INSIDE THIS ISSUE: DEPARTMENTS Citizens rise North Carolina 2 C A R O L I N A Education 9 up against Higher Education 13 forced an- Local Government 16 Books & the Arts 20 nexations in Opinion 24 Parting Shot 28 N.C./5 A MONTHLY JOURNAL OF NEWS, ANALYSIS AND OPINION JOURNALFROM THE JOHN LOCKE FOUNDATION December 2009 Vol. 18. No. 12 STATEWIDE EDITION Check us out online at carolinajournal.com and johnlocke.org Rand Key Player in Easley Property Swap It’s unclear how Easley paid for his house on Bald Head Island Former Gov. Mike Sen. Tony Rand, D- By Don Carrington Executive Editor Easley Cumberland RALEIGH an additional 25 percent discount, ew information developed by $137,470, from the publicly stated pur- Carolina Journal shows that for- chase price of $549,880. mer Gov. Mike Easley’s 2005 That discount is not mentioned in NCannonsgate real-estate deal was not any publicly recorded documents and the first time Easley was involved in a was disclosed only when The News & deceptive land transaction. Observer acquired a copy of the closing The information shows that Eas- statement. ley acquired a lot and a home on ex- Bald Head Island, located in clusive Bald Head Island some years Brunswick County, is considered one of earlier with the assistance of state Sen. North Carolina’s most exclusive resort Tony Rand of Fayetteville. areas. Only 2,000 of its 12,000 acres are In addition, it’s unclear from the scheduled for development. The unde- public records how much Easley paid veloped property will remain natural areas. There are no high-rise buildings for the property. In 2007, CJ reported After a complicated series of transactions involving state Sen. Tony Rand and Bald that Easley paid less for his Bald Head Head Island Limited, former Gov. Mike Easley eventually became the owner of this and no billboards. With the exception Island home than a nearly identical house at the exclusive island resort. Go here http://bit.ly/5F7eIb for a virtual tour. (CJ of a few construction and emergency house sold for at the same time. photo by Don Carrington) vehicles, no cars are allowed on the is- These revelations follow an April ing that Easley got a favorable deal on 2009 report in The News & Observer of 2006 report by Carolina Journal show- his Cannonsgate lot, and a September Raleigh that showed Easley received Continued as “Rand,” Page 2 UNC-CH Reimbursed $27K for Commute PAID RALEIGH, NC U.S. POSTAGE and lodging while in the Chapel Hill PERMIT NO. 1766 NONPROFIT ORG. area on business. Since her employ- Deputy director ment began in October 2006, the university has repaid her a total of continued commute $76,558. Kerner-Hoeg is the second- highest-paid employee in the program, with an annual salary of $129,600. even after questions Her reimbursements have come under scrutiny in recent months af- By David N. Bass Public documents and infor- Associate Editor ter an internal UNC-Chapel Hill re- mation obtained by Carolina Journal view, released in June, found evidence RALEIGH show that Susan Kerner-Hoeg, di- of waste and abuse in the program. military-aid initiative at the rector of military relations for the UNC-Chapel Hill announced University of North Carolina at Citizen-Soldier Support Program, Nov. 13 that it was trimming back the Chapel Hill reimbursed one of booked $22,181 in commercial airline program, reorienting funding, and Aits employees at least $27,000 to com- flights to the Triangle over the last shifting leadership responsibilities. mute between North Carolina and her three years and charged about $5,400 Kerner-Hoeg’s role is also changing home in Virginia, even as questions for mileage between 2007 and 2009. about the program’s effectiveness and Receipts also show that she The John Locke Foundation 200 W. Morgan St., #200 Raleigh, NC 27601 use of resources lingered. spent nearly $25,000 on rental cars Continued as “UNC-CH,“ Page 4 PAGE 2 DECEMBER 2009 | CAROLINA JOURNAL

C a r o l i n a Rand Key Player in Easley Coastal Property Swap Continued from Page 1 Journal land. Transportation on the island is by foot, bicycle, or golf cart. Rick Henderson In November 1992, just after be- Managing Editor ing elected to his first term as North Carolina’s attorney general, Easley Don Carrington transferred ownership of Lot 619 on Executive Editor Bald Head Island to his friend Rand, who, according to records, paid Easley David N. Bass, Mitch Kokai $40,000 for the property. But in a re- Michael Lowrey cent phone interview, Rand told CJ he Associate Editors didn’t pay Easley anything and Easley Jana Benscoter, Kristen Blair continued to control the property. Roy Cordato, Becki Gray Three years later, at Easley’s re- Paige Holland Hamp, David Hartgen quest, Rand said he transferred Lot Sam A. Hieb, Lindalyn Kakadelis 619 to a developer who was building George Leef, Karen McMahan a home for Easley on another parcel on Donna Martinez, Sarah Okeson the island. “He said you convey it back Karen Palasek, Lee Raynor to them and they will give me credit Marc Rotterman, Jim Stegall for it, so that’s what I did,” Rand said George Stephens, Jeff Taylor Easley told him. Michael Walden, Karen Welsh Public records show that Easley Hal Young, John Calvin Young and his wife Mary jointly owned Lot Contributors 619 with another couple, Tom and Su- san Rabon. Easley, his brother Henry, Laura Barringer, Jacob Burgdorf and their wives are listed as the own- Adrienne Dunn, Marissa Farell ers of the new home, referred to in re- Ben Goldhaber, Hans Kist cords as Unit 23, Flora’s Bluff. Caitlin McLean, Alex Pitsinos, Public records indicate the de- Sara Riggins, Andrew Schreiber veloper — Bald Head Island Limited Former Gov. Mike Easley’s Bald Head Island house, center, as seen from the air. (CJ Editorial Interns photo by Don Carrington) — paid Rand $80,000 for Lot 619, but Published by Rand said he received no money for Easley received for the lot is not known other sources. Easley did not respond The John Locke Foundation the sale. He said he understood that because representatives from Bald to a message left with his assistant at 200 W. Morgan St., # 200 the developer applied the value to- Head Island Limited refused to discuss the McGuire Woods law office in Ra- Raleigh, N.C. 27601 ward Easley’s purchase of the newly the transaction with CJ. leigh. Calls to Thomas Hicks of Wilm- (919) 828-3876 • Fax: 821-5117 built home. Company employee Judy Ward, ington and Wade Byrd of Fayetteville, www.JohnLocke.org Rand said his original involve- who returned calls from CJ on behalf lawyers believed to be representing ment with Easley revolved around of Bald Head Island Limited President Easley, were not returned. A message Jon Ham discussions of jointly building a home Kent Mitchell, acknowledged review- left for Easley’s brother Henry Easley, Vice President & Publisher on the coast. “Easley and I were talk- ing the files on the Easley and Rand a Chocowinity physician, also was not ing about doing something. I was talk- transactions but would not discuss the returned. John Hood ing about doing something. We didn’t details. “The details of that transaction In addition to their half-interest Chairman & President know what we were going to do,” are between the parties of that transac- in the Bald Head Island home, public Rand said. “We talked about doing a tion,” she said. records show that Mike and Mary Ea- Bruce Babcock, Herb Berkowitz place together. We never could come to Asked if she could explain the sley own a waterfront home in South- Charlie Carter, Jim Fulghum an agreement on what we were going transactions involving Bald Head Is- port located less than four miles across Chuck Fuller, Bill Graham to do.” land Limited and the then-attorney the Cape Fear River from Bald Head Robert Luddy, Assad Meymandi “I never put any money in the general, she said, “I have no desire in Island, a home in Raleigh, and the wa- Baker A. Mitchell Jr., Carl Mumpower, terfront lot in the Cannonsgate subdi- J. Arthur Pope, Thomas A. Roberg, deal. I was going to do it and then de- helping you explain anything.” Asked vision near Emerald Isle. David Stover, J.M Bryan Taylor, cided not to. Nobody paid me $80,000,” if she was speaking for the company’s The Easleys offer the home, Andy Wells he said. owners, she said, “I am speaking for Board of Directors Public records indicate Easley Bald Head Island Limited.” known as the Maritime Cottage, for paid $250,000 for the new home when The Easley home at Bald Head rent through Bald Head Island Lim- Carolina Journal is a monthly journal he took title in June 1996. The complet- Island comprises 1,336 square feet and ited. Easley did not declare any rental of news, analysis, and commentary on state ed home was added to the Brunswick has four bedrooms. It sits on a bluff income from the property on his eco- and local government and public policy issues County tax records with an assigned and has an ocean view from the second nomic interest statements. In peak sea- in North Carolina. value of $329,440, or $79,440 more than floor. A state-owned maritime forest son, the house rents for $607 a day. ©2009 by The John Locke Foundation the amount public records indicated preserve adjoins the