Wealth redistribution plan coming
Published March 17, 2015
by Doug Clark, Off the Record, Greensboro News-Record, March 16, 2015.
The other shoe is about to drop, and it's a big one.
The N&O of Raleigh reports that N.C. Senate Republicans will introduce their wealth-redistribution plan this week.
They've been working up to it. I wrote a preview last July.
It's related to their efforts to weaken Democratic power in the state's urban areas.
The concern is the decline in rural areas, which is a very serious problem in North Carolina.
While cities are progressing, some more than others, small towns and sparsely populated counties are suffering.
The large cities generally are run by Democrats; the smaller towns and rural counties by Republicans.
Job growth is happening in the cities. So is retail development. People who live in outlying areas visit the cities to eat out, shop and seek entertainment. They pay sales taxes on their purchases, and much of that tax revenue accrues to the cities, although some is redistributed based on a population formula.
Senate Republicans, who largely represent suburban areas, small towns and rural counties, want to redistribute more of the money. A lot more.
There's a case to be made for a greater share-the-wealth scheme (although it's not one Republicans usually make). The question is how far to go.
Given the overall assault on cities waged by legislative Republicans, the cities and urban counties can fear they'll be hit too hard. Losing millions in sales taxes will force them to raise their property taxes if they want to maintain their current levels of education funding and other services.
Here's where engineering more Republican city and urban county governments can help: They might be more inclined to cut funding. But legislators might have miscalculated on this point because even Republican county commissioners and city council members will resist efforts to take away local tax revenue.
There's also a fear that depleting cities and urban areas of sales-tax revenue and forcing them to raise property taxes, or in the alternative forcing them to cut services, will hurt their economic competitiveness. Starving them of revenues will make them more like our failing small towns. In the short run, Republican senators may get to play Robin Hood. But in the long run, it won't pull up those at the bottom to drag down those at the top.
This is going to be a heck of a battle --one that, incidentally, will test our governor's leadership.
