INSIDE THIS ISSUE: DEPARTMENTS EPA ‘dust’ North Carolina 2 C A R O L I N A Education 7 regulations Local Government 10 Interview 16 could harm Higher Education 17 agriculture, Books & the Arts 20 Opinion 24 BBQs/6 A MONTHLY JOURNAL OF NEWS, ANALYSIS AND OPINION Parting Shot 28 JOURNALFROM THE JOHN LOCKE FOUNDATION November 2010 Vol. 19 No. 11 STATEWIDE EDITION Check us out online at carolinajournal.com and johnlocke.org Perdue Didn’t Pay For State Flights, Either Gov.’s office says Dozens involved flights were deemed in provider program ‘gifts to the state’ for Perdue, Easley By Don Carrington By Don Carrington Executive Editor Executive Editor RALEIGH RALEIGH Carolina Journal review of 2007- n late October, Gov. Bev Perdue 08 expenditures by the office of confirmed that a federal grand jury then-Lt. Gov. Beverly Perdue has subpoenaed several people Areveals that, in addition to not paying Iconnected to her 2008 campaign. Wake for a number of County District Attorney Colon Wil- campaign-related loughby, who has launched a criminal flights, she also When Perdue flew on official state business in David King’s Cessna Citation jet, investigation of Perdue’s campaign made no pay- pictured above, she didn’t pay him because she considered the flight a gift to the flights and other fundraising issues, ments to private state, her office said on Oct. 27. (Photo courtesy FlightAware.com) said Oct. 22 that several witnesses who aircraft owners for business was treated by the Office of fined the Perdue Committee $30,000 had been talking to him have gone si- travel related to the Lieutenant Governor as a gift to the — $10,000 each for the 2006 general lent, citing the federal probe. official state busi- state from those providing the flights. election, 2008 primary election, and Last year, the elections board ness. Perdue also has acknowledged 2008 general election cycles — for be- fined former Gov. Mike Easley’s cam- Gov. Beverly R e c o r d s that her campaign committee did not latedly reporting and paying for flights paign $100,000 for accepting free flights Perdue show flights that pay a number of aircraft providers for on private aircraft. In September, Wake from Raleigh businessman McQueen were a combina- campaign-related County District Campbell and his family, a violation of tion of official business and campaign airplane travel in a Attorney Colon campaign finance laws. Apparently in events. Perdue spokeswoman Chrissy timely manner. Willoughby asked reaction to the spotlight on Easley, in Pearson acknowledged the flights and Issues with Many reported the State Bureau 2008 Perdue’s committee began paying told CJ that travel provided to Perdue Perdue’s flights of Investigation for some flights and amending cam- when she was conducting official state go back at least to flights involved to ask more ques- paign reports. 2004, but CJ has tions about the The free flight issue is far from not yet requested official state flights. over, as the recent subpoenas of Perdue Perdue records for It’s widely supporters show. Investigators may be 2004-06. business as well suspected that interested in why Perdue waited so Perdue cam- federal investiga- long to report and pay for a number PAID as political paign committee tors, along with of flights, or if the campaign had no RALEIGH, NC U.S. POSTAGE records turned or campaign Willoughby, are intention of paying for them. Federal PERMIT NO. 1766 NONPROFIT ORG. over to the State seeking more in- prosecutors are interested in Easley’s Board of Elec- events formation from a free flights, his real estate deals, and a tions earlier this system of “aircraft lucrative job for his wife at N.C. State year show that she providers” the Bev University. He has not been charged, sometimes used Perdue Committee but several people have been subpoe- privately owned aircraft for trips that had created and who were identified naed to appear in front of a grand jury. were entirely related to official state in elections board reports. Moreover, several people impli- business. On many other flights, she In some cases, the reports found, cated in the Easley investigation also combined official business as lieuten- Perdue reported the flights weeks or had a role in the Perdue campaign. ant governor with political events in months after they took place, a viola- What follows is an alphabetical her quest to become the state’s chief tion of election laws. In other instanc- listing of known aircraft providers for executive. es, the committee claimed flights as Perdue (and in some cases, Easley), For those flights, someone in the in-kind donations to the campaign. based on reporting from Carolina Jour- Perdue campaign made calculations to Additional listings failed to report the nal, the Raleigh News & Observer, and separate the purported costs of official amount charged for the flight, the date, the State Board of Elections: state business from expenses related to or the destination. her gubernatorial campaign. The John Locke Foundation 200 W. Morgan St., #200 Raleigh, NC 27601 The elections board in August Continued as “Perdue,” Page 14 Continued as “Dozens” Page 14 PAGE 2 NOVEMBER 2010 | CAROLINA JOURNAL North CaroliNa C A R O L I N A N.C. Dog Breeders Wary of Missouri Referendum By Karen MCMahan JOURNAL Contributor Rick Henderson RALEIGH Managing Editor nimal-rights activists may have lost a two-year battle earlier Don Carrington this year to pass “puppy mill” Executive Editor Alegislation in North Carolina, but the war isn’t over. David N. Bass, Sara Burrows North Carolina farmers and Anthony Greco, Mitch Kokai commercial dog breeders are casting Michael Lowrey Associate Editors a wary eye toward a referendum on Missouri’s November ballot: Proposi- tion B, the “Puppy Mill Cruelty Pre- Jana Benscoter, Kristy Bailey vention Act.” Opponents see the ballot Kristen Blair, Roy Cordato measure as an avenue for animal rights Becki Gray, Sam A. Hieb groups in other states to regulate a lot Animal-rights advocates in North Carolina say current state and federal laws do not Lindalyn Kakadelis, George Leef more than commercial dog breeding address problems with what they term ‘puppy mills.’ Karen McMahan, Donna Martinez operations. trary number of animals. “Poor treat- drews said. Karen Palasek, Lee Raynor Opponents say the referendum ment and cruelty can occur no mat- The Alliance says the real agenda Marc Rotterman, Michael Sanera ter how many animals someone may behind Proposition B is to control ani- Jim Stegall, George Stephens would not prevent cruelty and neglect Jeff Taylor, Michael Walden because it does not address all dogs, own,” Peterson said. “The number of mal enterprise completely and abolish Karen Welsh, Hal Young just those that are part of a breeding animals has nothing to do with wheth- animal ownership. Both Andrews and John Calvin Young program. Instead, critics say the law er they’ll receive good care.” Johnson cited a quote by HSUS Presi- Contributors would cause economic harm to respon- In 2009, Sen. Don Davis, D-Pitt, dent Wayne Pacelle: “We [HSUS] have sible licensed dog breeders by forcing introduced Senate Bill 460, a bill to no problem with the extinction of do- them to comply with arbitrary, costly, regulate commercial dog breeders in mestic animals.” Alex Gill, Steven Holden and unenforceable regulations, such as North Carolina. Many groups opposed Proposition B also has a gap- Sara Riggins, Kellie Slappey a limit on the number of dogs an indi- the bill, including the American Veteri- ing loophole, Andrews said. Because Amanda Vuke vidual can own. Missouri’s vote on the nary Medical Association, the Ameri- it covers only commercial breeders, it Editorial Interns measure took place after press time. can Kennel Club, the North Carolina would exempt HSUS and other non- While many federal, state, and Sporting Dog Association, the Animal profits operating animal shelters from Published by local laws regulate animal welfare in Agriculture Alliance, the National Ani- the standards of care it would man- The John Locke Foundation North Carolina, animal-rights groups mal Interest Alliance, and the North date. 200 W. Morgan St., # 200 say that existing laws are insufficient. Carolina Agribusiness Council. People naturally want to help Raleigh, N.C. 27601 Current laws do not address standards The House Finance Commit- when they see videos and photos of (919) 828-3876 • Fax: 821-5117 of care, and that’s why puppy mill and tee pulled the bill from consideration abused or neglected dogs, cats, and www.JohnLocke.org related animal-welfare legislation is in late August, and Davis told CJ that other animals, Peterson said, but they needed, said Kimberley Alboum, state he has no plans to refile the bill next don’t always understand the implica- Jon Ham session unless there’s more interest in tions of the laws being proposed and Vice President & Publisher director of the North Carolina office of the Humane Society of the United passing it. mistakenly believe that such laws will John Hood States. (HSUS is a major supporter of Alboum promised there will be prevent the type of abuse they see por- Chairman & President Propsition B.) Without standards, ani- another puppy mill bill and other an- trayed in these disturbing images. mal control and other law enforcement imal-welfare bills in next year’s Gen- “Those who fail to obtain a dog- Bruce Babcock, Herb Berkowitz officers in North Carolina are unable to eral Assembly. Alboum told CJ she breeding license are already breaking Charlie Carter, Jim Fulghum take action on neglect or abuse until it didn’t know who’d be sponsoring any the law and are unlikely to follow new Chuck Fuller, Bill Graham rises to the level of animal cruelty. new legislation, but vowed the fight laws,” said Peterson. “Nor are more Robert Luddy, Assad Meymandi Lisa Peterson, director of com- isn’t over. regulations likely to prevent people Baker A. Mitchell Jr., Carl Mumpower, munications for the American Kennel Breeders in Missouri have been from abusing animals who aren’t J. Arthur Pope, Thomas A. Roberg, outspoken in their opposition to Prop- breeding them for sale,” Peterson said, David Stover, J.M Bryan Taylor, Club, told Carolina Journal that Propo- Andy Wells sition B and similar proposals are mis- osition B, fearing that legal limits on but these laws do hurt law-abiding Board of Directors guided because they attempt to set a the number of dogs one person can individuals and businesses economi- benchmark for animal care on an arbi- own could be expanded to include cally, infringe on property rights, and Carolina Journal is a monthly journal other animals, including livestock. Kay limit consumer choices. of news, analysis, and commentary on state Johnson, executive vice president of Peterson cited Guilford County, and local government and public policy issues Correction the Animal Agriculture Alliance, told where the board of commissioners is in North Carolina. The September front-page story CJ that this type of legislation would be considering revisions to the animal ©2010 by The John Locke Foundation “University Administrative Bloat Ris- the first step for those seeking to elimi- control ordinance that, among other Inc. All opinions expressed in bylined articles nate agribusiness entirely. things, would allow animal control of- are those of the authors and do not necessarily ing” included data calculated by the “If the goal is truly humane treat- ficers to have unfettered access toin- reflect the views of the editors of CJ or the Goldwater Institute on administrative staff and board of the John Locke Foundation. spending at Wake Forest University ment of animals, the Humane Society spect private homes and properties of Material published herein may be reprinted as that was incorrect. Goldwater’s calcu- would work with dog breeding and dog breeders without any prior notice, long as appropriate credit is given. Submis- lation was based on costs at all Wake other agribusiness industries to edu- without proof of negligence or cruelty, sions and letters are welcome and should be Forest campuses rather than just the cate them on ways to improve animal and without a search warrant. directed to the editor. main Reynolda campus. Using current welfare. Instead, they spend millions Guilford County’s proposed re- CJ readers wanting more information data, Wake Forest’s Reynolda campus of dollars trying to regulate the indus- visions raise another serious issue between monthly issues can call 919-828- continued to report the second-largest try,” Johnson said. by making it unlawful for any per- 3876 and ask for Carolina Journal Weekly increase in administrative positions of Anita Andrews, campaign direc- son owning or responsible for any Report, delivered each weekend by e-mail, tor of The Alliance for Truth, an orga- animal to fail to supply the animal or visit CarolinaJournal.com for news, links, any North Carolina college or univer- and exclusive content updated each weekday. sity from 1993 to 2007. nization formed to defeat Proposition with necessary medical attention. Those interested in education, higher educa- A Goldwater Institute spokes- B, told CJ that HSUS has claimed false- “Such a requirement would tion, or local government should also ask to man said the institute would use the ly that Missouri has more than 3,000 elevate animals to the same or receive weekly e-letters covering these issues. Reynolda data in future editions of its puppy mills. “Missouri has 3,000 dog above the level of children or report. breeders, not 3,000 puppy mills,” An- humans,” said Johnson. CJ NOVEMBER 2010 | CAROLINA JOURNAL PAGE 3 North CaroliNa Gaps in Registration Process Raise Concerns Over Voter Fraud By Kristy Bailey The consulate has said it spon- Contributor sors mobile drives so that Mexican RALEIGH nationals can obtain passports or CIDs nyone possessing a North Car- without having to go to the consulate’s olina driver’s license, a Social permanent office in Raleigh. The con- Security card, a utility bill — sulate charges about $35 for a passport andA a willingness to lie on a voter reg- and $27 for a CID, the latter of which istration form — can establish enough is accepted by every state agency in “proof” of citizenship to allow him to North Carolina. register to vote in North Carolina. Possessing the ID allows Mexi- Moreover, the state’s system of can nationals to open bank accounts, allowing voter registration by mail and though some activist groups have same-day registration at early-voting claimed they also can be used to ob- sites operates essentially on the honor tain driver’s licenses, apply for food system. The registration form requires stamps and other public benefits, or each applicant to sign an affidavit con- even register to vote — a claim Con- firming that the applicant is a U.S. citi- sul General Carlos Flores Vizcarra told zen. WWAY-TV is “totally false.” The penalty for “knowingly” pro- The Mexican Consulate had held drives, like the one above at a public high school ‘Rife with fraud’ viding a false statement on the form is in Concord, N.C., to issue consular IDs, which, critics say, make it possible to obtain a felony. But critics say the process for documents that make it easy to register to vote. (Submitted photo) “Those things are so rife with checking citizenship status is lax, so fraud, it’s ridiculous,” said Hans von ered 24,821 invalid driver’s license monitoring them, it led to getting some anyone with phony documents and no Spakovsky, a former civil rights attor- monies from the legislature and clean- qualms about choosing untruthfully numbers and 700 invalid Social Secu- ney with the U.S. Department of Jus- ing up the rolls somewhat,” said Mer- the “yes” box under “Are you a U.S. rity numbers in the voter registration tice who is now a senior legal fellow citizen?” has a good chance of beating database; 380 people who appeared ritt, who is now executive director of at The Heritage Foundation. “No ma- the system. to have voted after their deaths; and a the Foundation for Ethics in Public jor bank in Mexico accepts the cards. The state’s efforts at verifying handful of votes cast by 17-year-olds in Service. The State Board of Elections Twenty-two out of 32 Mexican states the accuracy of voter rolls have con- previous election cycles. received a $1 million-plus appropria- reject it.” centrated largely on making sure the At the time, Gary Bartlett, ex- tion for that project. “But the controls The Mexican Consulate has not lists have been purged of people who ecutive director of the State Board of are no better,” he said. responded to requests by CJ for com- die, move, are convicted of felonies, do Elections, shot back: “Your office ap- Veronica DeGraffenreid, elections ment. not vote over several election cycles, or pears to have a fundamental misun- liaison for the State Board of Elections, The DMV in 2004 launched Oper- change their legal names. derstanding about the data that was says the state has adequate safeguards ation Stop Fraud and began requiring reviewed, or about the federal and in place to make sure that noncitizens applicants to provide documents is- Assessing citizenship state laws governing the voter regis- do not get on the voter rolls. In an e- sued by federal or state governments, tration process.” Bartlett said regular mail, DeGraffenreid wrote that in 2006, such as valid out-of-state driver’s li- As for false claims of citizenship, “North Carolina began requiring DMV experts say it’s tough to prove after the maintenance of the voter registration censes, or passports validated by the database resulted in 725,499 names of customers to present a valid Social Se- federal government. According to the fact. curity card when they applied for an “It’s tough to get anybody to ad- inactive or dead voters being removed DMV — confirmed both by examiners during a 19-month stretch. original North Carolina driver license at the Graham and Hillsborough bu- mit that they have committed voter or learner’s permit. If the customer is fraud,” former state Auditor Les Mer- But in 2008, elections officials in reaus, as well as the agency’s website not eligible for a Social Security card, ritt told Carolina Journal. “It’s tough to Wake and Durham counties stumbled — Matricula Consular IDs constitute he or she must provide documentation ever prove, but there are certainly op- across 135 voter registration forms acceptable forms of identification for issued by the United States Govern- portunities for people who are not here bearing bogus mailing addresses. proof of residency to obtain a driver’s ment indicating legal presence in this legally to vote.” “We kept monitoring the elec- license, and the DMV does not check country. This requirement is designed In 2007, Merritt’s office uncov- tions rolls, if you will, and I think by immigration status before issuing one. to prevent undocumented aliens from “The driver’s licenses and Social obtaining a North Carolina driver li- Security numbers are checked through cense. As of 2009, only New Mexico, their respective organizations,” John- Illinois, and Washington allowed un- son said. “However, if the documenta- Visit the new-look documented immigrants to obtain tion is forged to start with, it is forged Carolina Journal Online driver licenses.” in such a way as to match up paper- Even so, applicants with fraud- work-wise, just not to that particular ulent Social Security cards can slip person. This is actually the way most through the cracks. illegals are subverting the voting pro- Consular help to obtain ID cess.” In a 2008 legal memorandum for The Mexican Consulate in Ra- Heritage, Spakovsky suggested that leigh has worked vigorously to ease elections officials could check citizen- the process of obtaining U.S. govern- ship status with E-Verify, an Internet- ment identification, traveling through- based system allowing employers to out the state monthly to provide Con- verify whether someone legally is eli- sular IDs to Mexican nationals. The gible to work in the U.S. Likewise, he Mobile Mexican Consulate held drives wrote, courts could notify elections at a Catholic parish in Shallotte in Au- officials when people summoned for gust and at Concord High School near jury duty from voter registration rolls Charlotte in September. are excused because they are not citi- The CID, or Matricula Consular zens. ID, is a government identification The 2006 session of the General card issued to Mexican nationals liv- Assembly required state agencies and ing outside Mexico, regardless of their contractors to use E-Verify to check the With links to the new CJTV and CJ Radio Web sites immigration status. Also known as the citizenship status of employees; it has Mexican CID card, it has been issued not extended the use of that database http://carolinajournal.com since 1871. to verify the citizenship of voters. CJ PAGE 4 NOVEMBER 2010 | CAROLINA JOURNAL North CaroliNa N.C. Briefs ‘Need’ Law Hampers Breast Cancer Hospital Perdue wants to slash By sara Burrows certificate-of-need laws to keep health Democratic Gov. Bev Perdue Associate Editor care costs down by limiting the avail- wants to make state government RALEIGH ability of medical services, Coletti said. more efficient by slashing rules women’s breast cancer hospi- Theoretically, by allowing fewer and regulations that don’t make tal in Asheville has resorted to providers of expensive services — sense, according to a press release “begging” for a magnetic reso- such as open-heart surgery, organ from the governor’s office Oct. 21. nanceA imaging scanner, thanks to a law transplants, and air ambulance service Perdue banned her cabinet called “certificate of need.” — fewer people would use them. This secretaries from creating “any new The certificate-of-need law makes would keep insurance premiums low rules unless they are absolutely nec- it impossible for medical providers and reduce the amount of tax dollars essary.” She requested that the Coun- to build new facilities, expand exist- spent on Medicaid, Medicare, and un- cil of State — North Carolina’s top ing facilities, buy new major medical insured patients. 10 elected officials — do the same. equipment, or offer new services with- This premise was false, Coletti As part of the Executive out first obtaining a “determination of said. The hospitals that were allowed Order, Perdue required the Office The Hope Center in Asheville has been need” from the Department of Health to provide the services developed mo- of State Budget and Management and Human Services. thwarted in its attempts to get an MRI machine. (Hope Center photo) nopolies and were able to charge high- to review all new proposed rules The law — first enacted in North er rates for them. by cabinet agencies, and for the Carolina in 1971, struck down by the rooms in Wake County, but has been When states have repealed certif- agencies to justify the requests. state Supreme Court because it gave ignored. The clinic also petitioned for- icate-of-need laws, Coletti said, com- She also asked Tar Heel existing hospitals monopoly power, mer Gov. Mike Easley to exercise his petition has pushed prices down. State citizens, businesses, and and then passed again in 1977 — has authority to order the council to adjust Currently, 82 of 100 North Caro- local governments who find prompted dozens of lawsuits over the the plan, but he declined. lina counties have only one hospital. outdated rules to offer input. years. The most recent one involves The lawsuit challenges the coun- Insurance companies must pay the “I am calling on the people The Hope Center — a women’s can- cil’s broad discretion to decide which price the hospitals charge, or they lose of this state who come into contact cer center in Asheville that hasn’t been entities are allowed to offer new health an entire county of customers. with state government to talk to able to obtain a certificate of need for services, Kay said. “If a hospital were allowed to me,” Perdue said. “Tell me what a “much-needed” MRI scanner — and He said the General Assembly has open up across the street,” he said, “the isn’t working for you when you go Raleigh Orthopaedic Clinic, which has delegated too much power to DHHS, insurance company could go to the to a state agency for a permit, or a been denied permission to build addi- and, in turn, DHHS has delegated too original hospital and say, ‘Guess what, license, or any other project that falls tional operating rooms. much power to the State Health Coor- we can’t pay you what you want, and under state regulation. “My rule is Neither Hope nor Raleigh Ortho- dinating Council — which has an inter- we don’t have to worry anymore be- the ‘plain common sense rule’ — if paedic Clinic are asking for govern- est in limiting competition. cause you have competition.’” a regulation is needed, make sure ment handouts. They’re asking for per- The case now is before the North When insurance companies have it’s efficient for the user, trans- mission to use their own money to buy Carolina Supreme Court. If the justices negotiating power, they pay lower parent to the public, and has real equipment and to build on their own decide in the plaintiffs’ favor, the Gen- property. costs and can in turn charge lower pre- value for North Carolina citizens.” eral Assembly would have to take back The State Coordinating Council, some of the council’s power, writing miums, he said. an advisory committee made up of 29 laws that would restrain the council’s “In [the council’s] minds, the only private citizens, 25 of whom are offi- decision-making authority. way to limit cost is to limit supply,” Discouraged workers cers, employees, or directors of health If it were up to Joe Coletti, direc- Coletti said. “It’s completely against care companies, is the group empow- tor of health and fiscal policy studies at everything you learned in Economics North Carolina has little ered to grant permission to medical fa- the John Locke Foundation, the coun- 101.” reason to celebrate as its official cilities seeking a certificate of need. cil, and certificate of need, would be Increasing the supply of hospitals unemployment numbers start The council, in conjunction with done away with altogether. and services, he maintains, is the only to look more like the average the Department of Health and Human The federal government created road to lower health care costs. CJ numbers posted across the coun- Services, develops a State Medical Fa- try, according to the John Locke cilities Plan each year. The plan con- Foundation’s top budget expert. tains an inventory of existing medical “North Carolina’s unemploy- facilities and services in the state and ment rate exceeded the national “need” projections for such facilities average for 2 1/2 years, so some and services in various geographical observers will trumpet data that areas. show this state losing that du- If a “need” for a particular proj- bious distinction,” said Joseph ect in a particular area is not recog- Coletti, JLF director of health and nized in the plan, it is futile to submit fiscal policy studies. “But those an application for certificate of need, observers are missing a key point.” said attorney Jason Kay of the North “The official unemployment Carolina Institute for Constitutional rate does not count the discouraged Law. NCICL has joined the lawsuit on workers who’ve stopped looking for behalf of Hope and the Raleigh Ortho- jobs,” Coletti explained. “Thousands paedic Clinic. of unemployed workers quit active- Hope petitioned the council to ly seeking work in recent months, adjust the 2008 plan to show need for and that helped skew North Caro- an MRI machine in Buncombe County, lina’s real unemployment picture.” but the council refused. Hope said the council showed favoritism by approv- The N.C. Employment Se- ing similar petitions by Charlotte Ra- curity Commission’s latest report diology and Breast MRI Clinic in Win- lists the state’s unemployment rate ston Salem. at 9.6 percent for September, down The Raleigh Orthopaedic Clinic one-tenth of a percentage point from has petitioned the council four times August’s rate of 9.7 percent. CJ over the last six years to acknowl- edge the need for additional operating NOVEMBER 2010 | CAROLINA JOURNAL PAGE 5 WashiNgtoN Call for Disclosure of 501 Donors Runs Afoul of IRS Regulations

