This article is last installment of a series contrasting budget cut options identified by NC General Assembly joint appropriations subcommittees with revenue options that would preserve decades of public investment in the economic and social advancement of North Carolina. Click here for other articles in the series.

North Carolina’s budget is the tool by which policymakers invest in the public structures—schools, roads, courts and clinics—from which we all benefit. Even before the current recession, however, North Carolina had been under-investing in these public structures, thereby undermining the state’s prospects for economic recovery and access to economic opportunity for all North Carolinians. Yesterday, House legislative leaders announced their subcommittee recommendations for the Fiscal Year 2011-2013 budget. These recommendations fail to take a balanced approach to the state’s fiscal challenges, relying solely on cuts to public investments that will be particularly devastating to working families, the elderly and businesses.

Some weeks ago the Senate and House leadership had signaled this would be their approach when they released a budget target of $18.3 billion. This figure is $1.6 billion less than the Governor’s proposal and reflects an 8.4 percent reduction over the current year budget, making it the largest year-over-year reduction in total state spending in the last 30 years.

Rather than address the root causes of North Carolina’s current fiscal challenges—historically low revenue—North Carolina’s policymakers have claimed the problems can only be fixed by cutting spending. This is simply not true. Just as a contractor doesn’t arrive at a building site with just a hammer, North Carolina’s policymakers must have and use more policy tools than spending cuts. This is especially true when the cause of the shortfall is the collapse in revenue driven by a weak economy and made worse by an outdated revenue.

North Carolina’s policymakers do have choices. They can take a balanced approach to addressing the state’s fiscal challenges that includes both cuts and additional revenue, a move that would be supported by the public according to recent polls. Taking such a balanced approach would not only ensure the state’s investments in public structures continue but also could establish a more adequate and equitable revenue system that supports economic recovery and paves the way to a stronger economic future for the state.

The House leadership recommendations are moving North Carolina in a different direction, taking the state backwards in a way that will harm working families in North Carolina, especially those struggling the most in this economic downturn, and diminish the state’s ability to recover and grow. The cuts recommended in this proposal will result in thousands of job cuts in both the public and private sectors; families will receive less support in providing their children with health care and education; and communities will see the investments in their infrastructure erode. House budget leaders are doing a disservice to North Carolinians with this proposal, a disservice that reverses decades of progress and will undermine opportunity for the people of this state for years to come.

—Text: Alexandra Sirota, Director, NC Budget and Tax Center; Chart: Brenna Burch and Edwin McLenaghan, Public Policy Analysts, NC Budget and Tax Center