rear of the prop- Bald Head Island Inc. All opinions expressed in bylined articles the Easleys paid for the home. erty. A virtual tour of the home can be are those of the authors and do not necessarily There is no recorded deed of trust seen here: http://bit.ly/5F7eIb Bald Head Island is an incorpo- reflect the views of the editors of CJ or the associated with the transaction, which The day after the Easley deed was rated village with its own municipal staff and board of the John Locke Foundation. would be required if Easley had ob- recorded, a deed was filed from Bald government. The village is normally Material published herein may be reprinted as tained a mortgage. It’s not clear where Head Island Limited to Donald C. Ko- accessible only by private boat or a long as appropriate credit is given. Submis- Easley acquired the money to pay for lasch of Maryland for a 1,348-square- 20-minute ride across the Cape Fear sions and letters are welcome and should be the Bald Head Island house and prop- foot, four-bedroom house. The Kolasch directed to the editor. River on a private passenger ferry CJ readers wanting more information erty. home was also new construction, was from Southport. between monthly issues can call 919-828- Brunswick County tax records from the same developer, and is situ- Bald Head was a separate island 3876 and ask for Carolina Journal Weekly currently list the tax value of the Eas- ated on the same street as the Easley until 1999 when Hurricane Floyd de- Report, delivered each weekend by e-mail, ley Bald Head Island home at $979,270. house. Based on square footage and posited enough sand to turn it into an or visit CarolinaJournal.com for news, links, In another unorthodox arrange- county tax records, the Kolasch home extension of the Fort Fisher State Rec- and exclusive content updated each weekday. ment, after Rand transferred Lot 619 was a comparable home. Records show, reation Area. It is now connected to the Those interested in education, higher educa- to the developer another eight months however, that Kolasch paid $327,000 — southern end of New Hanover County tion, or local government should also ask to passed before the deed was recorded. or $77,000 more than Easley. by a thin strip of land. Four-wheel- receive weekly e-letters covering these issues. Rand acknowledged the delay to CJ CJ was unable to confirm Rand’s drive Bald Head Island Police vehicles but didn’t explain it. How much credit version of the transaction from any Continued as “Rand,” Page 3 DECEMBER 2009 | CAROLINA JOURNAL PAGE 3 Rand Key Player in Easley Bald Head Island Property Swap Continued from Page 2 to show that the Easley group paid the nonprofit, nonpartisan group De- walls and other hard structures since periodically patrol the connecting strip anything for the new home. mocracy North Carolina, “The Pollu- 1985, and only a few exceptions had of beach, but signs warn private vehi- Bald Head Island Limited sold tion Lobby: Shoreline for Sale, Whatev- been made. Frustrated with efforts to cles to stay away. Lot 619 to another buyer in October er happened to the Year of the Coast?” protect the beach in front of his house, In 1983, Bald Head Island Lim- 1997. Tax stamps indicate a price of The report charges that the state’s set- Davis sued the state in 1994. Easley’s ited, owned by the George P. Mitchell $131,000. tlement occurred after Davis put pres- office led the state’s defense. family, took control of the island. The sure on key state The same year, Bald Head Is- Easley’s ap- policymakers. land’s government applied for a per- Mitchells bought the undeveloped parent conflict land from oil mogul and philanthro- The report mit to renourish the beach. The state pist Walter Davis and his partner, Easley’s Bald Bald Head Island made no mention agreed to allow renourishment, but James Harrington. Head Island home of the Easleys’ not the construction of groins. In early The company has more than 300 negotiations were officials won’t real-estate trans- 1995, Davis met with Hunt to make his employees involved in real-estate de- under way in the explain the action. Bob Hall, case for the hard structures. velopment, sales, and island opera- fall of 1995 as executive direc- Later, Davis met privately with tions. evidenced by the simultaneous tor of Democracy the lawyer from the attorney general’s Nov. 1 date beside North Carolina, office leading the state’s defense. An Public record details Rand’s signature deed recordings said he did not agreement was worked out in which on the deed to Lot know about the Davis agreed to drop the lawsuit and In February 1986, Easley, his wife for Lot 619 Easleys’ home the state agreed to allow the groins Mary, and Tom B. Rabon Jr. bought Lot 619. Earlier in purchase until a along the beach, as well as to lobby the 619 from a woman named Susan Har- and Unit 23, reporter from CJ U.S. Army Corps of Engineers to pro- ris. At the time, Mike Easley was the 1995, Attorney General Easley Flora’s Bluff told him in 2007. vide the sand. local district attorney and Mary was The 1996 report By May 1996, the sand and 16 an attorney with a private practice settled a lawsuit and granted ex- can be found on groins were in place. A month later, in Southport. Rabon, a former state the organization’s after being held in limbo for eight House member from Southport, was a ceptions to state b e a c h - e r o s i o n Web site. months, Rand’s Lot 619 deed was filed lobbyist for AT&T. The Democracy North Carolina and, almost simultaneously, Easley’s The excise tax stamps indicate laws for homeowners at Bald Head Is- land. report says campaign reports show deed for the new house on Bald Head a purchase price of $40,000. The Eas- that Bald Head Island landowners do- Island was recorded. leys and Rabon signed a deed of trust Walter Davis, who was seeking to stop beach erosion at his Bald Head nated at least $800,000 to state-level Beach erosion issues continue to for $40,000 to United Carolina Bank. politicians from 1989 to 1995. Gov. Jim be a major concern for the Army Corps Southport attorney William F. Fairly Island home, filed the lawsuit against the state. In settling the lawsuit, the Hunt received $100,500, and Easley and the village on Bald Head Island. prepared the documents. received $50,600. Davis gave $169,500 The Easleys and Tom Rabon state made an exception to environ- Troubles mount mental laws by agreeing to allow per- during that period, including $12,500 signed a new deed in March 1992 to to Easley. add Tom Rabon’s wife Susan as an manent beach protection structures to This discovery comes as a federal be installed. The southern beach of Bald Head grand jury in Raleigh is investigating a owner of Lot 619. Susan Rabon, an at- Island was eroding rapidly because of torney, recorded the deed. Records also The properties owned by Davis, series of suspicious actions by Easley, other beachfront homeowners, and natural forces, possibly combined with his family members, former staff, and show that the $40,000 loan to UCB was the regular dredging of Wilmington’s paid off the same month. Bald Head Island Limited — and their major campaign donors. property values — were protected shipping channel. Davis and other In addition to the Cannonsgate The Easleys and Rabons sold Lot Bald Head leaders advocated periodic 619 to Tony Rand on Nov. 19, 1992, just from potential storm damage when transaction, the grand jury is believed the attorney general’s office settled the sand renourishment and the construc- to have heard testimony regarding ap- two weeks after Easley won his first tion of hard structures, or groins, to im- election as state attorney general and lawsuit. pointments to state regulatory agen- Bald Head Island’s beach erosion pede the erosion. cies that Easley provided top donors; Rand won election returning him to North Carolina had banned sea the state Senate after having been out issues were detailed in a 1996 report by free and unreported flights given to of office for six years. Easley on private aircraft; the free use Susan Rabon recorded the deed of automobiles by the governor’s fam- the following day and paid an excise Easley Bald Head Island Property Timeline ily; a job for Mary Easley at N.C. State tax indicating that Rand had paid University that Mike helped arrange, $40,000 for the property. Based on the • Feb. 1986: Mike Easley buys Bald Head Island Lot 619 for indicated sales and a subsequent 88-percent pay raise; public records, the Easleys and Rabons price of $40,000. and an elaborate campaign fundrais- made no gain on the sale of the lot they ing scheme designed to let high-dollar had owned for six years. • Nov. 1992: Easley elected attorney general and Tony Rand elected to donors pad Easley’s campaign coffers On Nov. 1, 1995, Rand signed a state Senate. by skirting contribution limits. deed transferring Lot 619 to the Bald The free flights and cars and the • Easley sells Lot 619 to Tony Rand for indicated sales price of Head Island Limited development Nov. 1992: campaign finance irregularities were $40,000. company. But eight months would the subject of a November hearing by pass before that deed was recorded. the State Board of Elections. The board • March 1995: Easley settles lawsuit with Walter Davis permitting hard fined Easley $100,000 and made a crim- Attorney Fairly recorded it on June 27, structures to stop erosion on Bald Head Island. 