In North Carolina, according to the latest polls, Republican George W. Bush is comfortably ahead of Democrat John Kerry for president. Republican U.S. Senate candidate Richard Burr has edged ahead of Democrat Erskine Bowles. But in the governor’s race, Republican challenger Patrick Ballantine continues to trail Democratic incumbent Mike Easley by a double-digit margin. What’s wrong with Ballantine?
Perhaps his problem is that Republican voters do not yet recognize him as one of their own, since he takes pains to say that he is “not a slasher and burner,” “not a mean-spirited Republican,” “not an anarchist” and not stridently anti-tax.
On the contrary, Ballantine says, he’s campaigning with a smile. And, unlike any Republicans who may in the past have used wedge issues to divide the voters, Ballantine says he “really believe(s) in the Big Tent”–the idea that the GOP should go after every voter, or at least most of them, and not just the slim plurality that’s against everything.
Indeed, in their only debate so far, Ballantine got under Easley’s skin by claiming to be more in favor of public education than the pro-education governor. “If Patrick Ballantine is a champion of education, then Saddam Hussein is a champion of civil rights,” an irritated Easley exclaimed. (Easley’s campaign quickly acknowledged that he’d gone over the line with that remark.)
Still, it’s been hard for Ballantine’s “hopeful conservatism” to gain any traction against Easley’s four-year record of tight-fisted moderation combined with a ready willingness to execute murderers. (Ballantine’s pro-capital punishment as well).
It’s especially hard when it’s the governor who’s campaigning against the pay raises for state employees that Ballantine has promised them, charging that the Republican would have to raise taxes to pay for them.
Along with appeals for clemency, their budgets–and the taxes they use to pay for them–are clearly a governor’s most important job. Would Ballantine’s budgets, if he were governor, be much different than Easley’s? Probably not that much.
Easley’s stiffed state workers ever since he took office, though his campaign notes that he didn’t resort to layoffs even at the bottom of the 2001 recession. When Ballantine pledged to come across with 5 percent pay hikes for each of the next three years, the State Employees Association (SEANC) rewarded him with its endorsement, breaking with its own long pro-Democratic posture. But Easley hit back with ads charging that Ballantine would have to raise taxes to pay the full cost of his pledge, some $1.5 billion a year.
Meanwhile, Ballantine was promising a list of tax cuts totaling $1.2 billion a year, which some have taken to mean that, whatever Easley would spend on education, social services, transportation and the rest of the $16 billion state budget, Ballantine would need to be spending almost $3 billion less. Where would the cuts come from?
For starters, the gap between Ballantine and Easley is nowhere near that large. As Ballantine points out every chance he gets, Easley, too, would surely raise the pay of state workers now that the recession’s ended and tax receipts are coming in ahead of projections. For four years, Easley’s signed budgets with pay hikes of $625, zero, $550, and 2.5 percent or $1,000 (whichever is more), respectively. If he were good for 3 percent a year going forward, it would cost about $1 billion–which is $500 million less than Ballantine’s offer, but not $1.5 billion less.
Then, too, Easley is predicting (if not promising) that the state’s improving fiscal picture will allow him to cut taxes if he’s re-elected. Specifi-cally, he’d like to drop the two tax hikes he’s been personally responsible for: a half-cent sales tax increase and a 0.5 percent increase in the personal income tax rate paid by the highest-earning folks (singles earning $120,000 a year or more, couples over $200,000). Together, those two are worth more than $550 million annually to the state. Add Easley’s longstanding position that business taxes should be trimmed as well, and you’ve reduced the gap between Ballantine’s goody list and Easley’s to about $1 billion–not $3 billion.
The big difference between Ballantine and Easley on taxes, according to the progressive N.C. Budget & Tax Center, is that Ballantine’s list of cuts is heavily weighted in favor of the wealthy and business owners, while Easley’s plan is more balanced.
Ballantine’s tax plan would hand the top 1 percent of earners some 43 percent of the total tax relief, or an average $8,300 a year, while the bottom 20 percent would get just $28 a year, the center says. The budget and tax center also disputes Ballantine’s claim that North Carolina is a high-tax state, discouraging companies and investors from looking here. In fact, it says, U.S. Census data shows we’re 34th out of 50 on state and local taxes as a percentage of personal income.
