• Doing a Number • Colleges Overboard on N.C. Schools C A R O L I N A On Overhead Receipts Rain Tax Falls on Towns All the President’s Children

Volume 12, Number 6 A Monthly Journal of News, June 2003 Analysis, and Opinion from JOURNAL the John Locke Foundation www.CarolinaJournal.com www.JohnLocke.org Basnight Faction Orchestrated Pipeline Project, Bonds

Senate leader drove Ethanol entrepreneur legislation that favored was considered a threat nonprofit over companies to Basnight’s pet project

By PAUL CHESSER By PAUL CHESSER Associate Editor Associate Editor RALEIGH RALEIGH taxpayer-funded natural-gas pipe- n his pursuit to build ethanol plants in line project for eastern North Caro- eastern North Carolina, DFI Group Alina, at the center of a government IPresident William Horton says he un- conspiracy alleged by a Raleigh business- wittingly got on the wrong side of the most man, was facilitated through legislation powerful politician in the state. pushed by State Sen. President Pro Tem Economic developers’ enthusiasm over Marc Basnight and steered to the control of Horton’s promise to bring jobs and a mar- his friends. ket for locally grown farm products was William Horton, president of The DFI tempered by his deals with outsiders to Group, has sought unsuccessfully to build deliver natural gas to his proposed plants. ethanol plants in eastern North Carolina for Horton attempted to work with South more than 20 years. He claims that since Carolina-based gas company SCANA Cor- 2000, associates of Basnight have obstructed poration and Texas-based El Paso Merchant his plans to build plants in Martin and Energy Corp. to deliver liquefied natural Beaufort counties because Horton was per- gas to the plants. Meanwhile, Senate Presi- ceived as an obstacle to the Basnight faction’s dent Pro Tem Marc Basnight promoted pipeline project. friends at the Albermarle Pamlico Economic In 1998 voters approved, by a 51 per- Development Corporation in their effort to cent to 49 percent ratio, $200 million in get up to $200 million in taxpayer-funded bonds to extend natural-gas pipelines to 22 bond money to build a pipeline in the east. unserved counties in the state. However, the weight of Basnight’s in- Horton explores ethanol in the east fluence apparently enabled political allies in eastern North Carolina to manage $188.3 In early 2000, APEC and partner CP&L million of the available funds. None of the requested $44.2 million in bond funds for money is likely to be paid back because the the beginning phase of their project in north- bond legislation doesn’t require it, and be- Workers install the natural-gas pipeline along U.S. 64 east of Williamston. eastern counties. At the same time, Horton cause the pipeline project isn’t expected to was planning the first of three proposed be economically feasible for decades, if ever. rided the move as political patronage be- North Carolina Natural Gas Inc. Still, the ethanol plants at a site near Williamston in cause Basnight waged a “blatant campaign” company did not provide natural gas to 17 Martin County. During the process, Horton Utilities Commission’s influence to get Owens on the commission. Owens of those counties because they lacked a was introduced to Rick Watson, president added fuel to the fire by saying, “I have sufficient number of potential, mainly in- of North Carolina’s Northeast Partnership, Political groundwork for the pipeline earned my right to the trough.” dustrial, customers. which shared its offices and staff with APEC. was laid in 1995, when Basnight sought to But Owens’s name resurfaced for the In the early 1990s, state legislators cre- Horton discussed with Watson road and get his own choices appointed to the seven- position again two years later, and his nomi- ated financing incentives for local natural- infrastructure improvements to the site of member Utilities Commission. The gover- nation won legislative approval despite gas companies to extend service into un- the proposed plant. nor officially nominates board candidates. more criticism. The salary for the job was served areas. The legislature also passed Access to natural gas was crucial to One nominee was Basnight’s brother- $97,388 a year. “use it or lose it” legislation in 1995, the Horton’s plans. Horton had reached a pre- in-law, Bobby Owens, a power in state poli- Another Basnight ally, former state Sen. same year Basnight tried to get Owens on liminary agreement with SCANA to ex- tics. Owens had been the chairman of the Richard Conder of Rockingham, won an the commission. The bill, sponsored by Rep. plore the extension of a pipeline into east- Dare County (Basnight’s home) Board of appointment to the commission in 1997 as Bill Owens, D-Elizabeth City, another ern North Carolina to serve the ethanol Commissioners. He also ran former Gov. well. Members of the commission serve Basnight ally, required all franchisees to plants. Little did he realize, however, that Jim Hunt’s eastern N.C. office. eight-year terms. provide natural gas to at least part of the the SCANA project would pose a threat to Basnight wanted Hunt to appoint unserved counties by July 1, 1998, or else the fledgling APEC-CP&L venture. Owens to the Utilities Commission in 1995, North Carolina Natural Gas they would lose their rights to the territo- DFI’s efforts to connect a SCANA pipe- but Owens withdrew from consideration ries. line to its plants repeatedly faced obstacles. after an uproar ensued over of his lack of Over time since the 1960s, the commis- experience. Critics, including editorial writ- sion was gradually awarded exclusive fran- ers of The News & Observer of Raleigh, de- chise rights for northeastern counties to Continued as “NCNG Forced Out,” Page 3 Continued as “Horton,” Page 3

NC Should Spend Gas, Car Taxes On. . . The John Locke Foundation NONPROFIT ORG. Contents 200 W. Morgan St., # 200 U.S. POSTAGE Only Roads 52% Raleigh, NC 27601 PAID Other Items, Too 42% RALEIGH NC PERMIT NO. 1766 Not Sure 6% Calendar 2 State Government 3 Education 6 Higher Education 10 Local Government 14 Books & the Arts 18 Opinion 20

% of N.C. Respondents in Oct. 2002 JLF Poll Parting Shot 24 C A R O L I N A Contents

ON THE COVER lic school lands or tax funds from being di- have become yet another excuse for cities JOURNAL vided between religious sects or denomi- and towns to raise taxes. Page 14 • A taxpayer-funded natural-gas pipeline nations. The amendment failed, but today project for eastern North Carolina, at the such provisions exist in 37 state-level con- • N.C. Department of Transportation offi- center of a government conspiracy alleged stitutions. Page 8 cials are examining the possibility of re- by a Raleigh businessman, was facilitated building Interstate 95 through toll collec- by State Sen. President Pro Tem Marc • As North Carolina heads into the compli- tions under a federal pilot program, but it Richard Wagner Basnight and steered to the control of ance phase of the No Child Left Behind edu- will be several years before anyone pays to Editor friends under his direct influence. Page 1 cation law, accountability experts must de- drive on the interstate. Page 15 cide which students can legitimately be ex- cluded from testing. Page 9 • An interview with Fern Shubert, state Paul Chesser, Michael Lowrey NORTH CAROLINA senator from Union County. Page 17 Donna Martinez, Associate Editors HIGHER EDUCATION • U.S. Rep. Frank Ballance, D-1st, has come THE LEARNING CURVE under scrutiny because hundreds of thou- • Last year schools in the University of Karen Palasek, Jon Sanders sands of taxpayer dollars went to a non- North Carolina system received $123.6 mil- • Reviews of All the President’s Children: Tri- Assistant Editors profit counseling center he started, but the lion in “overhead receipts” from federal re- umph and Tragedy in the Lives of America’s organization has failed to file reports re- search grants, which state legislators would First Families by Doug Wead, and The New quired by state and federal law. Page 5 like to see go to the general budget. Page 10 White Nationalism in America: Its Challenge Andrew Cline, Roy Cordato, To Integration by Carol M. Swain. Page 18 Charles Davenport, Ian Drake, EDUCATION • The latest case championed by the North Tom Fetzer, Nat Fullwood, John Gizzi, David Hartgen, Carolina Chapter of the Institute for Justice • A review of Bountiful Harvest by Thomas Summer Hood, Lindalyn Kakadelis, • For a man whose passion is statistics, Dr. involves two cherished traditions in the R. DeGregori, and a look back at Ayn Rand’s George Leef, Kathryn Parker, William Sanders has devoted much of his state, freedom and sports. It also concerns The Fountainhead. Page 19 Marc Rotterman, R.E. Smith Jr., career to education, and now has spent the a rapidly evolving form of journalism: Jack Sommer, John Staddon, last 21 years putting both together with his online news media. Page 11 OPINION George Stephens, Jeff Taylor, unique student evaluation method. Page 6 Michael Walden, Karen Welsh • Unethical behavior is rampant on college • An editorial on the record of Mike Easley Contributing Editors •The success in the Supreme Court for campuses and in society today, the director as governor. Page 20 voucher advocates hinged in large part on of the Kenan Institute for Ethics at Duke Jenna Ashley, Nathan Clark, the legal concept of true private choice. University said at an luncheon sponsored • Michael Walden tells how North Caro- Hans Hurd, Paul Messino Now that the federal question has been an- by the John Locke Foundation on April 28. lina got into its budget problems. Page 22 Editorial Interns swered, has the door to voucher programs Page 12 in the states been opened? Page 7 • Richard Wagner says another of the bad • The Daily Tar Heel April 24 reported that ideas that refuse to die is the “Dream Act,” • In 1999, Salisbury native Julian Robertson, “A woman is raped every two minutes,” but which allows illegal immigrants to enjoy Founder of Tiger Management, contributed no sources for this information were given privileges without earning them. Page 22 $1.5 million to start Children’s Scholarship — mildly surprising since UNC-CH has a Fund-Charlotte. In July, CSF–Charlotte will well-respected school of journalism. Page 13 PARTING SHOT John Hood Publisher become its own nonprofit. Page 7 LOCAL GOVERNMENT • Paul Chesser offers solutions the state can Don Carrington • In 1875 a proposed amendment to the implement to stave off the latest threat to Associate Publisher Constitution would have prohibited pub- • For state residents, rain and its runoff fairness in life: “Fat-finger dialing.” Page 24 Calendar Published by The John Locke Foundation 200 W. Morgan St., # 200 Raleigh, N.C. 27601 (919) 828-3876 • Fax: 821-5117 Former Attorney General Edwin Meese III to Speak in July www.JohnLocke.org

he John Locke Foundation will wel- yer, educator, and policy official, Meese has Bruce Babcock, Ferrell Blount, come former U.S. Attorney General been a business executive in the aerospace John Carrington, Hap Chalmers, Edwin Meese III for a Headliner and transportation industry. Sandra Fearrington, Jim Fulghum, T luncheon at noon July 8 at the Brownstone From January 1975 to May 1976, he was William Graham, John Hood, Hotel in Raleigh. vice president for administration of Rohr Kevin Kennelly, Lee Kindberg, Robert Luddy, William Maready, Meese is a distinguished visiting fellow Industries in Chula Vista, Calif. He left Rohr J. Arthur Pope, Assad Meymandi, at the Hoover Institution. He was the 75th to enter private law practice in San Diego Tula Robbins, David Stover, attorney general of the United States, under County. Jess Ward, Andy Wells, President Ronald Reagan, from February He is active in numerous civic and edu- Art Zeidman 1985 to August 1988. cational organizations and was appointed Board of Directors Meese is an expert on the U.S. legal by Reagan to the Board of Visitors of the system, law enforcement and criminal jus- U.S. Military Academy at West Point. tice, intelligence and national security, and Meese is a graduate of Yale University the Reagan presidency. His current research (1953) and holds a law degree from the CAROLINA JOURNAL is a monthly journal of news, analysis, and commentary on state focuses on the criminal justice system, fed- University of California at Berkeley. and local government and public policy eralism, emergency response management, The cost of the luncheon is $20 per issues in North Carolina. and terrorism. person. For more information or to prereg- His memoirs were published in the 1992 ister, contact Summer Hood at (919) 828- ©2003 by The John Locke Foundation volume With Reagan: The Inside Story 3876 or [email protected]. Inc. All opinions expressed in bylined ar- (Regnery Gateway Publishers). ticles are those of the authors and do not Meese is also a distinguished fellow Shaftesbury Society necessarily reflect the views of the editors of and holder of the Ronald Reagan Chair in Carolina Journal or the staff and board of Public Policy at the Heritage Foundation; a Each Monday at noon, the John Locke the Locke Foundation. member of the Board of Regents of the Edwin Meese III Foundation plays host to the Shaftesbury Material published in Carolina Journal National College of District Attorney; dis- Society, a group of civic-minded individu- may be reprinted provided the Locke Foun- tinguished senior fellow, Institute for United sition effort following the November 1980 als who meet over lunch to discuss the dation receives prior notice and appropri- States Studies, University of London; and a election. During the presidential campaign, issues of the day. ate credit is given. Submissions and letters member of the boards of directors of both he was chief of staff and senior issues ad- The meetings are conducted at the to the editor are welcome and should be the Capital Research Center and the Land- viser for the Reagan-Bush committee. foundation’s offices in downtown Raleigh directed to the editor. mark Legal Foundation. Formerly, he served as Governor at 200 W. Morgan St., Suite 200. Parking is Before serving as U.S. attorney general, Reagan’s executive assistant and chief of available in nearby lots and decks. Readers of Carolina Journal who wish he was counselor to the president from 1981 staff in California from 1969 through 1974 to receive daily and weekly updates from CJ editors and reporters on issues of interest to to 1985. In this capacity he functioned as the and as legal affairs secretary from 1967 “Carolina Journal Radio” North Carolinians should call 919-828- presidents chief policy adviser and had through 1968. 3876 and request a free subscription to management responsibility for the admin- Before joining Reagan’s gubernatorial Next month’s issue of Carolina Journal Carolina Journal Weekly Report, deliv- istration of the cabinet, policy development, staff in 1967, Meese was deputy district will provide more details about a new ered each weekend by fax and e-mail, or and planning and evaluation. attorney of Alameda County, Calif. weekly radio program based around the visit carolinajournal.com on the World During the time he held both these From 1977 to 1981, Meese was a profes- newspaper and its editors and writers. In Wide Web. Those interested in education, positions, Meese was a member of the sor of law at the University of San Diego, the meantime, however, CJ readers who higher education, or local government president’s Cabinet and the National Secu- where he was also director of the Center for might be interested in subscribing to a should also ask to receive new weekly e- rity Council. Criminal Justice Policy and Management. monthly CD version of the program should letters covering these issues. Meese headed the president-elect’s tran- In addition to his background as a law- call call Kory Swanson at (919) 828-3876. CJ C A R O L I N A June 2003 JOURNAL North Carolina 3 NCNG Forced Out of the Northeast, Basnight’s Friends Move In

group could then negotiate with another Continued From Page 1 company with natural-gas expertise. When the three-year time limit expired in 1998, the commission determined that Gas interest hinged on bond funds NCNG’s franchise for the 17 northeastern counties should be reviewed. Natural-gas companies didn’t seem in- While NCNG’s future in the northeast terested in serving the northeast counties came into question, lawmakers in the early until the referendum passed Nov. 4. summer of 1998 approved the $200 million AREA’s meeting minutes before the bond referendum. Advocates thought the election show discussions with only one funds could make service to NCNG’s un- gas company, Frontier Energy, which said served territories more appealing. its interest in the northeast was contingent upon passage of the referendum. Creation of AREA After the referendum passed, other companies courted AREA officials aggres- But long before the commission called sively, even though bond awards wouldn’t for hearings on NCNG’s franchise, compe- be decided for months and the commission tition for the territory, and eventually the had just begun hearing testimony about bond money, materialized. NCNG’s franchise. In 1997 Rep. Owens introduced another Later in November 1998, Carolina bill, which passed unanimously, that al- Senate Pro Tempore Marc Basnight Former Dare County official Bobby Owens Power & Light announced that it would lowed cities and counties to create natural- purchase NCNG and that it hoped to get gas districts. bond money to provide natural-gas service In January 1998 the counties of Chowan, make.” Davis said the small number of potential to the northeast counties. AREA lawyer Pasquotank, Currituck, Camden, and NCNG’s future hadn’t yet been re- customers and shortage of “industrial load” Allyson Duncan told AREA officials that Perquimans; the city of Elizabeth City; and solved, and the bond referendum wasn’t on made the prospect unattractive. CP&L was interested in working with them. the towns of Edenton, Hertford, and Winfall the ballot yet, but AREA positioned itself to “In the event the bond referendum is However, CP&L stayed on the sidelines teamed up to create a natural-gas district take over the franchise anyway. approved by the voters,” Davis said, while the APEC-NCNG battle ensued. called the Albemarle Regional Energy Au- At a Pasquotank commissioners’ meet- “NCNG believes that it, among all potential Several other natural-gas companies, thority. The group was led by then- ing Aug. 3, Dixon said the authority had the service providers, would be in the best po- from inside and outside of North Carolina, Pasquotank County commission chairman support of the Utilities Commission. “Mr. sition to make the most efficient and effec- were also eager to team with AREA on a Jimmie Dixon, another Basnight ally. Dixon noted that although there are other tive use of these funds…” pipeline project. However, none of those Minutes from a Pasquotank commis- regions in the state interested in forming The first public hearing on NCNG’s companies’ representatives interviewed by sioners’ meeting Feb. 2, 1998 said, “Com- natural gas authorities, the Albemarle Re- franchise rights for the northeast counties CJ could explain why they didn’t pursue missioner Dixon stated it is being recom- gional Energy Authority would be the first was scheduled for Oct. 27, 1998, one week the franchise for themselves. They all ceded mended that the [member counties and mu- to receive funding for expansion of natural before the vote on the referendum. the territory to AREA. nicipalities] pass a resolution of support for gas,” according to the minutes of the meet- Of the 17 individuals who testified Sen. Basnight’s efforts to obtain natural gas ing. Dixon repeated the claim at the com- against NCNG, 16 represented AREA-re- Fight for franchise and bonds for the area and to also establish a [gas] missioners’ meeting in September. lated entities. One of the most repeated authority…” The minutes don’t state who Dixon also did not respond to ques- complaints was that NCNG had the exclu- The battle between AREA and NCNG made the recommendation, but Basnight tions submitted by CJ. sive franchise for 40 years and did nothing over the franchise escalated in pleadings apparently played an important role. with it. Officials also testified that because before the commission. Duncan and NCNG “They said [Basnight] was the driving AREA vs. NCNG natural-gas service didn’t exist in the re- lawyer Edward Finley Jr. engaged in sev- force behind creating their group,” said gion, it harmed their ability to attract busi- eral motions to gain an upper hand before Brian Kennedy of Columbia Gas Transmis- Despite its failure to extend service to ness and industry. the commission. sion, one of the companies that later tried to 17 counties in its franchise territory, NCNG Dixon testified that because of the lack Finley requested from AREA its plans work with the group. When contacted by decided to defend its rights to the rural of natural-gas service, “we are eliminated to provide natural gas to its five-county Carolina Journal, a Basnight spokesman de- areas because of the prospect of bond money. from 40 percent of all the industrial clients region, a move Duncan called harassment. clined to comment about the matter. The company planned to provide service that come to North Carolina.” “AREA’s expressed position is [to] deny The group planned a trip to Raleigh immediately in Pasquotank, Camden, Referring to earlier testimony by NCNG’s request,” Finley said, “so as not to April 21, 1998 to meet with Basnight. Dixon Onslow, Bertie, and Martin counties. Still, Pasquotank’s director of economic devel- foreclose AREA’s opportunities to provide reported to his fellow commissioners after AREA and other political and business lead- opment, Randy Harrell, Dixon said, “…he’s natural gas serv[ice] in the northeastern the meeting that members of the natural- ers vigorously opposed continued franchise had clients that come, fly in at the local counties.” gas committee met in Basnight’s office with rights for NCNG. airport and once they hopped off the plane In other written testimony, Gerald Gisele Rankin of the Utilities Commission NCNG was less committed to serving the first question was, do you have natural Teele, NCNG senior vice president and trea- Public Staff and the senator’s general coun- 12 other counties without outside funding: gas availability? surer, argued that NCNG would have had sel at the time, Norma Mills. Washington, Carteret, Pender, Chowan, “And [Harrell] said, ‘no.’ And so they to dramatically increase rates its other cus- According to AREA meeting minutes, Currituck, Dare, Gates, Hyde, Jones, turn around and got on a plane and left. tomers paid if it had extended service into the group “asked Mrs. Mills if we were Pamlico, Perquimans, and Tyrrell. They weren’t even interested in looking at the northeastern counties. He also said the heading in the right direction. She agreed “NCNG is very interested in serving all us.” commission would have frowned upon such that we were and encouraged us to form an unserved areas,” Terrence Davis, former Dixon asked the Utilities Commission authority and to talk with the various gas senior vice president of operations for the to allow AREA “to be the appointed fran- companies to see what proposals they would company, said in written testimony. But chise of the five-county area.” He said his Continued as “Basnight,” Page 4 Basnight and His Allies Held a Grudge Over Natural Gas, Horton Says

Continued From Page 1 Morehead City’s harbor. remaining $149.6 million in natural-gas vember 2001 on the basis that he could help Including in the plan was the delivery bond funds. smooth over sore feelings with Basnight, The two parties broke off their agreement of liquefied natural gas to the Radio Island Horton said that in hindsight his agree- whom, he said, also was a friend of his. when DFI was unable to get its plants off the site and the barging of natural gas to the ment with El Paso “was the beginning of the Perry said he could help Horton get politi- ground, SCANA spokesman Robin Mont- Martin County plant on the Roanoke River. demise of our relationship with the North- cal support for his projects. gomery said. Horton said he was unaware DFI reached an agreement with El Paso east Partnership,” because it posed a threat Horton said associates of Basnight’s told that APEC-CP&L was planning a pipeline Merchant Energy Corp. of Houston to trans- to the eastern North Carolina pipeline him on many occasions that he would never when he started working with SCANA. port liquefied natural gas. project. He repeatedly had difficulty get- get permits for his plants because of Horton’s Horton said SCANA officials told him Plans for the Radio Island project, how- ting environmental permits for his ethanol perceived interference in Basnight’s plans they backed off because of pressure from ever, didn’t get very far. Citizens of Carteret plants. to bring natural gas to eastern North Caro- CP&L in North Carolina. Horton said County, especially in Morehead City and lina. Watson had told him to “stay under the Beaufort, opposed the plant. DFI abandoned Horton alleges conspiracy Horton alleges that officials, including radar screen” on his project with SCANA, its plans for Radio Island in February 2001. Watson and Perry, launched an attempt to and that DFI would not get environmental But later in February the State Ports Au- Despite ENCNG’s success winning take over his ethanol investments by invok- permits from the state until the Utilities thority granted El Paso an option to lease $188.3 million in bond funds, Watson and ing Basnight’s political power. He said the Commission approved bond money for land on Radio Island for a gas terminal. Basnight’s other political allies in eastern officials threatened that if he didn’t sell his APEC’s pipeline. Again unknowingly, Horton had ushered North Carolina apparently held a grudge proprietary information and knowledge to After the arrangement with SCANA in potential competition to the APEC-CP&L against Horton because of his attempts to them, they would put him out of business. failed, but still maintaining hope for a site in (now called Eastern North Carolina Natu- find a competing supplier of natural gas. Since then, loans to Horton have been re- Martin County, Horton turned his atten- ral Gas) gas pipeline project in the east, this Former Wake Forest Mayor Jim Perry re- called and lines of credit to him have been tion to another site on Radio Island, in time just as it was about to apply for the kindled a friendship with Horton in No- cut off. CJ June 2003 C A R O L I N A 4 North Carolina JOURNAL Basnight-Backed Nonprofit Got More Than $188 Million in Bonds