1996, and then immediately recorded a inal referral to the Wake County Dis- trict Attorney, concluding that Easley separate deed from Bald Head Island • Easley negotiates purchase of new home from developer BHI Lim- 1995: and most likely others broke the law. to Mike Easley, Mary Easley, Easley’s ited. brother Henry, and Henry’s wife Judy Jay Reiff, Easley’s 2000 and 2004 campaign manager, and the pre- for a lot and new home known as Unit • Nov. 1995: At Easley’s request, Rand transfers Lot 619 to BHI Limited. 23, Flora’s Bluff. Indicated sales price was $80,000. Deed was not recorded. sumed author of several memos that The excise tax stamps indicate outlined the Easley fundraising plan, that Bald Head Island Limited paid • June 27, 1996: Easley attorney records deed from Rand to BHI Limited appeared before the grand jury at Rand $80,000 for Lot 619 and that the for Lot 619, and then immediately records deed from BHI Limited to Easley the federal courthouse in November. Easley clan paid Bald Head Island for a new home with an indictated sales price of $250,000. The elections board had at- $250,000 for Unit 23. The source of tempted to subpoena Reiff but did funds to pay for the new home is un- • Nov. 2009: Rand tells Carolina Journal he didn’t pay Easley for Lot 619 not succeed because he was work- clear because there is no deed of trust and didn’t receive any money when he transferred it to BHI Limited. ing in Virginia at the time and was recorded. There are no public records outside the board’s jurisdiction. CJ PAGE 4 DECEMBER 2009 | CAROLINA JOURNAL UNC-CH Reimbursed $27K for Citizen-Soldier Commuting Tab Continued from Page 1 dale said most of the expenses were work that has been done,” Caudle said. in-state and for training purposes. The program also revamped its — she won’t have a management func- “We had a number of training ses- leadership structure. Beginning Nov. tion or travel to Chapel Hill as much. sions in 15 different locations, so that’s 16, Goodale, a former Harris Teeter “The review committee did rec- a portion of it,” he said. “Then, in terms CEO and N.C. Commerce Depart- ommend that the supervision of people of doing the strategic plan, I inter- ment official in the Hunt administra- be in Chapel Hill, and one factor in that viewed face to face about 100 people.” tion, succeeded Leousis as director. was the expensive travel,” said UNC- CSSP’s Web site previously listed Goo- Chapel Hill communications director Auditors OK travel dale as program Neil Caudle in a telephone interview. An internal UNC-Chapel Hill manager for CSSP is designed to help veter- mental health. ans of the Iraq and Afghanistan wars. audit released days before the re- view found that CSSP’s travel reim- L e o u s i s , Hosted by the Odum Institute for Re- who served as search in Social Science at UNC-Chapel bursements for Kerner-Hoeg were appropriate based on her arrange- director for two Hill, its offices are located on the sec- years, still will be ond floor of a minimall in downtown ment to work from home in Virginia. “Based on the procedures per- principal investi- Carrboro, located west of Chapel Hill. gator but won’t During the last two years, CSSP formed, we determined that the travel reimbursements were appropriate have a manage- has helped to create behavioral health ment role, said Manning Hall at UNC-CH, where the based on departmental approval for curricula, participated in behavioral U N C - C h a p e l Citizen-Soldier Support Program’s host, the employee’s home in Virginia to Bob Goodale, CSSP health seminars, and worked with the Hill spokesman U.S. Army Judge the Odum Institute for Research in Social be her duty station,” auditors wrote. director Science, is located. “The sponsor of the programs has also Mike McFarland. Advocate Gen- Goodale said Kerner-Hoeg eral (JAG) and approved this work arrangement.” ees, according to university officials. Asked if Kerner-Hoeg’s travel re- would be a “real asset” to the pro- others to assist “She’s got a lot of contacts and gram’s new behavioral health fo- military families imbursements were proper, Waldrop a lot of knowledge about how that said he trusted the audit’s findings. cus. “I’m really grateful for her with legal issues. whole system works. That’s why knowledge, expertise, experience, The in- “Was it the perfect way of do- she’s been used so much and very ef- ing it? No, I don’t think it was the and networks nationally,” he said. ternal review, fectively,” said Tony Waldrop, UNC- Although all 13 members of however, found perfect way of doing it,” he said. Chapel Hill’s vice chancellor for re- “Was it something that [at the time] North Carolina’s congressional dele- scant evidence search and economic development. gation initially backed funds for CSSP, to justify the pro- people thought was functional? I cer- The biggest share of reimburse- tainly trust that they did think so.” some lawmakers now say they won’t Susan Kerner-Hoeg, gram’s $10 mil- ments came in 2007, when Kerner- continue funneling money unless director of military lion price tag, $5 Hoeg incurred about $7,500 in ho- A facelift the program dramatically improves. relations for CSSP million of which tel fees, mostly from a Holiday Inn Waldrop said his expectation is North Carolina near the UNC-Chapel Hill campus. In response to the review com- that new funding will be there, but U.S. Rep. David Price, D-4th District, Peter Leousis, deputy director of mittee’s findings, CSSP is channel- additional dollars are contingent on obtained by an earmark. Instead, the Odum Institute, said that Kerner- ing resources to its behavorial health how the program fares in the future. university officials criticized the pro- Hoeg uses a rental car when “state initiative and phasing out its com- “Clearly, it will depend on gram for having an “ambitious and cars are not available or when a car is munity partnership effort. The pro- their performance — not only from ill-defined” mission, misappropriat- needed after UNC motor pool hours.” gram will pursue its revised goals the standpoint of the university, but ing funds to irrelevant activities, and When she isn’t required to travel with three fewer employees, too. as well from the funders, wheth- potentially overpaying its employees. to off-site meetings, she uses Cha- “What we’re looking for now is for er there would be funding in the An investigation by CJ revealed pel Hill’s free transit system, he said. the program to fulfill its potential, meet future to continue this,” he said. that CSSP paid K e r n e r - its contractual obligations, and take Efforts to reach Kerner-Hoeg six-figure salaries Hoeg most often more advantage of some of the good for comment were unsuccessful. CJ to over half of its used commercial employees. Be- airlines to reach cause two of its top CSSP will now North Carolina. managers, includ- pursue revised She occasion- ing Kerner-Hoeg, ally traveled by lived in other states, goals with car and asked there was little for a mileage re- oversight of work three fewer imbursement. responsibilities. employees N o r t h The program Carolina law also paid an out-of- limits in-state state consultant $150 lodging reim- an hour, amounting bursements for to hundreds of thou- university staff sands of dollars, for “strategic thinking to a per diem rate of $65.90. Employ- and action” that included “develop- ees can exceed that amount, which ing and disseminating” the program’s Kerner-Hoeg did routinely, with the bimonthly electronic newsletter. approval of the department head. Citizen commuter Although Kerner-Hoeg traveled most frequently, other staff also put CSSP hired Kerner-Hoeg in in for reimbursements. Documenta- 2006 to attract additional investment tion provided by UNC-Chapel Hill and to coordinate with officials at shows that between January and Feb- the U.S. Department of Defense. She ruary of this year, CSSP’s new direc- lives in the Washington, D.C., area tor, Bob Goodale, was reimbursed and commutes to the Carrboro of- $12,726.28 for travel, conference reg- fices on average two to three times a istration fees, and office supplies. month, partly to supervise employ- In a telephone interview, Goo- DECEMBER 2009 | CAROLINA JOURNAL PAGE 5 As Cities and Towns Step Up Annexation Efforts, Citizens Rebel

