Civitas Review Online

North Carolina State Auditor Beth Wood can’t seem to stay out of the news. In early February, Under the Dome reported Wood was late in paying a $1,200 property tax bill on her Raleigh residence. Wood said she was late because she had to repay a $90,000 loan she took out to help finance her 2008 campaign for State Auditor.

Wake County Property Tax online records indicate Wood paid her delinquent taxes in full on February 26, 2010. She later told Under the Dome, “I work from a budget. It is a choice I made to pay the property taxes late and pay the interest charge that goes with it.”

Come again? In February, didn’t Wood say the burden of her $90,000 campaign debt precipitated the late payment? Now a month later the State Auditor said, she’s on a budget and the late payment was merely a “choice” she made.

Seems like over the past decade Beth Wood has been making that “choice” quite frequently. Wake County Property Tax records indicate Wood was late in paying not only her 2009 property taxes but also her 2008 property taxes. A review of the records seems to indicate Wood frequently “chooses” not to pay her property taxes on time.  She was late in 2000 on her Lexus, and  in 1998 she was late paying taxes on the same car. As far back as 1995 she was “choosing” to pay her property taxes late.

Now it should be noted that in every case Auditor Woods has paid all of the taxes and whatever penalties and interest was assessed. What is interesting in the context of the story was her initial story that her borrowing money to finance her campaign was what necessitated her paying the taxes late. That does not seem to square with her record of past late payments.

In her present position as State Auditor we have to hope Woods ensures taxpayers that her approach to watching out for how tax dollars are spent is a little less cavalier than her approach to paying taxes.

Since most companies know our state’s leadership are a bunch of suckers for incentive packages and will throw taxpayer money around chasing the elusive score, North Carolina has once again been used as the rabbit to run up the incentive package for another state — this time, Radio Shack has made NC its tease.

RadioShack, which has looked at Raleigh as a possible place to move its corporate headquarters, is making signs that it plans to stay in Fort Worth.

The Fort Worth Star-Telegram reported today that the company’s lease on the Tarrant County College campus it shares with the college had been extended for five years.

So once again the state gets “played” for a package of incentives.  Instead of just being used as a tool to drive up a negotiating position, it’s time the state just said no.

The Heritage Foundation’s Brian Riedl has this lengthy summary of President Obama’s budget in the Wall Street Journal. An excerpt:

When he released his new budget proposal on February 1, President Barack Obama asserted that the government “simply cannot continue to spend as if deficits don’t have consequences; as if waste doesn’t matter; as if the hard-earned tax dollars of the American people can be treated like Monopoly money; as if we can ignore this challenge for another generation.”

Yet the President’s new budget does exactly that– raising taxes by $3 trillion and federal spending by $1.6 trillion over the next ten years. If enacted, this budget would increase the 2010 deficit to more than $1.5 trillion, and leave a deficit of more than $1 trillion even after an assumed return to peace and prosperity. Overall, the President’s budget would double the national debt over the next decade.

Runaway debt, massive deficits, job-killing tax hikes. Oh the joys of Hope and Change.

It seems the folks at Red State have notice our cocaine and monkeys article and have written a post about it. They also were quite creative in coming up with the following image to parody this wasteful spending.

Gov. Perdue today announced that North Carolina state employees  won’t be getting a pay raise in this summer’s budget.  Perdue did, however, mention the  possibility of paying back the unpaid two-day furlough from last year; but that remains in doubt.

Perdue’s administration writes the first draft of the state budget every year, and lawmakers then make substantial changes before passing it. In this case, though, legislative leaders already agreed with Perdue on forgoing raises. They expressed caution about paying back the $65 million to $70 million in furlough money.

“It depends on the economy,” said Rep. Mickey Michaux, a Durham Democrat and senior budget committee chairman. “I would gladly consider it, but that’ll be tempered by what [revenue] we’re bringing in.”

The governor did not comment on whether any state workers will lose their jobs this year, an issue on which they had conflicting messages recently.

The Washington D.C. based Tax Foundation released this report critiquing the “Amazon Tax,” a tax North Carolina enacted as part of the state budget last summer. Some highlights:

Sponsors have promised that a revenue windfall would follow enactment of an Amazon tax, but no windfalls have been forthcoming so far. This is often because online companies respond to Amazon tax law enactments by ending their affiliate programs.

….

Similarly, legislative officials estimated that North Carolina’s Amazon tax would raise $13 million in its first year of operation, but the termination of affiliate programs in the state makes this unlikely. Revenue officials have stated that they are not tracking Amazon tax revenues.

North Carolina lawmakers saw the Amazon tax as another revenue stream to help bail them out of a massive budget deficit last summer. It appears those funds won’t materialize. North Carolina’s current fiscal year revenue is already below projections, and may likely fall even further behind as the year unfolds. Additional layoffs and unpaid furloughs for state employees and teachers may well be on the horizon in order for the state to pay its bills. This dire situation can be blamed, in part, on legislators’ misguided belief that the Amazon tax would bring in millions in tax revenue. They can’t claim that they weren’t warned.

