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Riding to Raleigh

The General Assembly passes the lottery--poll taxes, anyone?



There's an interesting book review this week in The Nation. Historian Daniel Lazare, talking about the hagiography of the American Revolution, suggests that perhaps it was not the great burst of liberal democracy we all so love to celebrate. ("Patriotic Bore," Sept. 12.) There was also a strong strain, at the least, of the landed American aristocracy--the Van Cortlands, the Livingstons, the Jeffersons--freeing themselves from any taxation and regulation by the Crown. (Ring a bell?) And there were quite a few working-class folks at the time, including some of our own North Carolina Regulators, who weighed their options between what England might be doing to them from afar and what their own Tidewater, Va., or Hudson Valley, N.Y., landlords were doing to them right up-close and personal every day--and cast their lot with England.

A very conservative country emerged from the American Revolution, Lazare points out, in contrast to, say, Canada, which did not break from the Crown. Slavery intact, property sacrosanct, government by the elite, and a high tolerance, you might say, for lots of poor people in their midst--immigration, yes, so they can pick our crops, but don't give them a driver's license type of thing.

Which brings me to our General Assembly, which is in so many respects a vestige of those medieval times.

As the Senate went back into session on Tuesday, it wasn't clear what was on the docket (you don't just tell--then everybody would know). But it was clear that a lottery vote was on tap. I say this not out of any great insight or reporting, but mainly based on what Jerry Meek said a week ago when I ran into him at the N.C. Democratic Party headquarters. He predicted the Senate would pass the lottery that night, adding that it wouldn't be one of the Anti-Lottery 5 Democrats (Albertson, Clodfelter, Cowell, Kinnaird, Nesbitt) who'd buckle, but rather some unnamed Republicans.

The lottery didn't pass then, but I left reminded that Meek, the new state Democratic party chair, was once the protégé of Sen. Tony Rand, D-Cumberland, the Democratic majority leader. And Rand, in my mind, is the reason Mike Easley's the governor today. That's another story, but the two still get along, unlike Easley and Senate President Pro Tem Marc Basnight. And Easley's desperate for that damned lottery.

So we see what kind of predictor Meek is--he's good. The lottery passed, but the important thing to remember, as I was saying, is why Easley's lottery gets such a big raspberry on the progressive side of the block--and isn't because of the scourge of gambling. It's because we're still suffering the effects of Tory government today. And the lottery's proof of it.

Tory Stories
We still have in North Carolina a General Assembly that meets for part of the year, is paid tiny salaries, and conducts most of its business in back rooms (and taverns) out of public view. Open hearings? Forget it. It's all so redolent of the knickerbocker days when the landed gentry, having secured their affairs for the winter and leaving their trusted servants behind (and their wives, and their many children) would ride on horseback to the capital to make laws for the common good--meaning their common good.

And rather than tax their own vast estates or incomes to raise money, they preferred to levy "fees," "import duties" and "poll taxes" that fell heavily--and regressively--on the lower classes. (I'm drawing here on Alan Watson's chapter, "The Regulation," in The North Carolina Experience, UNC Press).

Centuries later, same thing.

Our "modern" General Assembly is also mainly comprised of upper-crust folks who, for one reason or another, find it unnecessary to hold a workaday job and are thus available to spend most of every week, for six or eight months every other year, and a few additional months in the intervening year, in Raleigh.

Not every legislator today is loaded. But the farther they live from Raleigh, the more likely they are to be.

And when they ride into the capital city to raise taxes, they aren't thinking, "Let's tax the folks who have." They're thinking, "Let's pass a lottery." Or a sales tax "option" for the counties (which, given how much of what we buy is made in China, is akin to a modern "import duty"). Fortunately, poll taxes are now unconstitutional.

Let's skin the underclass, in other words. Again.

I have on my desk the 21st Century Revenue Plan of the N.C. Budget and Tax Center, part of the N.C. Justice Center. It's progressive. It proposes to close corporate tax loopholes, increase taxes on corporate profits and (very slightly) higher incomes, and raise the cigarette tax enough to discourage teen smoking. As for the sales tax, it would extend it to the kinds of services wealthy people buy, cut the whole thing by three cents, and still collect more money. And they'd cut the income tax for poor people using an Earned Income Tax Credit.

Net gain to the state: More than $1 billion a year.

Gov. Easley says the schools need more money?

That's a lot more money.

Again, I have nothing against lotteries per se. If the General Assembly were voting on a tax package that included the above list of progressive tax measures, and a lottery, I'd say go for it. But somehow, we keep forgetting to pass the progressive taxes, but we always remember the regressive ones.

And the lottery is the most regressive tax you can imagine, short of just charging people money if they're poor.

Rob Schofield, the Justice Center's policy director, the other day called the state's reliance on regressive taxes a tradition of the Old South, which liked its "chronically under-funded government[s] and a permanently impoverished underclass that pays wildly disproportionate taxes" compared to the rich.

Yes, but it's an American tradition too, Rob.

Heroes and Zeroes
The flip side of revenue is programs, and I'm surveying the wreckage of the progressive program that might have been in this General Assembly but--once again--wasn't. Before I go there, however, there were two wins for our side, on lobbying reform and the issue of paperless voting machines (verified voting).

Hero: On lobbying reform, it took a village of progressive groups, plus Sen. Tony Rand and House Majority Leader Joe Hackney, D-Orange, to push the thing through. But the real hero is Bob Phillips, executive director of Common Cause N.C., who teed it up and drove it down the middle so both parties signed on. It's not the end of lobbying, or even the end of freebies. It is the end of lobbyists picking up tabs for legislators and not reporting it.

Hero: She started the N.C. Coalition for Verified Voting in 2004, before the touchscreen machine in Carteret County lost 4,500 votes and all the other '04 election mess-ups. Then Joyce McCloy literally took the next 19 months off to help Sen. Ellie Kinnaird, D-Orange, get S-223 enacted. Now, every machine must produce a ballot on paper; there will be random, hand-to-eye audits of the ballots, and no more machines with secret, "proprietary" source code.

Now, for all the General Assembly's zeroes --they were a true team effort:

  • Leandro: The state Supreme Court case stands for the proposition that struggling students need extra help and struggling schools in poor rural counties need a lot of extra help. The General Assembly gave a little more here, and took some away over there. But there will be a special study commission.
  • Mental Health: The state reform plan is just not going well--not enough money. But there will be a special study commission.
  • Health Insurance: Small businesses can't afford it and individuals with health problems really can't afford it. What a chance for a good "bidness incentive." But there will be a special study commission.
  • Death Penalty Moratorium: No moratorium. But there will be a legislative study commission.
  • Housing Trust Fund: $50 million for affordable housing, plus lots of jobs associated with it? No, $8 million. And not even a study commission.

    Also, the migrant housing bill stalled (over the high cost of a mattress?), the cigarette tax did not increase 75 cents (only 25 cents--not enough to discourage the teens, according to health advocates), third parties and independents still are persona non grata when it comes to running for office (sorry, you Greens and Libertarians, you), and the Rules Review Commission is still dominated by big bidness and the sprawl lobby.

    But victims of domestic violence will be alerted to the fact that gun permits are available, assuming Gov. Easley signs that stinker (HB 1311).

    Correction: I said last week that someone else is now "charged" with the crimes for which Silvester Smith served 20 years. Not so. A witness who recanted, leading to Smith's convictions getting thrown out, pointed to someone else who is already in prison. Gov. Easley, who prosecuted Smith, rejected his application for a pardon. I still think Smith, now not proven guilty, must be considered innocent under the law.

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