By Lee Raynor North Carolina is one of about a olina citizens can vote for legislators. expects the case to be in court early Contributor half-dozen states with involuntary an- Cathy Heath, chairman and di- next year. KINSTON nexation laws heavily favoring munic- rector of StopNCAnnexation Coali- Southport is in the midst of an- ine (pronounced “Miney”) ipalities. Several bills to modify exist- tion, said as many as 13 annexation nexing about 170 acres and 112 prop- Marshall and her late hus- ing statutes are making their way now cases were introduced in eastern North erties along N.C. 211 and the Dosher band built their Lenoir Coun- through the General Assembly. Most Carolina since 2006. The practice has Cutoff. The city originally intended to Mty home 46 years ago. Now she’s afraid are opposed by the powerful N.C. become much more common during take a much larger area, including a she’ll have to sell the tidy brick bunga- League of Municipalities. the last two or three years, she said. business corridor at N.C. 211 and Long low and move into an assisted living T o w n s S e v e r a l Beach Road. Oak Island, however, center. Marshall and her neighbors are and cities use cases are active made the first move toward annexing targets in a forced annexation plan un- a n n e x a t i o n now, includ- the land, and state law backs the early derway today in Kinston. to manage ing in Rocky bird. “I live almost from hand to growth, said Mount, Kin- The Oak Level Community mouth,” the 91-year-old woman said. Margot Chris- ston, Wilming- Against Forced Annexation has been “[Annexation] would cost me so much tensen, public ton, Oak Island, fighting Rocky Mount for more than money. My taxes would go up. I just affairs director and Raleigh. A a year. Residents went to court earlier won’t have any extra money. I don’t for the league, case in Wilm- last spring to appeal the city’s plans. know if I’ll even have enough. How am and ensure that ington in April Their claim is that the city has not met I going to take my pills to stay alive?” everyone who became fiery all the state annexation requirements. Marshall lives in one of three benefits from after several The lawsuit is expected to be heard this contiguous areas Kinston leaders want city services dozen com- month. to bring into the city limits. The neigh- contributes to plainants were “Annexation will be financially borhoods comprise mostly residents the expense of Photo courtesy FreedomWorks locked out of devastating to the people who will be with limited incomes. The combined those services. city hall during victimized in the future,” Heath said. properties would form a land bridge to One complaint of property own- a council annexation discussion. State In most cases, property taxes would the affluent Falling Creek area, the pri- ers who face hostile annexation is that law requires municipal officials to hear double. Homeowners would be re- mary target for Kinston, and the next they are not allowed to vote for the city all statements from people living in ar- quired to install city sewers and water area slated to join the city involuntari- or town leaders who took their land. eas to be annexed. lines, even if their septic systems and ly. Residents took their case to court in Christensen rebuts the complaint. She “All Wilmington had to do was wells are in good condition. The costs November and expect a decision from says state representatives and senators entertain a motion to continue the could be tens of thousands of dollars, the judge later this month. set annexation laws and all North Car- meeting until the next meeting day,” she said. annexation attorney James Eldridge On the other hand, said Kinston said. “People could have come back. City Manager Scott Stevens, county The city could have easily arranged residents use municipal services with- that.” out sharing the maintenance and up- Eldridge is considered an expert keep of features such as city parks, ath- in fighting involuntary annexation. He letic fields, and golf courses. has handled a number of cases across “It’s not a huge deal, but city resi- the state, and is involved now in court dents pay to have these things; people Since 1991, Carolina Journal has provided thousands of readers each month with cases against Kinston and Wilmington. outside the city do not. They pay a In the Wilmington fight, he represents fee for programs, but that only covers in-depth reporting, informed analysis, and incisive commentary about the most about 3,300 residents and many busi- referees and uniforms, not the facility. pressing state and local issues in North Carolina. Now Carolina Journal has taken nesses in the Monkey Junction area, Annexation by cities in general assures its trademark blend of news, analysis, and commentary to the airwaves with just south of the current city limits. the fiscal health, revenue, and popula- Carolina Journal Radio. That annexation would add 950 acres tion of cities. It’s fiscally fair to all citi- to Wilmington’s boundaries. Eldridge zens of the city.” CJ A weekly, one-hour newsmagazine, Carolina Journal Radio is hosted by Mitch Kokai and Donna Martinez and features a diverse mix of guests and topics. The program is currently broadcast on 18 commercial stations – from the mountains Books authored By JLF staFFers to the coast. The Carolina Journal Radio Network includes these fine affiliates: Efficiency and Externalities Albemarle/Concord WSPC AM 1010 Saturdays 11:00 AM Asheville WWNC AM 570 Sundays 7:00 PM in an Open-Ended Universe Burlington WBAG AM 1150 Saturdays 6:00 AM Chapel Hill WCHL AM 1360 Sundays 6:00 PM Elizabeth City WGAI AM 560 Saturdays 6:00 AM Fayetteville WFNC AM 640 Saturdays 1:00 PM Gastonia/Charlotte WZRH AM 960 Saturdays 2:00 PM Goldsboro WGBR AM 1150 Saturdays 6:00 PM Greensboro/Burlington WSML AM 1200 Saturdays 12:00 PM Hendersonville WHKP AM 1450 Sundays 6:00 PM By Roy Cordato Jacksonville WJNC AM 1240 Sundays 7:00 AM Vice President for Research Newport/New Bern WTKF FM 107.3 Sundays 7:00 AM John Locke Foundation Salisbury WSTP AM 1490 Saturdays 11:00 AM Siler City WNCA AM 1570 Sundays 6:00 AM “Cordato’s book is a solid Smithfield/Selma WTSB AM 1090 Saturdays 6:00 AM performance, demonstrating Southern Pines WEEB AM 990 Sundays 7:00 PM impressive mastery of both Valdese WSVM AM 1490 Tuesdays 6:00 PM the Austrian and neoclassical Wilmington WAAV AM 980 Saturdays 4:00 PM literature.” Winston-Salem/Triad WSJS AM 600 Sundays 8:00 AM Israel Kirzner For more information, visit www.CarolinaJournal.com/CJRadio Cato Journal www.mises.org PAGE 6 DECEMBER 2009 | CAROLINA JOURNAL

N.C. Briefs Push For Publicly Financed Elections Seen JLF: Government hurts By Sam A. Hieb much more money than first-time officeholder Knight. North Carolina’s ongo- Contributor Glasser — who’s also listed as the coordinator for ing struggles with double-digit GREENSBORO Greensboro Citizens for Clean Elections, which advocates unemployment raise questions oters should expect the debate over taxpayer-funded publicly funded elections — acknowledges that Greens- about government claims deal- municipal elections to heat up over the next year. boro’s race was unusual. ing with economic recovery, ac- A bill allowing municipalities with more than Still, he adds, the candidate with the most money pre- cording to the John Locke Foun- 50,000V residents to consider the option of taxpayer-funded vails in the majority of elections. Glasser also worries that dation’s top budget analyst. elections will more than likely be considered in the North campaign finance laws allow nonresidents who don’t have “Economic growth hit 3.5 Carolina Senate in the upcoming short session. a true stake in an election to bankroll campaigns. percent in the third quarter, but it Among the most vocal supporters will be North Caro- Daren Bakst, an attorney and John Locke Foundation is too soon to know how real or lina Common Cause. Josh Glasser, the group’s director of legal and regulatory policy analyst, says hopefuls for elect- sustainable that is,” said Joseph Co- local campaign finance reform, says Common Cause will ed office who can convince individuals and groups to un- letti, JLF fiscal policy analyst. “The lobby both lawmakers and the general public as the bill derwrite their campaigns voluntarily suggest there’s public Washington bureaucrats claim that moves forward. support for their candidacy. stimulus spending has created or Glasser and other proponents of taxpayer-funded elec- “When you raise money, that’s an indication of wheth- saved more than 640,000 jobs. But tions are citing Chapel Hill’s recent municipal election as er or not you have support from the public,” Bakst said. that’s an impossible claim to check.” evidence that public financing limits the influence of money “Fundraising is part of the process. This theory that fund- “Even if you accept that claim, in politics, and that a system of taxpayer-funded elections is raising is somehow wrong is incorrect.” the cost per job is $160,000,” Coletti workable. Bakst cites sev- added. “The national unemploy- In the November eral other arguments ment rate was never supposed election, Mark Klein- against taxpayer-sup- to reach 10 percent, yet now the schmidt edged Matt ported elections. For Czajkowski by 246 starters, he says there’s White House is telling us to expect votes in the mayor’s a powerful legal ar- such European levels of unem- race, while Penny Rich gument that publicly ployment well into the future.” received the largest financed elections are The N.C. Employment Se- vote total among town unconstitutional. curity Commission’s latest report council candidates. Bakst cites the lists the state’s unemployment rate Both Kleinschmidt and 2008 U.S. Supreme at 11.0 percent for October, up two- Rich accepted public Court decision in Da- tenths of a percentage point from funding through Cha- vis v. Federal Elections the