By Jeff a. taylor disclosure demand unconstitutional under the First Contributor Amendment. CHARLOTTE Concerns over this election cycle’s new breed of ecent calls by President Obama, Democratic (c)4 groups, which have raised millions of dollars for Party officials, and left-wing activists de- political advocacy, have neglected the longstanding manding the disclosure of donors to conser- worries about government disclosure requirements Rvative nonprofit issue advocacy groups have ignored for politically active citizens. Advocates of tougher the complexity of the federal regulations the groups disclosure, including the liberal groups Democracy face. 21 and the Campaign Legal Center, have demanded At its core, there’s a tension between tax code that the IRS investigate organizations like Crossroads compliance and public disclosure. Organizations GPS — a 501(c)4 founded by former Bush adminis- created as nonprofits must comply with the Internal tration political director Karl Rove — even before the Revenue Code as interpreted by the IRS. And the IRS group’s first fiscal year has ended. is concerned primarily with tax liability, not public This demand comes even though the IRS uses disclosure of revenue sources. the fiscal year as its way to measure tax compliance. “The IRS cares if you pay your taxes,” said Al- Critics see the DISCLOSE Act as an attempt to silence This disconnect illustrates another divergence be- lison Hayward, vice president of policy at the Center dissent. (Graphic courtesy of IOwnTheWorld.com) tween IRS regulation and FEC regulation — the IRS for Competitive Politics in Alexandria, Va. “The IRS is on a tax-year timetable, while the FEC revolves cal activities. Depending on the nature of the orga- does not care so much about transparency.” around election seasons and election days. nization, its social welfare projects could range from This lack of disclosure of all donors and rev- In theory, once the fiscal year is in the books, enue sources for groups organized under section 501 voter education and registration drives to support in 2011 the IRS could find that groups like Cross- of the tax code has critics calling for new filing re- for volunteer firefighting services. As for business roads GPS violated their tax status by overspending quirements based on the disclosure regulations man- and trade organizations and Chambers of Commerce on political activity. As is often the case with the tax dated by the Federal Election Commission. Congress operating under 501(c)6 of the code, an FEC-style code, however, the lines are fuzzy. The general rule twice has failed to pass the DISCLOSE Act (H.R. mandate could force all dues-paying members to be- of thumb is that c(4)s can maintain nonprofit status 5175/S. 3628), which would apply to organizations come public. so long as no more than 50 percent of their spending engaging in “electioneering communications” and Such overly broad disclosure would constitute require the disclosure of the names of donors who “a sea of junk,” Hayward said, which would both be is on political activity. give $1,000 and above. Nonprofit organizations op- invasive and fail to focus on the political actions of Another possible outcome is that a (c)4 may posed the bill, citing the potential for the harassment the 501 groups — the supposed target of the reform- find itself reclassified as a 527 tax-exempt political of their donors. ers. group as a result of its political spending. These 527s Hayward, a former law professor at George Ma- “The IRS is just not built to regulate political must follow some FEC reporting guidelines, but the son University and counsel to former Federal Elec- speech,” Hayward said. “I think it is an insanely bad requirements are not as stringent as those of political tion Commission member Bradley A. Smith, notes idea.” action committees or candidate campaigns. Unlike that supposed fixes like the DISCLOSE Act would In the past, the IRS has been used to target the (c)4s, 527s can dedicate themselves fully to political create new problems. A $1,000 disclosure ceiling political opponents of those in power. In 1966, Presi- activity, and 527 donors explicitly are exempted from would give donors a new incentive to bundle larger dent Lyndon Johnson’s IRS moved to revoke the federal gift tax on donations above $13,000 for indi- contributions. Such bundling would create pressure tax-exempt status of the Sierra Club after the group viduals or $26,000 for couples. The gift tax rate is 35 to require the disclosure of all donors to the IRS. ran ads in opposition to a plan to flood the Grand percent. In the case of 501(c)4 groups — which are al- Canyon to generate electricity. And U.S. Rep. Dan So large donors may face a trade-off — contrib- lowed to engage in political activity so long as it is Lungren, R-Calif., recently noted that a 1958 U.S. ute to a c(4), pay gift tax, and “buy” full anonym- not the group’s primary purpose — a blanket disclo- Supreme Court decision permitted the NAACP to ity. Or donate to a 527, surrender some privacy, and sure mandate could lump donors who contributed refuse to disclose its donors to officials of the state pay lower taxes. IRS compliance and tax-payment to a group’s nonpolitical, “social welfare” activities of Alabama. The group’s refusal was met with a concerns under current law still would trump along with those who supported the group’s politi- $100,000 fine by the state. A 9-0 opinion found the public disclosure demands. CJ

Books authored By JLF staFFers Efficiency and Externalities Visit our Triangle regional page in an Open-Ended Universe http://triangle.johnlocke.org The John Locke Foundation has five regional Web sites span- ning the state from the mountains to the sea.

The Triangle regional page in- By Roy Cordato cludes news, policy reports and Vice President for Research John Locke Foundation research of interest to people in the Research Triangle area. “Cordato’s book is a solid performance, demonstrating It also features the blog Right impressive mastery of both Angles, featuring commentary the Austrian and neoclassical on issues confronting Triangle literature.” Israel Kirzner residents. Cato Journal

www.mises.org The John Locke Foundation | 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 PAGE 6 NOVEMBER 2010 | CAROLINA JOURNAL WashiNgtoN EPA ‘Dust’ Regulations Pose Threat to Agriculture, Barbecues

By Karen MCMahan EPA could use the Clean Water Act to Contributor regulate farms, Formica said. RALEIGH Both Hillman and Formica said ntil recently, no one in North Maryland is leading an aggressive ex- Carolina, home to many to- pansion of its regulatory and enforce- bacco companies, could have ment authority against farming in the Uimagined a statewide smoking ban in Chesapeake Bay Watershed and has public buildings. said publicly it plans to replicate these And yet it’s possible that federal regulations to the rest of the nation. environmental regulators could target Should the EPA take over per- another signature Tar Heel State tradi- mitting from states, regulators would tion: the pig pickin’. eliminate the agricultural storm water Several cities in California, Colo- exemption and require farmers and rado, and other states have banned ranchers to obtain federal permits that outdoor grilling — particularly where would vastly restrict their productivity wood or charcoal is involved — at and efficiency. These actions would be parks and other public areas and at undertaken without regard for the im- events including weekend festivals. pact on agriculture and would not re- And if the U.S. Environmental Protec- quire the government to prove a public tion Agency tightens its regulations health threat. covering coarse particulate matter in Cultivating or planting on a dry day could put farmers at odds with the Environmental 2011, mobile smokers could be endan- Protecton Agency because of ‘coarse particulates’ that result. Barbecues and the Conflicting regulations gered. use of ‘smokers’ to cook meat also could be in violation should the new regulations Outdoor barbecues would not be instituted. “The EPA and other federal agen- be the main target of the new federal Horses running through a pas- significant costs to farmers and busi- cies have so many units within that op- regulations. Instead, the rules seek to ture, farmers harvesting crops, or even nesses.” erate in their own silos, making rules limit farm and rural dust, placing the someone driving or walking down an Michael Formica, chief environ- without knowing about other rules or nation’s farmers, ranchers, livestock unpaved road can kick up dust clouds. mental counsel for the National Pork understanding the consequences of producers, and miners on notice. Some “Dust is a natural occurrence,” said Producers Council, told CJ that, even their actions,” Formica said. activists even are suggesting a federal Paul Sherman, air and energy pro- though in 2006 the EPA lost legal chal- For example, to limit dust, farm- mandate for all unpaved roads to be grams director with the North Caro- lenges on 20 different points regarding ers in the Midwest and West are re- paved as a way to curb dust creation. lina Farm Bureau Federation, “so how dust regulation, the groundwork was quired to attach water tanks to their The EPA began regulating par- can someone mitigate dust creation laid to let the EPA start regulating rural conveyers to spray water on the ticulate matter in 1971 to battle soot, short of using water, especially in a ru- dust. ground as they harvest crops. In arid but over the years has expanded those ral area?” regions or when a region experiences regulations to include a host of other In testimony before the U.S. Sen- Clean Water Act drought, water is a precious resource. particles. Under the Clean Air Act, the ate Committee on Agriculture, Nutri- Formica and others have said Such actions defy reason, critics say. EPA conducts a review of the particu- tion, and Forestry Sept. 23, Rich Hill- The U.S. Department of Agricul- late matter national ambient air quality man, vice president of the Arkansas the greater danger to North Carolina and to rural communities nationwide ture’s Air Quality Task Force has been standards every 5 years to determine if Farm Bureau, said the “continuous holding meetings in several states the standards need to be toughened. onslaught of regulations and require- is from the Clean Water Act. By argu- to discuss concerns over regulations Congress determined that NAAQS ments” from the EPA is “driving costs ing that dust from farms and unpaved that impact agriculture. The most re- standards must be health-based, mean- so high that small, local farmers simply roads in rural areas can blow miles cent meeting was at EPA headquar- ing scientific studies must show a pol- cannot keep up” and are in grave dan- away and land in a pond or ditch, cre- ters in Research Triangle Park Sept. lutant causes adverse health effects for ger of going out of business. ating a discharge that could be harmful it to be regulated. “Farmers are good stewards of to humans and the environment, the 29 and 30. CJ After the last review in 2006, the the land, but these regulations could EPA adopted a more stringent stan- criminalize best agricultural practices dard for coarse PM that many scien- and make something illegal that’s not tists say was based on flawed health hurting people or the environment,” studies. Along with other groups, Lor- said Bryan Blinson, executive director raine Krupa Gershman, engineer and of the N.C. Cattlemen’s Association. director of regulatory/technical affairs Sherman told Carolina Journal for the American Chemistry Council, that his organization is evaluating the said the EPA based its proposed rules potential impact on North Carolina on flawed scientific reviews, failed to and wants to make sure “the science is cite numerous opposing studies, and sound and that regulators balance that used data not publicly available. In a against the economic impact.” Even so, July 2010 letter to the EPA, Gershman the Clean Air Act does not allow the said the “EPA should not base a rule- EPA to consider the economic conse- making on information which cannot quences of its regulations. be scrutinized by the public.” In July, a bipartisan group of 20 Both coarse (PM10) and fine U.S. senators, mostly from western and (PM2.5) particle standards are under midwestern states, sent a letter to EPA review, but the agriculture industry is Administrator Lisa Jackson expressing most concerned about coarse particles, their concern that the proposed coarse which are less than 10 micrometers in PM standard would be twice as strin- diameter, making them smaller than gent as the current standards, “which the average diameter of a human hair have been difficult if not impossible for (70 micrometers) and a grain of fine industries in the western portion of the beach sand (90 micrometers). Scientists country to attain.” The senators said say most coarse PM in a rural environ- these tougher standards could “slow ment is just ordinary dust. economic development and impose NOVEMBER 2010 | CAROLINA JOURNAL PAGE 7 EduCatioN Second Try at Social Studies COMMENTARY Standards Improved, JLF says The Truth About

