J. Peder Zane

TABOR is appealing, but ultimately undemocratic

J. Peder Zane

To appreciate why North Carolina Republicans may offer a constitutional amendment to limit taxes and spending, the “Taxpayers Bill of Rights” or TABOR, it helps to ponder Democratic economics.

In bad times, Democrats argue we must increase government spending to “prime the pump.” The fact this hasn’t worked as promised since FDR tried it during the Great Depression has not affected their thinking. Sure, President Obama’s stimulus saved or created some jobs – it’s hard to completely waste a trillion bucks – but the costs far outweighed the benefits.

In good times, Democrats argue … the exact same thing: We must tap bulging wallets to “invest” (i.e., tax and spend) in government (in the hopes that some will trickle down to the people). When Democrats controlled North Carolina’s government during the salad days of the Bush administration – ah, sweet memories of 2004-08 – state spending rose by about $9 billion more than required by population growth and inflation.

That above-and-beyond increase provides important context for assessing Democratic complaints about budgets passed and proposed by N.C. Republicans since voters gave them control of the legislature in 2011 – and why some GOP leaders are exploring TABOR.

It is true, as a recent editorial in this paper noted, that “the General Assembly has not increased spending since the 2007-2008 budget despite a state population increase of more than 900,000 people. … 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.”

But, if we take 2004 as our starting point instead of 2008, it is clear that the proposed 2015-16 budget is roughly in line with the growth in population and inflation.

Put another way, as the state and national economy has weathered a period of tremendous financial stress – when many businesses have closed or laid-off workers, when discouraged workers have stopped looking for jobs and families have been forced to trim their budgets – government spending has remained fairly steady. The argument, then, is not about cutting government but limiting its expansion.

Is big government good? Democrats say yes. Republicans say no. We will not settle that endless debate here. It’s why we have elections.

But TABOR brings a fresh focus to this debate. It is, in many ways, the GOP adoption of the Democratic approach to government.

A major difference between Republicans and Democrats is that while the former group’s victories tend to be fleeting, the latter’s are forever. GOP efforts to trim taxes and slow the growth of government are easily undone by Democrats. Just pass a bill.

Democratic initiatives, which tend to make people dependent on government through entitlements and distort the market through entrenched regulations, are indomitable.

Even President Obama admits that his party’s three great pillars – Social Security, Medicaid and Medicare – are “unsustainable.” Whatever their impact, we are stuck with them. Similarly, just a few years in, the Affordable Care Act appears to be both a major debacle and extremely difficult to dislodge.

In North Carolina, Democrats argue that we should increase teacher salaries and infrastructure investment. What they fail to mention is that this is hard to do at current tax rates because almost a fifth of our state budget goes to Medicaid mandates.

The intent of TABOR is appealing – to limit taxes so that government cannot grow faster than population growth and inflation. It would impose today’s budget priorities on future generations, making it harder for the next Democratic-controlled legislature to reverse the GOP’s recent accomplishments with a single vote. It is the GOP equivalent of a carved in stone, no way around it, anti-democratic Democrat program.

That is why TABOR is a bad idea. It has been rejected by states around the nation because it hamstrings government, limiting its ability to respond to changing circumstances. These can include both immediate crises and whims of the electorate.

Unlike our national government and its $19 trillion debt, North Carolina already has an important fiscal break baked into our system – the requirement to pass a balanced budget. If, at some point, voters want to increase spending, and pay for it, they should be able to.

It’s a scary thought, but it’s democracy.

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