Some simple and powerful truths about the NC economy

by Alexandra Forter Sirota, NC Budget and Tax Center, January 7, 2016.

North Carolinians have long recognized that for the state’s economy to work well, it must work well for everyone.

That’s why we built the first public university system in the country. It’s why we encouraged private sector innovation and research through a public commitment to modern infrastructure and training a world-class workforce.

This “big idea” that our economic fates are intertwined; that we must work together for broadly shared prosperity — launched our state on a different path than our neighbors. It made North Carolina such a great place to raise a family or run a business; our quality of life surpassed the other states in the region.

This strong tradition of caring and investing is in stark and discouraging contrast to the complacency of policymakers and pundits who believe North Carolina’s economy today is doing quite well. The reality is far from it. It’s time to raise the bar on what constitutes truly shared success.

The truth is that, for most North Carolinians, an hour’s pay today buys less than it did six years ago. What they make isn’t keeping up with the rising cost of housing, food and child care. Week to week they must confront decisions about what necessity to do without.

Tax cut devotees claim these policies are putting more in everyone’s pockets, but the fact is that most North Carolinians have less due to the double whammy of eroding wages and a heavier tax load. The tax cuts continue to provide big tax breaks for the people who make the most while middle-class and low-income families shoulder more and more of the tax load.

Meanwhile, most communities in North Carolina are struggling to keep their footing in a changing economic landscape. Many good jobs have disappeared – replaced by jobs that pay less (if they have been replaced at all). Poverty remains persistently high in many eastern and western counties and pockets of concentrated poverty have grown in urban and suburban communities across the state. North Carolina is, unfortunately, the home to too many communities where children born poor are among the least likely to move up the economic ladder in the nation.

Rather than build a pathway to the middle class in every community that passes through a schoolhouse and down a vibrant main street, North Carolina policymakers have chosen to give tax breaks to the wealthiest people and biggest corporations. The result: shortchanging schools, small businesses and public investments in water and sewer infrastructure, roads and other building blocks of job creation and economic growth.

Clearly it’s time to get back to the big idea that made North Carolina great.

Through smart investments and policy choices, North Carolina can strengthen the foundation of its economy so that it works for everyone.

That means ensuring that every community has infrastructure to deliver opportunity and support work, starting not just with roads, water and sewer, but public transit, broadband, affordable housing and health care providers as well.

That means removing barriers for those who are today still excluded from achieving their full economic potential by targeting investments to disadvantaged communities, connecting these communities to regional economies and seeding entrepreneurial efforts to deliver on the potential of inclusive innovation.

That means paving pathways out of poverty in every community with early childhood programs to prepare every child for kindergarten, with schools that offer the teachers, technology and classrooms that support a 21st century educational experience of high quality and affordable opportunities for lifelong learning.

And that also means reducing the harm that is inflicted on people and communities by the scourge of poverty through policies that stabilize families by ensuring access to food assistance, temporary wage replacement in times of need and job training relevant to local industry.

North Carolina’s leaders need to take our economy off auto-pilot. The idea of simply cutting taxes and coasting our way to prosperity just doesn’t work. Take a look at who is winning and losing. And don’t say the answer is for each person to figure a way out on their own. Deep down, North Carolinians know that our economy grows strongest when we all have opportunity and when lawmakers put the public good above helping the few. Let’s get back on that path.

Alexandra Sirota is the Director of the North Carolina Budget & Tax Center.

http://www.ncpolicywatch.com/2016/01/07/some-simple-and-powerful-truths-about-the-north-carolina-economy/