By CJ staff to Reconstruction (1877). A year later, Drugs and Teens RALEIGH they will cover United States history rotecting teens from the rav- of drugs, help kids stay clean. he second draft of standards for during the same period. ages of drugs indisputably And disengagement? It’s social studies courses in North Similar to the first draft of history is important. Illicit drug use disastrous: Teens with tenuous Carolina elementary and sec- standards released earlier this year, the virtually is unmatched in its ability family ties are undefended against ondaryT schools offers sound improve- second draft would require students to P ments over the initial version. That’s take world history courses in the sixth to decimate adolescent hopes and drugs’ siren song, succumbing to the conclusion of Terry Stoops, director and seventh grade. dreams. This is no late-breaking marijuana experimentation at a rate of education studies at the John Locke Stoops considers the sequence of epiphany; for years, parents, educa- quadruple that of their closely con- Foundation. courses to be taught in elementary and tors, and the architects of anti-drug nected peers, CASA has found. When the N.C. Department of middle school “somewhat unusual.” campaigns have enjoined kids to For their part, school districts Public Instruction released its first Two years of world history are sand- abstain from drug experimentation. should pursue aggressive interdic- draft of the standards last year, North wiched in between a fifth-grade U.S. Several years ago, anti-drug tion efforts. Many already are, turn- Carolinians identified a number of se- history course and an eighth-grade messages were resonating: By ing to drug dogs to sniff out con- rious defects throughout the revision, North Carolina/U.S. history course. It any indicator, teen drug use had traband. School-based dog searches Stoops said, particularly the scant cov- is not clear if teachers will be able to dropped. But the tide is turning. may be controversial, but they are erage of the American Revolution and integrate the content of the world his- Adolescent drug consumption increasingly necessary. Dogs do not the Founding Era. tory and U.S. his- is headed back up. Just-released search students, instead sniffing These objec- tory courses. government data from the National backpacks, lockers, cars, and just- tions largely were Stoops also Survey on Drug Use and vacated classrooms. ignored in the lo- Revisions add praised DPI for Health show an overall North Carolina’s cal media until a nixing a planned uptick between 2008 three largest school dis- Fox News report more coverage Global Communi- and 2009 in the number tricts utilize canine detec- on the controversy ty course in eighth of 12- to 17-year-olds tion. In mid-October, the aired in February. of Founding Era grade. This course consuming illicit drugs, Charlotte-Mecklenburg The Fox News would have cov- story elevated the between 4th ered only around with marijuana use on school board passed a concerns, and after and 8th grades 40 years of con- the rise, too. These results policy allowing drug dogs several months of temporary his- mirror findings from the on campuses. Guilford deliberation, DPI tory, a plan Stoops Partnership for a Drug- County has permitted dog responded with a called “ill-con- Free America’s latest high KRISTEN searches by law enforce- second draft including coverage of the ceived.” Instead, eighth-graders will school survey, revealing BLAIR ment since 1994. Wake Founding Era three times between the take an integrated North Carolina/ a spike in teens’ ecstasy County does not have a fourth and eighth grade and again in U.S. history course. The integrated and marijuana consump- formal policy, but schools high school. course would begin with the Declara- tion, particularly among girls. spokesman Bill Poston says drug The most notable change in the tion of Independence and end in the Not surprisingly, more dogs are used when high school second draft, Stoops said, is the addi- early 21st century. kids are taking drugs to school. principals and school resource of- tion of a United States history course at Stoops calls this “a welcome Two-thirds of high schoolers and ficers, working in conjunction with the high school level. The ninth-grade change, although it is not without one-third of middle schoolers law enforcement, deem they’re social studies course would survey shortcomings.” The eighth-grade nationwide say their schools are warranted. world history from early civilizations course integrates the history of the drug-infested, according to new Bud Cesena, chief of police to the present, but DPI asks teachers to state and nation as mandated by Ses- data from Columbia University’s for Charlotte-Mecklenburg Schools, focus on world history from the 1450s sion Law 2009-236: “An Act Modifying National Center on Addiction and says the district will use dogs from to the present. the History and Geography Curricula Substance Abuse (CASA). local law enforcement in searches. “This is an immense improve- in the Public Schools of North Caro- For younger adolescents, the Nationwide, school districts also are ment over the Global Studies course lina.” The law requires this course to proposed in the first draft,” Stoops have a “diversity” component. To ful- increase is sharp. The number of working with private companies said. The Global Studies course fo- fill this requirement, teachers must fo- tweens and young teens attending that provide trained drug dogs. The cused on globalization, human rights, cus on “racial and ethnic groups that campuses where drugs are “used, biggest of its kind, Interquest Detec- climate change, international organi- have contributed to the development kept, or sold” has risen 39 percent tion Canines, sends dogs to 1,200 zations, technology, and political, so- and diversity of the State and nation.” since 2009 –— a “middle school public school districts and private cial, and religious changes occurring in DPI is welcoming public com- mess,” reports CASA. Easy access schools, according to its website. the second half of the 20th century. The ment on the second draft until Nov. 10. is a ticking time bomb: Compared Educating students at school revised course will expose students At that point, the department may de- to kids in drug-free schools, 12- and about the dangers of drugs is essen- to the works of Locke, Montesquieu, velop additional drafts before submit- 13-year-olds on drug-infested cam- tial. This is no time to throttle back, Rousseau, Bolivar, Jefferson, Paine, ting the standards to the State Board of puses are much more likely to use especially since school prevention Adam Smith, and other Enlightenment Education. marijuana. programs are proven to deter drug thinkers. In addition, Superintendent of This calls for a ramped-up an- use. “Finally, high school students Public Instruction June Atkinson has ti-drug effort, starting at home. No We must keep at it, unmasking would be required to complete a civics asked a panel of several prominent one holds greater sway over teens’ drugs’ dark underbelly. Too many and economics course and a two-year current and former state officials — decisions about drugs than par- teens are being deceived by the United States history course,” Stoops including former N.C. Supreme Court ents. Parental prevention involves bewitching — but intrinsically false added. Justice and current Executive Director doubling down on time with kids, — allure of drugs. But parents and In earlier grades, the second draft of the Institute for Constitutional Law expressing love and engagement in schools, working together, can open sequence would require students in Bob Orr, former N.C. Supreme Court simple, practical ways. Data consis- their eyes to the truth. CJ kindergarten through third grade to Chief Justice Henry Frye, former N.C. learn the basic concepts used in the Supreme Court Associate Justice Wil- tently show parents who set rules, study of history, geography, econom- lis P. Whichard, and State Treasurer monitor behavior, help with home- ics, politics, and government. In fourth Janet Cowell — “to provide a special work, share frequent family meals, Kristen Blair is a North Carolina grade, students will encounter North review of the proposed Social Studies and communicate clear disapproval Education Alliance Fellow. Carolina history from precolonial time Essential standards.” CJ PAGE 8 NOVEMBER 2010 | CAROLINA JOURNAL EduCatioN ‘Blue’ states fared best Critics Allege Politics Affected ‘Race to Top’ Outcome By JiM stegall ties this election cycle for a Democratic Contributor pickup in the House of Representa- RALEIGH tives. id the Obama administration Education reformers also have allow politics to influence the questioned the role that teacher unions outcome of its signature educa- played in deciding winners and losers. Dtion reform initiative, the $4.3 billion Teacher unions generally favor Demo- Race to the Top grant competition? cratic candidates for office and were Several states that had been con- big backers of the Obama presidential sidered leaders in the kinds of reforms campaign in 2008. the administration had been pushing Since taking office, however, did not make the cut, while others many teacher union leaders have been sporting less impressive reform cre- uneasy with the Obama administra- dentials did. The nine winning states tion’s education reform agenda, espe- plus the District of Columbia barely cially his expressions of support for had been announced when adminis- charter schools, merit pay, and tenure tration critics began to charge that pol- reform. Critics, such as the American itics had played a decisive role in the Enterprise Institute’s Rick Hess, ques- selection of some victors. tion whether the design of the Race Jeanne Allen of the Center for Ed- to the Top competition, which gives ucation Reform was quick to see politi- points for the degree to which teacher cal motivations behind the selections. Democrat-dominated North Carolina’s official website touts its winning of $400 mil- lion in the second round of the Race to the Top competition. unions approve of a state’s reform ef- “It’s clear that some of these states forts, isn’t really an effort to mollify a last spot in the competition (and $440 National education experts who hand- were chosen for political reasons, as key disgruntled constituency. million), edging out New Jersey by icapped the competition … seemed these states offer little or nothing to In Colorado, after the legislature only three points. to think South Carolina was a lock to fundamentally improve schools and adopted a law linking teacher pay to learning for all children,” she said. Neither Maryland nor Ohio had win.” student test scores, only half of the U.S. Secretary of Education Arne been considered strong contenders by Journalist Amanda Carey of The teacher union locals signed on to sup- Duncan dismissed the charges, saying most in the reform community. The Daily Caller website suggested that port the state’s application. The lack that the winners were chosen by teams Cato Institute’s Neal McClusky called scorers might have had certain key of union support cost the state points of impartial education experts who Maryland’s charter school law “one of congressional races on their minds as it could not make up in other areas, had been vetted fully for any potential the most restrictive … in the nation.” well. She cited Hawaii, which came in and Colorado finished well out of the conflicts of interest. “We set a high bar, By contrast, Republican-led New third in the competition and won $75 money at a disappointing 17th. and these states met the challenge,” Jersey and Louisiana were thought to million, even though the state had not he said, adding, “We had many more be strong contenders, but they failed to been one of the 16 finalists in round In New Jersey, where the teacher competitive applications than money make the cut. Louisiana in particular one. union is locked in an increasingly bit- to fund them.” had been cited as a state with a strong That state features one of the ter battle with Christie over his reform The judges were guided by a reform agenda. Most observers were nation’s most watched congressional plans, only 1 percent of teacher unions 500-point scoring rubric that awarded shocked that it lost out. elections, with incumbent Republican were on board. Had New Jersey’s points for meeting specified reform cri- But Louisiana’s governor is Bob- Charles Djou struggling to fend off teacher unions supported the state’s teria. Within those guidelines, judges by Jindal, often cited as a rising star Democrat Colleen Hanabusa in the 1st application, the state would have could exercise a good bit of latitude. in Republican ranks, and sometimes District. According to Carey, the race gained 14 points — more than enough Duncan reserved for himself the re- mentioned as a possible challenger to is seen as one of the few opportuni- to displace Ohio as a winner. CJ sponsibility of making the final selec- President Obama in 2012. tion of winners and losers, but he has Republican Gov. Chris Christie of stated that he did not alter any of the New Jersey has garnered national at- scores arrived at by the judges. tention as a tough-minded education However, some critics are not reformer who successfully has taken convinced that politics played no role. on the teacher unions and education They point out that at least two states bureaucracy. Leaving those states out in which incumbent Democratic gov- of the money was seen by some as an ernors were fighting off strong Repub- attempt by the Obama administration lican challengers seem to have gotten to take the two potential challengers higher scores than their applications down a peg. would merit. It appeared to some observers In Maryland, which won a $250 that a state’s importance in the Elec- million grant by coming in sixth place, toral College also might have played a Democratic Gov. Martin O’Malley was role in how its application was treated. locked in a tight battle with Republi- South Carolina, conservative and sol- can challenger Bob Ehrlich. Through- idly Republican, submitted an appli- out July and August, when Race to the cation that some experts thought was Top judges were assigning final grades comparable to that of Florida. Yet the to the states’ applications and Duncan Palmetto State finished well out of the was reviewing the results, the Real- money, while electoral vote-rich Flori- ClearPolitics.com average of polls was da finished fourth, and won $700 mil- showing the Republican with a small lion. but consistent edge. “It’s disappointing and surpris- At the same time, Ohio’s Demo- ing,” said Jim Rex, South Carolina su- cratic Gov. Ted Strickland was trailing perintendent of education. “We placed Republican challenger John Kasich. sixth in round one and significantly Ohio surprised many by winning the improved our proposal for round two. NOVEMBER 2010 | CAROLINA JOURNAL PAGE 9 EduCatioN Charter School Summit Addresses Challenges for School Choice By JiM stegall the summit for their support of charter schools and Contributor called on everyone to “tell those North Carolina leg- CHARLOTTE islators to raise the stupid cap,” a reference to the alk of litigation and legislation filled the air as limit of 100 charter schools allowed in the state. leaders from North Carolina charter schools Attendees also heard from former Charlotte met with leaders of the business community Mayor Richard Vinroot, a trial attorney who has sued atT the Charter School Summit Oct. 21 in Charlotte. successfully a number of school districts that unlaw- Organized by the North Carolina Alliance for Public fully had withheld funding owed to charter schools. Charter Schools, the summit focused on the major is- Vinroot explained that to date his firm has recovered sues the state’s 100 authorized charter schools expect between $12 million and $13 million for more than 30 to face in the coming months. charter schools. In his address, keynote speaker Tony Zeiss, “The bad news is we’ve been so successful that president of Central Piedmont Community College the legislature, in its wisdom, allowed LEAs [Local in Charlotte, called on business leaders to become in- Education Authorities, or school districts] in the re- volved more deeply in the cause cent budget to continue with- of education. holding funds.” He related how “America’s most impor- the budget bill also contains a tant business is education,” he The first order provision allowing LEAs up to said. “If you don’t have edu- three years to pay off any judg- cated people, business will col- of business, ments they have entered against lapse. If you don’t have an edu- them. cated population, liberty will said summit “That’s not over three collapse.” attendees, is years, that’s up to three years, Zeiss argued that those meaning that some schools may who are undereducated and un- to work to not see a dime of their money deremployed are more willing to until three years from now,” Vin- sacrifice liberty for promises of raise the cap root said. He said his firm is now security from the state. “It only contemplating a constitutional takes one undereducated gen- on public challenge to that provision. eration for this to happen,” he charter schools Alliance President Eddie said, “and I tell you, we may be Goodall spoke to the audience at the tipping point now.” about the legislative environ- Citing the dropout rate ment charter leaders expect to and falling test scores relative to encounter when the General other nations, Zeiss said this generation “may be the Assembly convenes after the November elections. Rounding out his proposed agenda, Goodall first in America to be less educated and less prepared While charter schools most likely will have more spoke of the need to set “quantifiable performance than the one that preceded it.” He said that for our friends in the upcoming session, Goodall reminded standards” for charter schools so that there never democratic way of life to survive, schools must teach the crowd, “There are groups that have a vested in- again would be a case like that of the Academy of the principles of liberty. terest in preserving the status quo.” Moore County. The state tried to revoke the acade- “I was shocked when I heard about the propos- Goodall outlined a charter school agenda for my’s charter without giving a reason. The school was al to drop the teaching of U.S. history prior to 1870” the session. The first order of business was removing forced to sue to stay open. from the public school curriculum, he said. That pro- the cap on charter schools. He also proposed that a Goodall also spoke of the need for a funding posal from the state’s Department of Public Instruc- State Board of Charter Schools should be set up to stream for charter school construction, something tion was discarded after a public firestorm greeted its oversee the charter schools, rather than having the the current charter school law does not provide. presentation this past summer. State Board of Education continue to exercise over- Urging everyone to “go vote,” Goodall said, Zeiss praised those businesses represented at sight. “accountability starts with the legislature.” CJ Locke, Jefferson and the Justices: Foundations and Failures of the U.S. Government

By George M. Stephens Join the Carolina Journal Publishers Council Preface by Newt Gingrich Carolina Journal is North Carolina’s real alternative media source, giving you in-depth reports of statewide news, ag- “This book is about American gressively uncovering corruption and holding elected officials politics and law; it is also about accountable and honest. the roots of the Contract with America. A logical place to find We have the stories exposing millions of dollars in govern- the intent of the Founders is in ment waste, numerous cases of political cronyism, sweetheart Locke, [and] Stephens makes real estate deals for politicians, and secret political slush funds. a contribution to highlighting this.” If you believe government without scrutiny is a dangerous thing, count on Carolina Journal to be your watchdog. Get the Newt Gingrich inside lowdown on statewide news. Former Speaker U.S. House Producing the best journalism in North Carolina is expensive. of Representatives Keep the presses rolling. Join the Carolina Journal Publishers Council today at http://www.carolinajournal.com/support/. Algora Publishing, New York (www.algora.com) PAGE 10 NOVEMBER 2010 | CAROLINA JOURNAL loCal govErNmENt

Town and County

Dissatisfied with CMUD G’boro Council Worried About ‘Strings’

The Charlotte-Mecklenburg By saM a. hieB could be retrofitted over the course of the three-year grant, Utilities Department provides Contributor making its overall impact much greater than the grant itself. water and sewer service to all of GREENSBORO Because homeowners theoretically would save so Mecklenburg County. But CMUD t is hard for local governments to turn down so-called much on their utility bills that they could use those savings is part of the city of Charlotte, “free money,” no matter how many strings are attached. to repay the loans, Curry said, “In effect, there would be no which continues to concern resi- The City of Greensboro has had quite a bit of free net cost to the property owners.” dents from the county’s other mu- Ifederal stimulus money dangled before it, and both city staff But council members weren’t easily convinced. nicipalities about CMUD’s quality and the City Council generally are reluctant to turn it down. Council member Danny Thompson expressed con- of service and governance, reports But the City Council actually may reject a $5 million pot cern about homeowners taking on more debt, which he said DavidsonNews.net. of money offered by the U. S. Department of Energy, even largely was responsible for the economic meltdown still CMUD has been under fire though it has given city staff every opportunity to justify ac- plaguing the country. in recent months for both issuing cepting the dough. “I think this is what bills based on faulty meter read- Twice the coun- got us into a crisis in the ings and providing poor customer cil has discussed the first place,” Thompson service when residents questioned DOE grant, which — said. “I ask that we pro- their bills. Residents of the non- in theory, at least — is ceed with caution.” Charlotte portions of the county designed to help hom- Skepticism over also complain that they have no eowners save on energy the program reached say in the operation of the utility. costs. Twice the council its height when council CMUD has developed a has tabled the issue. members Dianne Bel- 40-point plan to improve the util- But the catch is lamy-Small and Trudy ity’s operations. that if Greensboro par- Wade — normally on Elected officials from David- ticipates in the pro- opposite sides of the is- son and Cornelius and representa- gram, homeowners sues — both agreed that tives of homeowners’ groups met would have to take out it was hard to see the with CMUD staff in October to loans to make energy- winners in this program, discuss the problems. saving improvements aside from government “CMUD is a long way from to their homes, with bureaucrats. winning a J.D. Power customer the expectation that Bellamy-Small — service award,” said Cornelius the energy they’d save probably the most liberal Mayor Jeff Tarte after the meeting. would more than pay member of a conserva- “But I think they may actu- for the cost of servicing tive–majority council — ally be trying. They’re definitely the loans. It’s not clear described the grant pro- making progress. [CMUD direc- this would be the case, gram as “government as tor] Barry Gullett’s heart is in the which is one reason the its usual self.” right place.” council has delayed its “We’ve made decision. something that should According to Buncombe development have been a very simple DOE’s Better Buildings process in trying to get Buncombe County has ad- website, partnerships stimulus funds down to opted a new set of guidelines for with local governments “will make energy efficiency retro- the people who need work, but we’ve [bogged] this thing development on steep slopes and fits accessible to hundreds of thousands of homeowners and down,” Bellamy-Small said. “I will not support encourag- ridgetops. Approval came de- businesses, saving consumers about $100 million annually ing an 80-year-old woman to go out and get a loan, because spite concerns that the regulations while creating tens of thousands of jobs.” she’s probably not going to live to pay it off.” would increase the cost of build- Greensboro is one of 27 local governments in roughly Wade supported Bellamy-Small’s concerns, noting ing houses on the lots, reports the 30 states to receive Better Buildings grants. such support would be a “historic” moment for the council. Asheville Citizen-Times. The DOE website adds the grant will help Greens- “We’re going to spend $5 million for two employees The new regulations in- boro employ “a neighborhood-based approach to build lo- to go tell you to do something,” Wade said. “What are the crease the minimum size of a resi- cal energy conservation infrastructure capacity as well as advantages here? I’m having trouble seeing them.” dential lot on slopes of 25 percent increase the community’s capacity for self-reliance. … The Another major issue is who would administer the or greater, with the specific lot community-building approach integrates broad outreach grant. Bellamy-Small questioned the $1.8 million alloca- size varying by the land’s average strategies, healthy homes concepts, jobs creation, economic tion for “consultants,” while fellow council member Mary slope. development, neighborhood empowerment, ongoing edu- Rakestraw questioned the salaries and generous benefits The county also adopted cation, and a monitoring system, resulting in a culture of package of additional city staff who would oversee the restrictions tougher than those energy efficiency and savings that will be sustained far be- grant. imposed by the state on develop- yond the life of the grant.” Curry replied that the $356,000 in salaries would be ments along ridgelines. State law But the conditions of the grant and exactly how it spread over the three-year grant period, while consultants prohibits buildings more than would be administered are unclear, so the council tabled the 40 feet tall on ridges above 3,000 issue for further discussion. would be needed to train outreach workers who would be feet that are more than 500 feet Dan Curry, the city’s sustainability manager, told the performing energy audits for homeowners. above the adjacent valley floor. council in September that the $5 million was a three-year Rakestraw also pointed out a condition of the grant Buncombe County would restrict grant “that will roll from year to year as the budget pro- was that the city would provide matching funds at a 5-to-1 buildings to no more than 25 feet gresses.” ratio — or $25 million, to which Curry replied that should under certain circumstances and Curry said “many of the details — such as agreements the city not be able to provide matching funds, then the imposed a two-acre minimum lot with private lenders — are yet to be worked out. terms of the grant would have to be renegotiated with DOE. size. “But the goals are pretty simple: to improve the health, Despite the many concerns, the lure of free money was Developers questioned the safety, and efficiency of buildings in this community and still too much for some council members. need for the new rules. County particularly east Greensboro,” he added. “I don’t think you delay this and let this money get officials estimate that the change More importantly, Curry said, the grant was an “eco- away,” said council member Robbie Perkins. “I think would affect some 3,500 lots that nomic development activity designed to create employment you instruct staff to listen to your concerns, peg the mon- have been planned but not yet opportunities and business opportunities.” ey, and come back in a briefing session and tell us where developed. CJ Curry estimated that several thousand buildings they’ve cured your ills.” CJ NOVEMBER 2010 | CAROLINA JOURNAL PAGE 11 loCal govErNmENt

Satellite Monitoring of Convicted COMMENTARY Sex Offenders OK, Says Court Constitution Optional

By MiChel lowrey pose or effect as to negate” the statue’s Associate Editor civil intent. The U.S. Supreme Court In N.C. Cities? RALEIGH laid out a framework for determining he Fayetteville City Coun- programs is the number of “disor- Kennedy v. Men- n 2006, the General Assembly this in its 1963 decision cil recently turned down a der activities” that are reported to passed legislation allowing satel- doza-Martinez. request from the city manager police within a certain time period. lite-based monitoring of certain Four of the N.C. Supreme Court’s typesI of sex offenders. Could this mon- seven justices found that subjecting toT establish a rental housing regis- Often this number varies based itoring requirement also be imposed Bowditch, Plemmons, and Waters to tration program. According to the on the number of apartments in on sex offenders who committed their the monitoring did not violate the fed- Fayetteville Observer, council mem- the complex. The Charlotte pro- crimes earlier? A closely divided N.C. eral or state constitutions. bers liked the program but disliked posal defines disorder activities as Supreme Court answered “yes,” say- “We hold that the SBM program the fees that would be charged “reported violent crimes, reported ing that such a requirement would not at issue was not intended to be crimi- landlords. property crimes, and certain types violate the prohibition on ex post facto nal punishment and is not punitive in On the surface, these pro- of disorder-related, person-initiated laws contained in the U.S. and North purpose or effect,” wrote Justice Ed- grams seem innocuous. Owners requests for police service.” Carolina constitutions. ward Brady for the court. of rental housing register with the The Constitution guarantees Kenney Bowditch, Kenneth Ed- Justices Mark Martin, Robert city so that if there is a that those accused of a ward Plemmons, and Mark Allen Wa- Edmunds, and Paul Newby joined in problem with rental units, crime are innocent until ters each pleaded guilty in separate Brady’s opinion. the police or other city proven guilty and are incidents to multi- The majority ple counts of tak- held that SBM was officials can contact the guaranteed a jury trial. ing indecent liber- The North Carolina Courts less harsh than owners quickly. A small The landlord registration ties with a child. other restrictions fee to pay for the paper- program effectively invali- The crimes took the U.S. Supreme work seems reasonable. dates both constitutional place before Aug. Court considered But that is not why protections. Landlords 16, 2006, when the nonpunitive, such these programs are being must evict tenants based SBM statute took as the involuntary established in cities across on “reported” crimes, not effect. The victims post-incarceration the state. The Fayetteville actual convictions. Land- were between confinement of MICHAEL proposal was modeled SANERA lords must evict tenants 6 and 10 years sex offenders, or after the Raleigh program, even if the accused tenants of age when the barring a person and Charlotte recently are found innocent. Land- crimes occurred. from working in a considered one amid lords must evict tenants Plemmons received a 24- to 29-month particular occupation. prison sentence; Bowditch and Waters “There is no denying that being much controversy. if the residents make too many both were sentenced to supervised subjected to SBM has an impact on the It seems that city managers, totally unfounded “person-initiated probation. lives of its participants,” the court said. city council members, police, and requests for police service.” After the state sought to require “Yet, when viewed in light of other civ- even the associations representing In order to protect themselves, the three sex offenders to be subject to il, regulatory schemes, we cannot con- landlords need a refresher on the landlords must snoop around and SBM, Bowditch, Plemmons, and Wa- clude that the effects of SBM transform Constitution. The not-so-hidden try to determine if illegal activity is ters challenged the constitutionality of it into criminal punishment.” agenda behind these programs is to going on inside tenants’ apartments. the requirement. Chief Justice Sarah Parker and force landlords to do police work There is no need for probable cause; Satellite-based monitoring in- Justices Robin Hudson and Patricia without compensation. In other they must take action based on sus- volves three separate pieces of equip- Timmons-Goodson dissented. In their words, if the police cannot catch picion or rumors. Tenants are not ment: an ankle bracelet, a tracking de- view, SBM had not been shown to be drug dealers, prostitutes, etc., and innocent until proven guilty; they vice, and a base unit. effective enough to justify the depriva- the courts refuse to hold convicted can be evicted based on little or no The monitoring equipment does tion of liberty involved. criminals accountable, the cities will evidence. Landlords who refuse to not function everywhere. Going deep “A review of the transcripts and into buildings containing significant exhibits here shows that this program use this program to force landlords act face the wrath of city officials amounts of steel, for example, can does not protect the public in any effec- to become police, prosecutor, judge, enforcing the ordinance. Landlords block the signal. If that happens, en- tive way,” wrote Hudson. “In light of jury, and executioner. who act without justification face rollees must go outside. Airline travel, its lack of effectiveness, the SBM pro- Here is how rental registration court suits brought by tenants who bathing, swimming, scuba diving, and gram at issue here is so excessively re- programs work in the Orwellian have been evicted unjustly. camping in remote areas all may be straining and intrusive that it becomes world of local government. After Ironically, these programs impossible while connected to satel- punitive.” landlords register and pay the fee, come after years of “tenants’ rights” lite monitoring. The limitations of the Hudson noted that the major- they are responsible for the behav- groups pressured city governments system may restrict where someone ity simply accepted at face value the ior of their tenants. If landlords per- to pass ordinances preventing connected to the system could find a state’s assertion that SBM advances the mit their tenants to engage in what landlords from interfering with the job, even if criminal history were not nonpunitive purpose of protecting the might appear to be illegal behavior privacy of tenants. a factor. public. This was particularly true for — selling drugs, prostitution, etc. — Now the cities are forcing The U.S. and North Carolina con- offenders who might have completed stitutions prohibit ex post facto laws. probation and/or parole, and who the landlords must evict the tenants. landlords to investigate the person- The N.C. Supreme Court has stated were not under any legal restrictions If landlords refuse, they, rather than al lives of tenants, make decisions that “An ex post facto law may be de- on their movements. In fact, Hudson the tenants, face penalties. on suspected illegal behavior, and fined … as a law that ‘allows imposi- noted, SBM does little beyond creating In Charlotte, the proposal then to evict those the landlords, tion of a different or greater punish- a log of someone’s movements. included a provision that if the not the courts, deem illegal. ment than was permitted when the “Given that the program as im- landlord did not act, the city could When did the Constitution crime was committed.’” Whether the plemented essentially fails in its non- revoke the registration. Since it become optional for cities? CJ SBM requirement amounts to punish- punitive purpose, the numerous af- would be illegal to rent apartments ment is a key constitutional consider- firmative restraints and intrusions it without being registered, the re- ation. Even if the law does not impose imposes on its enrollees become, in my quirement effectively would put the Dr. Michael Sanera is director of restrictions that are considered punish- view, punitive in effect.” landlord out of business. research and local government studies ment, it must still be examined to see The case is State v. Bowditch The trigger for many of these at the John Locke Foundation. whether it is “so punitive either in pur- (448PA09-1). CJ PAGE 12 NOVEMBER 2010 | CAROLINA JOURNAL loCal govErNmENt From The Newsstands Monroe: Company Lied to Us

