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Gov. Mike Easley has the right end in mind:improving education for North Carolina children, starting with the youngest. But he’s wrong when he says a lottery is the only means of getting there.
First, he and lawmakers have to convince citizens they’ve found all the savings they can in existing state programs, and all the revenue they can find in existing state taxes.
Elected with an aggressive agenda of education improvements, Easley took office only to find that whatever money the state might have had to carry out his ideas had disappeared. Blame Medicaid increases, tax cuts, education reforms, costly court decisions, a slowing economy. It all adds up to a mounting shortfall — latest tally, nearly $800 million.
The words of O. Max Gardner must be echoing in Easley’s ears. Forced to slash the budget when he took office as governor during the Great Depression, Gardner once wrote: “I lie awake at night wondering how I let my ambitions lead me into the governorship at a time like this.”
Easley sums up the feeling more jovially:“You might want to congratulate me on picking a great time to be governor.”
The funding crunch was not a complete surprise to Easley. As a candidate, he said that the state would need a lottery to carry out his education dreams. But the degree to which all state funding has fallen short has caught taxpayers by surprise.
Former Gov. Jim Hunt is no Bill Clinton. But questions have arisen in the aftermath of his administration, too. What did Hunt know and when did he know it when it came to the economic iceberg toward which he was steering the ship of state?Budget watchers point to last spring’s shrinking tax receipts, increasing Medicaid payouts and budget tricks —$120 million in delayed tax refunds —as sure signs of trouble that Hunt could not have missed.
Hunt rejects this line of questioning. “I just stand on the record,” he has been quoted as saying. “You can say any of it was too much as you look back, but the fact is that my tax revenues and so forth over the years have been very, very close to the mark, very conservative.”
Maybe so. Certainly few argued against Hunt’s main expansion items in 1999-2000 —increased spending for Smart Start and teachers’ salaries. They showed the same commitment to children and education that Easley is pushing now.
But former governors are not the only ones whose voices echo through the years, nor do you have to go far back to find an authority. Harlan Boyles, the state’s treasurer from 1977 until last month, was quoted recently in the Charlotte Observer as describing the situation this way: “We were so carried away with the prosperous economy that we assumed all would be well. In 1991, the economy was our problem. In 2001, spending is our problem. We are our problem.”
Easley has taken an important step in appointing Boyles to head a task force looking at tax-code loopholes. Easley suggested closing these gaps could raise as much as $2 billion —more than enough to fund smaller class sizes and a pre-kindergarten program for at-risk children.
Easley is creating possibilities. He is working on paring down state spending and beefing up tax collections without passing major new taxes. If he succeeds in both those areas, he might significantly lessen the amount of new revenue needed to carry out his education initiatives. Then he can present the voters of North Carolina with a clear-cut choice for coming up with the rest of the money:Vote for a lottery or, if these programs are truly essential to the future well-being of the state, support a tax increase.
Voters will be ready to make that decision when they have confidence in state budget numbers — both coming in and going out.
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