As to Easley’s position on taxes, it’s not as specific as Ballantine’s, as the center notes. Letting go of the increased income-tax rate for the highest earners obviously would help the rich, but the sales-tax cut would be tilted toward middle- and lower-income folks; an old Easley proposal for a state earned income tax credit, never enacted, would give “substantial tax relief to the state’s working families,” the center says.
On spending, Ballantine has never offered any real plan to cut $1 billion more than Easley. He’ll bring up the notion of a generalized freeze on “some” spending, but as soon as he starts answering questions about it, it’s apparent his freeze isn’t a freeze at all.
For example, when asked about mental health programs, Ballantine rips the governor for raiding the Mental Health Trust Fund and promises to do better. “I mention that everywhere I go,” he told a public radio interviewer recently. “If government can’t help those who can least help themselves, what good is government?” And Ballantine’s in favor of pushing teachers’ pay up to the national average, and he supports such programs as the Clean Water Management Act, which uses state funds to buy forest, riverbank and riparian acreage so it can’t be developed–and polluted.
Is there a way Ballantine’s promises can be made to add up? Set aside his explanation that cutting taxes would spark the state’s economy and increase revenues. Such Keynesian economics has worked at the national level, but small changes in tax rates by a state are unlikely to produce much in the way of instant results–which is what Ballantine needs.
With the only other debate in the campaign coming up this week (and the only one Easley accepted that was not limited to education subjects alone), Ballantine will be under pressure to draw specific distinctions between his spending agenda and the governor’s. Some possibilities:
He’ll Borrow: One easy way to cut the state’s operating budget is to borrow the money–by asking the voters to approve bond issues–and hand most of the tab to future taxpayers. Ballantine’s already said he’ll consider a bond issue to help local school systems add new buildings. He could propose borrowing to buy pollution-sensitive land on grounds that once bought, it belongs to the state forever. But the UNC system, given $3.1 billion by the voters just three years ago, is already making noises about asking for another big chunk.
He Won’t Close Dix: The Easley administration is making plans to close Dorothea Dix, the state’s mental hospital in Raleigh, and replace it with a new but smaller hospital in Butner. Price: About $100 million. But Wake County’s Republicans are fiercely opposed (so are the Wake Democrats, but Butner’s got Democrats, too). And if Ballantine could get Dix “privatized”–turned into a nonprofit, say–he could save the construction cost while opening the federal-funding spigot for mental health that’s closed to state hospitals. He could still sell most of the land, however.
No TTA: The Wake Republicans hate the Triangle Transit Authority’s commuter rail plans, which depend on federal funding and a state match that’s currently pegged at 25 percent of the total cost of $800 million. Ballantine’s a “good roads” candidate, but not transit-friendly.
Less at Four: Easley’s signature education initiative is “More at Four,” a combination of preschool preparation and social services for–at present–12,000 at-risk 4-year-olds around the state. Ballantine says Easley’s plan is “redundant” and he’d focus education money on K-12.
Bigger Classes: Easley’s also pushed to decrease class sizes in grades 1-3, which is forcing school systems to add classrooms–and buildings. Ballantine’s position seems to be that state spending should be targeted to low-performing and low-wealth schools, and he’s against mandating smaller classes everywhere.
Cut Medicaid? Ballantine talks vaguely about cuts, but his friends at the John Locke Foundation are pitching the idea of cutting Medicaid spending–the program that provides health care for the poor–by some $183 million a year. With health costs rising, and most of Medicaid mandated by the federal government (which pays two-thirds of the cost), the only way to do that is to eliminate such optional “frills” as prosthetic devices, physical therapy, eyeglasses, hearing aids for children, dental care, prescription drugs, lab work and X-rays, and so on.
Chris Fitzsimon, the progressive analyst now writing for ncpolicywatch.com, calls such cuts “outrageous,” which is why, he says, candidates always talk in terms of the money they could save on Medicaid, not the human costs that would be entailed if they actually tried it.
Oh, there’s also the lottery question. A state lottery might bring in $350 million or so per year, mainly from low-income folks. Easley’s for it, and it’s his answer to almost any question that begins, “How would you pay for. …”
Ballantine’s against a lottery.