By MiChael lowrey debt to finance various construction Ribbon Cuttings = Growth Associate Editor projects. The percentage of operating RALEIGH funds going to debt service has grown t’s her commitment to “service” Christina Romer: he Monroe Enquirer-Journal re- from 14.2 percent in 1999-00 to 20.1 that helped Gov. Bev Perdue at- She won’t bring a new per- ports that a company was award- percent this year. tract attention in the latest print spective, but she brings the right ed incentives by both Monroe The county currently is operat- Iversion of U.S. News & World Report. perspective. In her final speech as Tand Union County even though it lied ing under a “debt diet,” placing $900 (It’s interesting that the only two chairwoman of the Council of Eco- to officials about the possibility it could million in projects on hold so that the governors from whom the magazine nomic Advisers, she offered the relocate to Indiana. The incentive deal county does not have to borrow even solicits input are some of the na- full-throated call for more fiscal would cut the firm’s property tax pay- more. tion’s least popular governors and stimulus that the administration ments roughly in half for a three- to At a planning conference, county one with the nation’s worst unem- has largely abandoned. “Concern five-year period. staff outlined a proposal to compare ployment rate.) about the deficit cannot be an Perfect Fit projects across But aside excuse for leav- Inc. LLC cur- categories and from the com- ing unemployed rently has fa- determine the ments about the workers to suf- cilities in both Cherokee best use of the fer,” she said. joys of service, Monroe and county’s limited the remarks that “We have tools Loogootee, Ind. funds. Under the attracted our at- that would bring to It sought incen- proposed crite- tention were unemployment tives from Mon- down without ria, a proposed those dealing roe and Union with economic worsening our Currituck new school might County, claim- development. long-run fiscal compete against a ing that it was R e g u l a r outlook, if we can jail addition or a going to close one of the two locations. readers of CJ only find the will park for funding. know that low and the wisdom “The decision as to which facil- The county also may apply the marginal tax rates to use them.” ity is closed rests in large part on the approach to its backlog of approved and less onerous Yes, what we partnership that we can form with capital projects awaiting funding. regulations are need now is more the respective governments here and Projects that score poorly on the as- keys to economic stimulus spend- in Indiana,” Monroe facility produc- sessment may not be built, even when growth. Instead ing. Stimulus sup- tion manager Steve Dickens said to the funding becomes available. For items of focusing on these ideas, Perdue porters are rushing to make that case Union County Board of Commission- that would be funded by voter-ap- focuses on wheeling and dealing during the election season. ers. “In this case with Union County proved bonds, commissioners empha- with targeted tax breaks and cash and Monroe.” sized the importance of getting public grants: Monroe awarded Perfect Fit input before dropping a project. Every so often, though, you Market for nonfossil fuels $31,740 in incentives, while Union enact a law or close a deal that Does a string of hydrogen-car County awarded the company an ad- Brick and mortar in Garner delivers a positive impact that fueling stations along the Interstate ditional $19,557. The moves came de- you can see and feel right away. spite Perfect Fit giving Indiana an of- The Garner Town Council has re- 95 corridor sound crazy to you? It jected a proposal by developers to re- In these difficult times, there is might be. ficial notice that its plant there would nothing more rewarding than close by the end of the year. duce the amount of brick required on But libertarian Lumber Liq- the fronts of homes in a planned sub- convincing a company to move uidators chairman Tom Sullivan is “Basically, they just told us that division that has stalled, reports the to, or expand in, North Carolina betting that the idea will work. The it’s a done deal,” said Loogootee May- Garner-Clayton Record. and create jobs. When I recently Atlantic explains in its November is- or Don Bowling to The Loogootee Tri- Developers of the Sutton Springs announced Caterpillar’s expan- sue: bune. sion at not one but two plants, the This fall he opens his first Monroe and Union County of- community cited the sinking economy audiences exuded both excitement SunHydro station, in Wall- ficials were not aware of the develop- as reason to ask for the variance. The and relief. It was the best payback ingford, Connecticut. It will be ments in Indiana. town’s plan required the fronts of the you could hope for. powered by 30,000 square feet “I’m kind of stunned,” said Chris homes to be made of at least 80 per- It’s nice to read near the end of rooftop solar panels and will Platé of Monroe’s economic develop- cent brick. Instead, developers say, by of her column that the governor is sell hydrogen for the gas-mileage ment department. “We got pretty hon- reducing the minimum brick coverage willing to take a “barrage of attacks” equivalent of about $5 a gal- est feelings that we were in very strong to 30 percent, they could add square for her focus on ribbon cuttings and lon. Sullivan, who grew up near competition.” footage to the homes (which would be press releases, rather than real poli- Boston and now lives in Miami Platé added that the closing of at least 2,220 square feet) and still sell cies focusing on economic growth: Beach, plans to expand along the them for less. [I]f that’s part of the cost of the Indiana facility would not have East Coast’s I-95 corridor, from Patrick Burns of the Brick In- advancing my ideas, of landing mattered, though. Miami to Maine, by building sta- “Knowing what we know now, it dustry Association urged the council that next corporate relocation and tions at his Lumber Liquidators raising the quality of life for folks would not have changed the staff’s po- to deny the request, saying that brick stores—slapping solar panels on sition to take it to the council,” he said. homes would have a higher tax valua- in my state, then it’s more than the roofs and setting up electrolyz- “We stand behind our decision and tion and attract additional upscale de- worth it. ers in the parking lots. Of course, still hope to win the company.” velopment. as a moneymaking venture, this Councilman Buck Kennedy also might be completely crazy. But New blood, no new ideas Meck capital spending said higher-end houses would lure there’s also a bullheaded logic at Ezra Klein suggests in the Oct. work here. Sullivan is hoping he’s Mecklenburg County is moving new homebuyers to Garner after the 18 Newsweek that President Obama ahead of the curve. “I’d rather be toward a process of prioritizing con- economy rebounds. needs some “new blood” in the early,” he said, “than late.” struction projects across different types Bill Peebles, a Realtor working White House. What’s most useful about the of facilities. The move comes, reports with Capital Bank to finance the proj- Fair enough. It’s too bad Klein article is its reminder that the best The Charlotte Observer, as the county ect, said houses that meet the original doesn’t make the case for new ideas ideas about replacing fossil fuels struggles with debt service payments plan are not selling in today’s housing as well. Here’s his pitch for Obama will come from innovators and en- that are consuming an ever-larger market. He did say developers were to rehire (in a puzzling diversion trepreneurs — not from the govern- share of the county’s budget. open to working with the town to rec- from the theme of “new blood”) ment. — MITCH KOKAI CJ Over the past decade, Mecklen- ommend changes that would allow the burg County has issued $2.3 billion in subdivision to be completed. CJ NOVEMBER 2010 | CAROLINA JOURNAL PAGE 13 loCal govErNmENt N.C. Counties and Cities Missing Financial Reporting Deadlines

By Karen MCMahan ed statements on its website are for the the real tale,” Lowrey said. “Some data for 2007 and 2008. The state re- Contributor prior fiscal year. Fiscal Year 2010 AFIR towns follow odd business models, ceived the 2009 AFIR on March 9, 2009, RALEIGH reports will not appear until 2011. making it easy for staff to hide the true but has not yet reviewed it. Rebecca tate law requires all 100 counties A note on the website states that cost of government from the taxpayers, Garland, Graham County’s finance and 551 municipalities in North the financial data for counties and mu- but this report catches these oddities.” manager, told CJ the county had fallen Carolina to file an Annual Finan- nicipalities were last updated on March To produce the report, Lowrey exam- behind because its finance officer had Scial Information Report — a full ac- 12 and June 11, 2010, respectively. ines property taxes, sales taxes, and to- left and the county had trouble finding counting of each local government’s With many North Carolina cities tal local government collections of all a qualified replacement. Garland says financial status — by Oct. 31 with and counties facing severe fiscal cri- taxes and fees for counties and munici- she’s completed three past-due audits the state Treasurer’s office. A review ses, taxpay- palities. in one year. of county and municipal data on the ers increas- “ S o m e “I’m not aware of any fine for Treasurer’s website shows that seven ingly are towns get missing a filing deadline,” said - Gar counties and dozens of municipalities questioning most of land, “but a county or city cannot issue missed the deadline to file their audit- the cost of their rev- debt unless its audits are up to date. ed financial statements due on Oct. 31, government enues from Being delinquent can also lower the 2009, the latest year for which data are and whether fees instead bond rating.” available. services be- of property Garland said state officials often Meantime, 53 municipalities ing provided taxes,” Low- insist on some line items being sub- have failed to file an AFIR for two or truly are nec- rey said, and mitted, even without the audits being more years, and several have not filed essary. “this model completed, to prevent the withholding a report for six years, dating back to T h e of state funds earmarked for local gov- 2004. failure to distorts the cost of gov- ernments. It’s unclear what penalties, if any, report also Kimberly Honeycutt, budget an- local governments face if they miss the is an issue ernment by making it ap- alyst for Harnett County, said its 2009 deadline. Heather Strickland, deputy of transpar- report was late because the county had pear the city director of communications for state ency and ac- lost its finance officer. She was- sur Treasurer Janet Cowell, said local gov- countability, or county has prised to learn that the state website ernments failing to submit audited said Michael a low tax bur- shows only partial data for 2009. Har- financials by Oct. 31 receive written Lowrey, a den.” nett County residents do have access follow-ups from staff and that “staff John Locke Lowrey to audited financial reports for the past encourage them to complete and sub- F o u n d a - cited the ex- several years on the county’s website. mit all reports.” tion policy ample of one Many municipalities that have The State and Local Government analyst who town that not filed reports for multiple years have Finance Division of the state Treasur- c o m p i l e s gets most of er’s office is charged with providing JLF’s annual small populations, some with fewer its revenue than 100 residents. Repeat offenders oversight and technical support to lo- report By from build- the Numbers: What Government Costs in include Gatesville, Greenevers, Hot cal governments in financial matters, ing permits and another from huge im- including local government debt and North Carolina Cities and Counties. By Springs, Princeville, and Whitakers. pact fees. “The bottom line is, whether fiscal and accounting practices. Caro- the Numbers is in its 12th year of pub- Officials in smaller communities it’s fees or taxes, that’s revenue for the lina Journal made multiple attempts lication. One source Lowrey uses is emphasized that a lack of personnel to speak with a division official about AFIR reports. And he notes an increas- government,” said Lowrey. and financial resources contributes to specific details of AFIR reporting, but ing number of delinquent cities and CJ contacted some of the cities untimely reporting. The auditor for one was unable to do so. counties. and counties that missed deadlines or community said the state has changed The Treasurer’s office doesn’t re- “Many North Carolinians think remain delinquent in filing AFIR re- the AFIR forms, and older ones are no lease AFIR data until nearly a year af- they understand what their govern- ports. longer on the website, adding to the ter it receives the reports, so the audit- ment is doing, but By the Numbers tells Graham County did not submit delay in filing reports. CJ Help us keep our presses rolling Publishing a newspaper is an ex- pensive proposition. Just ask the many daily newspapers that are having trouble making ends meet these days. It takes a large team of editors, re- porters, photographers and copy editors to bring you the aggressive investigative reporting you have become accustomed to seeing in Carolina Journal each month. Putting their work on newsprint and then delivering it to more than 100,000 readers each month puts a sizeable dent in the John Locke Foundation’s budget. That’s why we’re asking you to help defray those costs with a donation. Just send a check to: Carolina Journal Fund, John Locke Foundation, 200 W. Morgan St., Suite 200, Raleigh, NC 27601. We thank you for your support.

