The rift in Raleigh
Published March 22, 2015
Editorial by Greensboro News-Record, March 22, 2015.
The harsh language heard in Raleigh last week echoes the heated rhetoric frequently sounded in Washington.
There, it’s understandable. A Democratic president and Republican congressional leaders don’t agree on much and don’t like or respect each other.
In our state capital, the only players who matter are Republicans. They should work together rather than insult each other through public statements and press releases.
In addition to the acrimony over a constitutional separation-of-powers dispute, where Gov. Pat McCrory won the first round with a favorable court ruling against the legislature Monday, conflict emerged over tax policy and economic incentives.
The Senate introduced major proposals, including further corporate tax cuts, that seemed to catch the governor by surprise.
“It breaks the bank. It breaks the promises of last year’s tax reform,” McCrory said in remarks to the N.C. League of Municipalities.
“I’m trying to comprehend how the governor wants to spend $1 billion on new incentives but considers it ‘breaking the bank’ to allow North Carolina taxpayers and job-creators to keep about $500 million of their own money. The math does not add up,” Senate leader Phil Berger responded in a press statement.
McCrory meant this: The corporate tax changes, including cuts in the rate from 5 percent to 3 percent over the next two years, were supposed to kick in if revenue targets were met. If reducing the corporate tax rate actually produced more revenue by spurring business activity, it would make sense to reduce the rate further. It hasn’t happened. So further cuts will just leave a budget hole, reducing the state’s ability to pay for education, health care and other services.
The Senate is on firmer ground in wanting to spread economic incentives more evenly around the state. Most Job Development Investment Grant funds have gone to projects in just three counties: Wake, Durham and Mecklenburg. The Senate wants to guarantee that rural counties get more of that money. That proposal should be discussed and negotiated.
On the one hand, it’s interesting to see the conservative Senate acknowledge that incentives are often needed to foster economic development. At the same time, senators must come to grips with the larger reasons why rural counties and small towns aren’t attracting new businesses. Lack of public investment in education, infrastructure and quality-of-life amenities all are part of the equation. JDIG grants don’t drive companies to Wake, Mecklenburg and Durham counties; they are awarded because that’s where companies want to locate. Guilford County — fifth in JDIG grants awarded since 2002, according to a recent N.C. Justice Center study — must keep up.
There are real concerns about the growing economic divide between urban and rural areas in North Carolina. The governor and legislature should address this complex problem together.
It doesn’t make the state look more attractive or business-friendly when political leaders can’t talk without bickering.
March 22, 2015 at 7:03 pm
Norm Kelly says:
Libs disagree and it's swept under the rug. Republicans disagree and it's a major deal.
Incentives should be spread around the state? It's more logical to actually cut the corporate income tax rate again, to the 3% proposed. Then eliminate ALL business incentives. By cutting the corporate tax rate to 3%, doesn't EVERY business get an incentive to do business here? It wouldn't matter, then, where in the state the business located, it would automatically get the incentive of a lower tax rate. How does our tax rate compare to our neighboring state? Wouldn't it make sense for those employed by government to use the new, low tax rate as the incentive in EVERY discussion with any and all businesses looking to move or expand here?
Is it better for one or two businesses to get an incentive or for EVERY business to get an incentive? Wouldn't the new incentive, the tax rate, be better for ALL businesses and wouldn't that help to stir some economic activity in our state?
Why is it that raising taxes is always so desirable? Is it just libs that like raising taxes? We know that the uneducated will say idi0tic things like it doesn't matter if increasing a tax reduces income to the government, it's the fair thing to do to raise the tax anyway. That was the unqualified, communist, community organizer who made that comment. Before he referred to white people as stupid. Has there EVER been a tax that any lib has agreed should be cut? Has there ever been a tax increase that any lib hasn't supported?
I think it would be an excellent idea if all corporate tax rates were lowered to 3% except for publishing. Whether it's a magazine or a 'news' paper (rag!), the income tax rate for in-state publishing should be set at about 25%. Then, any publisher that chose to move/keep their production out of state should be penalized with a 38% tax for shipping their product into the state. This would greatly increase sorely needed revenue to the state. Imagine how many kids could get free/reduced lunch with a tax rate this high on publishing! I expect every lib in the state would back this proposal. Even rag publishers would support it because the state needs the money so bad, they realize they are just players in the game and it's their turn to support the needs of the state. After all, libs believe needs of the state trump personal property, personal income, and taxing businesses does not negatively impact any other aspect of business or families. It's time libs are forced to live under their own policies and beliefs. Force their religion on them instead of letting them force their religion on us. I have my religion that I am quite happy with and CHOOSE not to participate in the religion of the left!