September rate of 10.8 percent. pel Hill’s pilot pro- Commission, which North Carolina now ranks No. 9 gram, which was en- ruled that the govern- in the nation in unemployment. acted by the General ment couldn’t penalize The state has logged nine Assembly for the 2009 a candidate for spend- straight months of double-digit and 2011 elections. ing beyond a thresh- unemployment. North Carolina’s Chapel Hill calls old amount of money unemployment rate peaked at 11.1 its system “voluntary” because those penal- percent in May, according to the ESC. because candidates ties hindered his free do not have to accept speech rights. public financing. Of 12 As a result of the candidates on the bal- Supreme Court’s deci- Critics: Toll roads better lot, only Kleinschmidt sion, two states — Ari- Gov. Bev Perdue announced and Rich took taxpayer zona and New Jersey Nov. 9 an innovative public- funding. Supporters of — have taken closer private partnership — the first of taxpayer-financed elections say their victories indicate the looks at plans to create matching-fund provisions in local its kind in North Carolina history program is a success. elections. — designed to accelerate comple- “Chapel Hill was a watershed moment in local public Bakst also argues that taxpayer-funded elections really tion of the conflict-ridden Inter- financing in our state,” Glasser said. “Now that cities have do nothing to stop money from influencing elections. While state 485 outer loop in Charlotte. seen the Chapel Hill example, and that it’s functioned quite candidates might be limited in how much money they The new funding strategy, well, I think there’s quite a bit of interest. There’s reason to can raise, political action committees still can raise large believe cities would want to at least consider going along amounts of money to support a candidate. unveiled at a press conference by Chapel Hill’s path.” “You can have independent groups spend a fortune Perdue and N.C. Transportation In Chapel Hill’s program, which could serve as a mod- for subsidized candidates,” Bakst said. “The point is you’re Secretary Gene Conti, combines el for publicly funded elections in other cities, a special fund not reducing money through these systems.” public and private resources to build that’s part of the town budget finances the program. Bakst says the most compelling argument against tax- a new interchange and connect the Council candidates must raise at least 75 qualifying payer-financed elections is that it’s just plain wrong to take only unfinished portion of the high- contributions totaling between $750 and $2,250. Mayoral money from a city’s or county’s general fund — as Chapel way between N.C. 115 and I-85. The candidates must raise at least 150 qualifying contributions Hill’s system does — to subsidize political candidates. estimated price tag is $340 million. totaling between $1,500 and $4,500. “Rescue funds” pro- There are more essential public uses for scarce taxpay- Supporters say the approach, vide additional money to candidates facing opponents who er funds — such as infrastructure, education, and police and known as design/build/finance, will spend more money than the high end of the threshold dur- fire protection. Bankrolling political campaigns is not a high be faster and save taxpayer dollars. ing a campaign. priority for taxpayers. But critics say toll roads would Without question, money affects elections. In the 2008 And any system of public finance forces taxpayers to be a better way to fund the project. presidential race, Barack Obama prevailed over John Mc- provide financial support for candidates they endorse and With long-term toll concessions, a Cain after spending record-breaking amounts of money. those they disagree with. private company “not only has to fi- McCain accepted the spending limits of the federal public- “Taking the hard-earned dollars of Chapel Hill resi- nance and build the project itself, but financing regime. Obama opted out of those restrictions. dents and handing those dollars to politicians for per- to operate it for a long term — typi- Conversely, the November race for mayor of Greens- sonal purposes is inexcusable,” Bakst said. “They may cally 25 to 50 years,” said Bob Poole, boro throws a wrench in the argument that only money talks. not have voted for a certain candidate, but they were director of transportation policy for In that contest, challenger Bill Knight defeated incumbent certainly supporting them financially. Even if they find the Reason Foundation, a libertar- Yvonne Johnson, even though Johnson — a 14-year veteran their views morally repugnant, [taxpayers] have to sup- ian think tank in California. CJ of the city council and one-term mayor — raised and spent port that candidate.” CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 7 Cowell Implements Ethics Rules to Prevent Moore-Era Activities

By Sarah Okeson ment managers, and favoritism from companies that the state invests Contributor a company that aren’t going to in can create an appearance problem. RALEIGH helps invest- be allowed as “It would be good if the treasurer tate Treasurer Janet Cowell told ment firms so- they have in the said, ‘I am not going to take campaign her employees in March, about licit business for past.” contributions from anyone doing busi- two months after she’d been their firms. And But other ness with the state,’” said Merritt, now Ssworn in, that they and future employ- in November, authorities on the executive director of the Raleigh ees couldn’t do business with or lobby Cowell banned state pensions nonprofit Foundation for Ethics in the treasurer’s office for a year after employees from q u e s t i o n e d Public Service. they’d left their jobs. taking gifts how effective At least 36 states or other govern- Asked in August about the new from companies N.C. Treasurer Former Treasurer the new poli- ment bodies have some type of law ad- policy and which employees had gone doing business Janet Cowell Richard Moore cies will be and dressing pay-to-play. Illinois lawmak- to work for firms that had business with the agency whether Cowell ers approved a law last year that bans with the treasurer’s office, Cowell and also limited the charitable contri- should have done more. companies that have contracts or want didn’t mention her predecessor. Rich- butions they could solicit from contrac- “It’s too little, too late,” said Ed- to get contracts with the state from ard Moore, who was state treasurer tors. ward Siedle, president of Benchmark donating to the campaigns of state of- for eight years, invested $500 million Cowell fired one of Moore’s top Financial Services in Ocean Ridge, Fla., ficials who oversee who gets those con- of state pension funds in Relational officials, Chief Investment Officer Pa- which audits pension plans. “What are tracts. Investors in August 2008, about three tricia Gerrick, after Gerrick failed to you going to do now? Are you going to “The goal is to eliminate favor- months after he lost the Democratic disclose properly travel costs paid by put in place a policy, or are you going itism in the government contracting gubernatorial primary to Bev Perdue. investment firms. Gerrick also solicited to investigate how much the state may process,” said Steven Sholk, an attor- In April, he went to work for the San donations from in- have lost because ney with Gibbons P.C. in New Jersey. Diego-based firm as a managing direc- vestment officers of a failure to have In Ohio, Ennis, Knupp was called tor. for SECU Family this in place?” in to investigate the state Bureau “Increasingly, all things are being House, a charita- New rules Chris Tobe, of Worker’s Compensation. Ennis, questioned,” Cowell said in August. ble organization a trustee for Ken- Knupp found that the bureau’s invest- Cowell may be reluctant to talk on whose board designed to tucky Retire- ments, which were touted as earning about Moore — she declined to be she served. prevent too-close ment Systems, an annual return of 16.51 percent for a interviewed for this article — but her Cowell hired said North Caro- decade, were actually earning 7.3 per- new policies seem designed to address Ennis, Knupp & associations lina doesn’t have cent, less than they would have earned some of the questionable practices of Associates, the enough employ- in index funds. The state ended up Moore, who had a reputation of invest- Chicago firm between staff ees to oversee ad- putting the money in index funds. ing state money in firms whose em- tapped by the equately the doz- Heather Franco, a spokeswoman ployees gave him campaign contribu- U.S. Treasury De- and investment ens of investment for Cowell, said Ennis, Knupp hasn’t tions. partment to help firms managers and finished reviewing North Carolina’s In September, Cowell said that oversee its bailout funds that Moore investments. she, senior staff, and key investment fund for banks, to added to the state “We hope to have some initial staff couldn’t do business with the review how North pension plan. findings by the end of the year,” Fran- treasurer’s office or try to influence Carolina has in- “All these co said. them for two years after leaving their vested its