Fitzsimon File

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House Minority Leader Paul Stam said Thursday that every economist he knows thinks it is not a good idea to raise taxes during a recession, a view unquestioningly accepted by many lawmakers. Mr. Stam, meet Mr. Joseph Stiglitz, Nobel Prize winning economist at Columbia University.

Stiglitz believes that slashing state budgets and programs is worse for a state's economy than raising taxes on the wealthy. The deep cuts reduce demand more than a moderate tax increase. Stiglitz says that tax hikes are the "least damaging way for closing state deficits in the short run."

No-new-tax pledge exposed again

Speaking of raising taxes, Republican Arizona Governor Jan Brewer this week called for a temporary increase in the state sales tax to help address her state's $4 billion budget shortfall.

Brewer signed the absurd no-new-tax pledge last fall, but the state's economic crisis demanded common sense, not some arbitrary promise never to raise revenue, which is an irresponsible position for any political candidate to take.

Maybe one of the few good things to come out the current economic crisis is that politicians will think twice about being bullied into signing the ridiculous pledges from now on.

How about some more help from the mansion?

Stam was right about one thing this week when he called on Governor Beverly Perdue to step up and lead. Perdue took a baby step in that direction, telling reporters Thursday that a tax hike might be needed to prevent the worst cuts proposed in the House budget.

That's not exactly news.  The budget Perdue presented in March called for increase in taxes on cigarettes and alcohol, so she is already on the record supporting new revenue.  And those recommendations came before forecasters realized that next year's shortfall would be $2.2 billion worse.

Does that mean she is considering calling for additional tax hikes? She said, as she always says, that she is looking at all the options and that she is very serious about hard, tough cuts. We get that, but how about a little help for advocates trying to fend off cuts in services to people with disabilities or an end to dental care for poor adults?

Perdue is travelling around the state often and her office is cranking out press releases about every appearance. But they are almost all politically safe appearances, talking about stimulus money, job announcements, and volunteer programs.

There's nothing wrong with that, but it would be nice if Perdue would use her bully pulpit to focus public attention on the proposed budget cuts and what is at stake if lawmakers don't pass a revenue package.  She is the only political leader that television cameras will always follow and newspapers will always cover.

Perdue read to a third-grade class in Wilmington Friday to launch the Find-a-Book Summer Reading Program which is designed to encourage students to read when they are out of school. Perdue's office sent out a press release about her appearance but it didn't mention the teacher assistants that were most likely in the classrooms.

Both the House and Senate budgets would eliminate teacher assistants in the third grade. It would have been nice for Perdue to mention that or maybe kick off the Save-a-Teacher-Assistant Summer Program.

From the fringe

This week's from the fringe report focuses on the latest version of a common claim of the Right, that the state wastes hundreds of millions of dollars funding non-profit groups. One of the Lockers railed about it this week, citing a relatively recent report from the state auditor's office that broke down the roughly $700 million the state sent to nonprofit groups in 2008.

The Locker picked a few nonprofits to make her case, including $7,500 given to a theatre in Charlotte for a play that is a spoof of a famous adult film. The six nonprofits cited received a total of $150,000 last year. The current budget shortfall is $4.6 billion.

Missing from the nonprofit bashing was a list of which ones got most of the money, including private colleges and universities that received tuition subsidies of $107 million in 2008. There was nothing about the $70 million to child care centers, the $19 million to family violence shelters, or the $5.5 million to volunteer fire departments and emergency services.

Instead we hear about $7,500 for a play that apparently offends the folks on the Right. For the sake of conversation, let's assume the play and the other items listed weren't funded again.  Now all they need to tell us is where they would cut the other $4,599,850,000.

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