Economic underdevelopment

by Thomas Mills, Politics NC, November 14, 2013.

There’s a lot of talk about North Carolina’s stubbornly high unemployment rate and job recruitment efforts lately. Commerce Secretary Sharon Decker says that we can blame a lot of our woes on people who have moved to the state to find employment but have not been successful. John Hood, President of the John Locke Foundation, says that, contrary to popular opinion, our economic sluggishness is not confined to rural areas but includes urban centers like RTP and Charlotte.

Republicans’ solutions to these problem hinge on their tired mantra of less taxes and lower regulations.Gary Pearce, though, speculates that those solutions may backfire and with good reason. He asks whether companies are going to find the workforce they want in a state that underfunds education, discriminates against gays and lesbians and generally panders to the narrow-minded views of religious fundamentalists.

Decker’s assertion is based on data from 2008 to 2010 when the state was still one of the fastest growing in the nation. We’ve had almost three years of anemic growth since then. Her rationale sounds more like an excuse than anything. The GOP enacted tax cuts in 2011 that they said were going to juice the economy. Obviously, it didn’t work.

As for Hood’s assessment, he says our metros aren’t performing as well as some would imply and that the state, overall, is not competitive as a place to make a living. He sites Moneyrate.com to show that NC is ranked 38th overall as best place to make a living based on a variety of factors including cost of living, housing prices, energy prices and state and local taxes. What he doesn’t mention is that we are falling, not gaining, on the Moneyrate scale. Under Republican rule, we’ve dropped four places since 2011. So maybe their economic policies are making us less attractive, not more so.

In contrast, Pearce’s speculation is right in line with the assessment of Raleigh’s economic development manager. He says that Raleigh competes with larger cities because of its educated workforce and amenities like parks and the arts. So cutting funding to community colleges, public universities and our public schools doesn’t seem like much of a strategy.

Republicans in North Carolina, like the Europeans, have decided that austerity is the right answer to our economic woes. They’ve had control of government for three years now and it hasn’t worked out so well. Instead of attracting industry, they are scaring them with their regressive taxes, puritanical philosophy and cuts to education. By 2014, they will own the economy here in North Carolina. They better hope for a quick uptick.