money. rules are fine, but I don’t know if the Cowell told Gerrick in August jobs. She also ordered that employees “I think she’s making some very treasurer has the budget or the political that she needed to resign after Gerrick disclose travel reimbursements they positive changes,” said Charles Heath- capability to hire staff to cover this,” missed a deadline to comply with an- had received from companies or asso- erly, a former deputy state treasurer. Tobe said. “It’s almost like the invest- other of Cowell’s directives: disclos- ciations and required that investment “It’s very encouraging as a beneficiary ment design was an experiment in ing how much of her travel expenses managers say if they are using place- of the system to know that cronyism how to grow a pay-to-play machine.” had been paid by companies or asso- Moore did not return a phone call ciations. The paperwork that Gerrick from Carolina Journal. turned in showed that she had almost Cowell’s policies are similar to $20,000 in help with travel in 2008 for Free Choice for Workers: public pension reforms instituted by 18 trips to places like London, New A History of the Right to Work Movement New York Attorney General Andrew York, and Houston. Gerrick was later Cuomo, who is investigating corrup- fired. tion in the New York state pension. In Cowell hasn’t said why Gerrick New York, a bribery scandal involving was terminated, though documents re- the state pension fund has led to crimi- leased in an open records request filed nal charges and guilty pleas. by CJ and other media organizations No public allegations of criminal show that Cowell terminated Gerrick wrongdoing have been made in North after “a review of various agency re- Carolina, but there is a widening mul- cords” and “other concerns.” tistate probe into corruption in public Gerrick said some of her travel pensions. costs were reimbursed by fund manag- Cuomo has required some invest- ers under an agreement between the ment firms to ban campaign contribu- treasurer’s office and the fund man- By George C. Leef tions by their employees and relatives ager. Vice President for Research at the to pension officials. “My immediate supervisor, the John William Pope Center for Higher Cowell, who has received more state treasurer, was always aware of Education Policy than $211,000 in campaign contribu- my travel and had authorized my trav- “He writes like a buccaneer... tions in 2008 and 2009 from people and eling at the expense of others,” Gerrick recording episodes of bravery, political action committees connected said. “These trips were either because I treachery, commitment and to funds the state invests in, has said was representing the N.C. pension plan vacillation.” she supports a law creating public fi- on an advisory committee of a particu- Robert Huberty nancing for the treasurer’s race. lar investment, or as part of due dili- Former state Auditor Les Merritt gence on one of the pension plan’s ex- (Call Jameson Books, 1-800-426-1357, to order) Capital Research Center said accepting campaign contributions isting fund-of-funds relationships.” CJ PAGE 8 DECEMBER 2009 | CAROLINA JOURNAL Thomas: ‘We’ve Got a Bunch of Social Reprobates in Office’

By CJ Staff RALEIGH “We are in the midst of the most radical transfor- f you’re looking for a positive spin mation our country has ever seen, and I do not on the opening year of the Obama administration, don’t ask Cal believe that is overstatement. There has been IThomas for his opinion. The author, syndicated columnist, and Fox News a coup in Washington. ... It is a time when we analyst recently shared his thoughts about the administration with a John ought to be frightened because of where they Locke Foundation Headliner audi- want to take us.” ence in Winston-Salem. He also dis- cussed the administration with Mitch Kokai for Carolina Journal Radio. (Go Cal Thomas to http://www.carolinajournal.com/ Syndicated columnist cjradio/ to find a station near you or to learn about the weekly CJ Radio pod- cast.) I mean, he’s a hard-core leftist; that’s rules. Now, the rules are that if you We have to fight this, by electing just a fact. You can’t deny it. There’s no make more money than I do, you owe people who have strong conviction, Thomas: We are in the midst of consensus. There’s no bridge building. me to make it fair. Well, that’s stealing. and principles, and a track record. Too the most radical transformation our There’s no feeling that the Republicans There’s a commandment against it, but many people go to Washington with country has ever seen, and I do not or the conservatives have anything that when government does it, it’s taxation promises, and they get transformed believe that is overstatement. There he wants to embrace, and I think with — same thing. And so we’re now go- like Jekyll and Hyde into something has been a coup in Washington. We — from Cass Sunstein to some of these ing to tax and penalize success, and else, something different from what have elected a bunch of people who other people who he’s surrounded we’re going to subsidize and encour- they ran on. Term limits is an answer; have appointed a bunch of people, and himself with — Sunstein believing that age failure. This is not the value system get these people out. Don’t make nominated and had confirmed a bunch animals should have lawyers — my cat that built and sustained this country them career politicians and subject to of people who are more left-wing and thinks that’s a good idea, but I’ve told through World Wars and the Great De- the kind of lobbying and temptations ideologically opposed to the funda- her forget it, she’s not getting it. pression. And it’s depressing me, I can that go with staying in office too long. mental principles of this country than I think we’ve got a bunch of so- tell you. That’s just for a beginning. have ever run it in our entire history. It cial reprobates in office, and I’m very, is a time when we ought to be fright- very worried about it. I’ve not been Kokai: What do we do about Kokai: Do you see any signs of ened because of where they want to worried as much about the future of these problems? encouragement in these tea party ral- take us. our country, from any president, Dem- lies and in town hall meetings? ocrat or Republican, in many years. Thomas: Well, I think you have Kokai: It sounds as if you defi- This guy is a potential disaster, and to vote, and get your dead friends Thomas: Well, the key, of course, nitely think the country is moving in what can happen, I think, is that there to vote like the other side does. You is not just to rally the base, and we are the wrong direction. will be things put in place that will be know, democracy, a constitutional re- increasingly — I say we, those who nearly impossible to reverse, and, of public, freedom, liberty, are not the are conservatives, or libertarians, or Thomas: Well, I think it’s just course, that’s what the Democrats are natural state of humankind; otherwise, people who believe in self-control, not beginning. I think this country is go- doing with their power, and they want everyone would be free. Dictatorship, government control — we’re increas- ing through an extreme makeover, and to do as much as they can before the top-down government — these seem ingly a minority. You’ve got to win the I’m sure that most of the public doesn’t 2010 election. to be the natural order of things, in a mushy middle, so it’s OK, it’s fine to think that this is what they voted for dysfunctional world. So we can’t just — those who voted for Barack Obama. have the tea parties, and get together Kokai: You said Americans didn’t coast along, thinking things are going The polls certainly show that we are and convince us all that, boy, we’re sign up for the policy choices we’re getting ready to transform the health to remain as they’ve always been, with going to change America, but you’ve seeing today. Is American distaste for insurance industry, and the way we re- our parents, our grandparents, and go- got to win the moderates, the indepen- these policies enough to kill them? ceive health care, unlike anything that ing back many, many centuries. That’s dents. That’s the key. In every election, we’ve ever seen before in this country. not going to happen. We have to take they are the key. I wish they had more A lot of people are calling it socialism. Thomas: Well, the problem is our government and our politics seri- convictions. And you’ve got to do it on I don’t know what you would call it, we live increasingly in an entitlement ously enough to be engaged not only the basis of self-interest. but it’s certainly being done without environment. If you look at what hap- at election time, but between elections One of the encouraging signs to the permission of the public. We don’t pened in Detroit [recently] — that — in fact, daily. me — you asked for encouraging signs elect dictators in this country. The best 5,000 people lining up for handouts These are people who can change — is that seniors — who have been advances are done by consensus and from the government — the local sta- our way of life. They can tax our busi- pretty much in the pocket of Demo- by bringing the