Continued From Page 3 NCNG filed for an appeal of the seek the franchise and bond money and 1 of its project. With no oncoming propos- commission’s decision, and CP&L remained that it would “loan” its name to CP&L. als on the horizon, the commission closed an action. in the background despite its pending pur- Under the APEC name, CP&L would own the application process. “It must be borne in mind that in the chase of the gas company. both the transmission and distribution lines “We expected a lot more to apply,” absence of the $200 million in bond funds,” and submit a surcharge or royalty to APEC, Rankin said. “I think a lot of [the compa- Teele said, “none of these parties would be AREA, APEC & CP&L even though taxpayers served as the money nies] viewed it as a dicey proposition.” coming forth with…a viable, economically source. While CP&L would own the sys- feasible plan…” AREA met March 8, 1999, nine days tem, APEC would have input about the An easy $150 million before the commission’s decision on the placement of distribution lines. Enter Basnight franchise, and set a deadline of April 1 for On Oct. 26, 1999, APEC and CP&L no- Between Frontier and ENCNG, the com- submission of proposals from private com- tified the commission that they would ap- mission had already awarded $50.4 million Debate about NCNG’s franchise came panies “for providing natural gas to our ply for the exclusive franchise for the 14 in bond funds. In March 2001, ENCNG to a head Dec. 7-8, 1998, when the commis- area,” according to meeting minutes. counties and for $197.5 million in bond requested the remaining $149.6 million in sion conducted hearings in Raleigh. On April 20 AREA’s directors decided funds. Commissioners said that in the first available money for the remaining eight Basnight, in a statement read by Mills, to enter negotiations with CP&L to provide hearing they would consider only Phase 1, counties of its project. weighed in with a passionate argument natural-gas service to unserved areas. AREA which would serve the six northeastern- The commission granted ENCNG’s re- against NCNG. would request “that CP&L restrain NCNG most counties of the 14, for the first round of quest by early June, since little objection “Perhaps NCNG now intends to ex- as much as possible from proceeding with bond money. APEC and CP&L sought $44.2 was raised against the request. Still, some pand into the northeast by applying for their appeal to the Utilities Commission,” million for Phase 1. observers were surprised that the 14 coun- some of the recently approved bond pro- according to meeting min- Sanford’s prediction ties ended up with more than 93 percent of ceeds,” Basnight said. “Despite the avail- utes. Within months the of a “free-for-all” for the the bond funds. One gas-industry execu- ability of these proceeds, however, I do not CP&L-NCNG deal was franchise never material- tive said he thought the area would never believe that NCNG should be granted an consummated and the “I thought the Utilities ized. get more than 50 percent of the money. extension of the exclusive franchise…” appeal was dropped. Commission would do “I thought it was a statewide thing,” he Then Basnight said the idea for a refer- As discussions pro- Utilities Commis- said. “I thought the (Utilities) Commission endum existed as far back as 1995, at the gressed and the franchise the right thing. But then sion considers plan would want to do the right thing. same time the “use it or lose it” law was for the 14 unserved coun- I thought about it and “But then I thought about it and said, passed and he tried to get Bobby Owens on ties opened, AREA and As the commission’s ‘well, look who’s driving the train: Marc the commission. CP&L decided they said, ‘well, look who’s hearings progressed, Basnight.’” “The natural-gas bond legislation was would join in an attempt driving the train: Marc CP&L and APEC formed The executive said he thought NCNG just barely a dream in my mind and in the to get the rights and bond Basnight.’” a separate corporation, was doing its best to “chip away” at serving minds of other legislators when the General money for the whole re- called Eastern North the rural northeast. Assembly enacted the ‘use it or lose it’ leg- gion. As a result, AREA Carolina Natural Gas, “But it wasn’t the grand scheme that islation,” Basnight said. officials began discussing and substituted it instead (APEC leader) Jimmie Dixon and Basnight During the hearings, Owens was one of a conversion into a nonprofit organization. of APEC as the applicant for the franchise wanted,” he said. the most active interrogators among the All the wrangling between AREA and and bond funds. Both APEC and CP&L commissioners. More than other commis- NCNG became moot. (now Progress Energy) own equal stakes in East benefits from state debt sioners, Owens’s questions to NCNG’s op- Suddenly, minutes of meetings by ENCNG. ponents elicited answers about the north- AREA officials and Pasquotank County In testimony before the commission, So far, ENCNG has about 350 custom- east region’s plight without natural-gas ser- commissioners that previously had detailed some groups expressed concern about parts ers for Phase 1 of the project. CP&L, now vice. On the other hand, Owens’s questions discussion about natural-gas service failed of ENCNG’s proposal, especially the need Progress Energy, is selling the $7.5 million to Davis pointedly challenged him about to provide information on the issue. Begin- for almost all of the $200 million in bond stake it invested in the venture to Piedmont the long period of time the company held ning in June 1999, discussions about forma- funds. The Carolina Utility Customers As- Natural Gas Corp. CP&L began buying gas the franchise rights but failed to provide tion of the nonprofit, except for AREA di- sociation argued that it should be allowed companies in the late 1990s because electric service to most of the area. rectors approving the reorganization, were to participate in commission hearings about companies expected deregulation, which According to minutes of AREA’s meet- shrouded in secrecy. ENCNG’s request. made purchasing sources of power appeal- ing Dec. 14 , Duncan told the group, “North What emerged from the process was “If [ENCNG] is going to try to get all of ing. Deregulation never happened, and now Carolina Natural Gas became very conten- the Albemarle Pamlico Economic Develop- this money which is designed for the en- Progress is getting out of the gas business. tious during the hearing, and questions ment Corporation, which represented the tirety of this state…,” said lawyer James ENCNG’s board consists of four APEC from the Utilities Commission were very 14 counties that NCNG lost. A representa- West, “…I believe we have the right to directors and four Progress Energy execu- hostile.” The minutes said Duncan “felt tive from each county was appointed by intervene and determine whether the project tives. It includes Dixon and John Hughes, extremely positive about the hearing.” their respective commissioners, and the new is of such significance and of such benefit president of APEC. Hughes is chairman of The commission decided March 17, 1999 group assumed the partnership with CP&L. that they should, in fact, get that amount of ENCNG’s board. Norma Mills is the ninth that NCNG could retain its franchise in Other documents obtained by CJ pro- money.” member of the ENCNG board and breaks only Bertie, Martin, and Onslow counties, vide some insight to APEC’s creation. In an The commission heard testimony April all tie votes. Dixon is chairman of APEC’s and that NCNG must forfeit its rights to the appeal to the IRS for 501(c)(3) status, APEC 12 on ENCNG’s bond and franchise request directors. 14 other counties. stated that “Marc Basnight is… a driving for the 14 counties. The hearing again drew ENCNG pays Progress Energy (and a The timing of legislation, the strategy force behind forming APEC and securing the interest of the northeast’s most influen- few other contractors) for administrative of NCNG’s opponents, and the makeup of the bonds for the pipeline.” tial advocate: Basnight. costs, operations, maintenance, construc- the commission wasn’t a coincidence, some Dixon was elected chairman of APEC. In a statement read by Mills, Basnight tion of the pipeline, and its distribution observers said. The presence of R. V. Owens III on APEC’s thanked the commission for its decision to network. ENCNG appears to exist only as “I think it was a master plan [AREA board of directors further strengthened strip NCNG of its franchise, “because it an entity to receive bond money alloca- and Basnight] had,” said a retired gas-in- Basnight’s influence on the corporation. paved the way for what is before you now.” tions, to pay Progress Energy for its ser- dustry executive who didn’t want to be Owens, the son of Bobby Owens, is Basnight asked the commission to sup- vices, and to pay APEC for some economic identified. NCNG never had a chance, the Basnight’s nephew and one of his key po- port APEC’s (ENCNG’s) plan because “it development efforts. executive said. litical operatives. He also is a prolific fund- provides the hope of opportunity for en- The project involves installing about “That hearing was the only time I raiser for Democrats. hanced economic development to our re- 750 miles of steel gas-transmission lines thought the decision had already been According to an article in the March gion as a whole…” He also argued for the and plastic distribution lines throughout made,” he said, “because of pressure from 2002 newsletter of the North Carolina Citi- entire 14-county franchise and for the com- eastern North Carolina. Municipalities in- Basnight. With (Bobby) Owens (on the com- zens for Business and Industry, R.V. Owens mission to earmark the entire $197.5 million cluding Elizabeth City, Plymouth, and mission), it was like having Basnight him- III “…combines his fierce determination on requested by ENCNG, even though the Morehead City are receiving natural gas for self there.” behalf of economic development for North- panel was considering only Phase 1. the first time. The project should be com- Another observer of the NCNG pro- eastern North Carolina with his realization “Without the promise and commitment pleted by late 2004, but several of ENCNG’s ceedings said, “Senator Basnight is a pow- that technology is the best hope for speed- of bond funds,” he said, “the award of a counties are not served yet. The company is erful legislator. [AREA] had the political ing up the process. Owens and others rec- franchise is meaningless for us. up for a Utilities Commission “use it or lose support and took advantage of it.” ognize the lack of natural gas and high- “I urge you to consider the application it” review for those counties this month. Utilities Commission Chairman Jo Anne speed Internet access in most of the region as a whole, because the needs of our region When the referendum was originally Sanford told CJ that commissioners abide is a negative. Ever the visionary, Owens led need to be addressed as a whole.” presented to voters statewide, the legisla- by strict rules of judicial conduct. others to wonder aloud why fiber optic Basnight also called for the closure of tion stated the money would be issued as “We don’t foretell decisions,” she said. cable couldn’t be laid at the same time in the the application process for bond funds. Only grants or loans, to benefit unserved coun- “We don’t say we’re going to do this or that 800-mile trench for the natural gas pipeline Frontier Energy had submitted other pro- ties throughout the state. Former state Trea- on official decisions.” that is being dug.” posals, to serve Warren, Ashe, and surer Harlan Boyles’s prophesy that the After the decision Sanford told The News Alleghany counties, for a total of about $11 funds would become taxpayer subsidies & Observer of Raleigh, “It will be a free-for- Seeking bond funds million. Together with ENCNG, the total appears accurate. Most observers believe all, in a good sense of the word. The fran- amounts requested by the two applicants that the money is a grant, not a loan. chise that prevented anybody else from In the only minutes of APEC meetings exceeded the $200 million available. “Once the project is deemed feasible, it providing gas service will no longer act as a obtained by CJ, county members were told On July 12, 2000, the commission has to be paid back,” Rankin said. “No one barrier.” that the corporation would aggressively awarded $38.8 million to ENCNG for Phase expects it to be feasible anytime soon.” CJ C A R O L I N A June 2003 JOURNAL North Carolina 5

Free DWI program violated state law Investigations Widen Into Ballance’s Foundation and Campaign

By DON CARRINGTON rector of operations and clinical services in mission. The foundation’s office for the last tion Commission report with the Associate Publisher the Division of Mental Health, told CJ he several years has been at Greenwood Bap- foundation’s grant information that Bal- RALEIGH initiated a review of the Hyman program tist Church, where Lawrence is also the lance released to the Roanoke Rapids Daily few months after being sworn in to after he was first informed by CJ that the pastor. Herald, which reported it May 2. Among the Congress, Rep. Frank W. Ballance, foundation’s students were attending class Financial statements, belatedly submit- givers whose churches also received fund- A Jr. is trying to answer questions for free. ted by Lawrence on April 28, 2003, state that ing from the foundation are: about accounting procedures of a nonprofit for the year ending June 30, 2002 the foun- • United Solid Rock Church in Norlina foundation of which he is the chairman. Frank’s foundation dation paid $1,800 in rent. For the previous received $6,500 from the foundation, and In addition, the State Board of Elections year the foundation paid his church $35,000 its pastor, Moore Bynum, gave Ballance is investigating Ballance for his failure to The articles of incorporation for the in rent, with a note saying that it was for the $1,000. respond to requests that he explain discrep- Hyman Foundation were filed with the period March 1, 1996 through Aug. 31, 2000. • White Oak Baptist in Enfield received ancies on his 1999 and 2000 Financial Dis- North Carolina secretary of state June 28, Balance is chairman of the church’s Board $7,500, and Pastor Ray E. Bynum gave closure Reports. 1985. Ballance, in his second term in the of Deacons. $1,500. The John A. Hyman Memorial Youth state House, was one of the 24 founding Lawrence, at Gov. Mike Easley’s re- • Nebo Baptist in Murfreesboro received Foundation, which claims to run substance- board members. The stated purpose of the quest, resigned from his state government about $70,000 over the past five years, and abuse programs, is totally funded through organization was to engage in activities job April 22 after news reports revealed that pastor Robert Holloman and his family gave the state budget. Ballance designed to facilitate the he had not listed his income from the foun- Ballance $4,000. helped start the foundation, physical, mental, and intel- dation on economic interest statements. • Greenwood Baptist received more than and as a state senator ar- lectual development of Melinda Solomon-Harris was paid $30,000 in rental payments for office space. ranged about $2 million in young people, with a par- $24,200 per year as a director of the founda- Lawrence gave Ballance $2,000. funding, which it has re- ticular emphasis on resi- tion for Halifax County. She was a public • Oak Grove Baptist in Littleton re- ceived since 1993. The dents in Warren, Halifax, schoolteacher until July 2002, when she be- ceived $7,500, and Pastor David Moore and found-ation’s top three staff North-ampton, Bertie, and came assistant principal of Weldon High his wife gave Ballance $2,400. Ebenezer members have close rela- Martin counties. The ad- School in Halifax County. Her salary at the Baptist in Rocky Mount received $7,500, tionships with Ballance. dress for the foundation was school is $41,970. and Pastor Thomas L. Walker gave $1,500. The foundation failed 113 West Market St. in Principal David Jones said that he was Ballance also directed money to other until recently to file finan- Warrenton, the same ad- unaware of her role with the foundation, organizations. The Warren Record reported cial statements required by dress as Ballance’s law of- but that his school system did not have a in December 2002 that the Norlina Public the state and the Internal fice. policy regulating secondary employment. Library received a $5,000 grant from the Revenue Service. The State On Dec. 9, 1985, the IRS She is also the Democrat Party’s First foundation “through the efforts of Con- Auditor and the IRS are in- approved the foundation’s Congressional District Chairwoman and gressman Frank Ballance.” vestigating the organiza- application for tax-exempt held the position during the 2002 Demo- The library donation was not listed with tion and its substance-abuse Rep. Frank Ballance status as a 501(c)(3) organi- cratic primary, which Ballance won. the information the foundation released to program. zation. In the approval let- The Ballance campaign paid Solomon- the Daily Herald. Officials are also investigating the ter, Ballance, or whoever was reading the Harris $500 for Get-Out-The -Vote activi- foundation’s driving-while-impaired treat- found-ation’s mail at 113 West Market St., ties in that primary. Financial discrepancies ment program for possible violation of state was notified that the foundation was re- Joyce L. Bullock was paid $14,400 per laws. quired to file a Form 990, Return of Organi- year as an administrative assistant for the CJ also found several discrepancies be- Stories first published by the Littleton zation Exempt from Income Tax, if annual foundation. She is also a member of the tween the unaudited statements on file with Observer reported that Ballance and other gross receipts were more that $25,000. foundation’s board and on a report submit- the General Assembly for the past two years foundation officials did not provide infor- CJ has obtained information that indi- ted April 28 to the Department of Correc- and audited financial statements submitted mation on the program or return phone cates the organization has had gross re- tion she cosigned the cover letter as trea- to the Department of Correction April 28. calls. Carolina Journal then reported that the ceipts of more than $25,000 for at least the surer of the foundation. Among the discrepancies for the year foundation failed to file state and federal past nine years. Ballance recently admitted She worked as a secretary at Ballance’s ending June 2001 were $228,951 for salaries financial reports. Ballance acknowledged that the organization has never filed a Form Warrenton law office and was his legisla- in the first report versus $101,670 in the the failure and foundation officers submit- 990 and has promised to file the forms. tive assistant in the General Assembly. She audited report; and $2,871 for contractual ted the state reports, but at press time they Records indicate that has been a secretary at services versus $12,393 on the audited ver- had not filed federal reports. Ballance played a major Warren County High sion. For the year ending June 2002, the first CJ has also uncovered a close correla- role, if not the sole role, in Ballance received at School since 1997. report stated $75,346 for “prevention mini- tion between pastors that gave to Ballance’s securing state funding for Bullock was the offi- grants,” while the audited version stated 2002 campaign for Congress and the the foundation. least $25,000 from 23 cial treasurer for all of $47,500. Also appearing on the audited re- churches that received “prevention mini- In 1996, the founda- pastors and their fami- Ballance’s state Senate port was $25,000 for “administrative fees” grants” from the foundation. tion received $140,000 lies for his 2002 elec- and congressional cam- — a category not listed on the original re- from a Health and Hu- paigns, but her real role is port. DWI treatment violations man Services discretion- tion. At least 12 of the not clear. She recently The audited report also noted that as of ary fund controlled by pastors received foun- told the Rocky Mount Tele- June 30, 2002, the foundation had a $100,000 The foundation runs a state-approved Sen. Marc Basnight. Be- gram that she had no certificate of deposit held in reserve for DWI program free at the Greenwood Bap- fore receiving payment, dation grants. knowledge of the reports. future expansion. tist Church in Warrenton. While the pro- the foundation had to sub- “You need to call the con- gram itself may conform to state guide- mit information to the agency’s chief bud- gressional office. I didn’t directly do them. Campaign finance violations lines, offering it for free is a violation of state get officer. A January 1997 transmittal letter My name is just on them,” she told the law. accompanying the information was signed paper. Ballance’s failure to report extends be- A DWI offender must attend a class to by Ballance as chairman of the board. yond the Hyman Foundation to his last get a driver’s licence reissued. The According to minutes from a March 7, “Faith-based initiative” campaign for state Senate. foundation’s program is licensed by the 2001 Joint Appropriations subcommittee On March 29, 2001, Joyce L. Bullock, state as an outpatient substance-abuse fa- on justice and public safety meeting, A “faith-based initiative“ is how Bal- treasurer of the Committee to Elect Frank cility. The program’s original license was Ballance introduced Eddie Lawrence and lance described the foundation’s substance- W. Balance, Jr., received a letter from the issued in 1994 and the DWI classes were Melinda Solomon-Harris, the top two staff abuse program when he was defending it to State Board of Elections asking her to clear authorized in 1998. members of Hyman’s substance-abuse pro- The Wilson Daily Times on April 18. up several problems with the 1999 and 2000 Lisa Hayes, the instructor at Green gram, to the committee to make comments While Ballance admitted paying campaign finance reports. wood Baptist Church, is paid $10,000 per about the program and make the case for churches to deliver services, he said there is One specific problem was a $2,473 con- year directly from the foundation. Director continued funding. Ballance was vice chair- no relationship between those payments tribution from Solomon-Harris and a match- Eddie Lawrence told CJ that Hyman stu- man of the committee, but according to the and campaign contributions from several ing refund that was not explained. dents pay nothing. State DWI program offi- minutes, he did not reveal his role as chair- pastors. The board’s records indicate that Bul- cials said the foundation does not have a man of the foundation. “There is absolutely no connection, be- lock did not respond. On May 14, 2001 the waiver to exempt enrollees in DWI classes cause there is no way I could have dreamed board issued Bullock a final notice threat- from paying for the class. They noted that Friends of Ballance up that one day I would need these monies ening to issue a letter of noncompliance paying for a DWI class is part of the punish- for an election,” Ballance told the Rocky after May 29, 2001. Bullock did not respond ment for receiving a DWI conviction. The three top paid staff members of the Mount Telegram again. First- or second-time offenders are typi- foundation have close ties to Ballance. The Ballance received at least $25,000 from On July 30, 2001 the board’s general cally required to have from 10 to 40 hours of salaries of the staff members were based on 23 pastors and their families for his 2002 counsel Don Wright wrote directly to class. The going rate for the instruction information Ballance released to the Roanoke election. At least 12 of the pastors received Ballance at his legislative office and gave across the state is about $10 per hour, so a Rapids Daily Herald. grants for their churches from the founda- him one more chance to respond. Ballance 20-hour course would cost each person $200. Eddie W. Lawrence was paid $30,000 tion. More connections may surface when did not respond. State law requires a student to pay a mini- per year as director of the foundation. He the foundation files the required reports Election board Deputy Director Kim mum fee of $75 for the class. was also paid $66,351 for his full-time state with the IRS. Westbrook told CJ that she is now pursuing Spencer Clark, the DWI section’s di- job as director of the Human Relations Com- CJ compared Ballance’s Federal Elec- the matter. CJ June 2003 C A R O L I N A 6 Education JOURNAL