John Locke Foundation | 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 PAGE 14 NOVEMBER 2010 | CAROLINA JOURNAL From PagE 1 Perdue Didn’t Pay For Either State or Campaign Flights Continued from Page 1 Perdue traveled round-trip from Cha- pel Hill to Hickory in a corporate plane In others, Perdue mixed official originating in Dunn owned by Warren state business with campaign activi- Oil Company. Her events in Hickory ties. consisted of an official state business A round-trip flight for Perdue on event lasting 50 minutes and a private Jan. 30, 2007, from Raleigh to Concord campaign event lasting 120 minutes. in a Cessna Citation jet owned by Da- The total flight costs were stated vid King of Raleigh was listed as of- as $589, with $415 calculated as the ficial state business, yet there is no re- share attributed to the campaign. The cord of either the lieutenant governor’s Perdue Committee paid Warren Oil office or the campaign paying for the $415 on Dec. 31, 2007 — almost two flight. months after the flight took place. The King provided flights to Perdue difference could have been paid direct- on other occasions. A flight on March ly with public funds from the lieuten- 5, 2007, to Wilmington in King’s jet was valued at $1,389. Two-thirds of the ant governor’s office, but there is no This helicopter, owned by McQueen Campbell, is one of the private aircraft used by record of payment. event time involved state business, and former Gov. Mike Easley and then-Lt. Gov. Beverly Perdue for what investigators one-third covered campaign events. have called questionable flights. (CJ photo by Don Carrington) A Jan. 31, 2008, flight, in an - air The Perdue Committee paid only $202 craft owned by of Agemark LLC in for this flight on July 1, 2007. There is governor’s office. The pilot was Mi- W LLC and managed by Buddy Stall- Hickory, originated in Hickory. Perdue no record of any payment from the chael D’Orosko from Wilmington. CJ ings of New Bern. Her events that day was picked up in Chapel Hill, flown to lieutenant governor’s office. was unable to determine who owned were a mix of campaign and state busi- Concord, and then delivered back to A July 23, 2007, flight between the single-engine airplane used for the ness. The total cost was $701, and the Chapel Hill. The trip was listed as of- New Bern and Ocean Isle to transport trip. campaign paid $239 on Jan. 12, 2008. ficial state business, but no value was Perdue for a speech to the N.C. Sher- A flight Sept. 29, 2007, involved There is no record of payment from the assessed for the flight, and there is no iffs Association was listed as official a one-way trip for Perdue from New lieutenant governor’s office for the re- record of a payment from the lieuten- state business, but there is no record Bern to Raleigh in a Cessna Citation mainder. ant governor’s office or the Perdue of any payment from the lieutenant jet. The plane was owned by Flying On Nov. 9, 2007, records indicate campaign committee. CJ Dozens Involved in Perdue, Easley Flight Provider Program Continued from Page 1 provided a flight on Nov. 6, 2008 – two The Perdue Committee paid $714 for Board of Trustees and a friend of days after Perdue was elected gover- that flight on July 31, 2009. He also Fulenwider. Caldwell had some role Donald Adams is listed as the nor. The flight was valued at $887, and provided flights in 2008 on Oct. 7, Oct. in recruiting Fleming or submitting aircraft owner for a June 24, 2008, the Perdue Committee didn’t pay for 14, and Nov. 25. The Perdue Commit- his name as the provider of the in- flight for the Perdue Committee. The it until Dec. 16. No other information tee paid for them Dec. 16. kind donation for the flight arranged Perdue Committee reported it as an in- about the flight is available. William Edwards, owner of Air by Fulenwider. kind contribution of $155. No additional Rusty Carter, owner of Atlantic Norman LLC in Denver, N.C., provided • Ola Caldwell, Robert information is available. Packaging in Wilmington and a fra- a flight in a twin-engine Cessna for the Caldwell’s wife, made an in-kind Bruce Brandon, a Greensboro ternity brother of Easley, flew Easley Perdue Committee on Sept. 22, 2007. contribution of $1,194 to the Per- attorney and aircraft owner, provided in 2004 in a corporate plane for cam- The flight apparently began at the Lin- due Campaign associated with the flights to the Perdue Committee on paign purposes, and the Easley Com- coln County Airport and involved stops December 2007 in-kind contribution Oct. 15 and 16, 2008. The committee mittee failed to disclose it. Carter also in Chapel Hill and Salisbury. The com- from Fleming, according to records reported the flights as in-kind contribu- provided a flight to the Perdue Commit- mittee paid $544 for it on May 27, 2009. filed by the Perdue Committee. tions of $140 and $181, but no addi- tee on Oct. 27, 2006. Carter’s Beech Mario Fedeli, of New Bern-based • Robert Noyes, a Morgan- tional information is available. King Air flew from Wilmington to Cha- Fedair LLC air charter service, was in- ton businessman, is connected to Mary Brinn, a New Bern busi- pel Hill to Cleveland County. It then volved in several flights arranged and an Oct. 11, 2007, flight arranged by nesswoman, is associated with provid- flew to Chapel Hill before returning to apparently paid for by New Bern attor- his then-employer Mike Fulenwider. ing a flight for the Perdue Committee Wilmington. The Perdue Committee ney Trawick “Buzzy” Stubbs. The Per- The Perdue Committee reported the on May 25, 2006. The Perdue Commit- did not disclose the flight until May 26, due Committee paid Fedair directly for flight 39 days after it occurred as an tee didn’t pay for it until Nov. 9, 2009. 2009. The total cost of the flight was a January 2008 flight — valued at $943 in-kind donation paid by Noyes. The The flight was in an aircraft owned by $1,579, but the committee paid Carter — in July 2009. aircraft originated in Hickory, picked Flight Pack LLC of New Bern, a com- only $966, saying a portion of the flight Mike Fulenwider, owner of Fu- up Perdue in Chapel Hill to travel to pany Brinn owns. was official state business. The State lenwider Enterprises in Morganton, Concord and then apparently flew McQueen Campbell, a Raleigh Board of Elections recently accepted paid $1,993 for a charter flight for the her to New Bern before returning to businessman, provided numerous a $100,000 settlement from Carter for Perdue Committee on Nov. 15, 2006. Hickory. free flights to Easley. The elections illegal campaign contributions he fun- He already had given the maximum Cameron Harris, a Charlotte board fined Easley’s campaign a total neled through his employees to vari- $4,000 to Perdue’s campaign at the insurance executive and owner of of $100,000 associated with the ille- ous Democratic candidates. time. The committee didn’t reimburse BoHaHa LLC, an air charter services gal unreported flight activity. Campbell Myles Cartrette, a Greenville him for that flight until Dec. 3, 2009. He company, provided a nonspecific flight also flew Perdue during her campaign businessman and owner of AMC II also arranged two other flights that the for the Perdue Committee on Oct. 20, for governor, even though he didn’t LLC, gave the Perdue Committee a Perdue Committee reported as in-kind 2008. The committee paid $6,006 on have FAA certification to operate his flight on his Cessna Citation jet on April contributions from others: Dec. 29, 2008. On Jan. 12, 2008, the airplane and helicopter as an air char- 2, 2008. The Perdue Committee paid • Robert Fleming, a Morgan- Perdue Committee recorded a dona- ter service. Flights occurred in 2008 on $1,619 for it July 31, 2009. ton barber, paid $3,048 to an air tion from Harris of $3,267 as an event Aug. 2, Sept. 10, Sept. 21, and Oct. 29. Jimmy D. Clark is president and charter service for a Dec. 8, 2007, expense. Harris did not return a phone The Perdue Committee paid Campbell owner of Guy M. Turner Inc., a Greens- flight arranged by Fulenwider, ac- call to CJ seeking clarification of his fly- one month after each of the first three boro-based heavy rigging and crane cording to a report filed by the Per- ing activities on behalf of the Perdue flights and three months later for the service company. He also operates an due Committee. Committee. fourth flight. aircraft under the name of Clark-Griffin • Robert Caldwell, of Mor- Robert O. Hill Jr. of Kinston and Roy Carroll, a Greensboro de- Air LLC and provided a flight to the ganton, is chairman of the West- veloper and owner of Granite Air LLC, Perdue Committee on Oct. 28, 2008. ern Piedmont Community College Continued as “Dozens,” Page 15 NOVEMBER 2010 | CAROLINA JOURNAL PAGE 15 From PagE 1 Dozens Involved in Campaign Flight Provider Program due Committee. Continued from Page 14 Thomas Taft, a Greenville at- Wilmington, is owner of Hillco, the op- torney and former state senator, is erator of Britthaven nursing homes. associated with a flight to the Perdue Hill’s company Flying W LLC provided Committee on July 7, 2008, in an air- a flight to New York City for the Perdue craft owned by his law firm. The Per- Committee on Feb. 26 and 27, 2008. due Committee reimbursed his law The Perdue Committee paid $10,144 firm $1,310 on July 31, 2009. This may on Aug. 7, 2008, for the flights. Perdue be the same flight associated with Sid appointed Hill to the N.C. State Ports Pruitt. Authority. Hubie Tolson of National Air Cress Horne, the owner of US Charter of New Bern, provided a “State Helicopters in Wingate, flew Mike Ea- Fly Around” to the Perdue Committee sley in a corporate plane to a political on May 5, 2008, in a twin-engine Cess- event, and the Easley committee failed na. The Perdue Committee reported it to disclose it, according to a May 2009 on Sept. 11, 2008, as an in-kind contri- News & Observer report. He also flew bution from the N.C. Democratic Party. Perdue on July 31, 2008. The Perdue He also provided a flight on May 30, Committee paid $1,219 for the flight 2008, in a Robinson helicopter, and on June 30, 2009. Easley appointed the Perdue Committee reported it as a Horne to the N.C. Aeronautics Coun- The Perdue campaign says it spent $4,243 to use this private Beechcraft King Air to $341 in-kind contribution from the N.C. cil. Horne did not return a phone call go to an event in Manteo in December 2007. (CJ photo by Don Carrington) Democratic Party. from CJ seeking clarification of his fly- vided flights for the Perdue Committee information or payment information is Jack Trabbuco of New Bern, ing activities on behalf of the Perdue on May 12 and 14, 2008.The Perdue available. flew Perdue three times in 2005. The Committee. Committee reported them on Sept. 11, Thomas Seagrave of Seagrave Perdue Committee paid for the flights David King, of Mach 1.0 Aviation 2008, as $413 and $219 in-kind con- Aviation, a Kinston-based air charter in 2010. He is currently the manager of LLC in Raleigh, provided flights to the tributions from the N.C. Democratic service, provided $4,317 in travel ser- the Coastal Carolina Regional Airport Perdue Committee on April 1, 2006, Party. vices to the N.C. Democratic Party that in New Bern. May 23, 2006, and March 5, 2007. The Chester A. Michael III, the own- appeared to be solely for the benefit of Charles Trefzger of Chancellor Perdue Committee paid for them July er of Parkway Ford in Winston-Salem, the Easley Committee. If so, Seagrave Health Services and Agemark LLC of 1, 2007. King provided another flight is listed by the Perdue Committee as would have exceeded the contribution Hickory, provided flights for the Perdue on Nov. 7, 2007, and the Perdue Com- making a $794 in-kind donation on limits, according to The News & Ob- Committee on Jan. 31, April 3, Oct. 7, mittee paid him $593 on Jan. 12, 2008. Nov. 27, 2007, for a flight by Blue Star server. The transaction also may be in and Oct. 20, 2008. Perdue campaign Terence McEnally III, a Raleigh LLC of Winston-Salem that took place conflict with the legal ban on corporate records labeled the first one as state attorney, made a least four flights in his on the same day. The flight originated contributions. business. The second flight was listed twin-engine Beech Barron for the Per- in Winston-Salem with stops in Raleigh James M. “Marvin” Shearin, a as a $723 in-kind contribution from due Committee from 2004 to 2006, and and Statesville. Norman Wiginton, a businessman from Rocky Mount, pro- the N.C. Democratic Party on Sept. the Perdue Committee failed to report Perdue appointee to the N. C. Aero- vided flights to Perdue on at least sev- 11, 2008. The Perdue Committee paid them until 2009, when they were clas- nautics Council, owns Blue Star. en occasions since 2003. He does not $369.84 and $354.42 for the other two sified as in-kind contributions. Reached Dell Murphy, a Duplin County have the FAA approval to operate his on Dec. 16, 2008. by phone, McEnally refused to discuss hog farmer, flew Easley in 2003 in a aircraft in an air charter service. Some Larry Wagner of Raleigh pro- his flying activities on behalf of the Per- corporate plane to fundraising events of the trips were for state business, vided a flight to the Perdue Committee due Committee. in Washington, D.C., and Atlanta, and some were for campaign purposes, on April 23, 2008. The Perdue Commit- John A. “Sandy” McNeill, the Easley committee failed to disclose and some a combination. tee paid $393 for it July 1, 2009. He CEO of Liberty Healthcare Services the flights according to The News & Singh Development LLC, a also flew Perdue on Nov. 16, 2007, and in Whiteville, owns aircraft operated Observer. He flew Perdue on March Michigan-based real estate company, the Perdue Committee reported it as a under the name McNeill Transporta- 30, 2004, and May 25, May 30, and provided a round trip to Michigan for $156 in-kind contribution on that day. tion. He provided flights to the Perdue Oct. 17, 2008. The Perdue Committee the Perdue Committee that took place That day his plane traveled from RDU Committee on July 22, 2006, and Jan. didn’t disclose and pay for the flights Sept. 12, 2007. The Perdue Commit- to Chapel Hill, to Greenville, to RDU. 6, 2007. A flight on May 2, 2008, was until 2009 and 2010. tee paid $8,944 for those services to Reached by phone, Wagner refused to listed as a $511 in-kind contribution Bryan Neal of Falcon Airlink, an Landmark Aviation in June 2010. discuss his flying activities on behalf of from Sandy McNeill. Another flight on Asheville-based helicopter company Perdue Committee Finance the Perdue Committee. Oct. 29, 2008, was listed as an in-kind that is no longer operating, provided at Chairman Peter Reichard arranged the William. I. Warren of Warren Oil contribution on Dec. 30, 2008. Easley least four flights to the Perdue Commit- flight, according to a report by elections Co. of Dunn, provided a flight to the and Perdue appointed McNeill to the tee. Perdue Committee records show board investigator Kim Strach. Perdue campaign involving actor Andy UNC-Wilmington Board of Trustees. one flight was paid for the day it took Robert Stallings, of Pintail Avia- Griffith April 20, 2008. The committee McNeill did not return a phone call from place. The other three were paid sev- tion of New Bern, is associated with a didn’t reimburse Warren Oil for that CJ seeking clarification of his flying ac- eral weeks later. A Oct. 3, 2008, flight flight for the Perdue committee on May flight until June 19, 2009. The Perdue tivities on behalf of the Perdue Com- was paid for Dec. 16, 2008. 4, 2008. The Perdue Committee paid Committee did not pay for other War- mittee. Parker Overton, a Greenville $1,628 for it on July 31, 2009. ren Oil flights on Oct. 1, Oct. 27, Oct. Cameron McRae, a Bojangles’ businessman, flew Easley to Florida Trawick “Buzzy” Stubbs, a 31, and Nov. 13, 2008, until Dec. 16, franchisee from Kinston, flew Easley in 2003 in a corporate plane, and the New Bern attorney and close friend 2008. Flights apparently took place in multiple times for the 2004 campaign in Easley Committee failed to disclose it, of Perdue, paid for nearly $30,000 in a Beech King Air owned by Warren Oil. a corporate plane, and the Easley com- according to The News & Observer. air charter flights for the Perdue Com- Vannoy Construction furnished mittee failed to disclose it or pay for it, PA Aviation was involved in a mittee through his law firm. In October a Beech King Air based in Jefferson to according to The News & Observer. June 14, 2008, round-trip flight from 2008 he attempted to convert this gift the Perdue Committee on Oct. 2, 2008, Lloyd “Mickey” Meekins Jr., Raleigh to Brunswick County for the to an in-kind donation to the N.C. Dem- for a round-trip flight from Asheville to owner of Mickey Meekins Farm Equip- Perdue Committee. The committee re- ocratic Party after CJ reported on free Raleigh. The Perdue Committee paid ment Inc., an auction company from ported it Sept. 11, 2008, as a $625 in- flights McQueen Campbell provided for $629 for the trip on Dec. 16, 2008. Lumberton, is associated with flights kind contribution from the N.C. Demo- Easley. His attempt failed. After a May Willaim F. Zahn, of Accident for the Perdue Committee on Oct. 19 cratic Party. CJ was unable to find out 2009 News & Observer report on Ea- Research Specialists and Z Avia- and 21, 2008. The Perdue Committee any further information about PA Avia- sley taking free flights from Campbell tion based in Cary, was involved in a paid $232 and $196 for the flights on tion. and several others, the Perdue Com- flight for the Perdue Committee ina Dec. 16, 2008. Sid Pruitt, a pilot from Wilm- mittee started reimbursing Stubbs. King Air 100 Aug. 6, 2008. The Per- Stephen W. Merritt, of Cary ington, was involved in a flight for the Stubbs did not return several phone due Committee reported it Sept. 22, and the J.D. Hamm Corp., an aircraft Perdue Committee on July 7, 2008, in calls from CJ seeking clarification of 2008, as a $717 in-kind contribution hangar construction company, pro- a twin-engine Cessna. No destination his flying activities on behalf of the Per- from the N.C. Democratic Party. CJ PAGE 16 NOVEMBER 2010 | CAROLINA JOURNAL iNtErviEW Barone: U.S. in Period of Low Party Loyalty, Volatile Voting Behavior RALEIGH — When Barack Obama won the presidential race in “So Americans have gone back to 2008 and his Democratic colleagues increased their advantages in the U.S. the founding documents. We’ve had House and Senate, some pundits pre- dicted a major realignment of Ameri- new people involved in politics. On can politics. Two years later, the pic- balance, while this Tea Party move- ture looks much different. Michael Barone, senior political analyst for The ment and other such movements Washington Examiner, top political ana- lyst for Fox News, and co-author of The say they’re bipartisan, most of their Almanac of American Politics, recently energy and focus has gone into the discussed the changing political land- scape with Mitch Kokai for Carolina Republican Party. They’ve given the Journal Radio. (Head to http://www. carolinajournal.com/cjradio/ to find a Republicans a lot more energy, en- station near you or to learn about the thusiasm, and ideas.” weekly CJ Radio podcast.) Michael Barone Kokai: Two years ago, when the Senior Political Analyst president had just won, he was presi- The Washington Examiner dent-elect at this point and told every- one that hope and change had arrived. People were excited. Did anyone ex- pect we’d be where we are today? even an accurate, or at least a full, ac- — pool — to political conflicts. I think They’ve given the Republicans counting of what went on in the 1930s, the rejection of the Republicans in the a lot more energy, enthusiasm, and Barone: I don’t think very many but we’ve had the closest thing we 2006 and 2008 cycles was a rejection ideas. Those are assets to the Republi- people expected to be where we are to- can get to a controlled experiment in more on grounds of competence than can Party. day, certainly not that crowd of what- American politics. People basically on grounds of ideology. Many Demo- There is also a certain amount of ever it was, several hundred thousand don’t believe in these big-government crats disagreed with that at the time liability to the Republican Party. Any enthusiastic people in Grant Park in programs. and proceeded to support these big- time you have an inrush of hundreds Chicago. [It was] quite a wonderful Now, it’s not utterly clear that government programs. of thousands or millions of people into demonstration of support and post- they’re going to believe in what the Those in turn have been rejected politics, you get a certain number of electoral joy and celebration of Amer- Republicans may be offering if they by a majority of American voters, but wackos and weirdos who are part of ica. And you had the political philoso- get congressional majorities or if they what’s really interesting is that we have the group, and they can be a liability pher James Carville predicting that get the White House and congressional seen an inrush into political activity of to a party. we were in for 40 years of Democratic majorities in 2012. I think we’re in a pe- hundreds of thousands, even millions, So we saw something like this Party dominance. riod of what I call open-field politics, of our fellow citizens, [in a] widely de- with the peace and anti-war move- when political loyalties are low, politi- centralized, spontaneous manner. It’s ments of the late 1960s/early 1970s, Well, it turned out not to last as cal voting behavior is volatile, rapidly an inrush that’s symbolized but not which still has had its influence on the long as 40 weeks, because by August changing, issue-focused changes, and limited to the Tea Party movement. Democratic Party today. I think we’re 2009 you had voters on the generic bal- as a result you see wild swings in par- We’ve seen these people invok- seeing something that is likely to have lot question … pollsters asked people, tisan performance. ing the language, the arguments, of the lasting influence quite possibly for a which party’s candidate for the House We had a period from 1995 to Founding Fathers — even the garb of couple decades to come in the Republi- of Representatives would you vote for? 2005 — a period I call trench warfare the Founding Fathers on occasion — can Party and in our politics generally. They started preferring Republicans politics — very little change in parti- and recalling America’s historic past to Democrats, and that’s an historical san voting behavior. Since 2005 we’ve and our founding documents, the Dec- Kokai: Do you see the possibil- anomaly. The question tends to un- seen lots of change in partisan voting laration of Independence and the Con- ity that if Republicans don’t live up derpredict Republican actual electoral behavior. [It] favored the Democrats stitution. to what the Tea Party folks want them performance. So basically people were in 2006 and 2008, favored the Repub- It’s interesting speaking to the to do, we could be seeing some sort of kind of soured on the Obama Demo- licans in 2009, and seems pretty clearly John Locke Foundation, who of course split, maybe for the first time in 150 crats 40 weeks after the celebration of to be favoring them in 2010, with 2011- talked about the right to life, liberty, years or so, a viable third party? Grant Park. 12 still, in my view, question marks. and property and whose language in I think what’s happened is fairly that regard was adapted by Thomas Barone: Well, I think we’re in a simple: The Obama Democrats came Kokai: While some were saying Jefferson and the other drafters of the period of what I call open-field politics, into office [with the] president win- that the election of Barack Obama and Declaration of Independence when and many things are possible. We had ning a higher percentage of the vote the Democrats’ success in 2006 and they talked of life, liberty, and the pur- a similar period in 1991-95, and we saw than any Democratic nominee in histo- 2008 marked a major change, a shift suit of happiness — and by the framers three impossible things happen, which ry except for Andrew Jackson, Franklin back toward the left, there were others of the Constitution when in the Bill of were the election of a Democratic pres- Roosevelt, [and] Lyndon Johnson. … who said, “No, people just got tired of Rights they wrote the Fifth Amend- ident — we’d been told the Republi- The Obama Democrats came to office, the Republicans not living up to what ment. We have a right not to be de- cans had a lock on the presidency — came to power with the assumption they said they were going to do.” Do prived of life, liberty, or property with- the election of a Republican Congress that economic distress would make you think that what has happened out due process of law. — we were told that the Democrats Americans more likely to support or at over the past couple years has refo- So Americans have gone back to had a lock on Congress — and we had least be amenable to big-government cused conservatives and the people the founding documents. We’ve had two independent or third-party candi- programs, and that assumption has who want Republicans to act a certain new people involved in politics. On dates leading in polls for president of turned out to be wrong. way? balance, while this Tea Party move- the United States, Ross Perot in spring I would’ve argued based on my ment and other such movements say 1992 and Colin Powell in fall 1995. reading of history that it was wrong, Barone: Yeah, I think we’ve seen they’re bipartisan, most of their energy I think that we could see simi- that this idea has been peddled by the a couple of carom shots here, if we can and focus has gone into the Republican lar movements here and in many dif- New Deal historians. I don’t think it’s adapt the language of pocket billiards Party. ferent directions. CJ NOVEMBER 2010 | CAROLINA JOURNAL PAGE 17 highEr EduCatioN Miller: Lack of Openness COMMENTARY The College Board Plagues Higher Education And the Bubble By DuKe Cheston “red-alert,” the worst possible rat- Contributor ing, by the Foundation for Individ- he College Board administers other than college, such as voca- the SAT Reasoning Test (for- tional education or the military. CHARLOTTE ual Rights in Education, a group that he root of all evils in our nation’s monitors campus speech codes. Not a merly called the Scholastic The authors of the report higher education system, accord- single university in the state has been AptitudeT Test) to students who are want to obliterate such think- ing to John J. Miller, conservative given a “green light” rating. considering college. If the number ing. So they make the astounding writerT and founder of the National Re- Again recalling his days at Michi- of young Americans in that catego- claim that students who hesitate to view’s blog Phi Beta Cons, is a lack of gan, Miller concluded that it was pos- ry drops, so does revenue for the enroll in college “stand to benefit transparency and accountability. sible to get a good education at the College Board. Thus it has a strong the most from a postsecondary “No sector in American life or university, but a student could have interest in keeping the college degree,” compared with students culture,” he said, “is more unaccount- gone to Michigan and graduated with- bubble growing. “who knew from an early age that able than higher education.” out getting one. “The problem was that With that in mind, let’s look they would attend college.” Miller, the author of several you had to seek it out,” he said. at the latest publication of the Really? Many marginal stu- books, gave a talk Oct. 21 at a Pope To demonstrate the problems board’s Advocacy and Policy Cen- dents drop out if they do enroll in Center reception arising from such ter, “Education Pays 2010.” college. What justifies the assertion in Charlotte. His lax standards, The thrust of the report is that they will have any earnings talk was on “Col- he pointed to a simple: the more people going to gain, much less incrementally leges and Uni- New York Times college, the better. Graduates will larger ones than students who have versities Today: political reporter earn more money, have been on track for college What Parents and who, in a recent more satisfying jobs, and since they were born? Citizens Need to article, didn’t un- are less likely to become The evidence cited Know.” derstand the con- unemployed. They pay is a paper by two sociolo- Miller out- cept of “the rule more in taxes, are health- gists who hypothesize lined three main of law.” Miller ier, and are more inclined that “individuals with problems with declared, “This to do good things (like relatively disadvantaged our country’s col- is what our uni- voting and volunteering). social backgrounds, or leges and univer- versities have Nothing but benefits. those with the lowest sities, all of which wrought: a gener- You don’t even probability of completing arise from this ation of students find the kind of carefully GEORGE college, benefit the most lack of account- whose thinking hedged writing that’s LEEF from completing college.” ability. The politics and world-view of is so impoverished that one who goes common in scholarly (Emphasis in original.) faculty and administrators are unbal- on to one of the most prestigious beats work. We read, “Students This research is anced: “They’re radically out of step in all of journalism — political cover- who attend institutions based on two data sets, with the American mainstream and are age at The New York Times — behaves of higher education obtain a wide one comprising individuals nation- downright hostile to the beliefs of most as if she’s never heard the term ‘the range of personal, financial, and wide who were 14 to 17 years old Americans.” rule of law’ before.” Upon reflection, other lifelong benefits. …” Not in 1979 and the other of individuals Second, they’re doing a terrible he said, “the scary thing is that maybe may obtain or many students obtain. who graduated from high school job of teaching our children: “Aca- she hasn’t.” Sounding like advertising copy, in Wisconsin in 1957. Pretty old demic standards have withered to the There are rays of hope amid the this report never admits that higher data — furthermore, the authors vanishing point.” darkness, however. New and relatively education’s costs might exceed its don’t know how much better the And they cost way too much: new ranking systems are being imple- benefits for some people. noncollege group would have done Costs are “so high that for many stu- mented to get some kind of idea about The authors try to brush off if they had gone to college, so they dents, higher education is arguably what students are getting for their tu- reasonable doubts that people rely on estimates. Whatever that a bad investment that they shouldn’t ition dollars. In addition to the famed might have about college. In re- paper may demonstrate, it does make.” U.S. News and World Report rankings, sponse to recent stories about col- not prove that today’s marginal Miller’s experiences at the Uni- Forbes has a ranking, and soon the lege graduates who can find only students undoubtedly will benefit versity of Michigan, which he attend- Pope Center will be providing valu- low-paying jobs, they say, “We be- by enrolling. ed in the late 1980s, served to illustrate able information to potential students lieve it is critical that more people Indeed, the report under- two major failings of higher education: about what they can expect from dif- … examine for themselves the mines its own arguments. We read political imbalance and the deteriora- ferent colleges. evidence of the benefits of a college that 20 percent of male and 16 tion of standards.. Moreover, Miller mentioned that degree, rather than relying on the percent of female college graduates Political lopsidedness leads to the public perception of higher edu- opinions of others — opinions that earn less than the median earnings intolerance of dissent, which in turn cation has shifted drastically since he are too frequently grounded in for high school graduates. That’s translates into restrictions on politi- graduated from Michigan. Today’s ideology and anecdotes rather than a substantial percentage of those cal speech, often in the form of speech generation is a lot more skeptical about evidence.” who go to college. codes. Michigan enacted one of the the American university, the term “po- I cannot fathom what “ide- The authors of “Education first and most stringent speech codes litical correctness” has captured the ology” has to do with the issue, Pays 2010” are highly selective in the country. Even though the most popular imagination, a consumer cul- and “anecdotes” can be useful to in their evidence. There are solid odious parts of it were struck down ture is developing in which people as unconstitutional by a federal court actually weigh costs and benefits, and an individual making the college arguments to suggest that some ruling, it is still a useful illustration be- an infrastructure has been developed decision, particularly if the circum- students don’t belong in college, cause university speech codes persist, to support a “counterintelligentsia” stances of the person in the anec- even if the College Board chooses even at Michigan, and have prolifer- (including, for example, the Heritage dote are similar to his own. to deny them. CJ ated widely. Foundation, the John Locke Founda- Some of us have argued that Several schools in North Caro- tion, and the Pope Center). most high school graduates who George Leef is the director of lina — Appalachian State University, Given these signs of hope, per- are borderline regarding college are research for the John W. Pope Center Davidson College, Wake Forest Uni- haps Miller’s next speech will not so academically weak that they’d for Higher Education Policy (popecen- versity, and the University of North be quite as gloomy about the state of be better off choosing something ter.org). Carolina at Greensboro — are rated higher education. CJ PAGE 18 NOVEMBER 2010 | CAROLINA JOURNAL highEr EduCatioN Campus Briefs Growing Pains: UNC System Facing Big Cuts umanitarian speaker and Holocaust survivor Elie By Jay sChalin a bill limiting enrollment is more likely this coming year. Wiesel spoke to a sold-out Contributor Bowles said that he believed enrollment growth “will be re- audience Oct. 10 at Memorial Hall H RALEIGH stricted, almost out of necessity, by the legislature.” at the University of North Caro- ver the past couple of years, the University of North Bowles also mentioned that the system might again lina at Chapel Hill’s Memorial Carolina system has dodged the budgetary bullet. lose control of tuition money. In decades past, tuition was Hall. His speech, “Against Indif- But a fiscal cannonball is headed straight in its direc- treated as revenue that the General Assembly could dis- ference,” detailed how “nothing Otion, with no time to get out of the way. At least, that was tribute to the different campuses. In recent years, tuition can come out of being indifferent.” the impression given by Erskine Bowles, system president, stayed on the specific campuses where it was raised. In the Wiesel is a professor at Bos- at the Oct. 6 Board of Governors meeting. 2009 budget session, the legislature took back control of the ton University and a winner of the The UNC system must have its preliminary budget scheduled tuition hike for 2010-11, but in the 2010 session, it Nobel Peace Prize. Born in 1928 in ready in November. Bowles said at the meeting that there relented and returned control to the campuses. Transylvania, he was 15 years old was likely a “$3.5 billion hole” in the state’s overall $19 bil- Additionally, the escheats fund, which provides $116 when he was taken to the Nazi lion budget. million of the $162 million appropriated by the state for concentration camps at Auschwitz Former Gov. James Holshouser, an emeritus member need-based financial aid (tuition provides another $122 mil- of the board, broke down the projected deficit for the 2011- lion), will run dry by 2013 if current expenditures continue, and Buchenwald. He wrote about 12 fiscal year: According to Gov. Bev Perdue’s office, he according to Bowles. The escheats fund is made up of un- his experience — including wit- said, there is a “shortfall” in tax revenue collections of be- claimed property, such as money that reverts to North Car- nessing the death of his father — tween 3.5 percent olina when people in his book Night. First published and 4 percent. He die without nam- in France in 1958, it was a 2007 cautioned that two ing heirs. selection of “Oprah’s Book Club.” other key sources But even Wiesel’s speech was spon- of revenue are like- as the economy sored by North Carolina Hillel ly to end this year is about to force and the Douglass Hunt Lecture — federal stimu- huge cuts, past Series of Carolina Seminars. He lus money (from decisions are forc- was paid $50,000. the 2009 American ing further expan- Wiesel used the Holocaust to Recovery and Re- sion. Bowles cited demonstrate how indifference can investment Act) two new programs cause appalling events to scar his- and a temporary that need more tory. He emphasized the indiffer- state sales tax that money to begin runs out at the operations: the ence of nations and their leaders end of 2010. Those dental school at in allowing the Holocaust to con- sources added a East Carolina Uni- tinue. “Memory is the best shield, combined $2.8 bil- versity, and the the best tool to fight indifference. lion to the North joint School of Na- You cannot be indifferent if you Carolina budget noscience and Na- know,” Wiesel said. last year. noengineering at Recalling his experience, he UNC’s re- UNC-Greensboro said, “The only face [he] remem- cent strategy was and North Caroli- bered was the face of indiffer- to patch together na A&T State Uni- ence.” One memory is of a man enough funding versity. whose appearance showed that he and trim around A third ex- felt nothing for the victims — nei- the edges so that pansion item pro- ther good nor bad. it could continue posed by Bowles Wiesel told the crowd that on its prerecession would add money course. When the to programs in- the most important decree of the economic down- tended to raise re- Bible is, “Thou shall not stand idly turn began, cuts tention and grad- by” (Leviticus 19:16). could be made to uation rates by In closing, Wiesel said, nonessential items having students “What you learned here must be such as travel ex- who are likely to used for morality.” In response, penses and un- drop out work UNC Hillel and other groups filled administra- intensively with across campus, including the tive positions. Iin mentors or faculty LGBTQ Center, are sponsoring a April, Bowles said members. campaign called “Against Indif- that 834 of the 935 positions eliminated by the 2009-10 bud- Bowles did call for some austerity, indicating that ference.” get were administrative. chancellors’ requests for new construction likely will fall Their mission is “to use Elie In the following 2010-11 budget session, the system on deaf ears. He said that any capital spending should be Wiesel’s lecture as a stepping still was able to expand its financial aid program and- in used on the $2.1 billion backlog of “deferred maintenance” stone to deeper dialogue and con- crease the student population. A $170 million drop in ap- projects. Statewide borrowing for either repairs or new con- propriations to the system’s general operating fund did not struction is unlikely, Bowles added. He indicated that the versation to combat indifference cause the job losses and cuts to academics that were antici- state’s debt load probably cannot go much higher without at Carolina.” pated because a massive, last-minute tuition hike — over affecting its top bond rating, which permits it to borrow at These groups have set up 20 percent for most undergraduate students — offset the the best interest rates. events called the “Big Question reduction. The Bowles administration has attempted to improve Series: Exploring Indifference.” CJ Furthermore, the university system’s lobbying efforts efficiency by expanding cost-effective online programs and to continue its growth-oriented policies were extremely suc- working with the lower-cost community colleges to stream- cessful. The legislature initially introduced a bill that would line the transfer process. However, the economic reality Reported by Ashley Russell, an cap future enrollment growth at 1 percent annually. Not likely will force incoming system President Thomas Ross intern with the John W. Pope Center only did the bill fail, but the legislature also funded fully a to make some severe choices right from the start. CJ for Higher Education Policy (pope- 3.1 percent enrollment increase. center.org). The political climate is likely to become less favorable Jay Schalin is senior writer with the John W. Pope Center after the elections in November, however; the passage of for Higher Education Policy (popecenter.org). NOVEMBER 2010 | CAROLINA JOURNAL PAGE 19 highEr EduCatioN Opinion The Trouble With Intellectuals: They Ignore the Real World s economist Thomas Sowell merely concentrates on the crucial in its con- The idea that important knowl- a “secure inhabitant of the right- intellectuals, most sequences was the edge is dispersed among many people wing think tank world,” one who of whom work in Issues mundane knowl- encapsulates F. A. Hayek’s most hasI no “genuine vitality,” who “learns the academy. His edge of where important contribution to the history nothing that does not confirm what message: The Ivory in particular icebergs of ideas, one that Sowell often has he already knew,” Tower should not Higher Education happened to be lo- championed. Sowell quotes Hayek: and whose “main be the source of cated on a particu- Not all knowledge in this idea is the hatred most ideas adopted lar night,” Sowell sense is part of our intellect, nor is of ideas”? to improve society. writes. “In the ag- our intellect the whole of our knowl- That’s what Sowell does gregate, mundane edge. Our habits and skills, our Alan Wolfe, a not describe all knowledge can emotional attitudes, our tools, and Boston College academics, just “public intellectu- vastly outweigh the special knowl- our institutions — all are in this political science als,” who apply their ideas to current edge of elites, both in its amount and sense adaptations to past experience professor, claimed issues. Furthermore, “intellectuals” in its consequences.” which have grown up by selective last January in a aren’t just “smart people.” Physicians, But intellectuals, having great elimination of less suitable conduct. review of Sowell’s JANE engineers, and financiers are smart but faith in their own “special” kind Many intellectuals think that 2009 book, Intel- SHAW not intellectuals. They work directly of intellectual knowledge, dismiss they have the “right” solution, and so- lectuals and Society. with concrete facts or situations, or mundane information and often try to ciety should welcome it. But their so- He said that he with people who give them real-world override it. lutions often rely on limited, abstract could not find “a feedback. Intellectuals produce ideas, Elites disdain Scholastic Apti- knowledge, with real-world feedback single interesting idea in its more than rather than invent machinery, cure tude Tests, which are used to select filtered out. three hundred pages.” That statement diseases, or manage corporations. freshman classes; instead, they want The results can be disastrous. says more about Wolfe than it does The thesis of Intellectuals and So- people to be judged as “whole per- They range from increasing rapes in about Sowell. ciety is that many intellectuals ignore sons.” But judging a “whole person” prisons (because money is spent on Sowell has always been about or disparage knowledge that may be could take a lifetime, Sowell says, and “rehabilitation” rather than on build- big ideas — and they apparently sail far more important to the way society people in the real world need short- ing enough prison rooms to allow completely over Wolfe’s head, per- operates than their own ideas. They hand methods. Many intellectuals privacy) to the appeasement that led haps because Wolfe epitomizes the think they can fix society’s problems don’t consider the real world in their to World War II (both examples from intellectuals who are the target of without taking such knowledge into calculations. Sowell’s book). Sowell’s criticism. Central to Intellectu- account. In a similar vein, intellectuals As with other Sowell volumes, als and Society is the concept that many Much of the information that en- often reject the “first-hand experi- every page can be a touchstone for university faculty and administrators ables society to function is what Sow- ence of others [i.e., their mundane exploring an idea or examining evi- are different from most of the rest of ell calls “mundane” knowledge. No knowledge], in favor of prevailing dence that supports an idea — despite us, and their impact on society can be one person, however smart, can build assumptions among themselves.” Wolfe’s disparagement. I have tried harmful. up more than the tiniest portion of the Sowell cites the Duke lacrosse case, in to clarify just one idea: that intellectu- Sowell has written for decades relevant information about particular which female lacrosse team members als do not know enough to determine about problems caused by elevated social behaviors and situations. (one of them black) defended students the fate of others. Some humility is in elites who impose their beliefs on Consider the Titanic. Lack of accused of raping a black striptease order. CJ others. These elites include academics, mundane information destroyed it. dancer. Because the women players “opinion leaders” (such as editorial “No doubt those in charge of the knew the male lacrosse team well, writers and pundits), and politicians Titanic had far more expertise in the their statements should have been Jane S. Shaw is president of the John who implement the elites’ “solutions.” many aspects of seafaring than most taken seriously; instead, they were W. Pope Center for Higher Education In Intellectuals and Society, Sowell ordinary people had, but what was denounced. Policy (popecenter.org). PAGE 20 NOVEMBER 2010 | CAROLINA JOURNAL Books & thE arts