public along. I think tion up there went and interviewed nesses and regulate them. They can crats who have given them every- we have a complete novice who knows a woman in line and said, “Where take more and more money out of our thing they wanted, and scared them nothing about foreign policy, who’s do you think this money is coming pockets. Now, Nancy Pelosi’s talking to death on Social Security, any time never led a war, who’s never done from?” These were homeless people about imposing a value-added tax to the Republicans want to try to reform anything except community organiz- or people supposedly on the verge of go along with the federal, the state, the program — are not signing on in ing, and who now is going to revamp being homeless. Well, the woman says, the local taxes, all the fees. Seen your very large numbers to this so-called the economy and is in charge of fight- “Well, it’s coming from the city of De- phone bill lately? Take a look at the health care reform. I think the last fig- ing the war on terror. I think it’s a very troit.” And the reporter asked, “Well, five, six, seven lines. I just bought an ure I saw was only about 24 percent of scary time. where do you think that money is com- international airline ticket. There are seniors. When you talk about paying ing from?” “Um,” she thinks a minute. at least eight levels of fees and taxes for this new health care bill, so called, Kokai: Are you surprised? “Well, President Obama’s giving it to for this country and the one to which by taking $400 billion out of the Medi- us.” I’m going. Entrance, exit taxes, security care program — when seniors find out Thomas: Not really, because See, that’s the idea. This is totally taxes, fees — all sorts of things. They what that’s going to mean for them, I you’re known by your associates, and foreign to me. I grew up with the value never run out of ways to find to take think you’re going to see a mass exo- from Jeremiah Wright to William Ayers and concept of taking care of myself, our money: lotteries, gambling, ev- dus from the Democratic Party, and I to a whole lot of other people that he’s making decisions that would allow me erything. They never have enough of think there’s a lot of hope in that, for surrounded himself with, I think all of to live a rather successful, or modestly our money, but they never ask us if we Republicans and conservatives, if they this was predictable. He didn’t hide it. successful, lifestyle if I played by the have enough. play their cards right. CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 9

Char-Meck Superintendent Wants COMMENTARY Teacher Pay Tied to Performance The Truth About

By Jim Stegall to measure teacher performance or set Student Funding Contributor teacher pay. They argue that wide dif- oes North Carolina’s method from a low-income family (+$356) CHARLOTTE ferences in the academic preparation, of funding public schools who lives in a low-wealth county harlotte-Mecklenburg Schools discipline, and motivation that indi- favor wealthy counties at (+$268). He has an Individualized Superintendent. Peter Gorman vidual students bring to the classroom theD expense of poor ones? The facts Education Program (+3,501) due plunged into one of the most make comparisons of educational out- suggest not. To illustrate differ- to an emotional handicap, namely Ccontentious topics in public education comes useless. ences in per-pupil appropriations, I hoarding nuts. Alvin also did not last month by announcing his intention Moreover, Charlotte-Mecklen- will outline state, federal, and local perform at grade level on the state to begin basing teacher pay on effec- burg Association of Educators Presi- funding for three fictional students end-of-grade exam (+$164). Un- tiveness in the classroom, rather than dent Mary McCray told WFAE-FM that — Alvin, Simon, and Theodore — like Alvin or Simon, Theodore also on experience and academic degrees. pay for performance wouldn’t work who attend elementary schools in lives in a small county (+$629) But if experience is any guide, he’ll in North Carolina because the state different counties in North Carolina. and — given that Chipmunkian is face plenty of opposition from teacher doesn’t allow teachers to unionize. She According to the N.C. De- his native language — has limited groups and their political allies. said flagging high-school graduation partment of Public Instruction, English proficiency (+$756). Theo- Generations of North Carolina rates is a national problem that an iso- school districts received a base dore’s school district would receive public school teachers have been paid lated local program could not reverse. state appropriation of $5,511 per $11,420 in state funds. Theodore’s according to the level of degree they But Gorman insists that distinc- elementary school student for the circumstances make his school dis- hold (bachelor’s or master’s) and their tions between effective and noneffec- years of teaching experience. Some tive teachers can be made, and that test 2008-09 school year. This appro- trict eligible for an additional $5,777 school districts in the state have ad- scores must be part of the equation. He priation included funds for Alvin, in federal dollars. Thus, Theodore’s opted incentive plans to reward teach- also said that development of the pay- Simon, and Theodore’s school district would ers who teach in shortage areas such as for-performance plan will rely heavily teachers, teacher assis- receive approximately math or special education, or who take on input from “teachers, assistant prin- tants, administrators, $17,197 in state and fed- positions in less desirable schools. cipals, psychologists, social workers,” instructional resources, eral funds, almost three The state also has awarded bo- and other employees. and transportation. Yet, times the amount received nuses to all staff at schools where stu- Referring to pay-for-performance this amount does not take by Simon’s school district. dent test scores schemes that have into account additional Nearly 75 percent of rise to meet certain been tried else- funds earmarked for stu- the total per-pupil expen- goals, though that where, he said, dents facing challenging diture comes from state program, part of Salaries have been “We’ve seen some circumstances. and federal funds. Locali- the state’s “ABCs places that have Alvin (+$5,511) is a TERRY ties provide the remaining disadvantaged student 25 percent. Local funding of Public Educa- paid according been successful STOOPS (+$235) who comes from varies based on the tax tion” plan, was with developing a low-income family base of the county. Typi- put on hold due to to the number pay for perfor- (+$356) and lives in a low- cally, wealthier counties the budget crisis mance, and [oth- and level of wealth county (+$268). He has an appropriate more per-pupil funding and is unlikely to ers] that have not Individualized Education Program than poorer ones. For example, one be resumed. been successful. academic degrees (+$3,501) for his Attention Deficit of the wealthiest counties in North G o r m a n ’ s When you roll out Disorder, which, unfortunately, led Carolina adds approximately $5,000 plan would be the a completed plan to a poor performance on the state per pupil in local funds, while one first in the state ac- and tell folks ‘this end-of-grade exam (+$164), even of the poorest school districts adds tually to pay higher-performing teach- is it’ without any involvement, it’s not after the retest. Given these circum- slightly more than $1,000 per pupil. ers more than their peers. This “per- that successful.” stances, state funding for Alvin Simon’s suburban school formance pay” is a key component of As for the argument made by would total $10,035. district likely would receive a larger the district’s Strategic Plan 2014, which some that any move away from re- Gorman debuted Nov. 5 in a presenta- Alvin’s situation makes appropriation from his county than warding teachers for degrees held and his school district eligible for an Alvin’s and Theodore’s school tion to top educators and community years of experience would weaken leaders. When fully implemented, all additional $3,820 in federal dol- districts would receive from their teacher performance, Gorman said, lars. Thus, there is approximately low-wealth counties. CMS employees, including Gorman, “For CMS there’s no research that links would see their salaries rise or fall de- $13,855 in state and federal funds Nevertheless, it is clear that graduate degrees to teacher effective- available to assist struggling Alvin. state and federal funding more pending on how well they did their ness.” jobs. Unlike Alvin, Simon (+$5,511) than make up the difference. Even He said that while there is some In an exclusive interview with is an intellectually and academically if Simon’s large, suburban county research that indicates increased effec- Carolina Journal, Gorman outlined his gifted child (+$423) who performs can contribute $5,000 to his educa- tiveness with years of experience, “af- thinking. “What we’re looking to do is at or above grade level on the state tion, Alvin and Theodore’s disad- ter the first three years it