NC News in Brief Statisticians Do a Number on Schools • Former state Sen. Howard Lee Inventor discounts class size, says his system shows critical impact of teachers was installed in May as chairman of the State Board of Eduction. Lee, the first black to hold the position, suc- By KAREN PALASEK of the individual classroom teacher is as ceeds retiring Chairman Phillip J. Assistant Editor much as 20 times more significant in a Kirk. RALEIGH student’s annual progress as any of the re- The chairman serves a two-year or a man whose professional passion maining variables, including class size. term, which will expire March 31, in life is statistics, Dr. William Sand- 2005. Lee was appointed April 29 to Fers has devoted an enormous amount Growth and No Child Left Behind an eight-year term on the board. of his career to education. The last 21 years, in fact. Sanders doesn’t necessarily mind, “The intent of No Child Left Behind is • The News & Observer of Ra- although he shrugs his shoulders in some to set an academic floor,” Sanders said. But leigh reports that the North Carolina wonderment at the whole notion. “This is he argues that states and districts have to Senate is considering a law that not something that I planned,” he said. go beyond NCLB, particularly when it would limit the total number of test- “This is something that fortuitously hap- comes to adequate yearly progress. Ad- ing days to five for public school stu- pened 21 years ago.” equate yearly progress measures average dents. The bill is sponsored by Sen. The “something” Sanders mentioned is performance of different categories of chil- Tom Apodaca, R-Henderson. The his off-the-cuff invention of a system to dren. There are serious sanctions if schools legislation would also replace state- evaluate student achievement gains. Speak- fall short under the No Child Left Behind created tests with nationally normed ing at a North Carolina Education Alliance Act. Incentives to avoid sanctions may have tests written by outside testing agen- Headliner luncheon inside North Carolina unintended consequences, he argues. cies. A switch to the outside tests will State University’s McKimmon Center, One incentive is to focus attention on mean that North Carolina students Sanders related the unintentional develop- children who are nearest the adequate can be measured against students ment of the value-added student assess- yearly progress achievement standard. elsewhere in the country. ment method. Along with Dr. June Rivers, They are the ones who can “make or break” Sanders now heads the Value-Added As- Dr. William Sanders speaks on assessment the school’s rating. Sanders predicts that •The House agreed to raise the sessment and Research Program at the SAS students far below, or well above the stan- cap on charter schools to 110 in the Institute in Cary, N.C. time, the child serves as his or her own ‘con- dard, won’t get the same attention. Aca- state. Charter school students, teach- trol.’ This enables the partitioning of school demic growth rates will be highest for the ers, and principals met at the Gen- A better example system, school, and teacher effects free of almost-proficient children, and lower for eral Assembly on April 30 to greet the exogenous factors that influence aca- low and high-achieving students. Two out their representatives and inform While a faculty member at the Univer- demic achievement…” of three groups of children won’t be achiev- them about their schools. About 800 sity of Tennessee at Knoxville, Sanders no- With these individual measurements, ing at their potential. students from schools as far away as ticed a news item criticizing the use of researchers get a picture of how much aca- Using the techniques developed in their Charlotte participated in the event, achievement data and statistics in student demic growth each child achieves yearly. program, Rivers and Sanders can plot pro- said Roger Gerber, president of the assessment. He noted that the news conclu- Sanders’ method also associates the teacher jected academic growth rates for different League of Charter Schools. sions were correct, but for the wrong rea- with the child. That tells researchers about students. “Because you can see what the sons. When Sanders walked into his ad- the “teacher effect,” the impact of the growth trajectory has to be to get kids to • The U.S. Department of Edu- vanced linear modeling techniques class, he teacher on academic growth. make appropriate progress, you can tell cation has approved North cited the news story’s faulty statistical whether they are on a path to make it,” Carolina’s compliance plan for the method. Sanders said he “pulled the value- Tennessee value-added system Sanders said. Low-performing students No Child Left Behind law. About 25 added system out of the air” as counter will not improve rapidly enough if all they percent of states have received ap- point to the botched news report. The The Tennessee Value Added Assess- do is meet adequate yearly progress, he proval so far. State preparations for method Sanders outlined, in a spontaneous ment System includes data on the state’s said. “The trick is to get the gain rates to compliance include new account- classroom example, eventually became the comprehensive test, results from annual where you can create a progression like ability measures, measurement cornerstone of Tennessee’s student assess- tests in math, science, social studies, read- compounding money. That’s the way you plans for adequate yearly progress ment system. ing, and language arts for third through ratchet academic achievement to higher and for students, and requirements for What schools needed, Sanders knew, eighth grades, and end-of course tests for higher levels.” teaching staff. All students in the was a method for assessing gains in student five high school math subjects. The Sand- Sanders’ studies have found that one state must reach proficiency by 2013- achievement over time, using a technique ers model is robust enough to allow substi- year with a poor teacher has a noticeable 14, according to the law. that would stand up to the usual problems tution among variables effect on a child’s aca- that frustrate that type of data collection. that have the same char- demic growth. Two or • The News & Observer reports Those problems include incomplete data, acteristics. That means Class size…has an ef- more years of poor teach- that students in some neighbor- following each child’s individual progress, the results are not neces- ers can devastate achieve- hoods in Wake County will no and establishing a baseline for the change sarily sensitive to a fect only when it ap- ment. There is little evi- longer have an option to attend year- in each child’s performance. change in specific tests proaches the level of dence of “compensatory round or traditional-schedule Sanders was allowed to test his pro- used by the school sys- effects” from later help. schools. posed system in Knox County, Tenn. He tems. private tutoring. Re- Sanders found that years The Wake County School Board obtained school roll books and began to Analysts collect three ducing class size by of service are strongly re- has voted to require every year- extract information. Using college students, years of data before as- two…is insignificant. lated to effectiveness. Ef- round school to be “pegged” to a and what Sanders describes as “about 200” sessment occurs. And the fectiveness increases in neighborhood. Students who receive computers, student test data was logged state will not use the the early years, and typi- free and reduced-price lunch may and correlated with who taught each child. TVAAS data alone to cally plateaus at the 22nd make up 10 percent more of the stu- Sanders wrote his report to the county, evaluate a teacher, school, or school system. year. After that, there is a lot of variability, dent body than at a traditional and submitted it in September 1982. Knox Promotion, attendance, and dropout rates he reports. Teachers who leave the profes- school in Wake County. This means County apparently wasn’t expecting much, are also used in the state’s accountability sion after one or two years have been the that 50 percent of the student body, if anything, from the research. When Sand- system. most ineffective teachers, his studies show. rather than the nominal maximum ers informed them that “I’m through,” they Sanders used a physical growth curve Class size, Sanders said, has an effect of 40 percent, can consist of needy asked “With what?” to draw an analogy to his method. If we plot only when it approaches the level of pri- students under the new plan. Details Not until 1990 did the Tennessee Value a child’s height during the growing years, vate tutoring. Reducing class size by two, of which neighborhoods will be in- Added Research and Assessment Center, we will often find that it is not a smooth or five, Sanders said, is insignificant. In- cluded have not been finalized. The and Sanders’ method, come to life in Ten- curve. It is still possible, Sanders said, to stead, he argues for variable class size, de- changes won’t take effect, planners nessee. By then, Gov. Ned McWherter real- find the trend line and possibly make some termined by the needs of the students. Low- said, until the 2004-05 school year. ized that there had been no improvement predictions about the child’s future height. achieving students benefit most from in academic achievement in the state, de- Likewise, we could plot a “math growth smaller classes. High-achieving students •Approval for a physical edu- spite the appearance of A Nation at Risk and curve” using annual math test data. The don’t benefit as much, and don’t need them. cation requirement by the North other school reform proposals, since the model converts raw scores and grades into The general findings of value-added Carolina House came in April, ac- mid-1980s. a statistically comparable format before assessment, as seen in Tennessee, are that cording to the Winston-Salem Journal. Today, the Tennessee Value Added Re- looking for trends. the teacher is as much as 20 times more sig- The proposal requires that children search and Assessment Center has the larg- As in physical growth, learning can nificant than any other factor in student in kindergarten through the eighth est collection of longitudinal student data accelerate, decelerate, or remain flat. Obser- achievement growth. Disadvantaged chil- grade get 2 1/2 hours of physical ac- in the country, Sanders said. Tennessee has vations in one child alone don’t tell us much dren make as much progress as other chil- tivity during each school week. been able to follow students from second about a teacher, but a flat line for most chil- dren with the same teacher, and schools in Some teachers and administrators grade through to college. Instead of mea- dren, Sanders said, could be evidence of poor and minority areas are as effective as object to the requirement, which suring one group of second-graders in one something going on in that class that year. other schools. they say places an added burden on year, against a different group of second Racial, socioeconomic, and other factors Sanders knows his views won’t be po- schools. Senate approval is still graders another year, the Tennessee system wash out of the analysis when each child litically popular. “I try to let the data speak,” pending. CJ measures the same children’s progress from serves as their own ‘control.’ he said, ”and I’m telling you what the data year to year. “By following growth over According to Sanders, the effectiveness say.” CJ June 2003 C A R O L I N A JOURNAL Education 7

Next stop: state laws School Choice Still Faces Various Hurdles CSF-Charlotte Goes Despite Victory in U.S. Supreme Court Case Independent in July ew York financier Ted Forstmann of Forst- mann-Little, Inc., and John Walton, founder By KAREN PALASEK ing this requirement. of Wal-Mart, started the Children’s Schol- Assistant Editor N A third element of “true private choice” applies to arship Fund in 1998. These businessmen contrib- RALEIGH voucher recipients. To avoid the charge that a program at- uted $100 million to start a scholarship fund for he school-choice decision in Zelman vs. Simmons- tempts to establish a religion, it must apply to a broad cli- children whose families wanted them to attend tu- Harris was the last case decided by the Supreme entele. In the language of the court, the voucher program ition-based schools they could not afford. In 1999, TCourt in its 2001-02 term. Writing Voucher Wars as must have “a broad class of beneficiaries.” Salisbury native Julian Robertson, Founder of Tiger a chronicle leading to that decision, Clint Bolick of the In- Programs with narrowly defined beneficiaries raise a Management, contributed $1.5 million to start stitute for Justice said, “We live in a society characterized constitutional flag. Vouchers for Catholic schools have been Children’s Scholarship Fund– by consumer choices — just about everywhere except in ruled unconstitutional because they were exclusive. A pro- Charlotte. The New York the most important service of all, elementary and second- gram that would fund children from one religious group Scholarship Fund matched ary education.” Bolick and IJ played a pivotal role in the would be equally unconstitutional. Robertson’s funds, and a total preparation and litigation of Zelman. The “broad beneficiaries” component of true private of $3 million was made avail- The success of Zelman for voucher advocates hinged choice would also prohibit funding that goes exclusively able for children in the Char- in large part on the legal concept of “true private choice.” to private schools, religious or not. In Nyquist the ruling lotte area. Although money Parents needed market-type options, both within and with- on vouchers exclusively for private schools was deemed existed for scholarships, a out the public schools, voucher advocates argued. The unconstitutional. Even now, Nyquist retains some contro- nonprofit organization that Zelman decision meant that if the court’s requirements were versial elements for scholars. But at this point, if benefits was willing to administer the met, a state voucher program wouldn’t violate the First can be claimed by a diverse group of individuals, the fund- funds was needed. The John Amendment Establishment Clause, and was therefore con- ing program is likely to withstand a challenge. The fact Locke Foundation saw the po- stitutional. Now that the federal question has been an- that families that could participate in a program don’t tential, answered the call, and Lindalyn swered, has the choose to do so, isn’t provided operational support Kakadelis door to voucher the pivotal issue. for four years. programs in the Under the cur- In July, Children’s Schol- states been opened? rent interpretation arship Fund–Charlotte will become its own non- Not necessarily. of Nyquist, pro- profit. Under a vibrant board of directors, scholar- Programs still can’t grams that want to ships will be administered through a community give direct aid to re- pass the constitu- foundation, the Foundation for the Carolinas. ligious schools or tional test must of- Robertson gave an additional $2.5 million in 2002, religious groups. fer both secular and and the Walton Foundation continues to match con- But Zelman has de- religious school op- tributions for extending and awarding new scholar- fined what is al- tions. ships. The charity has a bright future and will con- lowed under federal Opponents of tinue to help low-income families provide educa- law. publicly funded tional options for their children. Zelman “clari- vouchers fear that While more than 400 students receive support fied the rules for de- once religious op- for a four-year scholarship term, there is a problem. termining what tions are included, Not enough money is available to assist the 1,900 kinds of school- voucher programs families that have requested support. The organiza- choice programs are will tilt choice to- tion limits names collected, and turns away families constitutional,” said ward the religious calling from other counties pleading for help. Caro- Marie Gryphon of Bolick speaks at pro-voucher rally at the U.S. Supreme Court. schools. But “true lina Journal has published stories about families, the Cato Institute. In private choice” re- obstacles faced by students, and success stories com- “True Private Choice: A Practical Guide to School Choice quires structural neutrality in voucher programs. “The ing from scholarships. If you missed these high- After Zelman v. Simmons-Harris,” Gryphon explains the five choices offered can’t be rigged,” Gryphon wrote. lights, go to www.csfcharlotte.org. criteria necessary to meet the federal benchmark: If programs are skewed away from the choice of a reli- Private-sector support for K-12 education is a gious school, they may not run afoul of the Constitution. win-win for everyone. One size does not fit all — and “True private choice” In Zelman, parents in Cleveland were faced with financial one type of schooling does not fit the needs of all incentives to select a nonreligious school under the voucher children. Competition improves education for all, One of the first obstacles that state voucher programs plan. The program also generated incentives for nonreli- and when schools compete, students win. If you encounter are tuition payments for religious-school edu- gious private schools to become public charter schools, a desire something for your child other than govern- cation. Zelman allows public funding at move that would increase the amount of ment-funded schools, you must pay twice. Once religious schools, assuming they serve a funds they receive. through your taxes, and then again to pay tuition. legitimate secular purpose. In this con- Parents… should A voucher program must provide Even to simply cross a county line, the family must text, education at a religious school ‘”adequate nonreligious options.” In pay the county supplement. would likely serve both a secular and a have the primary re- this, Cleveland is an interesting example. The education establishment has done a re- religious purpose. If literacy and sponsibility and power Bolick and others argued during the markable job of miseducating the public and mak- numeracy are legitimate secular pur- to determine where Zelman case that public schools should ing elected officials indebted to campaign contribu- poses, for example, a Christian school be included in the alternatives available tions. Considering that we already have vouchers that teaches math and language skills can and how their children to parents. Otherwise, most of the op- for low-income families using preschools, and tax- pass the hurdle. The fact that the school should be educated. tions available in Cleveland would be re- funded assistance for higher education, only K-12 promotes religious values as well would ligious. grades are held in a sacred monopoly. Florida, Ari- not be a barrier under the law. The court accepted nonfailing pub- zona, and Pennsylvania allow specific tax credits for According to Ira Lupu and Robert lic schools, in the form of magnet and donations to aid low-income families with tuition. Tuttle in “Zelman’s Future: Vouchers, Sectarian Providers, charter schools, as “reasonable and genuine“ alternatives. Other states offer vouchers. North Carolina offers and the Next Round of Constitutional Battles,” if govern- The viability of nonfailing traditional schools, not consid- NOTHING to support these families. ment offers aid to all on the same terms, then funds going ered by the court, remains an open question. In August 2000, after only one year of the pro- to a religious school will further a secular purpose. Gov- gram, research on the achievement of scholarship ernment-sponsored religious indoctrination isn’t an issue Conclusions students was conducted. The findings demonstrated under those circumstances. large and immediate gains in reading and math, A second requirement under Zelman is that aid to reli- “Whatever the legal issues in a particular school choice similar to those found in other choice programs. gious schools be indirect. Government cannot promote, or lawsuit, our core argument throughout has been that par- The N.C. Education Alliance will continue to appear to promote, a specific religion. When children at- ents, not government, should have the primary responsi- inform North Carolina citizens that school choice is tend religious schools under a voucher program, parents, bility and power to determine where and how their chil- happening around our country. I bring a big thank not the school, receive the support. In practice, the state dren should be educated,” Bolick says of the institute’s role. you to the John Locke Foundation and their support- can issue a voucher in the parents’ name, but send it to the Because state laws vary in the details of funding re- ers from hundreds of families that were given op- chosen institution. The parent, exercising private choice, strictions, vouchers won’t become a universal feature of portunities to choose schools. Children’s Scholar- endorses the voucher over to the school in payment. The the education landscape right away. ship Fund–Charlotte is launching! While I will miss indirect aid requirement is designed, in part, to prevent Some scholars see antireligious discrimination, and the working with the families and students, I am de- the state from limiting the parents’ choice of schools. Free Exercise clause, as a future line of argument for lighted to continue directing the North Carolina The direct-indirect distinction did not originate in the voucher advocates. Others see the tainted history of state Education Alliance and promoting education choice. Zelman case, but Zelman finally established its importance. restrictions, because of the “Blaine amendments” to state Indirect aid, through parents, is “a necessary ingredient of constitutions (see page 8), as a line of challenge. a program of ‘true private choice,’” Gryphon said. No state Whatever the future of vouchers, it is likely to be years Kakadelis is director of the N.C. Education Alliance voucher program will qualify under Zelman without meet- before many of the remaining issues are resolved. CJ June 2003 C A R O L I N A 8 Education JOURNAL

School News: Nation UNC symposium focuses on separation of church and state

• American textbooks have be- State ‘Blaine’ Laws: Bigotry or Philosophy? come subject to increasingly politi- cally correct editing, reports the By KAREN PALASEK New York Times about Diane Assistant Editor Ravitch’s new book. The Language RALEIGH Police: How Pressure Groups Restrict n 1875, a proposed 16th amendment to What Students Learn describes how, the U.S. Constitution would have pro- as pressure groups “have clamped hibited public school lands or tax funds down on the education system, I from being “divided between religious sects more and more subjects, words and or denominations.” The amendment was ideas have become taboo.” introduced by James Blaine, then-speaker The forbidden topics include of the U.S. House. Not one of the three ver- mention of rodents generally, in- sions eventually offered achieved the cluding Mickey Mouse and Stuart supermajority needed for passage, so Little; mothers or fathers in any Blaine’s bill died at the federal level. situation that might be considered Blaine’s legacy continues today, how- stereotypical, such as a mom cook- ever, in the form of “baby Blaines,” Blaine- ing dinner; and any identifiable re- type provisions enacted into 37 state-level gional setting, because of possible constitutions. State-level baby Blaines are “regional bias.” Recommendations often more restrictive than the proposed also include dropping mention of amendment that inspired them. The Zelman “junk” foods in favor of “health” vs. Simmons-Harris Supreme Court decision foods. Ravitch is an education his- clarified issues surrounding public vouch- torian, and argues that this type of ers for religious schools, but state-level censorship has gradually gutted questions remain. Thomas Nast cartoon depicting Roman Pope preying on American schoolchildren the teaching of literature and his- At a recent UNC Law School sympo- tory over the last 30 years. sium sponsored by the First Amendment Law lic sentiment and galvanized sanctions One cartoon by Thomas Nast depicts what Review, and the Pew Foundation Forum on against Catholic influence, and even pres- appear to be alligators, advancing on help- • The superintendent of the Religion and Public Life, legal and educa- ence, in schools and in the workplace. less children along the banks of a river. The Washington Township, Ind. tion scholars convened to discuss the his- According to Kevin “Seamus” Hasson, predators have Pope’s mitres for jaws, and schools has a problem and a solu- tory and significance of the failed amend- president of the Becket Fund for Religious the reptiles are actually Catholic clerics, tion, according to the Boston Globe. ment that bears Blaine’s name. Liberty, the Congregational Church was preying on frightened, and presumably Superintendent Eugene White established as the official church of Massa- Protestant, children. A lone (Protestant?) de- called a convocation of his black Zelman clears the Supreme Court chusetts during the 1830s. The King James fender stands between the terrified inno- male high school students last fall, Bible officially became required reading. cents and a Catholic onslaught. and confronted them with the fact The Supreme Court’s 2002 decision, in Immigrants were precluded from holding that nationally, black males lag be- Zelman vs. Simmons-Harris, allowed parents office or from voting. The “Know-Nothing” Blaine’s continuing impact hind other high school students. in the monumentally failing Cleveland party that controlled Massachusetts politics White told the boys that they school district to in the 1850s was, Why does it matter today whether spent too much time on clothes, use publicly funded Hasson said, “anti- Blaine intended to prevent specific groups partying, and jobs, and not enough vouchers for pay- Catholic, anti-immi- from receiving public monies for religious on their education. ment of school tu- grant, and anti-Ne- education? Or whether he took an explic- Only 43 percent of black male ition. Parents were gro.” Anti-Catholic itly anti-Catholic, or pro-Protestant view? students passed math and reading allowed to choose fervor was particu- Because intent may matter, according to the as sophomores in the district in religious schools if larly keen, and led to courts. 2001, compared to 88 percent of they wished, or to “searches in nunner- Hasson points out that in Hunter vs. white male students. The state av- elect private or non- ies for hidden dun- Underwood, the Supreme Court ruled an erage for black males in Indiana is failing public geons, and removal Alabama state constitution invalid. It con- an even-lower 33 percent on both schools. of Latin inscriptions tained a provision that was originally tar- tests. The court ruled above the doorways geted at blacks, even though the law was White offered extra tutoring, in Zelman that the of state offices,” later applied equally to all. Alabama’s con- study assistance, and help with Cleveland program Hasson said. stitution suspended the voting rights of a Advanced Placement classes, was “neutral to- Hasson argued person convicted of a crime of “extreme im- which he insists the students need ward religion” un- that the legal restric- morality or wickedness.” The plaintiff suc- to push themselves to take. He also der the law, that tions facing Catho- cessfully argued that the intent of the law emphasized the importance of pa- parents were exer- lics, blacks, and im- was to disenfranchise blacks. The court con- rental support. “I think parents cising true private migrants in Massa- curred, and declared the state constitution drop out of school before kids drop choice, and that vi- chusetts predated invalid. Hasson argues that all state Blaine out of school,” he said. He calls able secular options James Gillespie Blaine Blaine’s amend- laws are unconstitutional for reasons of tar- meetings with groups of parents, existed. Under ment, and reflected geted intent. and holds them even if only about these conditions, publicly funded vouchers “pure bigotry.” Professor Steven Green, of Willamette 20 show up. do not violate the Establishment Clause of Although fewer than 3 percent of Mas- College of Law, argued that nonfunding White’s tactics have met with the First Amendment to the U.S. Constitu- sachusetts residents were Catholic, the state principles precede anti-Catholic sentiment, some resistance from students, es- tion. But because of state Blaine laws, strengthened its anti-immigrant laws dur- and may reflect an underlying moral phi- pecially for singling out one group Zelman did not universally clear the way ing its 1917-18 constitutional convention. losophy instead. for criticism. “I don’t like you seg- for vouchers. The convention adopted a rule preventing Green noted that James Madison, in regating us like this. I think you a citizen ballot from changing Massachu- Memorial and Remonstrance, warned that should have something like this Anti-Catholic or anti-religion? setts’ Blaine provisions, and a further rule publicly funded religious after school,” one student said of prohibiting a citizen’s activity differs from tyr- the in-school convocation. Bible reading was a long-standing prac- ballot from amending the anny “only in degree.” “You’re in school. I run this tice in America’s “common schools” dur- “no change” rule. Ac- State level “baby Madison was re- school, and I meet with you when ing the 19th century. A Protestant education cording to Hasson, these Blaines” are often sponding to an attempt to I want to,” White replied. White, was the accepted common denominator rules are currently being use taxes to support who is black, is seeing returns on among students, and “a means of establish- challenged in the courts. more restrictive than houses of worship in Vir- his challenge to the students. In ing a national culture,” said Dr. Ward Bigotry wasn’t con- the proposed amend- ginia. Madison’s moral 2002, 55 percent of black males McAffee, professor of History at California fined to Massachusetts. philosophy led him to ar- passed the language test, and 60 State University-San Bernardino. “The King The American Protective ment that inspired gue that state funding of percent passed the math test. James version of the Bible was assumed to Association was formed them… any religion was a viola- be non-sectarian,” McAffee explained in a by Henry F. Bowers in tion of everyone’s reli- • The New York Times reports background presentation on Blaine and his Iowa in 1887. Its member- gious liberty. According major changes in the Individuals proposed amendment. Catholic beliefs ship oath said, “I will use my utmost power to Green, the Blaine Amendment simply with Disabilities Education Act, were considered both suspect and sectar- to strike the shackles and chains of blind “acted as a fulcrum for Protestant exercises which will affect 6.6 million chil- ian in the Protestant atmosphere of 18th and obedience to the Roman Catholic church,” in public schools, and a host of other dren. Earlier intervention, a reduc- 19th century American public education and, “I will use my influence to promote things.” tion in paper work, and legal as- In 1789, less than 1 percent of the U.S the interest of all Protestants everywhere in Scholars see post-Zelman issues sur- sistance to states are included in the population was Catholic. By 1840, Catho- the world…” rounding vouchers focused more and more new legislation, gathering biparti- lics still accounted for less than 3 percent of New York-based Harper’s Weekly maga- on unresolved state restrictions. They also san congressional support. CJ the population. But increasing numbers of zine published political cartoons that re- see the possibility of a return to the Supreme Catholics, mostly Irish, raised anti-Catho- flected popular anti-Catholic sentiment. Court, to adjudicate remaining disputes. CJ June 2003 C A R O L I N A JOURNAL Education 9

Nation’s report card shows scores drop with increase in participation rates Student Exclusions May Affect Integrity Of National Assessment