From the Liberty Library Book review

• He’s been called many things: a socialist, a radical fellow traveler, a Where Keynes Went Wrong Demolishes Keynesianism Chicago machine politician, a prince of the civil rights movement, a virtual • Hunter Lewis, Where Keynes Went of the landscape below increasingly second coming of Christ, or even a Wrong, Mt. Jackson, Va.: Axios Press, will be subject to political control by covert Muslim. 2009, 384 pages, $18. interest groups manipulating the gov- But as New York Times best-sell- ernment to suit their own ends. ing author Dinesh D’Souza points By george leef Lewis points out that at the time Contributor Keynes was penning his ideas about out in his controversial new book, RALEIGH “animal spirits,” the Austrian theory The Roots of Obama’s Rage, these labels n the wake of the bursting of the of the business cycle was known in merely slap our own preconceived housing bubble and the resulting London. F. A. Hayek was teaching notions on Barack Obama. financial collapse, many politicians there, and the two had exchanged let- The real Obama is a man andI high-profile economists (such as ters in newspapers. The Austrians had shaped by experiences far different Nobel winner and New York Times col- explained that the business cycle was from those of most Americans; he is umnist Paul Krugman) have missed a result of previous government inter- a much stranger, more determined, no opportunity to push the idea that ventions, mainly efforts at “stimulat- and exponentially more dangerous the economic tonic we need to get over ing” the economy with artificially low man than you’d ever imagined. our troubles is “stimulus.” What that interest rates. means is increased spending by the The Austrian theory stood in di- He is not motivated by civil federal government, thereby pumping rect opposition to his own explanation, rights struggles, socialist principles, up demand for goods and services and but Keynes never engaged it. As Lewis or the tenets of Islam. What really in turn putting people back to work. shows, Keynes was good at using satire motivates Barack Obama is an in- Of course, there is considerable and misrepresentation to make himself herited rage — an often masked, disagreement over that notion, but its seem far smarter than “old-fashioned” but profound rage that comes from popularity is widespread, especially economists, but he never bothered try- his African father; an anti-colonialist among intellectuals. Intellectuals are language, that we should forget about ing to refute the Mises/Hayek expla- rage against Western dominance, prone to distrust the supposed “messi- bacteria and once again think about nation for the business cycle. and most especially against the ness” and even “chaos” of freedom how diseases are caused by an imbal- Perhaps the most astounding fea- wealth and power of the very nation and easily fall for theories that extol ance of bodily humors. ture of Keynes’ economic beliefs was socioeconomic planning by experts Lewis readily admits that he is that capital was not really scarce. All Barack Obama now leads. Learn like themselves. not the first writer to undertake a de- government needed to do was to cre- more at www.regnery.com. That haughty disdain for individ- molition job on Keynes. He praises ate so much money that interest rates ualism perfectly mirrors the economic Henry Hazlitt’s 1959 book The Failure would be driven down to almost zero philosophy of the man most closely of the New Economics for its line-by- and goods would become abundant • In March 2009, British con- associated with the theory that an ad- line debunking of The General Theory. for all. servative Daniel Hannan became an vanced economy needs constant gov- Instead of reprising Hazlitt’s work, He maintained that greedy capi- overnight celebrity when he assailed ernment intervention — John Maynard Lewis gives us an easily read book that talists kept the price of money arti- Prime Minister Gordon Brown on the Keynes. concentrates its fire on Keynes’ major ficially high for their own gain, thus floor of the European Parliament. Keynes, who lived from 1883 to ideas. limiting investment that would greatly 1946, was the progenitor of the eco- expand the nation’s production. The YouTube clip went viral, lead- Under that fire, the Temple of nomic theories that mostly have ruled Keynes is reduced to less than rubble. That belief is on a par with think- ing to whirlwind appearances on the roost since the 1930s. The Obama At the outset, Lewis observes that ing that through politics we can turn FOX and other conservative media administration is full of advisers, Keynes wasn’t really an economist at stones into bread, but during the des- outlets. trained in the Keynesian approach, all, but was “the first of a breed that perate times of the Depression, people A thoughtful and articulate and its efforts at reviving the economy we have come to know well: the gov- were eager for any quick fix. Keynes’ spokesman for conservative ideas, through massive deficit spending is ernment policy entrepreneur. He lived message was just what most wanted to Hannan is better versed in America’s right out of the Keynesian playbook. and breathed policy, loved being con- hear — especially politicians. traditions and founding documents In his latest book, Where Keynes sulted, pursued, and even lionized by “Where did Keynes go wrong?” than many Americans are. In The Went Wrong: And Why World Govern- the political and business elite.” The The short answer is that he popular- New Road to Serfdom, Hannan argues ments Keep Creating Inflation, Bubbles, policy that Keynes pushed was the ized the habit of thinking about the and Busts, author Hunter Lewis utterly economy as if it were a machine. Peo- forcefully and passionately that antithesis of laissez-faire. Rather than deflates Keynes’ reputation. Keynes leaving the economy to the “invisible ple are always talking about the gov- Americans must not allow Barack was not a brilliant, original, far-seeing hand” — which is to say, to millions of ernment needing to “fix” the economy, Obama to take us down the road economist, Lewis argues. And his sys- individual decisions and transactions to keep it from “overheating,” or to to EU-style social democracy. More tem of thought was nothing more than — Keynes wanted experts like himself “rev it up.” at www.harpercollinscatalogs.com. a hodgepodge of false ideas. to control “the commanding heights” That’s how Keynes looked at it: Keynes became a giant, however, and make the choices that would shape The economy was a simple, poorly because his ideas appealed to statist the general contours of the economy. built machine that needed constant • As the recession contin- politicians and academics. They gave That is how Keynes explained the government attention. The economy, ues, President Obama has chas- intellectual respectability to a vast in- Great Depression of the 1930s: “Ani- however, is nothing like a machine, tised the “fat cats” who feast crease in government power. mal spirits” had driven investors wild, and government attention (spending, Keynes’ reputation rests largely borrowing, mandating, prohibiting, off government bailout money but after the bubble burst, they had on one book, his The General Theory of gone into a terrible funk. Getting the inflating) only interferes with the net- while unemployment remains high Employment, Interest, and Money, pub- economy moving again would call for work of human relationships — the and smaller businesses struggle. lished in 1936. At that time, he already government to step in and “prime the spontaneous order — that we call “the But according to Charles was a well-known public intellectual pump.” It needed to “invest” money in economy.” Gasparino in Bought and Paid For, (more so in Europe than in the United projects chosen by government plan- Keynes was a pseudointellec- Obama is faking his outrage, and States), but the General Theory got peo- ners. tual showman whose addled notions his calls for new policies to rein in ple talking about him everywhere. It is important to note that gave (and still give) advocates of the banks that are “too big to fail” are Lewis examines the major themes Keynes was not a totalitarian. Unlike megastate cover for their assaults on just pablum. In reality, Obama has of the book and concludes that the ad- many other British intellectuals at the liberty and property. Bravo to Hunter climbed into bed with Wall Street ulation for Keynes is much ado about time, he wasn’t enamored of Stalin’s Lewis for making the case against him nothing. Far from advancing human regime. Keynes wanted to preserve a so effectively. CJ CEOs, giving them what they want understanding, The General Theory is fairly large measure of personal liberty so they will support his liberal, big- a confusing, poorly written jumble of alongside his politicization of invest- government agenda. Learn more at antiquated ideas. It was as if someone ment. What he could not or would not George Leef is director of research for www.penguingroup.com. CJ wrote a book on medicine saying, in see was that when the state controls the John W. Pope Center for Higher Educa- obscure and intellectually intimidating “the commanding heights,” the details tion Policy (popecenter.org). NOVEMBER 2010 | CAROLINA JOURNAL PAGE 21 Books & thE arts Iredell’s Work Underscores the Nobility of Fighting for Freedom efending constitutional liberty leading Revolutionary-era pamphle- tionship between Great Britain and no longer entitled to their allegiance, and the ideas of the Founding teer and later a leader of the North her colonies. the only consideration for which it Fathers is an enterprise that Carolina Federalists during the state In the tract, Iredell rejected could be justly claimed or honorably hasD its ups and downs. It’s exciting to ratification debates of the U.S. Con- William Blackstone’s “parliamentary pledged being basely and tyrannically learn what James stitution. Following the document’s sovereignty” argument in Commen- withheld.” Madison, George ratification, President Washington taries, for as historian and former The aforementioned principle is Washington, appointed the North Carolinian to the North Carolina Supreme Court Justice echoed in the Declaration’s assertion Thomas Jeffer- U.S. Supreme Court, where he served Willis P. Whichard summarizes in that the purpose of government is to son, and Samuel until his death in 1799. His best- James Iredell, the doctrine made the protect the right to life, liberty, and the Adams thought known opinion is his dissent in Ch- “American legal condition” one of pursuit of happiness and that people about natural isholm v. Georgia (1793) that provided “conquered subjects.” Iredell put forth may alter or abolish a government if it rights and liberty the basis for the subsequent adoption another principle: Every person has becomes destructive to those ends. and to appreciate of the 11th Amendment to the U.S. the right of liberty, and the purpose of Principles, however, did not mark their dedication to Constitution. all government is to allow individual Iredell’s political divorce from Great preserving what TROY Let’s examine further his il- happiness (as it was defined then). In Britain. As late as spring 1776, he they deemed just KICKLER lustrious career as a pamphleteer in addition, Iredell condemned discrimi- considered himself to be an English- and later con- America’s earliest years. Although a natory laws that benefited only a few man and even contemplated moving stitutional. But royal customs collector, he wrote To and warned that Americans would back to his native land. In the end, he sometimes its can be discouraging and the Inhabitants of Great Britain and Prin- not tolerate such laws. identified with his friends and neigh- outright disheartening when discuss- ciples of an American Whig (1775). Principles is similar to the Decla- bors in what he called “the noblest of ing the Founders with people who Inhabitants catapulted the ration of Independence — or rather, all causes, a struggle for freedom.” dismiss their ideas as outdated or as 23-year-old Iredell into political fame. the Declaration of Independence bears For more information about roadblocks in the path toward pro- In it, he opposed what he described consanguinity to Principles, for it was James Iredell, and his roles in the Rev- gressive ideas. as Parliament’s attempt “to exercise a written after Iredell penned his work. olutionary War, ratification debates, It’s at those times that we should supreme authority” over the colonies. Iredell argues, for example, “that and on the U.S. Supreme Court, please remember James Iredell’s words He expressed this opinion in great government being only the means see northcarolinahistory.org. CJ in To The Inhabitants of Great Britain part because what began in 1773 as of securing freedom and happiness (1773): “The noblest of all causes [is] a a debate between the governor and to the people, whenever it deviates struggle for freedom.” the Assembly regarding the establish- from this end, and their freedom and Dr. Troy Kickler is director of the James Iredell (1751-99) was from ment of civil courts had evolved into a happiness are in great danger of being North Carolina History Project (northcar- Edenton. In his early 20s, he was a larger issue: the constitutional rela- irrevocably lost, the government is olinahistory.org).

