Archives: Dr. Roy Cordato

North Carolina faces significant fiscal and economic challenges over the next two years. But it need not resort to higher taxes, a state-run lottery, higher debt, or gimmickry to balance its budget. Nor does North Carolina need to skimp on crucial needs such as education and highways. By setting firm priorities within state government, eliminating unnecessary or duplicative programs, and charging users of some services a reasonable price, state leaders can generate sufficient savings to invest in the future needs of the state.

Ground-level ozone, often referred to as smog, is front and center on the policy agenda of environmental groups and legislators at all levels of government. Over the past several years, high-profile studies published by the American Lung Association, the Public Interest Research Group (PIRG) and the Clean Air Network (a consortium of environmental advocacy groups) have claimed that ozone is having a severe impact on public health, both nationwide and in North Carolina. These reports have gotten a great deal of media attention but very little media scrutiny.

North Carolina has now joined many other states and the federal government in debating solutions to the problem of rising costs in medical malpractice insurance. Evidence suggests that flaws in our tort laws and procedures are a major part of the problem. Proposed state legislation to cap “pain and suffering” awards and implement other reforms represents a good starting point, but state lawmakers should also look at a “loser pays” rule and judicial oversight of expert testimony to reduce the impact of junk science and quack medicine on jury deliberations.

North Carolina lawmakers are once again coming to Raleigh to grapple with a projected deficit exceeding $1 billion. A close examination of fiscal trends demonstrates that excessive spending, not inadequate revenue, is the cause and that the state budget continues to be bloated with wasteful or low-priority expenditures. Policymakers must show courage, be willing to apply fundamental principles, and target major areas of state spending for savings and reform.

Summary: During debates about air pollution in North Carolina, supporters of more regulation have asserted that high rates of childhood asthma are related to increasing exposure to ground-level ozone. Not only has there been no such increase, but a new study shows there is, if anything, an inverse correlation — the higher the ozone level, the lower the asthma rate. Next time, lawmakers and the media should check the facts before repeating unfounded and politically motivated allegations.

North Carolina’s state budget reflects its governmental priorities. Unfortunately, over the past two decades governors and lawmakers have usually chosen to add new programs to the state budget without considering the merits of existing programs and finding ways to fund higher-priority items by eliminating lower priorities. As a result, the budget has grown by leaps and bounds, interrupted only briefly by retrenchment during recessionary periods, including the past three fiscal years. Until state leaders learn to exercise fiscal discipline or to write fiscal discipline into law via a strong expenditure limit the budget problem will worsen.

Gov. Easley's new incentives proposal would put political appointees into the position of doling out special tax breaks that amount to grants of taxpayer money to private businesses. Because of the unpredictable nature of a free-market economy, such a policy cannot claim to boost overall economic growth. A better policy would be to reduce North Carolina sky-high marginal tax rates on personal income, investment, and capital gains - which are among the highest in the country.

The state legislature is currently considering the idea of "decoupling" North Carolina's income tax code from the federal tax code in order to avoid implementation of several tax reductions associated with a federal economic-stimulus package. But North Carolina's weakened economy desperately needs the $258 million boost that adjusting state taxes on business and personal investment would provide. Policymakers could offset any revenue loss by reducing spending.

With news of a worsening state budget and a weakened state economy, Locke Foundation analysts have updated last year's alternative budget with new projected savings and tax changes for FY 2002-03. The resulting Changing Course V budget would eliminate the deficit, repeal last year's hikes in sales and income taxes, stimulate the economy through additional tax relief and highway investment, and protect highpriority items such as public safety and classroom teachers.

The American Lung Association's annual "State of the Air" reports are treated as scientific and informative by the state news media. They are neither. They use outdated information that reflect changing weather patterns rather than real pollution and are biased against jurisdictions like North Carolina with high numbers of ozone monitors. As a result, the reports supply propaganda for lobbyists for heavier regulation but do a great disservice to science and the general public.