By KAREN PALASEK ing scores at the state level.” Assistant Editor While NAGB has the authority to deal NC Reading: NAEP Results 1998 With and Without Test Accommodation RALEIGH with questions surrounding the NAEP, so s North Carolina heads into the far they have not set a specific cutoff for ex- 65 With compliance phase of the No Child clusion rates. The history of NAGB has been 62 60 58 Without Left Behind education law, ac- to focus on inclusion rates instead. Accord- A 55 countability experts must decide which stu- ing to the National Center for Educational 50 dents can legitimately be excluded from Statistics, the intent of NAEP has been to 45 42 testing. Under the 2001 law, all students in include as many special-needs students as 40 38 grades four and eight will be required to possible. Expectations under the federal law 35 participate in the National Assessment of are that 95 percent of all students, regard- 30 27 28 Educational Progress in math and reading. less of disability status, be assessed by some 25 NAEP is required to conduct the assess- means. 20 ments at least once every two years under 15 SOURCE: 10 the law. Testing accommodations 6 6 National Center Before the No Child Left Behind law, 5 for Education Statistics state participation in NAEP was entirely Special-needs students were not gen- 0 voluntary. The National Assessment Gov- erally offered testing accommodations on Below Basic Basic/above Proficient/above Advanced erning Board, which determines policy for NAEP assessments before 1998. NAEP as- the NAEP, may offer tests in additional sub- sessed 31,398 public and nonpublic-school jects and additional grades “to the extent students in grades four, eight, and 12 for Percentage of N.C. fourth-grade students in NAEP reading proficiency groups that time and money allow.” What concerns the 1998 NAEP reading report card. Of the the Governing Board is the effect that test- 12th-grade students, 7 percent were classi- in special needs participation, and test ac- had succeeded in making the test accessible ing exclusions, or large changes in testing fied as SD and/or LEP — students with dis- commodations, would play out. to a wider population. Average reading exclusions, have on the integrity of the abilities or limited English proficiency. According to NCES, “For the 1998 scores on the more-inclusive NAEP de- NAEP’s results. Twelve percent of eighth-graders and 16 NAEP reading assessment, national and clined by one scale point in each grade. Ac- percent of fourth-graders were SD, LEP, or state NAEP school random samples were complishing one goal raised new issues. Exclusions and reporting both. About half of each group of SD/LEP divided into two equivalent halves.” One- North Carolina’s fourth-grade reading students were excluded because they could half of the sample took the test without any results declined significantly using the re- NAEP uses a sample of 2,500 students not “participate meaningfully in the assess- accommodations. Special-needs students in vised procedures. Forty-two percent of stu- in each state to generate its measurements. ment.” the other half-sample got extended time, dents scored below basic, 31 percent dem- NAEP is designed to provide information The guidelines for exclusion were iden- one-on-one testing, or other provisions typi- onstrated basic skills, and 21 percent were about the general level of skills and knowl- tical in 1992 and 1994. Students with dis- cally allowed in the schools. Translating dic- proficient. The percentage of advanced stu- edge of students, and no student takes the abilities who were tionaries were prohibited. dents was unchanged. Eighth- and 12th- entire test. All NAEP test questions, data, mainstreamed for less Questions and reading grade scores also declined, but were not sta- and assessment instruments are available than 50 percent of school …volatility in participa- passages could not be tistically significant. for public inspection in a secure setting. time, or judged incapable tion rates, seen in the read aloud. States, and the NAGB, understand the State education officials know that test of meaningful participa- The first 1998 NAEP implications of new NAEP procedures. The scores, particularly in reading, tend to rise tion, were exempt. Chil- 2002 NAEP assess- report used data from need to meet proficiency standards under with testing exclusions. In an interview dren who had spent less ments, signal the depth student samples without No Child Left Behind law drives exclusions with Education Week, Darvin M. Winnick, than two years in an En- any accommodation. In up. Because of the mandate to test all stu- chairman of the National Assessment Gov- glish-speaking school, of the dilemma states North Carolina, 38 per- dents, and the availability of a wider choice erning Board, noted the potential for gam- and could not participate are facing. cent of fourth-grade stu- of options, low-performing students can ing the results with student exclusions. meaningfully in English, dents were below basic in now be included. The revised scores are “This is a longtime discussion,” he said. “Do were also excluded. reading, 34 percent were probably a “truer picture,” NCES said. But you help your scores by excluding certain Under the new criteria, less than three at the basic level, 22 percent were proficient, recent volatility in participation rates, seen kids? It’s as simple as that.” years of English instruction, or an inability and 6 percent were advanced, the report in the 2002 NAEP assessments, signal the The National Center for Education Sta- to participate in English, will remove a stu- said. A ‘basic ’level means the student un- depth of the dilemma that states are facing. tistics manages NAEP for the U.S. Depart- dent from the testing pool. The revised cri- derstands overall meaning, but may not be The National Assessment Governing Board ment of Education. At the NAEP’s board teria also will disqualify a student with an able to draw inferences, and cannot gener- has already reversed itself several times on meeting with NCES, project officer Arnold individual education plan that prohibits the alize to concepts outside the text. a policy to ‘flag’ results when exclusion Goldstein noted recent dramatic move- NAEP test format, and a student with se- The revised NCES report, Including Spe- rates vary by more than 3 percent. No “pre- ments in NAEP participation rates. From verely low cognitive function. cial-Needs Students in the NAEP 1998 Read- cise point at which exclusion rates would 1998 to 2002, according to Goldstein, some Field tests with the new criteria began ing Assessment, showed that the modified have a significant impact on average test states had increases of as much as 7 per- with the 1995 NAEP reading test. Test ac- assessment framework tended to reduce ex- scores” has been determined, Goldstein cent in exclusion rates. Other states commodations were offered, on an experi- clusions. Students who used accommoda- said. Nevertheless, NAGB may reinstate the dropped exclusions by up to 9 percent, mental basis, in 1996. A split-sample design tions made up 1 percent to 2 percent of the ‘flagging’ policy until it can determine Goldstein said. He also said “exclusion rates for the 1998 NAEP reading assessment gave total number for each grade. By drawing in whether some states are using exclusion are correlated with increases in NAEP read- the first statistical measures of how changes more low-performing students, the NAEP rates to unfairly influence test scores. CJ

C A R O L I N A Weekly Report Center for Can local governments deliver good for Executives Local quality services without raising taxes? JOURNAL Innovation North Carolinians looking for the answer to that question need look no Carolina Journal Weekly Report for Executives is your antidote to New Ideas for Governing North further than the Center for Local watered down media coverage of state politics and policy. North Carolina’s Cities and Counties Innovation, headed by Thomas Carolina has hundreds of newspapers. But from those hundreds of Stith. Its mission is to identify and papers, only a handful of reporters are assigned to Raleigh. And 200 W. Morgan St., Suite 200 promote efficient, effective solutions how many of them do you think write from a free-market frame of Raleigh, North Carolina 27601 to problems in local government mind? using such tools as competitive contracting, new technologies, and In Carolina Journal Weekly Report, you get unfiltered weekly cov- activity-based costing. erage of state government from experienced reporters who have actually read the Federalist Papers. Our reporters attend commit- tee meetings and interview lawmakers face-to-face, so you get the Hon. Thomas Stith To obtain more information about CLI, stories firsthand. To subscribe, email [email protected] or call Director, Center for Local Innovation and subscribe to Prism, its weekly e- (919) 828-3876. Member, Durham City Council letter, call 919-828-3876. June 2003 C A R O L I N A 10 Higher Education JOURNAL

Bats in the Belltower UNC schools received $123.6 million in 2001-’02 UNC’s Federal ‘Overhead’ Grant Money Discrimination by the chaste

There’s an old joke about editorial biases in major newspapers that pro- Left Untouched — At Least for the Moment ceeds thus: The Lord, in a vengeful fit, decides he is going to destroy the world By JON SANDERS but wants to give mankind some kind Assistant Editor UNC System Overhead Receipts, 2001-02 of warning. He contacts the editorial RALEIGH boards of The Wall Street Journal, The ast year, 15 universities compris- UNC Institution 2001-02 Receipts Percent of total Washington Post, and The New York ing the University of North Carolina Appalachian State University $ 446,051 0.4% Times and tells each that he plans to system (excluding the N.C. School of East Carolina University 2,601,317 2.1% destroy the world at noon the coming L the Arts) received $123.6 million in “over- Friday. head receipts” from federal research grants. Elizabeth City State University 265,503 0.2% The next day The Wall Street Jour- That money, which the UNC system pre- Fayetteville State University 308,756 0.2% nal announces: “World to End Friday; fers to call “facilities and administrative North Carolina A&T State University 2,778,095 2.2% Markets to Close Early.” The Washing- receipts,” is money given on top of the ac- North Carolina Central University 725,103 0.6% ton Post states: “World Ends Friday; tual grant amount that is intended to de- Federal Workers Face Unemploy- fray the administrative and institutional North Carolina State University 24,307,963 19.7% ment.” The New York Times intones: costs in conducting the actual research. UNC Asheville 118,960 0.1% “World to End Friday; Women, Minori- Those are costs, however, that the Gen- UNC-Chapel Hill 83,719,986 67.7% ties Hardest Hit.” eral Assembly has already covered. Thus Meanwhile, on the greater come- the overhead receipts stand out as a recov- UNC Charlotte 1,614,674 1.3% dic stage of reality, Duke University erable pot of money to legislators, especially UNC Greensboro 3,634,306 2.9% Divinity School called for chastity, and during a tight budget season. UNC Pembroke 219,789 0.2% homosexuals were hardest hit. Not so fast, say university lobbyists. As the Duke Chronicle reported They paint a picture of future irrelevance UNC Wilmington 2,064,000 1.7% April 9, Divinity officials approved a of the UNC system if they are forced to give Western Carolina University 296,565 0.2% “conduct covenant… intended to forge back some of their overhead. That money Winston-Salem State University 336,906 0.3% a bond among students, faculty and is the catalyst for future research projects, UNC-General Administration 175,574 0.1% staff that ensures adherence to the they say, and equate the legislature think- school’s Christian roots.” A staff edito- ing of taking it with a farmer considering rial explains “[w]here the covenant eating his seed corn. TOTAL $123,613,548 goes wrong”: it “appeals to students to pursue, among other things, [scare A ‘close call’ quotes alert] ‘chastity,’ ‘justice,’ and Source: The 2001-02 University of North Carolina Report on Overhead Receipts, presented ‘mercy.’” by the Board of Governors of The University of North Carolina to the North Carolina So far the UNC argument has held General Assembly Joint Legislative Education Oversight Committee, Feb. 14, 2003. Truly one can only exclaim Kurtz- sway in Raleigh, although it suffered a close like at the horror of such an appeal. call in March, when a last-second change And even though it was probably not to Gov. Mike Easley’s budget changed a necessary at that point for the Chronicle plan to pull $13.9 million in the universi- staff to flesh out its objections, it did so ties’ overhead receipts to a proposal to cut pose — research — ultimately will help plan to pull $13.9 million from overhead re- anyway. “Quite simply, the code leaves that amount via a “onetime flexibility re- North Carolina recover its economic mo- ceipts rather than from the universities’ open the possibility of punishing a duction,” which left it at the chancellors’ mentum and stability.” budgets, the disproportionate effect of the community member for committing discretion where to make the cuts. UNC institutions weren’t allowed to loss of overhead revenue to UNC-CH homosexual acts or not being faithful Last year when legislators mulled the keep all of their overhead receipts until would likely have offset the positive rev- to his or her spouse, and this is unac- option of accessing part 1999. Until then the leg- enue effect of the tuition increase. That ef- ceptable — both morally and practi- of the universities’ over- islature expected a cer- fect would just as likely not be shared by cally — for a serious academic institu- head, UNC advocates Winston-Salem State tain share of it back into the other UNC institutions, including pos- tion.” (Note: Concerning the latter brought forth a litany of state coffers. In 1990, the sibly also N.C. State. point, neither coed-kissing Coach those “good uses,” such spent over $75,000 in state kept 30 percent of Apart from the matter of universities Eustachy of Iowa State University had as: N.C. State’s recruit- overhead receipts for UNC schools’ overhead. receiving “double payment” for their facili- been compelled to resign nor stripper ment of Ralph Dean, an In 1991 the legislature ties and administration (owing to federal patron Coach Price of the University expert in fungal a chancellor search. kept 50 percent, with the overhead receipts going to cover those of Alabama had been fired at the time genomics, who since UNC-CH spent $3,000 promise (which was things, which have already been funded by of the editorial’s writing.) 1999 has garnered more for gourmet pizza. kept) that the next year it the legislature), there is also the issue of Nevertheless, “it gets worse,” the than $11 million in re- would keep only 20 per- where those receipts go. Such funds have Chronicle warns. “It is not difficult to search grants; East Caro- cent. By 1997 the legisla- been abused by private as well as public in- imagine such a system being used to lina University’s acquisi- ture kept only 10 percent, stitutions, including recently. justify the harassment of others, par- tion of the Da Vinci Surgical System, robotic and was, also as promised, phasing out its A famous example from the late 1980s ticularly gays and lesbians.” technology that has enabled ECU surgeons demanded share of the overhead. is the $1,200 commode that Stanford Uni- That’s a point picked up by a to perform the world’s first adrenal gland versity put in its president’s house, paid for Chronicle letter-writer the same day. removal surgery, and the nation’s first gas- The UNC gorilla by federal research overhead. In 1991 audi- Divinity School student Rydell tric reflux repair; UNC-CH’s recruitment of tors for the U.S. Department of Health and Harrison writes under the heading Charles Perou, a researcher developing new The 800-pound gorilla in this issue, Human Services questioned more than “Divinity School not welcoming for technology in the fight against breast can- however, has always been UNC-CH. In $900,000 in overhead expenses listed by homosexuals” that “[b]y using the lan- cer; the further development N.C. State’s 1989-90, for example, UNC-CH brought in Duke University, which included $6,000 for guage of chastity without further clari- Centennial Campus, thus driving employ- $31.9 million of the system’s $45.3 million. wine. fication, our administration has unof- ment and spin-off beneficial research dis- In 2001-02, UNC-CH alone earned more Recent, questionable expenditures by ficially taken a stance on LGBT [for ‘les- coveries; and support of start-up costs for than two-thirds of the overhead ($83.7 mil- UNC schools include Winston-Salem State bian, gay, bisexual, and transsexual’] new laboratories and funding for new re- lion) of the entire UNC system. That University spending more than $75,000 to students.” search areas. amount dwarfs N.C. State’s haul of $24.3 search for a new chancellor, UNC-CH di- Harrison buttresses his concern by N.C. State Chancellor Marye Anne Fox million, even though N.C. State earned verting grant money supposed to reimburse noting a statement made by the Rev. and UNC-Chapel Hill Chancellor James more than 60 percent of the remaining over- its libraries to other areas, and UNC-CH Eugene Rivers III preaching at York Moeser co-wrote an op-ed in the July 2, 2002 head ($39.9 million). spending about $3,000 of its overhead on Chapel that was “incredibly offensive issue of The Charlotte Observer in which they So if the legislature were to return to gourmet pizza. to gay and lesbian students” (but not warned of devastating results if the legisla- taking a portion of that overhead, it would The latter prompted former Rep. Art the Bs & Ts?) which was “The Bible says ture took some of the receipts — and not receive a far greater amount from UNC-CH Pope last year to start the “Amante Pizza Adam and Eve, not Adam and Steve.” just to the universities, but also to the state. than any other school in the system. N.C. Index” to chart wasteful spending of over- Harrison found “most startling” that “If overhead receipts were diverted State would contribute a significantly head receipts according to how much fed- none of the faculty or students in at- from our campuses,” Fox and Moeser write, smaller share than its sister flagship, but it eral money is dumped on UNC-CH’s gour- tendance spoke out in opposition nor “North Carolina would lose ground — and would also give up an amount considerably met pizza vendor of choice. was any “formal apology to gay and perhaps new companies, new jobs, and our higher than those contributed by the re- In lieu of recovering a portion of uni- lesbian students or allies” made. best faculty — to other states that can make maining UNC schools. versities’ overhead receipts, the legislature A search on BibleGateway.com, “a investments that promote research.” The UNC system is scheduled to re- began requiring UNC officials to issue an- free service for reading and research- On the other hand, they argued, allow- ceive an additional $24 million in the House nual reports to the legislature on overhead ing scripture online,” yielded no results ing the universities to keep those funds budget or $25 million in the Senate from receipts. Nevertheless, the issue is not likely for “Steve.” CJ would have beneficial effects. “Preserving tuition increases. Nevertheless, if the legis- to be settled soon, especially if the state’s our overhead funds for their intended pur- lature had gone by the governor’s original budget crunch persists. CJ C A R O L I N A June 2003 JOURNAL Higher Education 11 Online Sports Medium Sues NCSU, UNC UNCW Observes For the Same Access as ‘Official’ Media Ludacris Standard By SUMMER HOOD own labor.’ Simply put, the state cannot interfere with one’s Contributing Editor right to earn a living in an ordinary and harmless occupa- RALEIGH tion without a substantial and solid reason.” his past semester several items were removed, he latest court case brought about by the North N.C. State and UNC-CH’s exclusion of TSW, however, as soon they appeared, from the student union Carolina Chapter of the Institute for Justice involves appears neither substantial nor solid. Royster said it is Tat the University of North Carolina at T two cherished traditions in the state, freedom and “based on the status of the medium or, in the case of UNC, Wilmington. Among them: antiwar flyers labeling sports. It also concerns a rapidly evolving form of journal- based on the medium’s point of view.” President George Bush a “bully,” depicting Lady Lib- ism, online news media. According to IJ-NC, this section of the state constitu- erty impaling a dove by The plaintiff is Jerry Cornwell, founder of the tion “is a strong and enforceable protection for North Caro- its rectum on a sword, StruttingWolf.com (TSW) website, an online medium fo- linians’ economic liberty and means that public entities — and having the U.S. flag cusing on North Carolina State University and Atlantic like the UNC system — can’t restrict that liberty.” IJ-NC being produced in the Coast Conference athletic news and events. After merging argues that the actions of NCSU in denying credentials to exhaust fumes of B-1 with a similar site, Statefans.com, the three-year old TSW TSW place the site “at a serious competitive disadvantage bombers; magazines is now the largest NCSU site on the Internet. “Thousands compared to [its] credentialed counterparts.” containing a photo- of people check our site to follow Wolfpack sports,” In addition, IJ-NC’s suit claims that the restrictions on graph of men engaging Cornwell said. TSW are a violation of another state constitutional provi- in anal sex; a large sign Despite TSW’s audience, the site faces a significant sion. Section 14 of Article 1 in the state’s Declaration of advertising “The Va- roadblock to providing coverage of Rights protects freedom of speech and gina Monologues” call- NCSU athletics: the university itself. the press. It calls these freedoms “two of ing for all [offensive TSW’s suit names NCSU and its ath- the great bulwarks of liberty and there- slang for vaginas] to letics archrival, the University of North N.C. State and UNC- fore shall never be restrained.” “Unite!”; and flyers in Carolina at Chapel Hill as defendants in CH decide on media IJ-NC further explains that the vio- support of the war in the case. Others are the Board of Direc- access “based on the lation is not just at the state level; the Iraq. tors of UNC-CH, Annabelle Vaughan, as- rights of the press are protected under Actually, only the Jon Sanders sistant athletic director for media rela- status of the medium the U.S. Constitution as well. As stated last one was removed. tions for N.C. State, and Steve Kirschner, or… the medium’s in the IJ-NC press release, “The drafters The rest were allowed associate athletic director for athletic of each constitution knew the importance to stand. communications for UNC-CH. point of view.” of an unfettered press to open govern- Also deemed too offensive for UNCW this year According to case, Vaughan and ment… and surely the courts will recog- was the song “Cotton Eye Joe” as performed by the Kirschner have refused to grant media nize that in the Internet age online me- group Rednex. The song used to be on the play list credentials to Cornwell because TSW is only an “online” dia are as important a part of that ‘bulwark of liberty’ as for UNCW basketball games, but it was pulled in Feb- media entity. Other online media, such as GoPack.com and any other form.” ruary when a trustee complained. The nature of its CarolinaBlues.com, enjoy such credentials only because According to IJ-NC, there is a legal precedent for TSW’s offense is not the Rednex version, however, but rather they are “official” school websites. case. In the 1986 trial of Anderson v. Cryovac, Inc., the First its roots as an old minstrel tune. As the trustee, Linda While TSW is denied access, Cornwell said, Inside Caro- Circuit Court of Appeals addressed the restriction of ac- Upperman Smith, explained to the Wilmington Morn- lina, a print and media publication that focuses on UNC- cess to information to certain types of media. Specifically, ing Star, “There are some very derogatory lyrics in CH is credentialed by N.C. State. “Here’s a print and online in the court’s legal opinion: “The danger in granting fa- the oldest version of the song that make reference to publication that serves our biggest rival, while our site, vorable treatment to certain types of media is obvious: It the ownership of a black man.” which does nothing but promote N.C. sports, is turned allows the government to influence the types of substan- Not too offensive for UNCW, however, were the down just because we are online and not ‘official,’” tive media coverage that public events will receive. Such a profanity-dependent lyrics of rapper Ludacris, who Cornwell said. “That makes no sense.” practice is unquestionably at odds with the First Amend- once sang that he hates it “when it’s too many n—— The denial of such credentials means more than “los- ment. Neither the courts nor any other branch of the gov- —, not enough hoes.” UNCW shelled out $120,000 ing the best seats in the house,” according to IJ-NC’s May ernment can be allowed to affect the content or tenor of (half through ticket sales, but the other half through seventh press release. It includes the lack of accessibility the news by choreographing which news organizations student fees) to bring him for a concert March 29. to coaches and players and being deprived of up-to-the have access to relevant information.” What’s behind this bizarre, apparently double- minute statistical analysis. IJ explains that this all means For Cornwell, the case is also about common sense. natured standard for offensiveness? How is it that pro- “obtaining information second hand or after the fact,” “It’s amazing that, in 2003, our two flagship public uni- war flyers, which if nothing else reflected the senti- thereby, “excluding the most loyal and enthusiastic me- versities would refuse to credential one form of media over ments of a large majority of North Carolinians and dia.” another, with the one they leave in the cold being the fast- Americans, and a sanitized song with admittedly est and best way to give information about sporting shady roots were treated as more offensive than a pho- Two great bulwarks of liberty events,” he said. tograph of anal sex, references to women as slang for Of “UNC’s restriction on ‘opposing’ media,” Cornwell their vaginas, descriptions of women as b—es or Heather Royster, staff attorney for the IJ-NC, which is said it “is more reminiscent of King George III and North “hoes” and boasts of violence to them, and desecra- a nonpartisan, nonprofit public interest law firm, explained Carolina’s Speaker Ban law than of the ideals of a state tions of American symbols? If censorship had to be that the N.C. Constitution in Article 1, Section 1, “guaran- university founded in 1789, the year our Federal Constitu- used, and if the basis for that censorship was that tees our citizens a fundamental right to ‘the fruits of their tion was adopted.” CJ some would be offended by the speech in question, as it was here, then why were only the former cen- sored and not the latter? Do those items that escaped censorship have any- thing in common? In fact, they do. They are all items of interest to the “protected” groups on campus: ho- mosexuals, feminists, black activists (who politicize rap and hip-hop as forms of political dissent), and leftists in general. What does that have to do with anything? Well, UNCW is very, very serious about ensuring “diver- sity” on campus. UNCW has a “Chancellor’s Task Force for Diversity” tasked with “improving overall campus diversity” that on April 15 released its final report of recommendations (available online at www.uncw.edu/dpscs/diversitytaskforce). Naturally the task force was told to place “spe- cial emphasis on racial/ethnic diversity.” That’s well in keeping with their peers across academe, where diversity is only skin deep and intellectual diversity is dangerous and probably offensive to somebody who’s “diverse.” The campus idea of diversity generally resembles a bag of Peanut M&M’s™: different colors on the outside, same nutty interior. Perhaps that’s why UNCW students had to pay to give Ludacris a forum on campus, but students who voluntarily devised, photocopied (at their own ex- pense) and posted pro-war posters on campus found out the next day that they had no forum after all. CJ June 2003 C A R O L I N A 12 Higher Education JOURNAL

Course of the Month Cheating, Ethical Violations Rampant, Director of Duke Ethics Center Says