More research at your fingertips at the redesigned JohnLocke Foundation home page You can now search for research by John Locke Foundation policy analysts much easier than before. Our new web page design allows you to search more efficiently by topic, author, issue, and keyword. Pick an issue and give it a try. Or choose one of our policy analysts and browse through all of their research. Ei- ther way, we think you’ll find the infor- mation presented helpful and enlight- ening. http://www.johnlocke.org PAGE 22 NOVEMBER 2010 | CAROLINA JOURNAL Books & thE arts

Short Takes on Culture Book review ‘Good Guys’ a Good Show Pursuit of Justice an Eyeopener • ”The Good Guys” My favorite areas are, not The Pursuit of Created by Matt Nix surprisingly, the ones most like the • Edward J. Lopez, ed., who work in them are prone to seeing Justice: Law and Economics of Legal Insti- Fox West: the Southwest, xeric, and scree their role as helping obtain convictions tutions (or Alpine rock) gardens, featuring , Independent Institute and Pal- rather than getting at truths that would ox’s new action-comedy “The massive yuccas, agaves, cacti, sages, grave Macmillan, 2010. help defendants. “All forms of error Good Guys” isn’t your typical sedums, and lavenders. I not only love from honest error to willful fraud are By george leef more likely to be made in favor of the cop show. There’s no dramatic the unearthly looking plants; I also am Contributor Fmusic, overwrought dialogue, or learning how the staff has amended prosecution than the defense,” Koppl gritty underworld backdrops. the soil and sculpted the landscape to RALEIGH writes. Instead, Dan Stark (Bradley provide enough drainage to let these ven the most ardent, minimal- Two essays focus on the abuses Whitford) and Jack Bailey (Colin desert succulents thrive in our wet state libertarians generally agree of eminent domain. Law professor Hanks) deliver tongue-in-cheek one- winters and steamy, hot summers. that the administration of jus- Ilya Somin argues forcefully that gov- Etice is a core function of government. ernment takings of real estate for the liners while driving around the sunny At home, we have several dozen Dallas set in a beat-up Trans-Am. succulents in containers that I duti- The kinds of efficiency questions that purpose of advancing economic devel- Stuck at the bottom of the depart- fully place outdoors every spring and routinely are asked of other (and more opment are both harmful and unnec- ment totem pole, they arrest thieves haul indoors around Thanksgiving. controversial) governmental activities essary. Private developers usually can and vandals instead of murderers or With what I’ve learned at the arbo- are seldom asked with respect to its overcome holdouts who might stand drug lords. retum, we’re planting many of these running of the justice system. in the way of projects; if they can’t, it’s The Pursuit of Jus- Stark and Bailey are the “Odd lovelies outdoors to see if we can bring better that an occasional tice Couple” of cops; the tension between a bit of the Rocky Mountain West to , edited by professor profitable development Bailey’s by-the-book attitude and the Triangle. Edward J. Lopez of San by shelved or delayed Stark’s longing for the excitement of To be sure, there’s much more Jose State University, than that some people the “good ol’ days” creates situations to see at the JC Raulston Arboretum. goes a long way toward be evicted from their that would baffle Oscar and Felix — to Admission is free. Visit often, and see rectifying that omis- homes for nothing. madcap and hilarious ends. what inspires you. sion. The book con- What about the Whitford, who previously — RICK HENDERSON sists of his introduction fact that individuals starred in “The West Wing,” plays and 11 original essays who have their property the washed-up cop to perfection: a that undoubtedly will seized must be paid just wannabe Magnum PI complete with open many eyes to the compensation? That is moustache and early-’80s “shades.” • Born to Run serious problems that the subject of Professor Hanks (son of Tom Hanks and Saman- Written by Christopher McDougall plague our efforts at en- John Bratland’s contri- tha Lewes) captures Bailey’s constant Knopf suring just treatment for bution. Courts gener- conflict between his desire to play by all citizens. ally have adhered to the rules and his yearning to impress Born to Run is an epic adven- As professor Rob- a “fair market value” ert Tollison points out his ex-girlfriend (Jenny Wade) with a ture that began with one simple requirement, assuming in his foreword, the daring or spectacular arrest. question: Why does my foot hurt? that dispossessed prop- book gives us a “public choice” view of The show’s one drawback is its As author Christopher McDougall erty owners are made whole if they our justice system, a view that concen- timeline. Instead of running chrono- seeks to answer this question, he receive that amount. Bratland eviscer- trates on the incentives of the individu- logically, “The Good Guys” always takes us on a ride that unearths ates that notion, pointing out that val- als and institutions that run it, for ex- begins in medias res before returning amazing athletic achievements, ue is subjective and includes emotional ample the American Bar Association. to scenes “One Month Ago,” “Two cutting-edge science, and unforget- attachments people often have to prop- There isn’t space enough here to Days Ago,” or even “30 Seconds Ago.” table characters. erty that cannot be priced. While not difficult to follow, the con- We learn that everything we consider each of the essays in full, al- though all are very worthy efforts. Lastly, consider Adam Summers’ stant scene changes are a distraction thought we knew about running is essay on the harmful impact of law- from the storyline. wrong. McDougall, a contributing Nicholas Curott and Edward Stringham write on the development yer licensing. Earlier in our history, News channels provide plenty editor for Men’s Health and a writer- America enjoyed a free market in legal of drama and grit. “The Good Guys” at-large for Runner’s World, as well of the justice system in England, which grew out of ancient legal norms that services — no educational credentials is a great break from reality. as an ultrarunner himself, uses this or licenses required for practitioners, — JENNA ASHLEY opportunity to suggest and pos- were not centrally controlled and em- phasized restitution to victims. Those and consumers could deal with any- ROBINSON sibly prove that running extremely one they wanted to. The American Bar long distances barefoot is the key to practices and institutions were rather good at dispensing justice, but they Association, Summers shows, moved health, happiness, and longevity. mountains to cartelize the legal profes- • JC Raulston Arboretum at N.C. McDougall argues and pro- did not put any money into the coffers of the king. Hence, the authors write, sion. State University vides plenty of scientific research It leaned on state legislatures to Raleigh to back up his claim that expensive “Centralized police and courts were created to bring revenue to the state.” mandate attorney licensure, which megacushioned running shoes ac- nearly all conditioned upon gradu- Thanks to my wife’s encourage- count for most running injuries. He The remainder of the book looks at America’s contemporary justice ation from an ABA-accredited law ment, I’ve rediscovered my green reminds us that for many genera- school. Little of what a lawyer needs thumb over the past few years. But tions, man ran for long distances system, and the essayists find much to know in his work actually is learned we’ve spent a lot of our adult lives barefoot or in moccasins without to criticize. In “Romancing Forensics: in law school, and what he does use west of the Mississippi. So we have any of the trouble that the modern Legal Failure in Forensic Science Ad- could be learned outside of law school. had to relearn what grows in the East runner encounters. ministration,” Professor Roger Koppl It is just a costly barrier to entry. and how to grow it. Born to Run is that rare book reveals the unpleasant truth about gov- The Pursuit of Justice is a thought- Fortunately, we have found that will not only engage your ernment crime investigation. While TV provoking volume. Running the justice a wonderful source of inspiration mind and entertain you, but it also programs depict forensic scientists as system may be a core function of gov- nearby: the JC Raulston Arboretum, inspires. You can’t help at times but devoted public servants, the fact is that ernment, but the government could near the State Fairgrounds in Raleigh. feel as if you want to put the book they are ordinary people who respond The eight-acre gardens feature more down, take off your shoes, and to incentives that don’t necessarily cor- and should do a far better job of it. CJ than 5,000 plant varieties in a host of simply run. respond with justice for defendants. Most crime science laboratories George Leef is director of research for delightful settings. — KELLIE SLAPPEY CJ in the U.S. are under the control of law the John W. Pope Center for Higher Educa- enforcement agencies, and the people tion Policy (popecenter.org). NOVEMBER 2010 | CAROLINA JOURNAL PAGE 23 Books & thE arts Well-Paced Narrative Recounts High Point of American Conservatism • Garland S. Tucker III: The High Tide of concludes. “To tax one person, class, or Search for the most important sands upon thousands of organiza- American Conservatism: Davis, Coolidge, section to provide revenue for the ben- presidential races of the past century, tions ceaselessly clamoring and agitat- and the 1924 Election, Austin, Tex.: Em- efit of another is none the less robbery and you’re likely to consider the afore- ing for Government action that would erald Book Co., 2010, 336 pages, $29.95 because done under the form of law mentioned 1932 contest that ushered increase the burden upon the taxpayer hardcover. and called taxation.” in Roosevelt’s New Deal and the land- by increasing the cost of Government’; Given the standard textbook slide 1980 election, which enabled and he solemnly pledged himself to By MitCh KoKai view of American history, the author Ronald Reagan to help steer the na- ‘the practice of public economy and in- Associate Editor of those words must have been a reac- tion away from big government pro- sistence upon its rigid and drastic en- RALEIGH tionary shaking his fist at the experts grams first launched under Roosevelt’s forcement,’” Tucker writes of Coolidge. or generations who’ve grown up descending upon Wash- watch. “He decried the growth in the Ameri- with the notion that Franklin D. ington to help Roos- You might point can tax burden over the twenty years Roosevelt’s New Deal saved the evelt turn the country to Johnson’s win over preceding Harding’s election, stating, UnitedF States from the Great Depres- around — through in- Goldwater in 1964, with ‘It is no wonder that under these al- sion, the following story might be hard creased government its profound implica- most despotic exactions the morale of to believe. planning, unprecedent- tions both for federal the country began to break down. Its It’s March 1933. Republican Her- ed centralization, and government expansion vitals were eaten out.’” bert Hoover has presided over several taxation not seen since and for conservative re- If Coolidge and Davis saw eye to years of dismal economic conditions, the days of World War I. trenchment, or the most eye on the dangers of too much gov- and his Democratic successor — an Surely the author recent election, which ernment, a significant minority of vot- overwhelming winner against Hoover of those words was a produced the first presi- ers shared the opposite view. The pros- in the 1932 presidential race — is about Republican, perhaps dent of color. pect of two conservative presidential to embark on a new course. the sore loser Hoover But chances are nominees prompted Wisconsin Repub- As FDR prepares to take aim at himself. pretty good that you lican Sen. Robert La Follette to bolt the the Depression, a “major article” in Find that copy haven’t considered GOP for the Progressive banner. the Sunday New York Times delivers a of The New York Times, 1924 among those ma- “While his 1924 run for the presi- dency fell short, it was a transforma- warning. “The chief aim of all govern- though, and you’ll dis- jor elections. After all, tional event in American political par- ment is to preserve the freedom of the cover that those Jeffer- Coolidge won big. The ty history,” Tucker writes. “Progressive citizen,” the Times author contends. sonian notions of limited government two major candidates were indistin- Republicans were shaken loose from “His control over his person, his prop- actually emanated from the pen of guishable in many areas of public pol- their historical party moorings of more erty, his movements, his business, his John W. Davis. Lifelong Democrat John icy. than a generation and ultimately found desires should be restrained only so W. Davis. One-time Democratic presi- The nation was enjoying a re- a home in the Democratic Party, which far as the public welfare imperatively dential nominee John W. Davis. spite of prosperity between the major turned away from its Jeffersonian roots demands. The world is in more danger It’s a major accomplishment of crises of the first “war to end all wars” in the years following 1924.” of being governed too much than too Garland S. Tucker III’s new book that and the first large-scale government The man who would become the little.” today’s students of political history attempt to steer the economy out of a next Democratic president certainly “It is the teaching of all history have a chance to learn more about Da- ditch. learned political lessons from 1924. that liberty can only be preserved in vis, an unsung hero of American con- Tucker’s well-paced narrative “Franklin Roosevelt commented short- small areas,” the writer continues. “Lo- servatism. might make you reconsider your as- ly after Election Day, 1924, that is was cal self-government is, therefore, indis- Tucker contends that Davis’ un- sessment of 1924. In addition to his pro- useless for Democrats to ‘wear the liv- pensable to liberty. A centralized and successful challenge of Republican file of the nearly universally neglected ery of the conservative’ — a lesson the distant bureaucracy is the worst of all Calvin Coolidge in the 1924 presiden- Davis, the author explains how a taci- Democrats have not yet forgotten.” tyranny.” tial race marked — as the title tells us turn conservative such as Coolidge Thanks to Tucker’s research and And there’s more to be feared — the “high tide” for American conser- won fans within an American elector- exposition of the often-neglected 1924 than centralization. “Taxation can vatives. The 1924 contest marked the ate that was still recovering from war campaign, readers catch a glimpse of justly be levied for no purpose other last time both major parties nominated and from the scandals of Coolidge’s the early signs of major change that than to provide revenue for the sup- a conservative candidate for the White predecessor, Warren Harding. paved the way for today’s ideolog- port of the government,” the author House. “He warned against the ‘thou- ical partisan battles. CJ Books authored By JLF staFFers Selling the Dream Why Advertising is Good Business

By John Hood President of the John Locke Foundation

“[Selling the Dream] provides a fascinating look into the world of advertising and beyond ... Highly recommended.” Choice April 2006

www.praeger.com PAGE 24 NOVEMBER 2010 | CAROLINA JOURNAL oPiNioN

COMMENTARY Can Leadership Be Taught? fter decades of research on things we call leadership develop- the practice, theory, and ment, to class after class of under- even the personal cache of graduate and graduate students, Aleadership, the question of whether as well as to executives and adult or not great leadership can be professionals. We firmly believe that taught is still the subject of debate. leadership is important — to study, On one side is the persistent idea to imitate, if possible to boil down that innateness and greatness are to its least common denominators. bound together in a great leader’s The hope of many existing makeup. Even if unspoken, the programs appears to be that the col- “born leader” idea is a conviction lective information and experiences that many people hold. On the garnered in class will enlighten, other side is the belief that leader- inspire, and encourage participants ship definitely can be taught. If that to become better leaders. By exten- is so, old ideas about natural ability, sion, they can then help others to do for leadership purposes anyway, are the same. EDITORIAL overstated and obsolete. Specific, concrete skills and An Academy of knowledge certainly are Management Learning and involved in the transfor- Education (2003) article mation process. But there The Integrity titled “Can Leadership Be is clearly an undefined Taught? Perspective From something more to be Management Educators,” understood. As analysts Of the Ballot examined this innate continue the conversation vs. learned leadership about what a leader is, week before the Nov. 2 elec- presses turnout and could lead to the question. Management and exactly what a leader tion, a divided three-judge “disenfranchisement” of racial and professors in the study does, training methods in panel of the 9th U.S. Circuit ethnic minorities. Fortunately, the U.S. emphasized the sharp KAREN the leadership develop- CourtA of Appeals overturned Arizo- Supreme Court already has dealt with difference between the PALASEK ment industry sometimes na’s requirement that voters provide those objections. In 2008, a 6-3 major- effort to impart knowl- share more with interpre- proof of citizenship before they regis- ity upheld an Indiana statute requir- edge as a teacher and tive dance than they do ter to vote. The court said the federal ing voters at polling places to show a leader, and students’ with exact science. National Voter Registration Act — re- government-issued photo ID — either ability to acquire knowledge as a That’s not necessarily a bad quiring applicants to sign an affadavit a driver’s license, a U.S. passport, or recipient. Most management educa- thing. Behavioral science, like other when they register swearing that they a state-provided nondriving ID card. tors thought that formal skills and social sciences, deals with human are U.S. citizens — offered enough The court ruled that the public interest knowledge, such as speaking and beings, all both highly similar and protection to prevent fraud. in preserving the integrity of elections the technical aspects of presenta- yet unique in countless ways. If The court did, however, rule that was more important than any burden tion, management theory, and even we are hoping to find a leadership it was OK for Arizona to require vot- individuals might find in obtaining formal strategy techniques, could recipe that works pretty much all of ers to present a state-authorized photo an ID. be taught pretty successfully. But the time for pretty much everyone, ID at the polls. The way we see it, if you have to the intangibles of Emotional Intel- or in all situations, we will be disap- If the ruling were applied present an official photo ID to board a ligence — personal characteristics, pointed. A universally recognized nationwide, it seems that the gov- commercial airliner or enter a federal intuition, empathy, attitudes, and “better leader” formula and metric ernment would look the other way building, you also should be required dispositions, some of them coach- remain unknown. if someone who’s not a resident of to provide reliable proof of identity to able but not readily teachable, fall What’s next? Studying Emo- North Carolina — including nonciti- cast a ballot. through the leadership develop- tional Intelligence. Formal leader- zens — lied or used phony documents When America’s founders (and ment cracks. ship and organization development to get on the voter rolls. That person their intellectual forebears such as So far the leadership training programs already teach courses in could cast a ballot, no questions John Locke) wrote “the law is king,” field remains divided. Depend- communications skills, strategic asked, so long as he brought a picture “a government of laws and not of ing on the aspects of leadership management, organization theory, ID (which itself may be bogus) to the men,” or “if men were angels, there you wish to teach, the answer to human resources, group and indi- polls. would be no need for government,” “Can Leadership Be Taught?” is vidual effectiveness, and collection This is nuts. And it’s why an they were stating basic principles that “Yes,” “No,” or “Maybe.” There is and use of data. Programs make early order of business for the 2011 have helped our Republic stay vibrant agreement on a number of points. extensive use of case studies, as- General Assembly should be a new and free for more than two centuries: Research suggests that effective sessment techniques and hands-on law setting tougher requirements People are fallible. Some are dishon- leaders have a “teachable” point of learning experiences. when persons both register to vote est. A just society requires institutions view that both defines them person- But the best new approaches and cast their ballots. and safeguards that protect the in- ally and recognizably shapes their incorporate learning from brain sci- Every session of the General nocent from those who would prey on goals, that attitudes in particular ence, from the science of happiness, Assembly since 2001 has considered a our weaknesses or misplaced trust. seem to be innate and less trainable and from Emotional Intelligence. bill requiring voters to show a driver’s Earlier this fall, state Republi- than other characteristics, and that The role of EI in leadership is next license or other state-authorized photo cans announced a 10-point plan they practical experience is essential to up in this series. CJ ID at the polls. None of the bills has would introduce at the opening of the the leadership development pro- gotten out of committee. 2011 General Assembly. One item on cess. . Why the resistance to such a the agenda: the so-called Honest Elec- Whichever view of leadership Karen Y. Palasek is director of the common-sense requirement? Old- tion Act, requiring voters to present a development is more correct, we E.A. Morris Fellowship for Emerging line civil rights groups claim that any valid photo ID at the polls. teach leadership, or a collection of Leaders. measure requiring photo ID sup- It’s a start. CJ NOVEMBER 2010 | CAROLINA JOURNAL PAGE 25 oPiNioN EDITORIALS COMMENTARY Higher Ed Costs Washington Borrows, Shiny new buildings no bargain Raleigh Spends f North Carolina policymakers payer money on remediating students want to improve the quality of at the front end and failing to gradu- or most of the past 50 years, transfers to states and localities. the buildings and facilities on the ate large percentages of them on the presidents and lawmakers of Until last year, that is. With Istate’s universities and community back end. Physically, their policies led both parties have misman- the support of outgoing President colleges, the last thing they should do to deteriorating classrooms, laborato- agedF the finances of the federal Bush, incoming President Obama, is authorize another massive higher- ries, and other facilities. government. In this season of bald and most of the Congress, Washing- education bond package. Rewarding those who have partisanship and sharp-elbowed ton responded to the recession with A decade ago, state policymak- managed North Carolina’s higher- politics, surely all North Carolinians a panoply of federal bailouts and ers placed a $3.1 billion package of education bubble during the past two can agree with that. spending programs, driving deficits construction bonds for UNC and decades with more taxpayer money But heaping scorn on the fiscal to unprecedented heights. States community college campuses on the would be akin to the recent bailouts statewide ballot. At the time, higher- of mortgage lenders, insurers, and recklessness of Washington can’t and localities got a good chunk of education leaders admitted that they auto companies. It would constitute a get state and local politi- the borrowed money, to had done a poor job of maintaining transfer of resources from the efficient cians off the hook. It turns be sure, about 40 percent. the extensive physical plant already to the inefficient, from the prudent to out that among the chief But most of it went else- on their campuses. They also argued the improvident, and from the far- beneficiaries of the fed- where. that if voters said yes to the bonds, sighted to the nearsighted. eral government’s deficit This isn’t just a fiscal they wouldn’t raise the state’s taxes. When faced with a budget spending are states and issue. Most state constitu- The bonds passed. Gobs of mon- crunch, the managers of public agen- localities. tions forbid the practice of ey went into the construction pipeline, cies already have good reason to I’ve recently been financing annual operat- enriching the contractors who helped skimp on supplies and maintenance updating my data on ing costs with borrowing. finance the referendum campaign and instead of personnel costs. Strong gross domestic product They do so for good rea- resulting in a dramatic change in the interest groups represent teachers, and government finances son. Access to easy credit look and feel of most of North Caro- state employees, and government con- JOHN lina’s public campuses. tractors. If managers can make their going back to the 1959 HOOD is particularly dangerous But the fundamental problem staff and vendors happy by deferring fiscal year, as part of a for teenagers and politi- wasn’t fixed. On campus, there contin- facility costs, and be reasonably cer- research project on the cians, for similar reasons. ued to be a fascination with shiny new tain that there’ll be a bond package in perilous fiscal situation facing many They lack the long-term incentive, things — not just buildings, but new the future to take care of the backlog, of America’s state and local govern- and often the knowledge, to make research projects, academic programs, they’ll do it. ments. Because one of the themes wise decisions. It’s best to impose entertainment and recreational facili- The Perdue administration and of my piece is the extent to which responsibility on them through ties, and huge increases in enrollment. the new General Assembly should the federal government acts as an ironclad budgeting rules. During good economic times kick off the tough budget delib- implicit borrower for states that Unfortunately, easy access and bad, UNC and many community erations of 2011 by giving the state’s aren’t supposed to finance their cur- to federal borrowing subverts the colleges failed to make a priority of higher-education leaders a clear mes- rent operations with debt, I’ve been states’ balanced-budget require- maintaining quality. The focus was sage: we no longer will reward your on expanding quantity. Educationally, poor management with promises of looking closely at intergovernmen- ments. If North Carolina politi- their policies continued to waste tax- future bailouts. CJ tal flows of revenue. cians can ask Washington for extra What I found struck me as Medicaid money, education funds, both fascinating and largely unrec- or other bailouts they can use to fill ognized even to fiscal-policy wonks: in holes during recessionary budget Fear the Tea Party Federal aid to states and localities is years, they have fewer incentives to a major element of federal budget control state spending growth when Cozy, corrupt relationships endangered deficits. times are good — or to pare expens- Since 1967, the federal govern- es when the recession hits. ment has run budget deficits in all The result is a ratchet effect in ree enterprise creates the condi- because they are afraid to buck the po- but five fiscal years. These deficits state spending. Through booms and tions for business to thrive. But litical tide. And many business groups don’t expect business organi- spend much of their time actively have ranged from small (less than busts, the overall trend is higher in Fzations and lobbies to be consistent lobbying for government intervention 1.5 percent of GDP in nine separate real terms. advocates of free enterprise and the in the marketplace — in the form of years, most recently 2006) to large Because most federally funded principles of limited, constitutional subsidies, bailouts, or regulations that (between 4 percent and 5 percent of programs — such as Medicaid, government that make it possible. exclude or damage their competitors. GDP in nine years) to scary (about 9 schools, and highways — require Among the organizations The Wall Street Journal recently percent in 2009 and so far in 2010). state matching funds, the result can representing businesses of all sizes, reported that a number of corporate In all of those deficit-spending be calamitous for taxpayers in the the U.S. Chamber of Commerce has executives and lobbyists are worried years, total federal grants to states long run. the best record of opposing tax hikes, about the rise of the Tea Party move- and localities amounted to at least Easy credit is a “favor” that intrusive regulations, trade barriers, ment. While increasingly hostile to the 40 percent of the federal deficit. In Washington should stop offering and wasteful spending. For smaller Obama administration and its growth- most years, a majority of federal North Carolina. North Carolinians companies, the National Federation killing tax and regulatory agenda, borrowing went straight to state end up paying for it all, anyway. of Independent Business has proved these business groups aren’t entirely to be an effective, principled defender sure they will like the alternative, and local budgets. More recently, It would cost us less if the federal of free enterprise in Washington and either. the trend has been even more exag- government “gave” us less. CJ elsewhere. They fear that Tea Party conser- gerated — since the return of deficit Other business groups and lob- vatives will win enough congressional spending in 2002, after the brief byists have far less impressive records. seats in November to threaten the bipartisan budget balancing of the Many are willing to cut deals with availability of special tax breaks, mar- late 1990s, virtually all of the federal John Hood is president of the John left-leaning lawmakers, either because keting subsidies, and bailouts in the deficit was consumed in revenue Locke Foundation. they secure a special favor out of it or coming years. CJ PAGE 26 NOVEMBER 2010 | CAROLINA JOURNAL oPiNioN EDITORIAL BRIEFS SSDI Out Of Control

