always spend more money — there are always salaries to raise, programs to initiate or expand.

But every citizen and business can say the same — I’ll show you my lottery-winnings wish list if you show me yours.

The difference is that we are limited in ways that government is not. We, the people, are limited by what we make; government can take what it wants.

It is precisely because government is insulated from the market signals that limit businesses and people — i.e. what people are willing to pay for their products and skills — that it has a greater responsibility to justify the need for every dollar it takes and spends.

In the real world, of course, the exact opposite happens. Government at all levels does a poor job of measuring the efficiency and effectiveness of its programs — for a crash course read “Why Government Fails So Often,” by Yale professor Peter H. Schuck.

One way we might reduce the partisan divide is if the people demanding more government spending paid more attention to how it is using the money it already has.

Take education. In recent decades the number of administrators has risen sharply. Are their salaries the best use of our funds? And what measurable benefits can we expect by boosting teacher salaries? What difference would Gov. Cooper’s proposed 8.5% increase provide over the legislature’s 3.9% raise?

As a practical matter, we can probably never increase their pay enough to convince talented young people to work in education rather than the law or tech. My children were educated in Wake County schools where they had many excellent instructors and several who had no business in the profession.

In addition, real per pupil spending has more than doubled since the 1970s with little improvement in student outcomes. Problems in the classroom are rooted in issues outside the schoolhouse. They won’t be solved with another across-the-board raise.

Obviously we need government and taxes. But taxes are a trade-off. A dollar spent by the government is a dollar not spent by a business or individual.

A recent editorial in this paper correctly observed that the GOP claim that “tax cuts generate more revenue by stimulating the economy” is incorrect. The record shows that at the state and federal levels, tax receipts do tend to rise after tax cuts, but at a slower rate.

But the economic literature is also clear that lower taxes, and regulation, help spur economic growth and opportunity. Here in North Carolina, real median income and family income have risen faster than the national average since GOP tax policies kicked in and our unemployment rate has fallen faster than the rest of the country.

The economy is complicated. Its health is determined by many factors besides tax rates. But as general proposition more people enjoy more opportunity when government lets people keep more of what they earn and decide for themselves how to spend it.

In a letter to the editor, a Durham woman who opposes the GOP said she plans to donate any tax refund she receives to Planned Parenthood. It’s good she has that choice.

Contributing columnist J. Peder Zane can be reached at jpederzane@jpederzane.com.





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