By JENNA ASHLEY municate their organizational values; we Editorial Intern must make ethics an integral part of our RALEIGH culture,” Kiss said. nethical behavior is rampant on In response to the crisis, students on college campuses and in society to- campuses across the United States have in- U day, the director of the Kenan In- troduced honor codes and have opened dia- stitute for Ethics at Duke University said at logue about ethics in school and in the com- an luncheon sponsored by the John Locke munity, Kiss said. The Kenan Institute and Foundation on April 28 . other similar organizations also have begun “The pressures and opportunities for programs to promote ethical behavior on dishonesty have increased in many arenas,” campuses and in businesses nationwide, the director, Dr. Elizabeth Kiss, said. Kiss said. A survey of college-bound seniors in The institute joined with the Center for 1998 revealed that many young people do Academic Integrity to create a program that not perceive cheating as a serious ethical promotes a “community of integrity,” Kiss problem, Kiss said. For example, many of said. Honesty, trust, fairness, respect, and them have taken part in unauthorized col- responsibility are the core values of integ- laboration on school projects, copied infor- rity. Academic integrity is the foundation mation without proper citations, or falsified for a vibrant community of teaching, learn- laboratory results. ing, and scholarship, she said. Similarly, one-third of employees re- In order to promote these values, edu- portedly observe misconduct at work, such cators must talk about them, measure them- as lying, withholding of information, using selves by them, create opportunities for stu- intimidation, and misusing company dents to practice them, model their behav- money, Kiss said. ior after them, and help students navigate Corporate and academic scandals, by them, Kiss said. linked to crises in core institutions such as Kiss said the Kenan Institute tries to Here’s a bit of non-history that clearly proves to any worth-his-salt Duke Literature the church, government, and professions, raise awareness of the importance of ethics student that Stalin brought hope, not horror. And they call it “propaganda.” Pah! can create a cynicism about society, Kiss in schools, businesses, and the community. said. Cynicism allows people to discredit The institute gives awards to schoolteach- ethics altogether by believing that “all stu- ers who teach ethics and character educa- dents cheat, all politicians are corrupt, and tion in innovative ways, collaborates with Duke Literature Course Details all businesspeople lie,” Kiss said. young adults in a forum about ethics in so- In order to resolve the problem, “we ciety, has created an eight-step program to ‘Hope’ Awakened by Stalinism must transform our organizational cultures create an ethical culture in businesses, and to pay attention to the implicit and explicit with the Center for Academic Integrity pro- ways in which businesses and schools com- motes ethics on campus. CJ his month CM traipses back to the tion’ of agriculture in the Soviet 1930’s Duke University Literature De- has awakened much hope as well as Tpartment, that wellspring of the much horror.” weird, to honor another gem. This one The grad-student instructor is also came to our attention by way of the Feb- quite suspicious of historical accounts, CAROLINA JOURNAL Publisher ruary 2003 issue of New Sense magazine, probably because of their alarming (to published by those mettlesome conser- Krysl) lack of cataloging all the hope vative students. (There’s something brought about by the Soviets. (Did they John Hood Garners Praise about the phrase “disastrous attempt to look under that pile of bodies? What whitewash Stalinist Communism” that about those hollow-eyed corpses; bet just arrests our attention.) they didn’t check beneath them!) New for His Most Recent Book: Sense reports that Krysl’s advertised LIT 60S.04: COLLECTIVE AND COLLEC- course readings are “various pieces of TIVIZATION: BETWEEN COLLECTIVIZATION OF Communist agitprop and radical AGRICULTURE theory.” This would be, one supposes, We will cross literary and historical what he means by “Reading literature texts, as accounts and as practices: begin- as history and history as literature.” Investor Politics ning in Soviet 1930s, the collectivization of New Sense asks, “why not read the his- The New Force That Will Transform American Business, agriculture. Reading literature as history tory as history? Because it is too pain- and history as literature, and reading nov- ful for a Marxist ideologue like Mr. Government, and Politics in the 21st Century els alongside and against diaries, we will ask: Krysl?” Do collective property, production and work Despite inferring oodles of hope in announce the arrival of collective political what untrustworthy History refers to “John Hood has produced a timely and informative account of the most power? Or was a collective, as much as an “The Great Purge” (partly to under- significant demographic shift of this century — the rise of a shareholder individual, possibility taken and made into score the tremendous amount of hu- democracy in America.” — Jack Kemp nothing? What is a *socialist* episode in the manity slaughtered, and partly to dif- “global war against peasantry”? Some other ferentiate it from the other Soviet “Investor Politics is chock-full of interesting historical anecdotes, clever projects of collectivity may show us if, and purges), Krysl does sound, if not hope- how, do the Soviet thirties speak to our own less, at least resigned in one part of his policy analysis, and surprising musings.” — National Review hopes. advertisement. “If we cannot build a fu- ture on the hopes of 1929 any longer, “John Hood offers many astute observations about the reasons govern- You saw that, too, didn’t you? [I]f, why is this so?” Ooh! Ooh! We know! It’s ment social programs are imperiled.” and how, do the Soviet thirties speak to our because of the slaughter of tens of millions, — Greensboro News & Record own hopes? The only way we could con- right? That and the concomitant terroriz- ceive of that era speaking to hopes is if ing of the entire populace? And all the star- what it spoke was LASCIATE OGNE vation and the commission of other atroci- “I highly recommend Investor Politics to any reader interested in under- SPERANZA, VOI CH’INTRATE (Abandon All ties? Are we close? standing how our government turned into an entitlement trough.” Hope, Ye Who Enter Here) — with full We see no need to improve on how — Kevin Hassett, AEI Dantean malice. Criminy. New Sense summed up the class. “Mr. Or how about this: “Do collective Krysl’s Communist navel-gazing on the property, production and work an- horrors of Stalinism is not just pathetic; “Hood has delivered a thoughtful and very engaging text that will help nounce the arrival of collective political it is immoral,” they wrote. “How can move the debate from last century’s entitlement-dependent view of power?” Well, did they? (Hint: does anyone treat the forced starvation of society to the country’s Jeffersonian roots of self-reliance” Marx say “Laissez-nous faire”?) countless souls as the plaything of his — Chris Edwards, Cato Institute The course is taught by a graduate own fashionable radicalism? Imagine if student, Simon Krysl. According to New anyone dared to treat the Holocaust as Sense, Krysl at least grants the existence the object of such disgraceful lucubra- of horror in the Soviet regime at the time, tions. There would be an outcry against Look for Investor Politics in bookstores or at www.TempletonPress.org. but he weighs it on equal scale with all this horrendous disgrace-and rightly that “hope” it brought: “‘Collectiviza- so.” CJ June 2003 C A R O L I N A JOURNAL Higher Education 13

The problem of rape and sexual assault statistics Misused Data, But Not Official Numbers, Point to College Rape Crisis

By JON SANDERS college women Probably neither he Underscoring that latter fact, UNC- Assistant Editor about sexual viola- nor his date would Greensboro students are dealing with the RALEIGH tion. She determined say so,” she wrote. reality of a serial rapist who is attacking news article in The Daily Tar Heel that 25.7 percent Issues in “Yet the survey clas- women in neighborhoods near campus April 24 contained a shocking lead: were victims of rape sifies him as a rapist (seven had been attacked by mid-April). A “A woman is raped every two min- or attempted rape Higher and her as a rape vic- Major J. C. Herring, assistant chief of UNCG utes. Almost one in every four women be- “because they gave tim.” Police, wrote to the UNCG Carolinian April tween the ages of 18 and 24 is a survivor of answers that fit 7 pointing out that “None of the attacks sexual assault.” Koss’s criteria for Education Politics intrude occurred on campus” and said “the Univer- No sources for this information are rape” — which bear sity should use the incidents to encourage given — which is mildly surprising since it scrutiny, as they are The problem of students to live on campus where they have is published in the campus newspaper for “penetration by pe- the faulty statistics the benefit of secured residence halls, well the University of North Carolina at Chapel nis, finger, or other owes to “the intru- lighted streets, a professional police force, Hill, a UNC flagship university with a well- object under coercive influence such as sion of politics into the field of inquiry,” and the safety escort service.” known school of journalism. It is not, how- physical force, alcohol, or threats.” Those Sommers said. “There are many research- At UNC-CH, meanwhile, the DTH story ever, unusual for any campus discussion of broad criteria may explain why only 27 ers who study rape victimization, but their cited at the beginning of this article con- that particular subject. Here are a few ex- percent of Koss’ “rape victims” considered relatively low figures generate no head- trasted the “one-in-four” claim with UNC- amples just from the current academic year: themselves to be rape victims. Also, Koss lines.” Among them: a 1993 Louis Harris CH’s comparatively low numbers of “only • “There are probably 200 to 250 under- considered a woman a victim of sexual and Associates telephone poll that found two rapes [on campus] in 2002 and only 17 graduate men on this campus who are rap- assault if she answered “yes” to (and 53.7 only 2 percent of women were victims of sexual assault victims.” For the DTH, “the ists (one out of 15), based on a 15-year old “victims” did) “Have you ever given in to rape or sexual assault; Professor Mary Gor- numbers don’t add up” — and it takes the survey. Fifteen percent of undergraduate sex play (fondling, kissing, or petting, but don of the University of Washington’s 1981 “one-in-four” statistic as gospel truth while men say they would commit rape if there not intercourse) when you didn’t want to study that found only one in 50 women viewing UNC-CH police’s official numbers was no chance of punishment.” Jillian because you were overwhelmed by a man’s raped; and Duke researcher Dr. Linda as clearly wrong and indicative of a greater Johnson, “Stop Rape at Duke,” Duke Uni- continual arguments and pressure?” George, who found, using “questions very problem. versity Chronicle, Feb. 27, 2003 University of California Berkeley Pro- close to Kilpatrick’s” one in 17. UNC-CH’s solution underscores • “1 in 4 college women,” sign seen at fessor Neil Gilbert pointed out a key flaw in Another problem Sommers cites is “the Sommers’ point about rape resource alloca- UNC-Chapel Hill protest of violence against that study: Koss’s categorizing as having morally indefensible way that public funds tion. “UNC officials submitted a grant ap- women, as reported in the DTH Nov. 5, been raped any woman who answered “yes” for combating rape are being allocated.” plication last week to the U.S. Department 2002 to “Have you had sexual intercourse when Specifically, “college women are getting of Justice,” the story said. “If the grant is • “Anytime a woman is drunk and has you didn’t want to because a man gave you the lion’s share of public resources for com- approved, the money will be used to re- sex, she has then been raped.” Andrew A. alcohol or drugs?” As Gilbert wrote in Cur- bating rape” despite studies (which she evaluate UNC’s Sexual Assault Response Farr, N.C. State Technician, Sept. 24, 2002 rent Controversies in Family Violence, edited cites) showing that rape rates are far higher Plan, add an antiviolence program to C- • “Every three hours and 52 minutes, a by Richard Gelles and Donileen Loseke, in poor areas than wealthy areas and far TOPS and create a media campaign against rape is committed in North Carolina. Most “What does having sex ‘because’ a man lower for women on a college or university violence at the University, said Melinda of the victims are women. One in four col- gives you drugs or alcohol signify? A posi- campus than for women off campus. Manning, assistant dean of students.” CJ lege women report surviving rape.” Dana tive response does not indicate whether Henderson, Technician, Sept. 10, 2002 duress, intoxication, force, or the threat of • “I am 100 percent sure that at least one force were present; whether the woman’s rape has occurred on campus since school judgment or control were substantially im- has started ... anywhere from one in three to paired; or whether the man purposefully one in eight women will be assaulted in her got the woman drunk in order to prevent lifetime.” Bryan Proffit, Technician, Aug. 27, her resistance to sexual advances.” 2002 (one week after school started) Sommers also points out a key flaw in What is going on? Are our universities the “one-in-eight” statistic cited above, undergoing an epidemic of curiously unre- which is from Dean Kilpatrick’s National ported rape? Or is something else at work? Woman’s Study. Kilpatrick’s study is “a As Katie Rophie wrote in the New York fairly straightforward and well-designed Times Magazine of June 13, 1993, in response survey” on rape and asked questions about to the one-in-four statistic: “If 25 percent of intercourse, oral sex, anal sex, or penetra- A Daily Web Site Providing a State Perspective my women friends were really being raped, tion by “fingers or objects” done “against wouldn’t I know it?” your will by using force or threat of harm.” on 9/11 and the Current International Crisis Christina Hoff Sommers, author of Who The last category, however, as Sommers From the John Locke Foundation Stole Feminism?, has provided the answer. explains, “includes cases in which a boy The one-in-four statistic hails from a 1985 penetrated a girl with his finger, against her Ms. magazine report by Mary Koss. Koss will, in a heavy petting situation. Certainly interviewed about 3,000 randomly selected the boy behaved badly. But is he a rapist? Recent Articles and Columns Spotlighted on NCAtWar.com Include:

¥ Military historian Victor Davis Hanson discusses why the United States prevailed so rapidly in the Iraq War and why this bodes ill for other terror states.

¥ North Carolinas economy, hurt further by wartime deployments, awaits help from Washington, where disagreements about tax cuts block a stimulus bill.

¥ Dr. Andrew Taylor, NCSU political scientist, on the likely impact of the war on North Carolina politics.

¥ As U.S. Marines from Camp Lejeune participate in the right-hand push to Baghdad while Airborne soldiers from Fort Bragg play key roles to the west.

¥ Gov. William Yarborough, former head of Special Warfare Center at Fort Bragg, distinguishes terrorism from legitimate armed resistance.

¥ Locke Foundation President John Hood discusses the military history of other, more ill-fated incursions up the Tigris and Euphrates rivers to Baghdad.

¥˚Moderate Muslim clerics preach peace in Durham and Greensboro while a former Black Panther leader calls First Lady Laura Bush a murderer at Duke.

For the latest news, analysis, and commentary on the war on terrorism, visit what National Review once named its Cool W eb Site of the Day located at www.NorthCarolinaAtWar.com or www .NCAtWar.com. June 2003 C A R O L I N A 14 Local Government JOURNAL

Town and Country Rain Tax May Fall on Residents of Towns

Racial discord in Chapel Hill Storm-water management programs required by EPA begin to filter down

A forum on Chapel Hill’s street fairs grew heated May 13, with issues By DONNA MARTINEZ “Certainly, people of race arising in the discussion, the Associate Editor have commented on Herald-Sun of Durham reports. RALEIGH that,” said Bradley The first speaker, Maxecine orth Carolina’s rainfall is a source Bennett about the tax Mitchell, said she thought some of the of the lush landscape and natural or fee debate. Bennett criticism aimed at the post-Apple Nbeauty that attracts thousands of hears from the public Chill gathering was racist, and that it tourists each year. But for residents, rain and local officials in sent a message that some residents and the ensuing runoff have become yet an- his job as supervisor of “don’t want black people here.” Apple other excuse used by cities and towns to the Stormwater & Chill is a town-sponsored street festi- raise taxes. General Permits Unit val held in April, which is followed Municipalities call them storm-water of North Carolina’s by an unofficial gathering of hundreds utility fees, but those who oppose them say Department of Envi- of people who drive cars and motor- they’re taxes in disguise. Regardless of the ronment and Natural cycles or circulate on foot around part label, the result is a steady and mostly un- Resources, Division of of West Franklin and other streets. noticed revenue stream flowing into gov- Water Quality, which Many participants in the “After ernment coffers sucked dry by ever-increas- administers the EPA Chill” gathering are black, although ing local spending and the loss of state re- program. people of other races join in the gath- imbursements. “Communities are ering as well. Residents of some large metropolitan looking for ways to The forum was held by the town’s areas have been paying the rain tax as part have an effective pro- Street Fair Review Committee, which of their water bill since the early 1990s. The gram. Obviously, they is looking both at Apple Chill and charge stems from storm-water manage- need a way to do this,” Festifall. The Town Council started the ment programs required by the Environ- he said. Bennett agrees process last year after resident Eunice mental Protection Agency as an outgrowth with Stam that nothing Brock petitioned the council to either of the Clean Water Act. Seven other com- in the EPA rules re- do away with both festivals or make munities reported charging utility fees for quires a municipality major changes. storm runoff programs implemented on to levy a fee or tax. Former Recreation and Parks Di- their own, in a 2002 survey by the North Now that Phase II rector Hank Anderson created the fair Carolina League of Municipalities. of NPDES is taking ef- about 30 years ago in an attempt to fect, smaller commu- foster better racial relations. Smaller cities, town next nities are on the hook. The law requires cities to control pollutants that filter into streams. According to the EPA New routine for dance classes But residents who live in one of about web site, the rules “further reduce adverse tions the inclusion of some smaller commu- 125 less-populated cities and towns should impacts to water quality and aquatic habi- nities. Arts dance classes could be spun get ready. Expanded EPA regulations now tat by instituting the use of controls on the off into a private, nonprofit organiza- require smaller municipalities to comply unregulated sources of storm water dis- Belville wins an exclusion tion if the Greensboro City Council with storm runoff rules. Whether these gov- charges that have the greatest likelihood of cuts the City Arts budget for a second ernments will institute rain taxes is the causing continued environmental degrada- She cites the Town of Belville in straight year, the News-Record of $64,000 question. tion.” Brunswick County as an example. The town Greensboro reports. “There’s no federal law that requires In common language, it means that of 300 was designated a Phase II commu- Greensboro Parks and Recreation them (local governments) to raise funds this communities of 50,000 or more population nity because it’s considered part of the administrators have proposed elimi- way,” said Rep. Paul Stam, R-Wake, a law- must create storm-water programs with six Wilmington urbanized area. nating the City Arts dance director’s yer whose firm represented clients in law- focus areas: public education and outreach; “They don’t have enough development job and having a nonprofit group suits against Durham and Greensboro over public participation and involvement; illicit to warrant this,” Martin said. Belville oversee the program instead. their rain taxes. “They know the storm- discharge detection and elimination; con- Mayor James A. Cain III agrees that, with Instructors would move from the water programs need to be done.” Stam struction site runoff control; post-construc- two main roads and “very little industry,” city payroll to teaching classes under contends the localities should shift existing tion runoff control; and pollution preven- his community poses little threat to water contract. The city would still provide budget dollars to the program rather than tion/housekeeping. quality. space and advertising; instructors instituting a new fee. The state has discretion about whether Since it doesn’t own and operate a would collect student fees and rent Instead, Durham, Greensboro, and even smaller locales of 10,000 or more popu- sewer system, the town officially asked the space from the city. three other urban centers levied fees to com- lation must institute detection and preven- state to drop it from the list of those required A vacant City Arts secretary’s po- ply with 1990’s Phase I of the National Pol- tion programs. That decision-making pro- to implement a runoff program, and Cain sition also would be cut. lutant Discharge Elimination System law. cess is under way. said the state recently agreed. Parks and Recreation Administra- It requires cities of 100,000 or more popula- Bennett, however, said that while the tor Ed Deaton proposed the changes tion to control trash, lawn pesticides, and Price of housing rises state has accepted the town’s certification after the city manager’s office, project- other debris that collect in storm-water run- about the sewer system, that fact may not ing continued tight budgets, asked de- off and discharge into lakes and rivers. Lisa Martin, director of regulatory af- completely eliminate Belville’s responsibili- partments to cut expenses without Large construction sites and 10 categories fairs for the North Carolina Home Build- ties. “The town still might be required to cutting service. of industrial activity also faced strict rules. ers Association, is con- comply in some way,” Charlotte, Winston-Salem, Fayetteville, cerned about how the Bennett said. Asheville eases vendor rules and Raleigh also were snagged in the popu- construction-related com- “There’s no federal law Although the mayor lation net and implemented storm-water ponents of the rules will said he’s relieved, he’s Asheville City Council voted 4-3 management programs. Only Raleigh affect her members. that requires them (lo- still concerned about one May 13 to amend a sidewalk ordi- bucked the trend and operates its program “They (the state) are cal governments) to thing. He said the town nance that now also allows vendors from the general fund. expanding the program raise funds this way.” was assured by the state to operate pushcarts from 7 a.m. to 10 But that may change. The Raleigh City well beyond what the for more than a year that p.m. in a space of no more than 24- Council is considering creating a storm- feds intended,” Martin — Rep. Paul Stam it would have to comply, square feet, according to the Citizen- water utility to charge each household $3 said. She contends that R-Wake so Belville paid $5,000 for Times of Asheville. per month. Existing big-city residential rain the cost of new homes special software to man- The changes allow vendors longer taxes range from $1 per month in will increase because of age the program, Cain business hours and greater flexibility Fayetteville, to $3.77 in Charlotte. Commer- the requirements. said. Now the box sits on a shelf and Cain on cart size. cial assessments are higher and typically “The more controls on building, the hopes for a refund. “I figure that’s just the Debate sparked last-minute based on formulas related to the amount of more cost that will be passed down,” Mar- way government works,” he said of the con- changes to the ordinance after coun- impervious surface on the property. tin said, adding that entry-level home fusion. cil members and citizens learned that homebuyers will be most affected. Any ad- In the meantime, cities and towns Anderson Davis’s downtown hotdog If it smells like a tax… ditional cost can edge them out of the mar- across the state await word on whether they stand could be illegal. ket, she said. must comply. Bennett said his department Most of the discussion about cart Stam thinks politicians are playing a se- Bennett acknowledges Martin’s con- will submit proposed final rules to the Gen- size and regulations centered on mantics game that attempts to equate the cerns, but defends the importance and eral Assembly for approval next session. Davis’s hot dog stand, which served rain tax with what he says is a true utility “pro-active” nature of the Phase II rules. Once program implementation begins and as a model for changes. City Council fee, in which a person pays for a service, “The big thing is the water quality and po- rain taxes appear in more municipalities, members wanted to make sure the and starts and stops the service at will. He tential impairment and problems,” he said. Martin predicts North Carolinians will get vendor and 11 other enclosed push- says the fees are a clever way to raise taxes “You’re looking at trying to save problems vocal. cart owners could continue to oper- without saying so. “You can’t disconnect down the road.” “As more people become subject to ate under old regulations. CJ from this thing,” he said. “It smells like a Martin agrees that some runoff controls fees, they’ll be calling their legislators,” she tax, eats like a tax, it’s a tax.” are necessary in major markets, but ques- said. CJ June 2003 C A R O L I N A JOURNAL Local Government 15

Local Innovation Bulletin Board

NYC Rent Control Questioned

ew York City’s rent stabiliza- that incineration “is best for the environ- tion, or rent control, provides ment, the economy, and the manage- Nlittle benefit to residents of the ment of natural resources.” That is be- outer boroughs and lower- and middle- cause it costs more to turn finished prod- income neighborhoods in Manhattan, ucts into reusable materials than to use according to a new report by the Man- raw materials. Recycled bottles cost glass hattan Institute. The only areas whose companies twice as much as making glass residents receive a substantial subsidy from raw materials, and recycling plas- live in the relatively affluent areas of tics is even more uneconomical. Lower and Mid-Manhattan. Technological improvements have The median monthly subsidy pro- made incineration cleaner. Because plas- vided by rent stabilization for all of New tics are made from oil, they are easily York City is $42. In the higher-income used to generate electricity. In addition, Interstate 95 runs for 182 miles through North Carolina and only one of the state’s large city. areas of Lower and Mid-Manhattan, the incineration will save space in landfills. median monthly subsidy from rent sta- British authorities have drawn up Federal program has never been used bilization is $397. By contrast, the me- plans to build as many as 50 incinerators dian subsidy in the Bronx is $58, in Up- in an attempt to eliminate a growing per Manhattan it is $9, in Brooklyn it is mountain of waste and cut the amount of Department of Transportation $5, while in Queens and Staten Island garbage going to landfills. the subsidy is effectively zero. Reported in the Washington Times. The report also finds that dereg- Considers Tolls for Interstate 95 ulating rental prices would not lead to Electronic loop provisioning significantly higher rents for most apart- By MICHAEL LOWREY Carolina, Arkansas, Texas, Michigan, and ment dwellers. Rent increases for resi- Everyone wants high-speed Internet Associate Editor Virginia have all expressed at least some dents of neighborhoods outside the af- service (broadband) spread across the FAYETTEVILLE interest in interstate toll road conversion, fluent part of Manhattan would be mini- country. But some think the only way to .C. Department of Transportation though none have yet filed a formal appli- mal to nonexistent because their rents roll out broadband rapidly is to abandon officials are examining the possi- cation with the FHWA. are not significantly below market prices the pro-competitive provisions of the bility of rebuilding Interstate 95 The reason for this limited interest to now. Telecommunications Act of 1996 and N In an unregulated housing market, hope that the regional Bell operating com- through toll collections under a never-be- date is the strict requirements set by the fore-used federal pilot program. It will be federal government. Section 1216(b) can- the supply would expand in the affluent panies will accelerate broadband invest- several years, however, before anyone pays not, for example, be used as a means to areas of Lower and Mid-Manhattan, cre- ment in a race for profits. their nickel (or dollar) to drive on the inter- simply impose a toll at, and only at, the ating downward pressure on rental rates. Fortunately, there is a way to ex- state. state border. If rental prices were completely de- pand broadband without undermining I-95 is something of an oddity. It is a Before the FHWA will approve an ap- regulated, the median monthly rent of local phone competition. The fix involves major north-south road in a state with an plication, a state must demonstrate that the subsidized housing would increase by using a next-generation, low-cost tech- east-west orientation. While the road runs only way the interstate can be reconstructed only $8 because of the expansion of the nology called ELP (electronic loop pro- for 182 miles through North Carolina, it or rehabilitated is through conversion to a unregulated market. If rental rates were visioning). “Loop” refers to the local loop serves only one of the state’s dozen largest toll road. Existing and future state and fed- deregulated only when vacancies occur, — the local telephone lines and poles, cities, Fayetteville. eral funding sources must be shown to be the median monthly rent increase dur- conduits, and switches that connect in- Aside from a 40-mile stretch forming inadequate for the work needed. ing the first two years would be $35. dividual users to the outside world. “Pro- part of the interstate link between Raleigh The FHWA will also figure the age, Researched by Henry O. Pollak- visioning” refers to the cumbersome pro- and Fayetteville, I-95 also does not serve to condition, and intensity of use of the road owski, “Who Really Benefits From New cess that sets up and cross-connects both connect the major population and business when determining whether to approve a York City’s Rent Regulation System?” voice and data circuits electronically. centers of the state. request as well as the interests of local, Civic Report No. 34, March 2003, Man- ELP would give competitors the What I-95 does do is serve as a conve- regional, and interstate travelers. hattan Institute. same access to customers as the Baby nient route for motorists driving between In addition, any local metropolitan Bells now enjoy. There are additional the Northeast corridor and Florida. Many planning organizations must be consulted Incinerate, don’t recycle benefits to the technology. It would make of the travelers, however, will spend little about the placement and nature of tolls. it possible to switch customers from one time, and money, in North Carolina. The tolls must last for at least 10 years and It is better to incinerate cardboard, company to another with the ease as With highway dollars always being in a state would not receive federal mainte- plastics, and garbage than to recycle long-distance service is now switched. demand, North Carolina has not made im- nance money for the interstate while it was them, which is a waste of time and money, ELP can deliver broadband speeds proving I-95 a priority. The 1989 law speci- a toll road. according to environmental experts in 30 to 100 times faster than current rates. fying which intrastate road projects would Conversion of I-95 to a toll road outside Sweden and England. They advocate Researched by Laurence J. Kotlikoff, be funded through the Highway Trust Fund the pilot program is likely not a workable the construction of more incinerators to “Breaking the Logjam: A Technological contained no provisions for major work on option. Such a move would require the dispose of waste. Fix,” Milken Institute Review, First Quar- I-95. Likewise, the state’s current Transpor- consent of Congress and that the state re- Swedish environmentalists claim ter 2003. CJ tation Improvement Program, which lists pay all federal money used to build and the state’s road plans for the next seven maintain the portion of interstate that be- years, includes no major upgrades on the comes a toll road. While an exact figure is road. not available, the bill is likely to be in the Still, I-95 will eventually need rebuild- hundreds of millions of dollars. ing as traffic increases in the future. The road already has a far higher fatality rate Path forward unclear than other interstates in the state. I-95’s outdated design, with limited room to ac- While section 1216(b) offers a possible celerate and merge, is a factor as is the long- means to convert I-95 to a toll road, many CarolinaJournal.com is Your Daily Launching Pad to haul nature of the road’s users. uncertainties remain. The N.C. Department the Best North Carolina News, Analysis, & Opinion of Transportation has contracted for a study Federal toll pilot program to determine the cost of improving I-95 and the potential revenues from and costs of ¥ Reports and columns on the legislature, politics, culture, and local The Transportation Equity Act for the collecting tolls. government from Carolina Journal editors and reporters. 21st Century, passed by Congress in 1998, Based on the result of this outside re- includes a pilot program, known as section port the N.C. DOT may recommend that ¥ Carolina Journal Publisher John Hood’s exclusive “Daily Journal.” 1216(b), allowing for interstate highways to the state proceed with an application. Such be converted into toll roads. Under section a move would also ultimately require the ¥ Timely links to important stories and editorials from the state’s major 1216(b), the Federal Highway Administra- approval of the General Assembly. The re- newspapers, magazines, and other media organizations. tion can approve up to three such projects, port should be out this summer. each in a different state. Unknowns also exist on the federal ¥ Instant access to state & national columnists, wire reports, and the The agency set a March 31, 1999 dead- side. The pilot program obviously requires John Locke Foundation’s other public policy web sites. line for applications. After no states ap- a detailed proposal, which balances off a plied, the FHWA changed the approval variety of interests. Given that no state has See what Spectator magazine called “Matt Drudge with Class” process to first come, first serve with no set yet applied, it remains to be seen exactly And Get Informed About Your State — At CarolinaJournal.com deadline for applications. Aside from North what the FHWA will find acceptable. CJ June 2003 C A R O L I N A 16 Local Government JOURNAL