On a somewhat related note to Civitas being mentioned on Fox News, last night Hannity began a series examining wasteful stimulus projects from around the country. The first installment highlighted a grant awarded to Michigan State University to help preserve their bug collection. Hmmm, that sounds familiar. Oh yeah, its the same as this item from the Civitas Institute’s “Top 10 Worst Federal Stimulus Projects in North Carolina”

9. Preservation of an insect collection at North Carolina State: $253,123

This raises the question: Just how many bug collections received stimulus money, and how much?

Today’s Drudge Report links to a McClatchy News article discussing my recent article on “The 10 Worst Federal Stimulus Projects in North Carolina.”

The radical left’s favorite partisan hackonomist, Paul Krugman of the NY Times, had some rather “bizarre” comments about unemployment benefits, as called out in the Wall Street Journal. When discussing the notion that extending unemployment benefits incentivize extended joblessness, Krugman declared:

Today, Democrats and Republicans live in different universes, both intellectually and morally.

Take the question of helping the unemployed in the middle of a deep slump. What Democrats believe is what textbook economics says: that when the economy is deeply depressed, extending unemployment benefits not only helps those in need, it also reduces unemployment.

….

But that’s not how Republicans see it. Here’s what Senator Jon Kyl of Arizona, the second-ranking Republican in the Senate, had to say when defending Mr. Bunning’s position (although not joining his blockade): unemployment relief “doesn’t create new jobs. In fact, if anything, continuing to pay people unemployment compensation is a disincentive for them to seek new work.”

In Mr. Kyl’s view, then, what we really need to worry about right now — with more than five unemployed workers for every job opening, and long-term unemployment at its highest level since the Great Depression — is whether we’re reducing the incentive of the unemployed to find jobs. To me, that’s a bizarre point of view — but then, I don’t live in Mr. Kyl’s universe.

But what “textbook” is Krugman referring to? As the WSJ notes:

What does textbook economics have to say about this question? Here is a passage from a textbook called “Macroeconomics“:

Public policy designed to help workers who lose their jobs can lead to structural unemployment as an unintended side effect. . . . In other countries, particularly in Europe, benefits are more generous and last longer. The drawback to this generosity is that it reduces a worker’s incentive to quickly find a new job. Generous unemployment benefits in some European countries are widely believed to be one of the main causes of “Eurosclerosis,” the persistent high unemployment that affects a number of European countries.

So it turns out that what Krugman calls Sen. Kyl’s “bizarre point of view” is, in fact, textbook economics. The authors of that textbook are Paul Krugman and Robin Wells. Miss Wells is also known as Mrs. Paul Krugman.

Oops.

Following up on a recent post, economist Robert Higgs delves even deeper into the numbers regarding the current recession. As he explains:

Personal income includes the various “factor returns”―wages, salaries, rents, interest, dividends, and proprietors’ income―plus transfer payments that individuals receive from the government. All of these items together constitute the income available to individuals for use in purchasing consumption goods, paying taxes, and saving. Personal income is much superior to GDP as a measure whose variations tell us something about changes in people’s economic well-being as the economy ebbs and flows.

Examining how the components of personal income have changed, however, we see that the recovery so far has been somewhat ambiguous, even apart from its “joblessness.” For example, private wages and salaries, which peaked in the third quarter of 2008 at $5,419 billion and then fell during the next three quarters to $5,129 billion, or by 5.4 percent, regained only a small fraction of their loss and ended the year at an annual rate of $5,179 billion, still 4.4 percent below their previous quarterly peak. It seems unlikely that the current shortfall will be eliminated within the next two years, even if the economy continues to recover steadily. Absent a turnaround in private employment, the prospects for a return to the previous high rate of wage and salary payments seem even less encouraging.

While private wage and salary income was falling, the disbursement of government wages and salaries was ascending. Between the fourth quarter of 2007 and the fourth quarter of 2009, such government payments (at an annual rate) increased from $1,106 billion to $1,189 billion, or by 7.5 percent in just two years.

Anybody surprised that government workers have been benefiting at everyone else’s expense? Higgs continues:

Another such troubling sign has to do with the flow of government transfer payments to individuals, which have increased greatly since the recession’s onset. In the fourth quarter of 2007, they were running at an annual rate of $1,721 billion; by the fourth quarter of 2009, they had reached $2,130, having risen by an astounding 24 percent in just two years. Of course, unemployment insurance payments (a subset of all government transfer payments to individuals) ballooned even faster, increasing from an annual rate of $34 billion in the fourth quarter of 2007 to $127 billion in the fourth quarter of 2009, or by 274 percent. In 2007 as a whole, total government transfers to individuals amounted to 14.2 percent of personal income; late in 2009, they constituted 17.5 percent.

To sum, transfer payments such as food stamps and unemployment benefits were up a whopping 24% in two years, and grew from 14.2% of personal income to 17.5%

As I noted last month, the radical far-left statists at NC Policy Watch had this to say about government transfer payments:

…money spent on food stamps or unemployment directly stimulates the economy because people almost always spend it. That helps create jobs.

I’ll ask again, if food stamps and unemployment benefits create jobs, and such transfer payments are up dramatically in the last two years – where are those jobs?