ocial Security Disability Insurance may not be the best-known government ben- efits program. It is, however, both expen- Ssive and understates the number of people without jobs, writes James Ledbetter for Slate. When SSDI was introduced in 1956, it covered only those aged 50 to 64 who had been in the work force and suffered “any medically determinable physical or mental impairment which can be expected to result in death or to be of long-continued and indefinite duration.” In its first year, 150,000 Americans were receiv- ing SSDI. Since then, Congress repeatedly has eased the eligibility criteria, resulting in an ever-growing pool of SSDI recipients. A mil- lion Americans were getting SSDI by 1966; the number increased to 2.8 million by 1977. Today, 8 million former workers are getting SSDI. SSDI also provides benefits to 1 million disabled adult offspring and disabled widows and wid- owers. This comes to over 4 percent of the U.S. working-age population. On Pay and Productivity There is no time limit on how long some- one can receive SSDI. Payments end only when like former U.S. Secretary of Labor Robert Reich. significantly. This “outside the paycheck” compen- a recipient dies, turns 65, gets a job, or becomes As a frequent debater of contentious public sation includes overtime, bonuses, and — most healthy enough to be self-sufficient. Only 12 policy issues in the media, Reich is affable and importantly — the cost of benefits like company- percent of those who leave the SSDI rolls each Igood-humored, and someone who never — at least provided health insurance. The “outside the pay- year do so because they found a job or returned in situations I’ve observed — resorts to personal check” compensation has almost doubled since 1970 to health. attacks. Reich is short in stature, and I remember — from 11 percent of total compensation then to 20 Ledbetter says SSDI’s $180 billion annual when he stood behind the podium at an NCSU percent today. cost is only one problem with the program. Emerging Issues Forum, he opened with the line, “Is If “outside the paycheck” compensation to “It’s also troubling that the U.S. unemployment this the picture of big government?” workers is included with their paycheck earnings, problem is actually much worse, and much Reich is a prolific writer, then Reich’s argument falls apart. Calculations more intractable, than the already dismal num- and his latest book is titled done by Harvard University economist Martin bers tell us.” Aftershock. The thesis of the book Feldstein, who also chaired the President’s Coun- is that the “bargain” between cil of Economic Advisers in the 1980s, show total workers and the economy has worker compensation — including both paycheck Keynesianism fails been broken. Prior to the mid- and “outside the paycheck” compensation — has 1970s, workers could count on continued to track worker productivity even since Across Europe, governments seeking to increased rates of pay commen- the mid-1970s. stimulate their economies are adopting auster- surate with the increase in their So the economic bargain that Reich talks about ity measures rather than running massive bud- productivity. However, since the — where workers are paid based on what they get deficits. A number of American economists, mid-1970s, Reich purports to produce — hasn’t been broken. It’s just that today, including Paul Krugman and Brad DeLong, show that, while labor produc- MICHAEL compared to the past, workers are paid in a different have claimed the European actions are likely to tivity has continued to rise, WALDEN way. return those economies into recession. Writing worker pay has stagnated. What about Reich’s other implication — that in Reason, George Mason University economics Hence, in Reich’s terms, the rich have grown richer at the expense of the professor Veronique de Rugy says this criticism the “bargain” has been broken. Average worker pay poor? This too, to be generous, is an oversimplifi- is wrong. has been flat even though workers are contributing cation. The fact is that from 1975 to 2009, the U.S. De Rugy states that the European move more to production. With income growth strongest Census Bureau shows that average income (ad- toward austerity is forced. Many European at the highest end of the income ladder, most work- justed for inflation) for all households on the income countries rely heavily on foreign investors to ers tread water while observing those at the top ladder has increased. Dividing the income ladder finance their deficits, and investors increasingly getting more. Reich’s solution includes higher taxes into five rungs, income at the lowest rung increased are questioning the governments’ economic on the rich, lower taxes for others, and “wage insur- 10 percent, followed by gains of 13 percent, 17 per- policies. ance” for those losing their jobs. cent, and 27 percent, for rungs two, three, and four “When investors lose confidence in a Reich articulates his view of the economy very respectively. Income for households on the highest government’s fiscal rectitude relative to its well. However, the big problem is that the assertion rung of the ladder increased 57 percent. competitors, they withdraw, and the snubbed on which his entire argument rests — that workers With income gains being greatest for house- have not been compensated for their increased work holds on higher income rungs, the gap between the country suffers,” says de Rugy. effort — is flat wrong! “rich” and the “poor” — income inequality — has “Capital being a scarce good, the result is Reich looks at what workers see in their pay- increased. But clearly the data show this is not a increased interest rates and a higher price for checks — earnings. And indeed, if you plot average result of the poor getting poorer and the rich getting debt.” worker earnings against worker productivity (what richer. Instead, everyone has gained — it’s just those Research also shows that stimulus is the worker produces in a given time period) — be- at the top have gained more. ineffective. A recently published paper by ing careful to adjust for inflation — then you do And why is this? economists Robert Barro and Charles Redlick see the two moving in lockstep until the mid-1970s. Easy — those at the top usually have more shows that a $1 increase in government spend- After then, worker productivity continues to rise, education and training — traits that have become ing produces less than $1 in economic growth. but worker earnings are flat. more valuable in our modern economy. CJ The numbers are even worse for tax-financed Yet in recent decades, how workers are paid government spending, which actually causes has changed dramatically. While workers still see the economy to shrink. CJ money in their paychecks, what companies pay Michael Walden is a William Neal Reynolds Dis- workers outside their paychecks has increased tinguished Professor at North Carolina State University. NOVEMBER 2010 | CAROLINA JOURNAL PAGE 27 oPiNioN Wake School Politics Defy Left-Right Labels

ake County school board 19th-century conservatives; speaking particular area, certainly recognizes the large issues that are discussed on politics are fun, aren’t they? as they do of civic obligations and a the important conservative value of newscasts or in speeches by the presi- The interesting characters, holistic community — the British To- choice. But its implementation re- dent and other national leaders. They egoW clashes, and name-calling make ries used to call it “one-nation conser- quires government activism and the are tribal rather than partisan and the 2010 midterm vatism.” commitment of significant resources frequently about personalities more elections seem like But this all seems a bit odd in the for transportation. than policies. a snoozefest. Who context of contemporary American In fact, although Debra Gold- But at another level this does needs Obama, politics. The bloc consisting of Chair man’s defection from the majority — a matter. It’s a shame that neighborhood Pelosi, and the Tea Ron Margiotta, John Tedesco, Deborah group I’ll call MTPM+G — protected schools should splinter MTPM+G. All Party when we Prickett, and Chris Malone (MTPM) the liberal status quo, an argument members of the group want a hands- have Ron, John, looks markedly more conservative to can be made that she took a principled off school assignment policy. There Chris, Anne, Keith, us — even though, in the tradition of stand in favor of a policy that is more Carolyn, Kevin, Newt Gingrich, who in 1995 became conservative than the zonal version must be a way for them to get back and the two Debs? the first Republican Speaker of the authored primarily by Tedesco. That together. This might House in 40 years, they might prefer policy, remember, initially was offered It’s a shame that year-round sound a little ANDY to call themselves “radicals,” or agents as a kind of olive branch to the pro- schools stoke controversy and divi- nerdy, but I think TAYLOR of change. diversity crowd. sion, too. Conservatives should be one of the most Much of this has to do with the There is another issue on allowed to speak freely and indepen- interesting discus- partisan affiliation of the group and its which MTPM (this time +G) are not dently on these issues and not allow sions I have had on the topic in recent neighborhood schools philosophy. It’s particularly conservative. The grass- their intramural squabbles to distract months was about ideology, not prom not easy to stretch the issue of school roots revolt that started in western from the bigger issues of education queens. Who are the conservatives on assignment neatly along the conven- Wake and helped propel Tedesco, reform. the board? Who are the liberals? On tional liberal-to-conservative spectrum Malone, Prickett, and Goldman to These include merit pay for the surface, answers present them- we use to understand American poli- victory last year essentially began as a teachers, creating metrics to measure selves pretty clearly. The pre-Goldman tics, but the argument is essentially backlash against the county’s man- student progress and hold schools defection majority are the conserva- that neighborhood schools represent a datory year-round schools policy. If accountable for performance, and per- tives, led ostensibly by John Tedesco. kind of “natural order” for assignment year-round schools can be thought mitting families that feel their school The “minority” — Anne McLaurin, and a laissez-faire attitude by policy- of ideologically, they are surely more has failed them to transfer elsewhere. Keith Sutton, Kevin Hill, and Carolyn makers, whereas the diversity policy conservative than those on the con- Morrison (I call them MSHM) — are is intrusive and involves the deploy- ventional calendar. They are more Although many of these decisions the liberals because they support a ment of a significant amount of public efficient and, on a per-student basis, would be made at the state level, a pro-diversity busing policy. But I resources. do not consume as much taxpayer unified school board majority could don’t think it’s quite as simple as that. Still, it is interesting that money. make a good start on them. CJ To use the pure definition of MTPM has moved away from the You might ask: Does this all the term, the minority is conservative idea of neighborhood schools a little. matter? To a certain extent the answer because it wants to protect the status The proposed zonal policy, in which is “no.” As I have noted, school board Andy Taylor is Professor and Chair quo and slow the pace of change. Its families could not be guaranteed politics are difficult to understand of the Department of Political Science in members and supporters sometimes their neighborhood school but would in liberal and conservative terms. the School of Public and International Af- even use the language of paternalistic choose between institutions in a They are much more parochial than fairs at N.C. State University. Transparency and Jennette’s Pier alls for transparency, open With record unemployment and the proved. The plan was no longer to cre- and outlets. Instead, $10.6 million of government, and fiscal respon- Nags Head area hit especially hard, ate jobs — none were created — but to it went to the Jennette’s Pier project. sibility have been heard often the bill promised more than 1,800 save them. Almost all of the receipts from the duringC the recent election season. new jobs and a $14 million economic When asked how many jobs had Aquarium Admissions Fund — $10.5 Everyone from the governor to school benefit to the area. The bill passed been saved, the spokesman said the million — will rebuild the pier. The board candidates has promised more unanimously in both chambers. company doesn’t keep a log of that. As fund has been cleaned out, leaving sunshine, more But was the information on for the promised $14 million economic nothing for the state’s three other disclosure, and which legislators based their vote ac- benefit, the spokesman explained that aquariums at Roanoke Island, Pine more restraint. curate? Clancy and Theys was a construction Knoll Shores, and Fort Fisher. The But will we see it? A staff member at the General company bidding on a job. Sometimes real Assembly’s Fiscal Research Division, No jobs. No economic benefit. Aquarium Society, which owned the disclosure hides which provides fiscal analysis legis- The bill states the project will be pier before it was damaged in 2003 behind half-truths lators depend on when considering “funded with receipts or from other by Hurricane Isabel, donated another and shadows. spending bills, said Fiscal Research non-General Fund sources” and will $400,000 to the project. Three “did not provide those numbers to the cost $25 million. The $25 million project to rebuild months into the members who sponsored the legisla- With the new pier set to open in Jennette’s Pier made claims of jobs 2009-10 session tion, and neither did [it] prepare a May 2011, where has the money come and benefits it hasn’t met. Funding of the General BECKI fiscal note” spelling out the projected from? The Clean Water Management sources for the project were not dis- Assembly, House GRAY taxpayer costs of the project. Trust Fund provided $2.3 million. The closed. The Jennette’s Pier law is just Bill 628 passed, The budget department of the fund is intended “to clean up im- one example of how business has been authorizing the Department of Environment and paired waters and protect remaining done at the North Carolina General expenditure of $25 million to rebuild Natural Resources — which would pristine waters of the state.” Assembly. Jennette’s Pier in Nags Head. The fund the project — didn’t provide the Another $1.5 million came from In 1913, U.S. Supreme Court Jus- bill was proposed and supported numbers, either. Water Access and Marine Industry tice Louis Brandeis said, “Sunlight is by northeastern coastal legislators, Nope. The number of jobs and funds, provided by the General As- the best disinfectant.” A new General including House Rules Committee the economic benefit promises came sembly in 2007 “to acquire waterfront Chairman Bill Owens, D-Pasquotank, from Clancy and Theys, the construc- properties or develop facilities for Assembly will take office in January. Rep. Tim Spear, D-Washington, and tion company that got the contract to the purpose of providing, improving Here’s a piece of advice: No more Senate President Pro Tem Marc Bas- rebuild the pier. and/or developing public and com- murky pier projects. night, D-Dare. When asked how many jobs the mercial waterfront access.” Let the sunlight in! CJ Members were assured the mon- pier had created, a Clancy and Theys In 2006, $15 million in taxpayer ey would come from “existing funds” representative said the economy had money was diverted to a stormwater Becki Gray is vice president for out- and not require any new spending. changed since the project was ap- pilot project to clean up ocean outfalls reach at the John Locke Foundation. PAGE 28 SEPTEMBER 2010 | CAROLINA JOURNAL PartiNg shot DMV Announces New Bev & Mike Aviation Auto Tag (a CJ parody)

By JaCques M. sorBer CJ Automotive Correspondent RALEIGH he DMV has unveiled a new spe- cial license tag promoting the North Carolina Aircraft Provid- ersT Association and the two governors its members helped elect. “Our members have been respon- sible in part for electing the winner in the last three gubernatorial elections,” NCAPA president McQueen Campbell told Carolina Journal. Campbell said he and 30 other association members have provided more than 200 free campaign-related flights to Mike Easley and Bev- Per due. The free flights allowed the politi- cal campaign organizations to devote more money to other expenditures such as television advertising. Campbell said that even though the free flights were violations of cam- paign finance laws, they have been The Division of Motor Vehicles’ new “Bev & Mike, First in Flight” specialized license plate features the countenances of the two common practice for the past 10 years. recent governors who have done the most to promote aviation in North Carolina. (CJ spoof graphic) “Our members have suspended flight activity due to state and federal cialized license plates, allowing citi- for a $30 yearly fee in addition to the “Bev & Mike” plates, however, will be investigations, but we don’t see how zens with common interests to promote regular fees. used to fund pilot training programs you can do politics in North Carolina themselves and their causes. DMV ap- Funds from most specialized for politically active young adults. without free flights,” Campbell said. proved the new tag last November. plates fund the state’s welcome cen- “Our current NCAPA member- North Carolina makes available Any North Carolina automobile ters, travel advertising, and highway ship is getting long in the tooth, so we to the public approximately 100 spe- owner may purchase an NCAPA plate beautification. Funds from the sale of need to plan ahead,” said Campbell. CJ E.A. MORRIS FELLOWSHIP FOR EMERGING LEADERS The E.A. Morris Fellowship is seeking principled, energetic applicants for the 2011 Fellowship class. Applications available online or at the John Locke Foundation. Application deadline is December 31, 2010. Please visit the E.A. Morris Fellowship Web site (www.EAMorrisFellows.org) for more information, including eligibility, program overview and application materials. Eligibility • Must be between the ages of 25 and 40. • Must be a resident of North Carolina and a U.S. citizen. • Must be willing to complete a special project requiring lead- ership and innovative thinking on a local level. • Must be willing to attend all program events associated with the fellowship. • Must not be the spouse of a current or past Fellow. Fellowship Dates Application Timeline March 18-20, 2011: Retreat 1- Pinehurst, NC December 31, 2010: Applications due June 10-12, 2011: Retreat 2- Blowing Rock, NC January 10, 2011: Notify finalists October 14-16, 2011: Retreat 3- Coastal NC February 5-6, 2011: Selection weekend December 24, 2011: Final project due

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