From Cherokee to Currituck City and Developer Win Cary Reconsiders Impact Fees But Landowner Loses After Growth Slows to a Crawl

By DONALD J. KOCHAN, J.D. development through a Common- Guest Contributor wealth agency really remove any po- By MICHAEL LOWREY simply be asked to come by at a certain date ARLINGTON, VA tential “private use” taint? Associate Editor to pick up their licenses. magine the government kicking Condemnation for private com- CHARLOTTE Another issue facing Rascue is the you out of your home or business mercial development projects has long fter experiencing lower than an- ordinance’s requirement that applicants I only to give your property to an- been sanctioned by many courts, so ticipated growth, Cary is reconsid- present a photo ID. Many homeless people other private individual whom it pre- long as the legislature or a municipal- ering the amount it charges in wa- do not have identification. “I, as the tax fers? It may seem implausible in a coun- ity can claim that the ends are in the A ter, sewer, and transportation impact fees. collector, have had to decide what was ac- try like the United States, but uses of “public interest.” Yet, governments “Our intent was to manage our growth; ceptable,” Rascoe said. the “eminent domain,” or “condemna- have proven themselves to be poor eco- it wasn’t to stop it completely,” Mayor Pro So far Rascue has accepted only mili- tion,” power by government to wrest nomic planners and susceptible to the Tem Jack Smith told the News & Observer of tary or state-issued identification. private property from one person for influences of special interests. Raleigh. the benefit of special interests is hardly Regardless of whether the full fac- Cary adopted the impact fees in an Chapel Hill panhandling ordinance unheard of. tual record in the Ottofaro case proves attempt to control the rapid growth that the the landowners’ claims, it is at least an town experienced from the 1970s through A new ordinance went into effect May Virginia allows condemnation instructive example of the potential the late 1990s. Cary’s population went from 1 in Chapel Hill prohibiting panhandling at harm inherent in the condemnation less than 9,000 in 1972 to more than 103,000 night. The new law comes after police com- A Jan. 10 court opinion examined power when political entities have last year. plained that previous rules on begging in this issue. In Ottofaro v. City of Hamp- broad discretion in its application and In the past few years, a weak economy public were essentially unenforceable. ton, the Virginia Supreme Court heard commercial development is in play. has slowed growth dramatically through- On March 28, the Chapel Hill Town a case in which the City of Hampton There are dangerous incentives. out Wake County. Things have since started Council adopted the new ordinance by a 7- condemned the property of private Suppose Company Z wants to build a to pick up again throughout most of the 2 vote. The council had rejected the change, landowners, Frank and Dana Ottofaro. new factory, but there are homes in its county, but not in Cary. With the higher but changed its position after town officials A small portion of the condemned way. The homeowners, for reasons ei- impact fees, Cary had hoped to achieve 4 and police officers noted the difficulties in property was to serve as a road. The ther economic or sentimental or both, percent per-year population growth. Last enforcing the town’s aggressive pan- residue of the land was to be trans- refuse to sell. year, however, only 466 residential build- dhandling ordinance, which required that ferred to the Hampton Industrial De- So Company Z uses its political ing permits were approved in the town. The both the complainant and the beggar ap- velopment Authority, a political subdi- clout to persuade the city to condemn town’s population is estimated to have pear in court. vision of the Commonwealth of Vir- the private property, force the owners grown by only 1.74 per- Under the new re- ginia. Two months after the condem- out, and grant Company Z title or a cent between April 2002 striction, a violator could nation decision was made, the author- lease. The transaction often will cost far and April 2003. “Developers will pay a be subject to a $50 fine ity entered into an agreement with a less than if the company had to buy the “Developers will pay and seven days in jail. commercial development project for property on the open market. a premium to build in premium to build in Opposition to the or- the use of the former Ottofaro land as Cary, but then you have Cary, but then you dinance was centered on part of a retail shopping center. Municipal conflict of interest to look at what amount of have to look at what whether it stifled free The Virginia and U.S. constitutions premium they will pay,” speech. “This ordinance specifically restrict the condemnation Municipalities have at least two in- Councilwoman Jennifer amount of premium creates a new criminal act power to “public uses,” forbidding centives to engage in such transactions: Robinson said to the they will pay.” in the choice of words on government from taking private prop- first, to curry favor with private com- N&O. Robinson and a Franklin Street,” said erty unless the government proves that panies; and second, because the new majority of the Cary Town Councilman Mark Klein- the property is necessary for its opera- owners will likely generate signifi- Council are concerned that Cary may be schmidt, who voted against the change. tion or otherwise cantly more tax rev- effectively pricing itself out of the market . needed to meet its enue. At the end of While many communities have impact New tax to build runway obligations to the citi- the process, the coer- “ When takings for pri- fees, Cary’s are especially high. The town, zenry. This vital con- cive power of emi- for example, often charges six times or more Passengers flying through Charlotte cept is too often lost vate use are allowed, nent domain has than what Raleigh does on a similar project. Douglas International Airport are likely to on government offi- the state becomes been used to kick a A recent case highlights the differences be paying an extra $3 per flight starting this cials and, unfortu- private property in fees. A local developer and Rex Hospital fall. The receipts would be used in part to nately, on many merely an agent of owner off his land are planning to build a 63,000-square-foot help fund a new runway. courts. coercion, with the in- for the mutual ben- medical office complex in Cary. The town Federal regulations allow airports to Quoting past efit of the developer terested buyer as its will collect $460,000 in impact fees from the charge a fee, called a passenger facility precedent, the Vir- and the municipality. project. By comparison, the impact fees for charge, to pay for improvements at air- ginia Supreme Court principal.” Private negotia- a similar project in Durham would be less ports. The Federal Aviation Administra- cautioned that “a due tions in property dis- than $120,000. In Raleigh, such a project tion recently noted that 85 of the nation’s protection for the putes are often more would incur less than $55,000 in impact 100 top airports have the charge of either $3 rights of private property will preclude costly than an investment in convinc- fees. or $4.50 per departing passenger. Airports the government from seizing it [from] ing the state to condemn. If an owner in Fayetteville, Greenville, New Bern, and the hands of the owner, and turning it refuses to sell or demands a price Greensboro panhandling ordinance Wilmington already charge $3. The fee is over to another on vague grounds of higher than the interested buyer is will- $4.50 in Asheville. public benefit from the more profitable ing to pay, the market provides no As reported last month in Carolina Jour- The new runway, the airport’s fourth, use to which the latter may devote it.” means by which the interested buyer nal, Greensboro has also been considering has been in the works for over a decade. The Despite this strong language which can force the owner off the land. When and has since adopted a new, stricter, ordi- 9,000-foot runway would be parallel to two sounds protective of property rights, takings for private use are allowed, the nance on panhandling. Implementing the existing runways, and would greatly ex- the court nonetheless upheld the con- state becomes merely an agent of coer- new regulations, however, is proving to be pand the airport’s capacity. US Airways, demnation of the Ottofaro property cion, with the interested buyer as its a challenge. which has a major hub at Charlotte, strongly against a challenge that it constituted principal. “The process got ahead of my office,” supports building the new runway. The an illegitimate “taking” for private use. As James Madison observed in city Tax Collector John Rascoe said to the runway could be ready for service by early The portion condemned for the road, it 1792, a just government “impartially News & Record of Greensboro. Rascoe’s de- 2006. The airport has already paid $80 mil- found, would be used by the public. secures to every man, whatever is his partment is responsible for issuing the pan- lion to acquire land. Building the runway That seems to pass the public-use test, own.” Without judicial reanalysis of handling licenses the new ordinance re- and associated taxiways is estimated to cost so long as there is no evidence the road constitutional limitations on condem- quires. There is no cost to obtain a license. an additional $80 million. is only necessary to provide access to a nation or legislation that specifically Among the things still being sorted out Charlotte’s decision to adopt the fee shopping mall. reins in the condemnation power, pri- is what the license will look like. Rascoe is reflects the new realities in aviation. The However, the court’s justification vate property rights in Virginia may not certain, though, that the specific restric- federal government paid for 75 percent of for the condemnation of the rest of the receive this impartial protection. CJ tions on panhandling, including time and the cost of the airport’s third runway, which Ottofaro property seems less convinc- distance rules and a prohibition on lying opened in 1979. ing. The court found no evidence that Donald J. Kochan is a visiting assistant about military service, will be printed on The FAA, however, after Sept. 11, is the residue would be “conveyed to a professor of law at George Mason Univer- the back of the licenses. now obligated to spend more on security- private entity.” Why? Because it would sity School of Law in Arlington, Va. and a Until the new licenses are ready, beg- related items, reducing its ability to fund be transferred to the development au- member of the Board of Scholars of the Vir- gars will be given receipts showing they airport improvements. It is unlikely to be thority which, in turn, “will lease the ginia Institute for Public Policy, an educa- have applied. Ordinarily, Rascue’s office able to fund as much of the cost this time. property to a private developer.” Does tion and research organization, which has would mail licenses when they are ready, The city will be responsible for whatever filtering the ultimate transfer to private headquarters in Potomac Falls, Va. however, many panhandlers do not have portion of the cost the FAA does not pick mailing addresses. In such cases, they will up. CJ June 2003 C A R O L I N A JOURNAL CJ Interview 17 Sen. Fern Shubert: Bill Would Curb Driver’s License Fraud N.C.,a magnet for illegal immigrants and criminals, issued at least half a million bogus licenses, senator says

By JENNA ASHLEY CJ: How easy is it to obtain a license here? What North Carolina licenses because they are a My guess is that the cost to the state is at Editorial Intern information do you have to provide? joke. There is a huge social cost. You can’t least a billion dollars. RALEIGH blame people for wanting to come here, but Sen. Fern Shubert of Union County is spon- Shubert: When this started when North you can ask them to follow our laws. If you CJ: Who opposes the bill, and why? soring a bill that would strengthen laws Carolina’s then Attorney General Easley’s don’t have the rule of law, you don’t have governing the issuance of driver’s licenses office told the DMV that just because the anything. And we are, as a state, actively Shubert: Mike Easley, Roy Cooper, Wayne and voter registration in North Carolina. driver’s license supposedly requires a So- undermining the rule of law. Hurder. All the leadership within the Demo- cial Security number, if they don’t have one, cratic Party. Last year, I tried to amend a bill CJ: Tell me about Senate Bill 531. What made don’t hassle them. Just put 999 for the SSN. CJ: Voter fraud is also a se- that retail merchants you want to author this bill? Since then, they have issued over 400,000 rious problem. Do you think wanted dealing with bogus licenses and it’s entirely possible that it stems from inadequate leg- “If the public gets be- driver’s licenses and un- Shubert: Basically, what they registered that islation, or could it be an en- derage drinking. The we’re trying to do is get many people to vote that forcement problem? hind it, it will happen. House Majority Leader the state to quit handing have no business voting Our state is the big- Phil Baddour came to my out real, government-is- in North Carolina. We Shubert: I have said from gest source of real fake office and said that if I sued identification with- have no idea, and the the beginning that the ran my amendments, he out any idea of who officials who run the only thing significant IDs in the world. We’ve would pull the bill and they’re giving it to. It state don’t want to tell enough to come up with got to stop it.” have it killed. came to my attention us. laws this dumb is planned I’d say it’s very clear over two years ago that When we caught voter fraud. And there is that they don’t like this we were giving identifi- them, before 9/11, they a bill in the House, and I’m sure it’s a legislation. And they have already begun to cation to people who we wouldn’t do anything coincidence, for same-day registration and attack us: we’re anti-immigrant, anti-His- didn’t know who they about it. voting that says they have to accept the panic. I have no problem with Hispanic were. We knew that it In the wake of 9/11, driver’s license for proof of identity for immigration, but I do think that they should was a problem, but we they realized they had voting. come through the standard process so we didn’t realize that it was to take action, so they They issued over 400,000 with 999 for know who they actually are. a statewide problem un- began a massive public- the Social Security number. We know they til a bill came up in com- ity campaign saying issue 75,000 a year using affidavits. This CJ: What are the prospects of this bill becoming mittee and a whole they have tightened en- does not count the number of people using law? group of us jumped on it forcement, but it is business letterheads or documents from for- at the same time. Then pretty much a joke. The eign countries to get their licenses. Shubert: If the public gets behind it, it will we started comparing proof of residency is hi- Minimum we have over one-half mil- happen. Our state is the biggest source of notes and we realized Sen. Fern Shubert larious: You can use a lion phony driver’s licenses circulating. Per- real fake IDs in the world. We’ve got to stop that this is one huge document from a for- sonally, I think we have well over a million. it. CJ problem and it starts really with the gover- eign government, which we have no way to nor making the decision that we don’t care verify. You can also use business letterhead if people come here and give false informa- that you make yourself. tion. But, my all-time favorite for the lazy terrorist who doesn’t plan ahead, the DMV CJ: Are North Carolina’s licensing law signifi- will run off an affidavit for those who have cantly less rigorous than those in other South- no proof of residence. They sign it and the eastern states are? affidavit becomes the proof. That’s why people come in by the busload to get their Shubert: Absolutely. There are only three licenses, because we give them away more states in the country now that issue driver’s easily than anyone else. licenses to illegal aliens, and I know Ten- nessee is in the process of reconsidering CJ: What are some of the possible repercussions that. The 9/11 terrorists had licenses from of North Carolina’s lax licensing laws? Florida and Virginia, but they have since improved their licensing process. We basi- Shubert: 9/11. We had the father of one of cally have a doormat out now saying, “Come the 9/11 victims testify the last time we to North Carolina if you want a real driver’s attempted to correct this problem. He said license without telling who you really are.” that if we don’t do something about this, the Sex offenders in California, you want a new next terrorist attack is on our hands. People life? Come to North Carolina! Lost your can come here and get a license and then go license driving under the influence? Hey, anywhere else in the country and use it as not a problem! Get another one with a dif- their identification. Some states have said ferent name!” they will begin to refuse reciprocity with

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From the Liberty Library Book Review

• We are passing through an ee- All the President’s Children: Hail to Storytelling rie phase of history, writes J. Budziszewski, in which the things • Doug Wead: All the President’s Children: lished a happy, successful life. Living in re- that everyone really knows are Triumph and Tragedy in the Lives of America’s tirement with wife No. 5, Elliott Roosevelt treated as unheard of, a time in which First Families; Atria Books; 2003; 464pp; $26. cowrote 20 best-selling murder mysteries the elements of common decency are with his famous mom as a fictitious crime themselves attacked as indecent. But By DONNA MARTINEZ solver similar to Agatha Christie’s Miss Budziszewski, in What We Can’t Not Associate Editor Marple. Know: A Guide, sets out to explore the RALEIGH FDR’s kids could be considered lucky lost world of common moral truths he disturbing discovery in Uday and their parents happily married when — what we all really know about Hussein’s Baghdad palace must compared to the children of Franklin and right and wrong. Bolstering the con- have made President Bush sick to Jane Pierce. The 14th president is remem- fidence of plain people in their com- T his stomach. Plastered to the gym wall of bered for the repeal of the Missouri Com- mon moral sense, Budziszewski ex- Sadaam’s sadistic son were photos of the promise, but the story Wead tells of Pierce’s plains its rational foundations and president’s 21-year-old twins, Barbara and 11-year-old son, Benjamin, is an awful ex- why it is under attack. His account Jenna. Captain Ed Ballanco told a reporter ample that power sometimes comes at a shows how to address the uncertain, that soldiers removed the pictures “to pro- tragically high price. the disoriented, and the self-deceived tect the president.” When Benjamin learned of his father’s among our neighbors in a way that The story gave me the creeps and nomination, he was open with his concern. may bring them back to moral san- heightened my interest in Doug Wead’s “I hope he won’t be elected for I should not ity. Published by Spence, at book, All The Presidents’ Children: Triumph like to be at Washington and I know you www.theimarket place.com/Spence. and Tragedy in the Lives of America’s First would not either,” he wrote in a letter to Families. With the Bush daughters still on his mother. It was sentiment they shared • In his book The Crisis of Islam: my mind, I was curious about the unique and, according to Wead, the religious Mrs. Holy War and Unholy Terror, Bernard burdens and opportunities afforded chil- Pierce prayed for her husband’s defeat. Two Lewis examines the historical roots dren like Barbara, Jenna, and even George Pierce children had already died, and she of the resentments that dominate the W. himself. believed God had taken them as a rebuke Islamic world today and that are in- Wead was a special assistant to the first There are a variety of interesting tales, for her husband’s political ambition. creasingly being expressed in acts of President Bush and worked on the 1988 but two are especially fascinating. Pierce won, and only weeks before tak- terrorism. He looks at the theologi- campaign that returned him to the White In The Search for Identity, Wead writes ing office, the family’s train car jumped the cal origins of political Islam and goes House as Ronald Reagan’s successor. Dur- of Franklin and Eleanor Roosevelt’s five tracks between Boston and New Hamp- through the rise of militant Islam in ing that time, Wead got to know George W. children (a sixth died before his first birth- shire. Benjamin’s skull was crushed; Iran, Egypt, and Saudi Arabia, exam- Bush as a presidential child. That makes his day). He contends that FDR was consumed Franklin and Jane were unhurt. She was too ining the impact of radical Wahhabi personal observations on the Bush father- by the presidency for more than 12 years distraught to attend the inauguration. proselytizing, and Saudi oil money, son relationship and the two Bush admin- and had little time for his four sons and When she later learned that Franklin had on the rest of the Islamic world. The istrations interesting and credible, but not daughter. “The trauma to his children is actively engineered his presidential nomi- Crisis of Islam ranges through 13 cen- new. Much has already been written about clear,” Wead writes. Their frequent poor nation and was not a reluctant candidate turies of history, but in particular the two very close but very different men. judgments indicate the children were inca- as he claimed, “she was revolted,” Wead charts key events of the 20th century Thus, it’s the stories of presidential pable of living happy, normal lives separate writes. To her horror, Jane Pierce believed leading up to the violent confronta- families and children who lived before the in the public’s mind from their father. her husband’s ambition caused the deaths tions of today: The creation of the age of the 24-hour news cycle that are the In a sad illustration of this instability, of their children. Can you imagine being a state of Israel, the Cold War, the So- most compelling in this 300-plus-page Wead tells of the confusion he experienced fly on the wall in their dining room? No viet defeat in Afghanistan, the Gulf book. Written in themed chapters — such researching their many marriages and di- elected office — not even the presidency — War, and the Sept. 11 attacks. More as Triumphant Sons, Unfulfilled Promises, vorces. Ultimately, the FDR Presidential is worth that pain. on the Internet at www.random and Resilient Women — Wead introduces Library confirmed that the Roosevelt rela- Wead is a good storyteller who packs a house.com/modernlibrary. us to children from different families and tionship train wreck consisted of 19 mar- lot into each chapter, making this a page- eras who shared common experiences, riages among the five children. Seven mar- turner. Savor the impact by reading a sec- • “Liberals’ loyalty to the United shortcomings, and outcomes. It’s an appeal- riages and divorces occurred while FDR tion or two and then taking a break. States is off-limits as a subject of po- ing approach and more enlightening than was in office. Even worse, one Roosevelt If your interest is peaked about some- litical debate. Why is the relative pa- a predictable administration-by-adminis- spouse committed suicide and another tried one specific, like mine was about the triotism of the two parties the only tration list of life’s winners and losers. This to do the same. Roosevelts and Pierces, check out the ex- issue that is out of bounds for ratio- emotional connection adds context to facts Scandals and controversy were recur- tensive bibliography and source notes. nal discussion?” Syndicated colum- and figures gleaned from traditional White ring family themes over the years. But You’ll find plenty of reading to keep your nist Ann Coulter asks that question House biographies and historical reviews. thankfully, at least one child finally estab- nightstand stacked for months. CJ in Treason: Liberal Treachery from the Cold War to the War on Terrorism. She contends that liberals have been Book Review wrong on every foreign policy issue, from the fight against communism at home and abroad, the Nixon and the New White Nationalism Shows Need for Openness Clinton presidencies, and the struggle with the Soviet empire up to today’s war on terrorism. “Liber- • Carol M. Swain: The New White National- by whites have black victims. groups and their recruitment strategies. als have a preternatural gift for al- ism in America: Its Challenge To Integration; According to Swain, the actual number Black and Hispanic emphasis on group ways striking a position on the side Cambridge University Press; 2002; 526 of white hate groups is in question because pride, group self-determination, and of treason,” says Coulter. “Everyone pages, $30. of differences in classification by watch multiculturalism have provided white na- says liberals love America, too. No, groups. As of 2000, the Southern Poverty tionalists with justification for advocating they don’t.” Learn more about her By WALTER E. WILLIAMS Law Center, for example, puts the number parallel forms of white solidarity seeking to June release at www.randomhouse. Guest Contributor at 554. Experts differ as to the threat posed protect white interests. com/crown/. ARLINGTON, VA by groups such as the Ku Klux Klan, Aryan In fact, David Duke formed the first arol Swain teaches political science Nation, and Skinheads. Some suggest that National Association for the Advancement • In his bestselling More Guns, and law at Vanderbilt University. liberal watch groups might overstate hate- of White People in response to his college Less Crime, John Lott proved that C In The New White Nationalism, she group threats in order to enhance their fund- experiences. He became upset because guns make us safer. Now, in The Bias warns about the growing “white national- raising opportunities. Swain nonetheless whites were not allowed to express racial Against Guns: Why Almost Everything ist” movement in contemporary America sees them as significant threats and an im- pride while blacks faced no condemnation You’ve Heard About Gun Control is that she says threatens racial harmony. portant wakeup call for Americans to re- for doing so. One of the most important Wrong, Lott shows how liberals bury Swain argues that over the last 10 years, examine policies and truthfully confront parts of Swain’s book is her discussion of pro-gun facts out of their own bias. this new white consciousness movement racial issues. what needs to be done. Mainly there must Lott refutes gun critics and shows: has gained strength by exploiting white I agree. Professor Thomas Sowell, who be open and honest discussion of racial how TV talking heads promote gun resentment over racial preferences and has written extensively on matters of race, issues in academia and the political arena. control in the guise of “news;” how double standards favoring blacks and other has frequently pointed out that multiethnic She says that one of the reasons for the reporters “spike” pro-gun stories; minorities. The movement has also exploited societies are inherently unstable. “Group avoidance of honest discussion in the po- how government statisticians “cook” white anger over soaring inter-racial crime polarization has tended to increase in the litical arena is “not to offend the affluent data for the antigun lobby; and why rates where, according to FBI 1997 statistics, wake of preferential programs, with non- blacks in the Democratic Party coalition.” “assault weapons bans” and “gun of about 1,700,000 violent interracial crimes preferred groups reacting adversely, in ways All in all, I recommend Swain’s book as show” regulations are counterpro- involving blacks and whites, 90 percent ranging from political backlash to mob vio- worthwhile reading. CJ ductive. Want the facts? John Lott has were committed by blacks against whites. lence and civil war,” Sowell said. them. More information available at Fifty-six percent of violent crimes commit- Swain agrees with Sowell’s findings, ted by blacks have white victims, whereas saying that racial preferences create a made- Walter E. Williams is professor of economics at www.regnery.com. CJ only 3 percent of violent crimes committed to-order grievance for white nationalist George Mason University. June 2003 C A R O L I N A JOURNAL Learning Curve 19 Book Review Bountiful Harvest Separates Wheat From Chaff in Environmentalism

