North Carolina Taxes

Civitas advises us of a recent Tax Foundation analysis, which indicates the state of North Carolina led the southeastern United States this year both in the number of different types of tax hikes, and the amount taxes were raised.  North Carolina raised five different types of taxes, unlike other states in the region.

In addition, Michael Barone writes about the states that led most in population growth over the last couple of years.  This is a proxy indicator of economic strength.  North Carolina was not among those states mentioned.

Which states were the winners, according to Barone?  Wyoming, Utah, Texas, Oklahoma, Tennessee, and South Dakota. Wyoming and Utah tend to be conservative states.  Texas and South Dakota have no state income tax; and Tennessee has no income tax on wages.

Is there a lesson, somewhere amidst all this data, to be learned?

Hmmm...

Comments

[Bubba]

"Is there a lesson, somewhere amidst all this data, to be learned?'

Indeed, there are several lessons that will be learned by SOME people.

If enough productive class people move to states like those, the burden on those left behind in North Carolina will be increased dramatically.

The "business as usual" attitude that causes the festering malaise statewide and locally shows no signs of changing.

Those who hold and promote that particular brand of "values" are the ones who don't think there's a problem.

They never do.

[Abner Doon]

"Government spending is the ultimate tax on the economy"

Milton Friedman
Economic Nobel Laureate

[Joe Guarino]

Great quote, Abner. So many believe these days that government spending helps the economy-- at all levels. Perhaps we need to get back to basics.

Bubba, I am afraid they will not recognize the problem until and unless the situation becomes truly dire. But we already have 10% unemployment; and no one can guarantee it will not get much worse.

[Duck]

But look behind the numbers and realize the high unemployment is from the construction, housing and related industries. The Triad suffered much greater job loss during the 2000 to 2005 period than now, mostly because the area lost the permanent jobs in the textile, furniture and tobacco industries. Construction and related industries jobs will come back, the others will never come back.

High taxes are a problem, but a bigger problem if the proceeds are not spent properly or via corruption. The US has a long history of financially supporting industries and public projects, starting with the Federalist Alexander Hamilton, who today would be considered a hard core Republican. He created the precursor to the Federal Reserve, and helped with earliest bank bail outs. This country would be vastly different if it was not for his vision.

It is too easy a idea to be anti tax when there is no industry, no jobs, no roads, no parks. Most if not all people do not want to be taxed, but they want the public amenities that gives rise to a healthy economy and quality of life. North Carolina is a growing state, with emerging industries. Seeding the territory is necessary. Where would RTP be without the vision 30 years ago. The Triad has turned after much pain. Jobs and property values will rise, thereby keeping the need for taxes at bay.

[Joe Guarino]

Duck, yes, some people want their public amenities, but if you truly analyze their preferences and what they would like to pay for, the support might not be as great as you like. These amenities might support a higher quality of life for some people, but not for everyone. And the premise they support the economy is dubious.

The tax environment is very important. We are probably losing in our competition with some of the surrounding states. Some people who are moving to North Carolina are doing so to get on Medicaid-- because it is easier to qualify here than other states nearby. And we are now competing with numerous foreign nations.

We cannot know how robust the anticipated recovery will be, or how long it will last. But North Carolina is setting itself up for more heartache because it is not acting responsibly with respect to spending. Who is going to want to replace those great industries we lost when our state government and local governments are behaving as they do? People who know the truth about those things will not be as likely to come. Or we have to bribe them with huge incentives to overcome the tax issue.

Do you really think we are doing that much better than the people in the lower tax states like Tennessee and Texas?