• Thomas R. DeGregori: Bountiful Harvest; what mankind has done on a hit-or-miss paralyze society and stifle progress, but it Cato Institute; 2002; 207pp.; $12.95 basis for thousands of years in breeding appeals to people who think in simple slo- better crops, has come under attack by gans. By GEORGE C. LEEF groups of Luddites who fear (or at least While on the subject of simple slogans, Contributing Editor claim to fear) that we are somehow creating how about this one: Organic is better. The WASHINGTON terrible “Frankenfoods.” organic-food movement has spread widely s I begin this review, Earth Day has For example, DeGregori mentions the over the last two decades, but DeGregori is just passed. As usual, the airwaves breakthrough of using genetic modifica- skeptical of its claims. “Organic” farming A and newspaper were filled with tion to create rice plants that produce vita- disdains the use of “synthetic” fertilizers, outlandish statements by self-proclaimed min A, which would be a great benefit to preferring those that are “natural.” environmentalists that unless we immedi- many of the world’s poor who have vitamin But the author observes that “urea is ately and drastically change our ways, there A-deficient diets. Unfortunately, he writes, urea and it is H2N X CO X NH2, whether in will be misery for all living things on Earth. “The potential benefit of vitamin A-enriched fertilizer or manure…Unfortunately, the Naive adults and impressionable children rice to the world’s most needy people has living properties in organic agriculture may received an increased dose of the not been sufficient to deter Greenpeace from well be the greater endowment of harmful technophobic hysteria that is now a regular attempting to disrupt the effort…to make it microorganisms that they contain.” A high part of their lives. available to the farmers of Asia.” He quotes percentage of cases of e coli cases come Fearmongering is easy and often prof- the bitter words of Florence Wambugu, a from “organic” produce. People may get a itable. Debunking of the claims of fear- distinguished scientist and director of the warm feeling of togetherness with nature mongers is much more difficult and usually International Service for the Acquisition of from eating “organic” food, but they may not so profitable. Hack writers can readily Agri-Biotech Applications, who called op- also get sick. toss off books and stories proclaiming im- position to gene technology a “northern Oh, and by the way, our current infatu- minent disaster and find mass markets for luxury.” ation with “natural” living is not particu- them, while refutation of falsehood both DeGregori launches an equally forceful larly new. DeGregori has the bad manners takes longer and is harder to sell. That is attack on a cornerstone of green, to show that the Nazis also embraced that why we owe a special debt to the dedicated ments of the population.” What makes him technophobic thinking, namely the “pre- ideology, favoring vegetarianism and or- truthseekers who work at the latter. One of angry is the fact that technophobic babble cautionary principle.” This principle says ganic agriculture as integral parts of the them is Professor Thomas R. DeGregori, has harmful, even deadly consequences for that risks are unacceptable. If an environ- “new, pure civilization that was to be whose book Bountiful Harvest is a marvel- people. mental or technological change could con- Germany’s future.” ous counterattack against the technophobes Food is one of the book’s main topics. ceivably lead to any harm, then it must be DeGregori’s conclusion regarding the and environmental doomsayers. Well-fed Americans and Europeans don’t opposed. In other words, humans should similarities between Nazism and contem- Even while science was making pos- need to worry about getting enough nutri- not act unless they have perfect foreknowl- porary environmentalism is a good sum- sible unprecedented gains in human life tion, but in other regions of the world, espe- edge of all possible consequences of their ming up point. spans and the comfort of living in the 20th cially Africa, the struggle to get enough to acts and can therefore say with certainty He writes, “An apocalyptic view that century, noisy and ignorant opponents of eat is as acute today as it was centuries ago. that there would be no adverse conse- the earth is threatened with imminent de- progress were working to convince people Genetic modification of crops holds the quences. struction absolves one from having to un- that progress was actually illusory and that promise of making it possible to feed popu- DeGregori writes, “This may sound like derstand the consequences of one’s actions, disaster was lurking just around the corner. lations in poor areas by making plants more a prudent course of action, but it would in since the good of saving the planet cleanses As DeGregori, who teaches economics at drought-tolerant, pest-resistant, and nutri- fact hold public policy hostage to those any wrong that one may do in saving it.” the University of Houston, puts it, “The tious. with vivid imaginations who are most vo- That indeed is the mindset of our alleged dangers of modern life have be- Alas, genetic modification, which cal in proclaiming their phobias.” This so- technophobes and this book is a welcome come conventional wisdom to large seg- DeGregori notes is simply doing precisely called principle would, if taken seriously, rebuttal to it. CJ Book Review Rand’s The Fountainhead: 60 Years Later and Still Going Strong

¥ Ayn Rand: The Fountainhead; Dutton/ lies in her characters. Each character, from at all costs, the essence of human nature. call yourself selfish. Plume, 1994; 736 pp; the heroic emblem of individualism, While attending the university, Roark If Roark is Rand’s embodiment of ob- Howard Roark, to the despicable collectiv- is surrounded by the past in all its classical jectivism, Ellsworth Toohey represents the By PAUL MESSINO ist Ellsworth Toohey, gives life to Rand’s glory. Everywhere around him Roark en- antithesis, collectivism. A successful writer Editorial Intern fear that one day the American ideal — the counters sycophants to the past, embodied for the leading gossip magazine, Toohey RALEIGH celebration of personal autonomy — could in his classmate — an outstanding student uses his opinion column to control the opin- he was born Alissa Zinovievna fall to collectivism. in the classical tradition — Peter Keating. ions of the masses. Toohey’s power of per- Rosenbaum on Feb. 2, 1905 in St. Rand builds her Objectivist philosophy suasion can only elevate him to the height S Petersburg, Russia. Fleeing the ef- around the novel’s protagonist, Howard Classicalists and collectivists of the collective mass. He is no individual; fects of the Bolshevik Revolution and the Roark. The reader is introduced to Roark in he does not possess the power to create or ensuing Lenin regime, Alissa chose her pen the 1920s attending a prominent tradition- Keating survives on the approval of the autonomy to survive. name, Ayn Rand at age 21 in Chicago in minded architecture school. A picturesque those around him. His skills as an architect The goal of existence cannot be found 1926. In 1943, working behind the scenes in romantic character, Roark is tall, slender, are limited to recreations of the past. And in “greatness — in other’s eyes. Fame admi- Hollywood, Rand published a few short angular, and quiet. His his success depends ration, envy — all that which comes from stories building to her May 6 publication of talent is astounding but upon gaining the ap- others.” When others are your prime con- The Fountainhead, her first attempt at com- overshadowed by his proval of those in cern, you forget about the most influential bining the narrative power of the novel more predominant power, an ability person in your life, you. But, this is not to with a sophisticated philosophical outlook characteristic, an unwa- Keating mastered over say that life is void of social roles and re- influenced by her exposure to early com- vering commitment to the course of his life. sponsibilities, far from it. We are, of courses, munist Russia. Sixty years later, America personal integrity. As a foil to Roark, social creatures. Being social creatures, how- celebrates Rand’s Objectivist philosophy Rand’s literary con- Keating shows that true ever, does not mean self-sacrifice for the that brought life to The Fountainhead. struction of her charac- success is achieved by philanthropic preservation of others. The power of Rand’s philosophy ma- ters parallels Roark’s a commitment to the Society for Rand consists in indepen- tures in her crowning literary achievement, anticlassical architec- growth of personal in- dent men interacting for their own benefit. Atlas Shrugged. This 1,000-page-plus novel tural principles. Roark tegrity. No individual has the ability to be totally was recently named the second most influ- believes that each edi- “Integrity,” as self-sufficient. Sometimes we need others ential book, under the King James version fice constructed must be Roark says, “is the abil- to complete ourselves. of the Bible, by a Library of Congress na- unique, precise, and ity to stand by an idea,” Rand late in her career said in a televi- tional survey. true. There is a sense of at all costs. To truly sion interview when asked whether she Rand’s philosophy is known as Objec- autonomy for each place value in human feared death, “I will not die, the world will tivism, the belief that all knowledge can be building. This au- nature is to be relent- merely end.” This is the Objectivist mind: rationally apprehended through observable tonomy epitomizes less in asserting “man’s striving, accomplishing, and living as if the Author and philosopher Ayn Rand facts. Rand’s objectivism hinges on a ratio- beauty. Roark defines right to the pursuit of whole world was their existence. The Foun- nal being’s ability to comprehend and inter- beauty as that characteristic which displays happiness. His own happiness; not anyone tainhead will pull you into a world where act in the world by maintaining personal a natural tendency to remain independently else’s...” This is the essence of objectivism, the human mind is celebrated above all integrity and autonomy throughout life. true to its nature. Similarly for Rand, hu- to live life under your own choices, to be else, and it will leave you believing in the The connection between Rand’s objec- manity is beautiful when people live lives free of the burden of society and to not, wonderful and awe-inspiring potential of tivist philosophy and her rhetorical skill that promote reason and personal autonomy because of this freedom, feel ashamed to the individual. CJ June 2003 C A R O L I N A 20 Opinion JOURNAL

Radical Surgery For Medical Suits

hould North Carolina reform its medical malpractice lawsuit laws? Physicians and S insurers say yes, arguing that exorbitant and arbitrary awards for “pain and suffering” are driving insurance costs higher. Nationally, from 1994 to 2000, jury awards tripled. For all but two of the last 12 years insurance claims have been greater than premi- ums. In 2002 insurers paid out $1.65 for every dollar received. The higher insurance rates al- legedly generated by these trends are cited as a reason why insur- ers have left some markets and why some doctors have left certain special- ties such as obstet- rics-gynecology, where awards and premiums have skyrocketed. Based on re- budget also broke an earlier promise to give a tax break to search by the U.S. Editorials families with children and to married couples. Department of • Local-Government Larceny. During the 2001-03 bi- Health and Hu- ennium, Easley seized hundreds of millions of dollars in man Services, the tax reimbursements to localities. To help local govern- TALKING THE TALK ments patch the holes in their budgets, the General Assem- American Medical Dr. Roy Cordato Society has catego- bly agreed to let cities and counties enact their own half- rized North Caro- But Easley incapable of walking the walk cent sales tax increases. For some localities for which the lina as in a “state of crisis.” According to HHS new taxes wouldn’t replace the withheld revenue, the data, from 2001 to 2002 North Carolina had a 50 administration agreed to make up $23 million in “hold percent increase in premiums for medical spe- en use thought only as authority for their injustice, harmless” payments. As mentioned, Easley soon reneged cialists, the eighth-highest in the country. and employ speech only to conceal their thoughts.” on that promise, too, in his 2003 budget proposal. According to the North Carolina Medical M — Voltaire (1763) • Lottery Lunacy. Easley included $250 million for a Society, insurance premiums for hospitals in the Pondering Voltaire’s aphorism, politically astute North state-run “education lottery” in his 2002 budget adjust- state have risen by more than 400 percent in Carolinians would consider Gov. Mike Easley the perfect ments. The problem was, no lottery existed. A back-door three years. Last year, rates for rural hospitals embodiment of hypocrisy. What you see, or in Easley’s measure to introduce a game failed to pass legislative rose by 180 percent. case, what you hear, is definitely not what you are likely to muster. Even so, the proceeds were not necessarily limited The American Association of Neurological get. to new education spending, as originally promised. Surgeons has designated North Carolina as a In the modern era, though, the governor most likely • “Clean Smokestacks” Smokescreen. In 2002 Easley state in “severe crisis” for neurosurgeons. A could be characterized as an adherent of the crassly dema- crowed about legislation and an agreement with power “severe crisis state” is one that has had either a gogic Bill Clinton school of thought rather than of the companies that required them to install updated antipollu- “50 percent increase in premiums from 2000 to purely logical French philosopher’s. tion devices on smokestacks. By using a magical account- 2002, or average premiums near or over During the 1990s graduates of the Clinton school be- ing technique, i.e, a five-year freeze on rates, Easley said, $100,000.” came master blacksmiths who pounded truth into what- consumers would not pay more for electricity. Missing In the General Assembly legislation has been ever shape suited their political objectives. Easley wields from Easley’s announcement was the fact that rates actu- proposed, the centerpiece of which is to cap pain the hammer in North Carolina. Sen. John Edwards carries ally would have decreased without the legislation and that, and suffering awards, i.e. damages for psycho- it in Washington. Secure in office, they are liberals. Vulner- according to research by the John Locke Foundation, there logical trauma and stress, at $250,000. able near election time, they become “moderates.” would be no significant environmental benefit. The problem with this is that any legisla- Rhetoric aside, Easley’s record as governor speaks • Economic Development. Ten months after taking tively imposed cap will necessarily be arbitrary. volumes about his shell-game shenanigans. The evidence office in 2001, Easley, apparently eager to show he had an Ideally, pain and suffering awards should re- lies in a lengthy list of injustices: economic development strategy, began making announce- flect actual harm, but there are no standards. • Highway Robbery. Easley has treated the Highway ments of business openings in North Carolina. Unfortu- Juries are often influenced by the plaintiff’s Trust Fund as a slush fund to buoy the General Fund and nately, most of the developments for which Easley took personal appeal or the deep pockets of a defen- to use in ways that were not intended. His recently passed credit were bogus. Many of Easley’s announcements came dant. Instead of arbitrary caps, Professors Jo- “Moving Forward” legislation will take $700 million in many months after the openings had occurred, and several seph Newhouse and Paul Weiler at Harvard bond authority approved by voters for new-highway con- of those arrivals were by companies that had planned to University argue for a damage scale “contain- struction and transfer it to road improvements, mainte- come to the state long before Easley took office. ing standardized injury profiles and specific… nance — and mass-transit projects. Employing a bait-and- • More at Four. Budgeted at $6.5 million in its first amounts that will govern the… juries’ appraisal switch tactic, Easley siphoned from the trust fund revenue year, More at Four was started as Easley’s signature pro- of particular claims.” This would make awards that motorists paid in higher taxes on gasoline, car sales gram in response to a court order requiring the state to offer more rigorously determined and consistent from taxes, and other fees. prekindergarten to at-risk children. Warning of catastrophic case to case. • Fleecing of Golden LEAF. Originally sold to the results if at-risk children weren’t given a head start, Easley In addition to “pain and suffering” reform public as a benevolent and independent nonprofit dedi- persuaded the legislature to provide funding through two the state should consider implementing a policy cated to health care and antismoking programs, Golden years of tough budgets. of “loser pays” where a plaintiff who loses a case LEAF in practice bends to the political manipulation of Now the state can’t find enough parents willing to would pay the legal fees of the defendant. The Easley and Senate President Pro Tem Marc Basnight. Al- enroll their children in the program. More than one-third of system often favors reaching a settlement even ready, the men have pressured the foundation’s board to More at Four’s $36 million budget has gone unspent and if the defendant would be acquitted. For ex- “invest” $85.4 million for “Democratic initiatives” of bio- the program is 2,200 pupils short of its 7,600 goal. Unde- ample, if it would cost $75,000 to defend against technological research and stimulation of the state’s terred, Easley wants to expand the program to 10,000 a lawsuit, the defendant would settle out of economy. Long term, the foundation plans to commit an children and the budget to $43 million. court for any amount less than that. Therefore, additional $108 million to biotechnology and millions of Starting with this year’s State of the State Address, some suits are brought even if the odds of win- other dollars to programs outside the organization’s origi- Easley appeared to be a man on a mission to get re-elected. ning in court are low. A loser-pays policy would nally stated mission. His speech that night included moves toward the middle discourage frivolous lawsuits and false accusa- • Tax-Hike Mike. Despite prior assurances he would ground, such as his proposal to index government spend- tions. not raise taxes, Easley’s administration, if anything, has ing. Medical malpractice reform should be a been punctuated by incessant tax increases. In 2001 the And for the first time, he seemed to acknowledge that high priority, but legislation being considered governor signed into law nearly $700 million in annualized spending, by the legislature — not tax cuts in the 1990s — focuses on cosmetic fixes and ignores root causes. tax increases. In 2002, he proposed a $400 million tax hike lay at the root of the state’s recent budget deficits. Whether A sound legal system that fairly redresses griev- and eventually signed a $343 million increase. And in 2003 the governor was serious, or intends to persevere after the ances is a right of both potential plaintiffs and Easley proposed $461 million in higher state or local taxes election, remains to be seen. defendants. The right reforms will ultimately (the latter due to imposing another hit on local government With a track record like his, Easley could hardly blame lead to better health care at lower costs. CJ budgets). His latest plan reneged on earlier promisse to let voters for doubting his credibility. He certainly talks the the previous income and sales tax increases expire. Easley’s talk, but he continually fails to walk the walk. CJ June 2003 C A R O L I N A JOURNAL Opinion 21

correct, then parents and teen-agers cannot blame (and, of course, sue) Big Food for their flabby fate. They would have ABUSING SCIENCE to take responsible for their own actions — or, in this case, inactions. So the “supersize value-meal theory” of teen- Chicken Littles on Political agenda warps academic debate age obesity, whatever the lack of underlying data, must continue to shuffle and grope its spooky way across the public policy landscape. Welfare Are Silent Until the governmental busybodies and trial lawyers rthur Koestler, author of Darkness at Noon and figure out a way to sue Big Video. hose politicians, activists, scholars, and jour- notable post-Communist man of letters, once ob- In conclusion, here’s a bonus Arthur Koestler quote nalists who issued dire warnings in the 1990s A served that “commitment to a scientific theory can relevant to the discussion: “Statistics is like a bikini. What Tabout the calamitous impact of welfare re- be as charged with emotion as a religious credo.” Anyone they reveal is suggestive. What they conceal is vital.” form on poor families have yet to offer a coherent who has seen social scientists, in particular, make the case explanation for how wrong they were. As many are for their favorite hypothesis about this or that will recog- the same who more recently predicted a “quagmire” nize the wisdom in Koestler’s remark. for coalition troops in Iraq, perhaps they simply The public policy landscape is littered with corpses of don’t perceive the need to defend past predictions. “scientific” hypotheses that manage to continue stagger- ON PARENTING Actually, there have been some halfhearted ra- ing around, like zombies, animated not by supporting data tionalizations. Some have attempted to credit eco- but by the fervent insistence of their masters that “it must Legislators have mixed feelings on lending nomic growth alone with the massive decrease in be true, it just has to be.” welfare recipiency, and decline in overall poverty, One thinks of 100-proof Keynesian economics. In the that America has experienced in the wake of the 1930s it was revolutionary. In the 1950s it was orthodoxy. couple of years ago, it was fashionable in the North (relatively modest, in my view) welfare reforms en- By the 1970s it was outdated inanity — among those with Carolina General Assembly to think so ill of pay- acted during the past decade by a Democratic presi- a willingness to examine actual data in the actual world. Aday lending that it deserved little more than a dent, a Republican Con- Of course policymakers couldn’t maximize prosperity, as quick death. Now, according to a large majority of mem- gress, and many of their Keynesians had advocated, by stimulating the economy bers of the N.C. House, it’s time to bring payday lending colleagues among the with easy money and restraining inflation with higher back? nation’s governors and taxes. Inflation had to be tamed with tight money and What gives? legislatures. growth-enhancing tax cuts (thus creating fewer dollars Well, the reality is that actual North Carolinians, quite I’d say this was a chasing more goods). Despite political huffing and puff- apart from their would-be protectors in political life, find good try, but it really ing since the early 1980s, pretty much all political actors the convenience of a short-term loan against their next isn’t. agree with this policy mix now, and disagree only on de- paycheck to be worth the expense. We’ve gone through tails (no serious Democratic presidential candidate, for ex- In the face of the state’s punitive regulation, much of many economic cycles of ample, would boost the top income tax rate back to 50 per- the payday-lending industry simply went on as before, boom and bust. There’s a John Hood cent, the pre-1986 level, or to 70 percent, the pre-1981 level). with national quick-cash firms claiming exemption from lot of data, going back More recent and closer to home, our colleague Dr. Roy the new rules by partnering with banks chartered in other decades, that allow one to test whether poverty rates Cordato has pointed out that a key assumption of envi- states. and welfare dependency are simply products of gen- ronmental activists about ground-level ozone — that when Rep. Bill Culpepper, a Chowan County Democrat, in- eral economic trends. They aren’t. Welfare rolls it spikes, people prone to asthma must suffer significantly troduced a bill in the General Assembly this session to re- soared even during the prosperous years of the more — sounds plausible but is not evident in the data. store the ability of North Carolina companies to compete 1960s and early 1970s. The growth spurt of the 1980s Cordato found in a recent study that North Carolina com- in the payday lending market. In selling the idea to the had only modest impacts on dependency. munities with high ozone levels actually displayed low House (it passed in May on a 79-32 vote), Culpepper ar- The main factor explaining the unique trends asthma-hospitalization rates, and vice versa. Perhaps the gued that the re-entry of local competitors to the national of the 1990s, as Heritage Foundation analysts Rob- links between ozone and asthma are so subtle that they chains would help to drive down interest rates and im- ert Rector and Patrick Fagan demonstrated in a re- are hard to find, but that’s the funny thing about science: prove service. cent paper, is policy change. Work requirements, It’s supposed to be about data, not rationalizations or wish- Someone’s been reading his economics, lately. Who time limits, and other welfare reforms — even when ful thinking. knew state legislators had the time — or inclination? imperfectly enforced — have changed behavior. Opponents of the bill continued to argue that it would They have led to the real work experience that, more “No matter what the data say” legalize a practice abusive to young and low-income work- than education or anything else, is the key to build- ers, citing extrapolations of the annualized interest rate ing the human capital poor people need to improve Another classic example materialized in May. It seems from some of these transactions. The numbers can be mind- their lot. that a UNC-Chapel Hill researcher, Lisa Sutherland, just boggling, with the clear implication that it is appropriate Now there’s another inconvenient fact for the completed a significant study attempting to explain why for state lawmakers to forbid such loans to protect against welfare Chicken Littles to attempt to explain way. obesity rates among teen-agers have risen over the past usurious returns. According to a recent Christian Science Monitor re- generation. Contrary to the conventional wisdom, This is paternalism, served straight up. We admit to port, there has been a sizable decrease in the con- Sutherland found that teens had not been consuming sig- some concern about some of these lending practices, to the centration of poor families in America’s cities dur- nificantly more calories. From 1980 to 2000, caloric intake extent that they employ confusing and misleading claims ing the past decade. went up only 1 percent. The real problem, she found, was and contractual language to defraud desperate borrowers. During the 1990s, the Monitor found, the num- inaction. Average physical activity dropped by 13 percent, The government has a legitimate role to play in ensuring ber of poor people living in high-poverty areas fell while obesity shot up by 10 percent. that market exchanges are free of force and fraud. by 24 percent — or 2.5 million. Among blacks, it Careful readers of obesity statistics, not just of the con- But our experience is that most users of payday lend- dropped from 30.3 percent to 18.6 percent. For His- ventional wisdom contained in the latest womens’ maga- ing know exactly what they are doing. Lacking easy ac- panics, it dropped from 21.2 percent to 13.8 percent. zine cover, would not have found Sutherland’s conclusion cess to credit cards or a savings account, they view pay- Among American Indians, it fell from 30.6 percent shocking. The national debate about obesity has long been day lending as an attractive way to handle cash-flow prob- to 19.5 percent. fraught with the misuse and misunderstanding of basic lems that would otherwise lead to checking-account fees The overall poverty rate declined during the facts. For instance, data from the U.S. Department of Agri- even larger than the lending fee. No doubt a few of these 1990s, from 13.1 percent to 12.4 percent. Child pov- culture show that the average caloric intake of Americans borrowers overuse the service and become trapped in a erty, especially among blacks, has been falling for — 2,344 a day for men, 1,638 for women — is significantly cycle of debt. Most do not. several years. below the recommended daily intake levels for the aver- Another way of putting all this is that there’s age man (2,538) and woman (1,982). If there is a huge and A case not just of bad legislating been a decline in housing segregation by class, and growing obesity epidemic, it must be coming from our apparently, by race as well. couches rather than our curly fries. Here’s the dividing line between advocates of limited How come? Again, it’s very difficult to attribute Speaking of curly fries, the reaction of the nutritionist government and advocates of expansive government. The the trend to the general economic cycle. A likely ex- establishment to Sutherland’s paper has been telling. Many former think that responsible citizens in a free society can planation, as the article explains, is that welfare re- observers have dismissed the finding on calories by claim- and should take responsibility for their own actions. The form led to many recipients exiting poverty-stricken ing that the survey data she used, all from familiar federal latter think, well, that’s just too mean. They think that gov- neighborhoods to look for jobs, in some cases leav- surveys, must be wrong. They offered no proof. Instead, ernment-as-parent should swoop in to bail out the unwary. ing stagnant urban areas in the Northeast and Mid- they have started reanimating the zombie. “We are pretty The problem is, the proposed intervention — to forbid west for more promising climes. sure [teens] are eating too much, no matter what the data payday lending practiced deemed too disadvantageous to Having found these jobs, they’ve been able to say,” said Dr. Nancy Krebs of the University of Colorado borrowers — isn’t just bad economics or bad legislating. establish residency in more mixed neighborhoods Health Sciences Center in Denver, who chairs a national It’s bad parenting! where their children are likely to be exposed to bet- pediatricians’ committee on nutrition. Thank you for your Learning often comes after painful mistakes. The par- ter role models and soak up better values. Their candor, Madame Chairwoman. ent who shields children from the consequences of such exposure to crime has been lessened, and to better- And don’t forget the political angle here. Clinical nu- mistakes inhibits their growth in knowledge and judgment. quality schools and other public services has been tritionist JoAnn Hattner of Stanford University told the AP In the case of personal finances, most of us have learned enhanced. that accepting Sutherland’s conclusion that food is not a what to do and what not to do by screwing up one or more Oh, the humanity. CJ big part of the problem could take pressure off food com- times. That’s just one example of how human beings thrive panies to cut the calories they feed the nation. “There is when they have choices. Properly understood, paternal- enough clamor throughout the country that we are get- ism should embrace personal freedom and personal re- Hood is president of the John Locke Foundation, pub- ting corporations to change,” Hattner said. “We need to sponsibility rather than trying to smother them. lisher of Carolina Journal, a syndicated columnist, and continue that clamor.” We’re not suggesting that payday borrowers are chil- host of “Carolina Journal Radio,” coming soon to a radio Here’s where the science disappears and the politics dren. That’s how the would-be payday prohibitionists view station near you. takes over. Think about it. If Sutherland’s conclusion is them — children who should never have to grow up. CJ June 2003 C A R O L I N A 22 Opinion JOURNAL

Editorial Briefs

Local ‘halls of fame’ multiply

As if multimillion-dollar sports arenas were not enough, taxpayers in cities and towns across America are being hit up for funds to build local “halls of fame.” Sponsors promise that the halls will instill civic pride, bring in tourist cash, and create jobs. But economists warn civic boosters not to count on the promised economic and job benefits. Some of the projects under consideration would be laughable, if they were not so wasteful and ex- pensive, critics say. Boosters in Buffalo, N.Y., want townspeople to build a $10 million National Com- edy Hall of Fame. A group of ukulele enthusiasts are trying to establish a Ukulele Hall of Fame — not in Hawaii, but in New England, of all places. The millions needed to build these pop-culture palaces are just the beginning of the expenses. Rev- enues from admissions are necessary to keep them open and operating. But experience has shown that visitor rates tend to decline after the first several years. That leaves critics warning promoters that: “If you build it, they’ll eventually stop coming.” Reported in the Wall Street Journal. North Carolina’s Spending Soared in 1990s

GED recipients falter in college By MICHAEL L. WALDEN these percentages for the governmental spending catego- Contributing Editor ries to gross state product in fiscal 1999-2000. The results General Equivalency Degrees help identify RALEIGH were governmental spending in 1999-2000 if each category’s people without a high school degree who have the ow did North Carolina get into such budget prob- relative share of gross state product remained at 1992-93 motivation and cognitive ability to pursue opportu- lems” is a frequent question asked among public- levels. I then compared these spending amounts to the nities that require a high school education. H policy thinkers and regular citizens during the actual spending amounts in 1999-2000. GED recipients, however, should not be com- past couple of years. Although many factors contributed, The results were very informative, and a bit surprising. bined with regular high school graduates in educa- clearly an important one is that North Carolina spent an Education, transportation, government administration, and tional statistics, says Jay Greene. increasing share of its income on government functions in debt interest each had actual spending in 1999-2000 that “We should not suggest to people seeking the the 1990s, and when the economic slowdown and recession was less than the spending they would have had if their GED or their prospective employers or admissions came in 2000-2002, the high level of spending share, or percentage, of gross state product committees that the GED is equivalent to a regular could not be sustained. remained at 1992-93 levels. Transportation was high school diploma,” he says. Here are the details. North Carolina’s the biggest loser, spending $187 million less, Although the GED gives students a chance at a economy experienced tremendous growth in followed by government administration at post-secondary education, most GED recipients have the 1990s. After the recession in the early part $110 million less, education at $96 million less, difficulty succeeding at the next level. Almost 75 of the decade, total income in the state (so- and debt interest at $2 million less. percent of GED recipients who enroll in community called “gross state product”) grew by a whop- Conversely, the “winners,” with actual college fail to complete their program. About 44 ping 63 percent, or 42 percent after inflation. 1999-2000 spending greater than the spending percent of regular high school graduates fail in This works out to be a 5 percent annual growth they would have had if their share of gross community college. rate in inflation-adjusted income, truly a re- state product had remained at 1992-93 levels, In a four-year college the prospects for GEDs are markable performance. were health care and welfare (plus $1.4 bil- worse. Ninety-five percent of GED recipients who Certainly the larger economy of North lion), environmental spending (plus $265 mil- enroll in a four-year college fail to finish, compared Carolina could support more government lion), and public safety (plus $52 million). to 25 percent of high school graduates. spending. In fact, we would expect govern- One use of these results is to pinpoint Given that the GED process does not require a ment spending to rise with economic growth, segments of government spending in North Michael L. Walden significant amount of time learning material, does as a larger economy requires more highways, Carolina that have grown substantially faster not require students to be disciplined and have a more police officers, more school buildings than the overall economy. Some of this addi- strong work ethic, and does not demand high aca- and teachers, etc. tional spending may have been by design. For example, the demic achievement, we should not expect to find A generous measure of government spending relative increased environmental and public-safety spending is that receiving a GED, on its own, makes a big differ- to the size of the economy is government spending divided probably a reflection of increased citizen concerns in these ence in the life-outcomes of its recipients, Greene by gross state product. Again, gross state product is simply two areas. says. the dollar value of all income produced in the state in a The results clearly show that any effort to restrain the Researched by Jay Green, “The GED Myth,” given time period, such as a year. Dividing government growth in state spending must address spending in health Spring/Summer 2002, Texas Education Review. spending by nominal (unadjusted for inflation) gross state care and welfare. Spending in this category increased more product will allow government spending to rise with infla- than 40 percent faster than growth in the economy during Steel tariffs damage the economy tion and with increases in the standard of living (termed the 1990s. Efforts to introduce automatic incentives for real economic growth). users to spend health care and welfare resources more A little over a year ago, President Bush made a At the beginning of the economic expansion of the frugally would be a good starting point. serious mistake by imposing tariffs on imported 1990s, in fiscal 1992-93, total state and local government Conversely, the finding that the share of the economy steel. As a result, many other industries were forced spending in North Carolina, exclusive of federal govern- devoted to transportation spending fell in the 1990s is at to sacrifice far more than steel producers made. ment grants and aid, was 11.5 percent of gross state prod- least one explanation for the apparent increase in frustra- The higher steel prices resulting from import uct. By the end of the decade (fiscal 1999-2000) it had tion with traffic congestion in the state. A larger economy restrictions have encouraged producers to expand climbed to 12 percent of gross state product. creates more road travel, and the simple fact is that North even though world steel capacity is far greater than “Big deal,” you might say, government’s take of the Carolina’s spending on transportation has not kept pace needed. In short, tariffs have done more to prevent private economy in North Carolina increased by one-half with economic growth. restructuring than bring it about, which has affected of 1 percent during the boom years of the 1990s. This Certainly this analysis is not the final word on govern- the whole economy. sounds like peanuts, or to keep the analogy in monetary mental budgeting and spending in North Carolina. Some In February, the Consuming Industries Trade terms, cents. will argue that today’s modern, complex economy requires Action Coalition, a business group, published a But hold on to your chair. If state and local government a higher percentage of income be devoted to government as study showing that about 200,000 jobs were lost spending in North Carolina had been kept at 11.5 percent the economy grows, while others will argue just the oppo- among steel users, while there are only 187,000 total of gross state product in 1999-2000, rather than the actual 12 site. However, step one in analyzing any issue is establish- people employed in the steel industry. percent, governmental spending would have been $1.3 ing the facts. The simple fact is that the share of North Sixteen states lost at least 4,500 jobs, including billion lower! Clearly, such a lower rate of spending would Carolina’s economy devoted to government increased in California (19,392), Texas (15,826), Ohio (10,553), have allowed governments in North Carolina to avoid a the 1990s. But equally important, there was also significant and Michigan (9,829). large part, if not all, of their budgetary problems during the redistribution in the allocation of those resources across The motor vehicle industry lost $7.6 billion, past three years. government functions during the decade. CJ industrial machinery lost $2.5 billion, and the fabri- We can be more specific and pinpoint what kinds of cated metal products industry saw profits fall from government spending most increased their share of the $9 billion in 2001 to $5.8 billion last year. state economy during the 1990s. Here’s how this is done. Michael L. Walden is a William Neal Reynolds distinguished Reported by the National Center for Policy First, I calculated the percentage of gross state product professor in the Department of Agricultural and Resource Eco- Analysis. CJ spent on various governmental categories (education, wel- nomics at North Carolina State University and an adjunct fare, transportation, etc.) in fiscal 1992-93. I then applied scholar with the John Locke Foundation. June 2003 C A R O L I N A JOURNAL Opinion 23

Issue of in-state tuition resurfaces A Dream for Illegal Immigrants Becomes a Nightmare for Taxpayers

By RICHARD WAGNER many American universities “when segregation was the tained a general education diploma (GED) issued in North Editor law of the land” and young Japanese-Americans who were Carolina shall be accorded resident tuition status,” the RALEIGH imprisoned with their families during World War II and legislation says. The bill currently lies in the Senate Educa- dd to the files of bad ideas that refuse to die the denied access to college. Certainly, those were grave injus- tion/Higher Education Committee. “Dream Act” and other similar measures that tices, and America today lives with the guilt of the policies Reeves’s use of the term “individual” rather than “citi- A would allow illegal immigrants to enjoy our of yesterday. zen” or “resident” and the questionable need for the bill are nation’s privileges without earning them, as American Unfortunately for the AFL-CIO, its comparison is il- tip-offs to whom would benefit from the state’s generosity: citizens have. logical. The injustices of yesteryear were suf- illegal immigrants. The Development, Relief, and Educa- fered by American citizens —c-i-t-i-z-e-n-s Again, Martin’s and Reeves’s intentions, at first glance, tion for Alien Minors Act has a noble pur- — not i-l-l-e-g-a-l immigrants. Proponents of appear to be compassionate. But are they compassionate to pose. It would enable, among other things, “social justice” programs frequently and con- taxpayers, whose children must sacrifice while the chil- the children of illegal immigrants to pay in- veniently forget to make that huge distinc- dren of illegal immigrants prosper? state tuition at colleges and allow them to tion. apply for financial assistance. The basic quali- The same movement has found its way Costly services provided for illegals fications, also, seem reasonable. Ostensibly, into North Carolina. A controversial bill filed anyone who has lived in the United States for by former Sen. William “Bill” Martin, D- Many similar ideas are finagling their way into law and five years, earned a high school diploma or Greensboro, last year also would have granted onto the backs of taxpayers with greater frequency every GED, and possesses good moral character reduced tuition for illegal immigrants, whose year. They provide ample testament to the kind of social deserves a break. numbers in the state swelled from about welfare programs that continue to drive state government’s The problem is “a break” doesn’t neces- 100,000 in 1990 to more than 400,000 in 2000. budget deficits. sarily equate with privilege, right, or justice, Richard Wagner The legislation, which died in committee, North Carolina’s outlay, and that of other states, for as some liberal activists claim. In this in- would have further widened the floodgates government services provided to illegal immigrants al- stance, justice would be in the form of yet another subsidy of state spending and exacerbated North ready has reached staggering levels. Sen. Fern Shubert, R- paid by taxpayers, who foot the bill for the lion’s share of Carolina’s budget deficit by hundreds of millions of dollars Union, who has introduced a bill that would halt the a public-college education. over a few years. issuance of driver’s licenses to illegal immigrants, esti- Let’s set aside for now addressing the insult that Ameri- mates that these services cost North Carolina’s taxpayers cans should be expected to provide more assistance to an Reeves introduces N.C. bill about $1 billion a year. Most of the expenses are incurred in illegal group of people whom taxpayers already have been the state’s over-extended criminal justice, health-care, and subsidizing heavily for years. We’ve been educating their Another measure, introduced this year in the General education systems. children, providing them with health care, and suffering Assembly by Sen. Eric Reeves, D-Wake, and co-sponsors Rather than aiding and abetting criminal behavior the injustices and associated costs wrought by the hard- Sens. Tom Apodaca, R-Hendersonville; Fletcher Hartsell, with measures such as the Dream Act, federal and state ened criminals among them. Jr., R-Concord; and Jeanne Lucas, D-Durham, apparently officials should pursue avenues that encourage legal immi- tries to succeed where Martin’s failed. Reeves, though, is gration. AFL-CIO’s illogical argument taking a lower-profile approach. His bill, consisting of one The United States could do that by increasing the paragraph, would amend the General Statutes to include quotas of immigrants it allows into the country and by Proponents of the legislation, such as the AFL-CIO, the same benefits and qualifications as the Dream Act. vigorously enforcing its immigration laws. say the United States “has a regrettable history of barring “Notwithstanding other provisions of this section, an indi- Those positive moves alone would turn violators into access to higher education for reasons of race and national vidual who has attended school in North Carolina for at law-abiding, taxpaying citizens who could fully share and origin.” They compare the plight of today’s immigrants least four consecutive years and has received a high school appreciate the benefits and burdens of a democratic gov- with that of young blacks who were denied admission into diploma from a school within North Carolina or has ob- ernment like the rest of us. CJ Letters to the editor: criticism of ADHD story; usurping Yanceyville

To the Editor, people who do not have ADHD to drop out of school, to North Carolina General Statute 153A-15 requires that have few or no friends, to underperform at work, to engage consent of the Board of County Commissioners, before As a researcher who has dedicated the past 30 years of in antisocial activities, and to use tobacco or illicit drugs land in their county can be condemned, or purchased by a my career to better understanding of Attention-Deficit/ more than normal. Children growing up with ADHD are unit of local government outside the county. There is no Hyperactivity Disorder (ADHD) and its treatments, I was more likely to experience teen pregnancy and sexually provision in this law for a corporate community within the dismayed to read your March 3 article “Grave New World: transmitted diseases, to speed excessively and have mul- county (Yanceyville) to act in lieu of the Board of County Relying on Ritalin.” ADHD is a valid medical condition tiple car accidents, and in hundreds of other ways misman- Commissioners, or to acquire property to facilitate outside supported by a substantial body of research. In her article, age and endanger their lives. authorities to act against the express authority of the county Karen Welsh failed to report on any legitimate studies Studies have consistently shown that treatment can board. The Yanceyville Town Council, not elected by vot- demonstrating the profound impact ADHD can have on an lessen the severity of these problems and enable patients to ers throughout Caswell County, cannot accept any author- individual or the significant body of research supporting live up to their potential and lead fulfilling lives. Yet ity on citizens of the county beyond the town corporate appropriate treatment. Instead, Welsh’s article included despite these serious consequences, and despite charges of limits of Yanceyville. the views of a handful of individuals who contend that overprescription of Ritalin alleged in Welsh’s article, stud- According to Gordon Bendall’s editorial in the April 23 ADHD does not exist and that its treatments are overpre- ies indicate that less than half of those with the disorder are The Caswell Messenger, the Town of Yanceyville has filed scribed. This can be contrasted against the International receiving treatment. “deeds” to two tracts of land in Caswell County on the Dan Consensus Statement on ADHD published in 2001 (Child ADHD should be depicted in the media as realistically River. One supposedly a willful sale and the other suppos- Clinical and Family Psychology Review), signed by more than and accurately as it is depicted in science — as a valid edly “condemned.” There are a number of things wrong 85 of the world’s leading scientists studying childhood disorder having varied and substantial adverse impact on with this: disorders, and supported by more than 700 scientific refer- those who may suffer from it through no fault of their own (1) The record shows that they are attempting to ac- ences. Noteworthy is that none of the so-called experts or their parents and teachers, and one for which effective quire these properties on behalf of Roxboro-Person County interviewed by Ms. Welsh have published any scientific treatments are available, and should be administered with- in a conspired effort to circumvent the intent of N.C.S.G research on ADHD and possess no recognizable scientific out criticism. 153A-15 and nullify and block the authority of the Caswell standing in this field. They were obviously chosen merely Russell Barkley, Ph.D. County Board of Commissioners. Clearly what is going on and exclusively for their opinions against this disorder and Professor here is far bigger than water from the Dan River. It concerns its treatment. Medical University of South Carolina every county commission and citizen in North Carolina. Such reports like those of Ms. Welsh give the public the Charleston, S.C. Are N.C. county commissions to remain relevant and to impression that there is cause for concern over prescription what degree? Will the Caswell County Board of Commis- of ADHD treatments. The idea that medicating those af- Caswell County a victim of ‘piracy?’ sioners fight it? All they need is backbone. Their legal flicted is questionable if not reprehensible, and that any position appears excellent. behavior problems associated with ADHD are merely the To the editor, Bendall, in his editorial, indicates that the Town of result of problems in the home, excessive viewing of TV or Yanceyville has purchased the Jane Thomas property and playing of video games, diet, lack of love and attention, or The power and authority of every county commission condemned the David Barker property. Thus they would teacher/school intolerance is wholly unscientific and con- in North Carolina will be diminished by the conspired like everyone to believe that it is a done deal. How can you tradicts decades of research demonstrating the significant attempt by Roxboro-Person County to use Yanceyville as condemn property without legal notice and court approved impairment caused by ADHD and the safety and efficacy an agent to circumvent the Caswell County Board of Com- appraisals? This appears to be more of the misinformation of available medical treatments. missioners’ authority vested in them by N.C. General from the Dan River Water Pirates. There is no doubt that ADHD leads to impairments in Statute153A-15 if it is allowed to proceed. If this, out of The ball is in the Caswell County Board of Commis- major life activities, including social relations, education, “county piracy,” is accomplished, the precedent that it will sioners’ court. Will they file an injunction to stop the family functioning, occupational functioning, self-suffi- establish will allow any convenient “corporate crossroad” Caswell County voters from being fleeced, or will they do ciency, and adherence to social rules, norms, and laws. For to be used by out-of-county authorities to override the nothing and watch it happen? those it afflicts, ADHD can cause devastating problems. county’s Board of Commissioners in respect to properties Frank B. Turberville, Jr. Studies suggest that sufferers are far more likely than in their home county. Milton, N.C. June 2003 C A R O L I N A 24 Parting Shot JOURNAL The Scourge of Fat-Finger Dialing Afflicts N.C. Where’s big brother when we need him to protect us from predatory telecommunications companies?

By PAUL CHESSER Unfair to North Carolina Associate Editor RALEIGH Like the tobacco case, this scam orth Carolina, the state that bore the brunt of the could harm residents of North Caro- Big Tobacco lawsuit, will soon face another chal- lina more than those in most other Nlenge that could cause it disproportionate harm. states. Why? Because we are among Widely reported lawsuits against America’s largest the states with the highest rates of obe- fast-food chains may be on hold, but the dastardly restau- sity. We rank in the bottom quarter, rants have helped spawn a surprise epidemic: “fat-finger meaning we have a plus-size percent- dialing.” age of plump pointers per capita. Only politicians can fix this ineq- Those predatory companies uity. First, the state Department of Jus- The federal government recently became aware of the tice should address the problem with problem, in which predatory telecommunications compa- a public-service advertising onslaught. nies set up multiple phone numbers resembling popular Remember when Gov. Mike Easley services like 1-800-CALL-ATT. ASC Telecom Inc., a Spring was attorney general in the late 1990s? Corp. subsidiary, and One Call Communications Inc. ben- He spent thousands of dollars warn- efit from dialers’ oversized digits when the victims press a ing blacks about the dangers of preda- wrong-numbered button (called “miss-mashing” in the Tar tory lending scams. The slick ads, Heel state), causing an accidental call to numbers like 1- prominently promoting Easley’s ef- 800-CELL-ATT, or other mistaken variations. forts in the fraud fight, ran in minor- Unintentional calls go to the non-AT&T companies, ity-targeted print and broadcast media which offer long-distance service like the telecom giant, throughout the state. The campaign but charge much higher rates than AT&T without the dial- was credited with helping him win ers’ knowledge. black voter support in his successful AT&T filed a complaint in U.S. District Court in New run for governor. York asking that the court force Sprint, ASC, and One Call A similar campaign by current At- to relinquish numbers similar to 1-800-CALL-ATT and pay torney General (and likely future gu- unspecified damages for business under false pretenses. bernatorial candidate) Roy Cooper, “Consumers who inadvertently dial one of the defen- cautioning potential victims about fat- dants’ numbers have been deceived into using defendants’ finger dialing, is in order. But where services, causing AT&T to lose business which was in- should he direct the ads? No obesity- tended for it,” the complaint says, according to a report in oriented publications or broadcasters the Washington Times. exist in the state, to my knowledge. CJ

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