dramatically define effectiveness, measure effective- end-of-grade exam. Simon comes vantaged school district would still levels off. There are even times [later in ness, recruit based on that definition, from a middle-class family and have a higher per-pupil expendi- a teacher’s career] where more expe- and reward based on that definition,” attends an elementary school in a ture, thanks to generous state and he said. rience is even worse than less experi- large, suburban county. Based on federal appropriations. Defining teacher effectiveness ence.” these circumstances, state funding Public school advocacy groups is the key. The strategic plan calls for Gorman has not identified where for Simon would total approximate- complain that local funding inequi- development of “multidimensional he would find the money to fund the ly $5,934. ties hinder academic progress in measures of teacher effectiveness” but program. He cited a law passed this Moreover, Simon’s school poor counties. These special interest makes clear that “student growth mea- year allowing CMS to use state em- district would receive only $47 in groups ignore the fact that state and sures,” such as test scores, must be a ployee salary funds in a pay-for-per- federal funds. In the end, Simon’s federal funds offset local inequali- part of that assessment. Asked about formance plan that would require a school district would receive ap- ties. specific measures of teacher effective- vote of all employees affected, not just proximately $5,981 in state and fed- These groups do not let the ness, Gorman said, “There’s one first teachers. eral funds for his education, half of facts get in the way of their desire and foremost, and that’s growth in stu- Gorman envisions a three-year what the state and federal govern- for more taxpayer money. CJ dent achievement.” timeline for implementation of his ment provide for Alvin’s schooling. Teachers’ groups nationally and plan. “I’ll be going to the board and Like Alvin, Theodore (+$5,511) Terry Stoops is education policy in North Carolina have opposed ada- asking them to put me on more of a is a disadvantaged student (+$235) analyst at the John Locke Foundation. mantly the use of student test scores performance-based contract first.” CJ PAGE 10 DECEMBER 2009 | CAROLINA JOURNAL Buncombe Early College Program Faces Challenges a school that is one of the first of its kind in the state, said Michael Webb, After rocky start, both associate vice president of Jobs for the Future and director of the national second and third Early College High School Initiative in Boston. He said the high attrition rate classes doing better in the first graduating class is typical By Karen Welsh for early college programs across the Contributor country. ASHEVILLE “It’s not exceptional that this ive years ago, Buncombe County happened,” Webb said. “It’s very dif- Early College became a trailblaz- ficult to be the first at something like er in education in North Carolina, this. Early college requires a different openingF an innovative high school on culture, not only for the students, but the Asheville-Buncombe Technical for the faculty as well. They have to Community College campus. rethink the mission of the school. The The idea was to give students, pioneering class is always bumpy. It mostly from low-income homes, the takes time to develop the culture of the opportunity of graduating from the school.” five-year program with both a high The Buncombe County Early College program was designed to allow students to Webb said it’s important to look school and a 66-credit associate’s col- graduate from high school and also get an associate’s degree in five years. (CJ at the second- and third-year classes to lege degree, fully honored by any photos by Karen Welsh) find out how the school is doing. school in the University of North Caro- Turner said students in the low- lina system. originally planned. I’ve always known the school’s been er years are beginning to understand The school was made possible “Our program has not come with- good for me, so I stuck it out. Right the depth of curriculum, expecta- with a multimillion-dollar grant in out its challenges,” she said. “I refer to now I’m just focusing on getting my tions, and the personal responsibility 2004 by the Melinda and Bill Gates our first graduating class at Buncombe classes done and getting out of here. needed to be successful at the school. Foundation. County Early College as our ‘pioneers.’ I am disappointed I’m not getting my They’re committed to the high-quality The first group of 60 students It’s been difficult for them because associate’s degree.” work and creative thinking needed to who entered the program during the they were the ones who helped us fig- Yoshida said she was often jeal- achieve in the program. 2005-06 school year set out on an un- ure out what we needed to figure out. ous of the underclassmen because they She said only a handful of stu- charted frontier. We needed to find the right support have benefited from the trials and er- dents have left the school from the sec- Carolina Journal began following systems and the right sequence of cur- rors her class endured. ond class, and there’s only one drop- the progress of the fledgling school in riculum.” “They started off on a different out from the third class. 2007. At the time, Principal Meg Turner Fifth-year student Megan Yoshi- path and are doing this program a “Every group gets progressively was candid about the school’s initial da, 18, said she has experienced dif- better way,” she said. “They are plan- stronger,” Turner said. “It is reflective struggles. ficulties being a part of the inaugural ning ahead more of the fact that we During her first interview, Turner class. A couple of years ago she was for the younger have gotten our said the journey already had proved fully expecting to graduate with two classes and have a foundational sup- better idea of how unsettling for 11 of the 60 students who diplomas. Now she’s hoping to finish Early student ports in place. Our to handle the situ- already had left the program. her work and leave with a high school procedures and ation.” In a recent follow-up interview, degree. ‘pioneers’ helped curriculum seem Fourth-year Turner said those numbers contin- “It’s been hard,” she said. “It steady now, and student Kiara improve the ued to dwindle each consecutive year. didn’t work out as planned. My class the groups that Jones, 17, said she Currently, 25 students remain and are was the learning curve. There were program for have followed our planning to graduate in 2010. Of those, times when I got frustrated, tired, and has learned a lot from the example first class are more less than half will graduate with both fed up. I wanted to quit, but I’ve had newer students stable and steady. a high school and associate’s degree as helpful and supportive teachers, and given by the per- severance of the They are focused, upperclassmen. mature, and goal- “I know it’s okay to struggle,” oriented. We are she said. “I’ve learned there are chal- having much more success.” lenges, and you have to expect them Despite the school’s initial grow- and work with them. It’s important to ing pains, challenges, and adjustments, not give up, but to work it out, step it Scott Ralls, president of the North Car- up more, and work better.” olina Community College System said Third-year student Al McCarthy, Buncombe County Early College has 16, said the program has provided both been a forerunner of educational re- the rigor and relevance she’s needed form throughout the state. to meet her ultimate goal of becoming Because of this trailblazing spirit, a law student. In fact, McCarthy said he said there are now 69 early college she’s hoping to graduate a year early programs, with more than 10,000 stu- with both degrees. dents, operating on community college “The school has a comprehensive and university campuses throughout articulation agreement that is quite the state. reasonable,” she said. “They have been “Certainly there have been ad- flexible and allowed me to accelerate justments along the way, but they have my learning experience, which is the influenced the educational experi- right thing for me. And, it’s free col- ence,” he said. “Each class has been a lege. I’m not going to get any better learning time, but the amount of work than this.” they have achieved in a short period Many Buncombe County Early College students, unlike like those above, have quit Buncombe County Early Col- of time is significant, and it is spilling the program, and many have not completed their associate degrees. lege has performed extremely well for over in positive ways.” CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 11 Wake School Reformers Aim to Revamp Real Estate Deals By David N. Bass Olive LLC, had bought the land 10 Associate Editor months prior for nearly three times RALEIGH less than the price agreed to by the embers of Wake County’s Wake County school board. new school board majority Accusations of a conflict of inter- say they’ll take a better ap- est also arose after it was revealed that Mproach to real estate and school con- Jim Goodnight, a software billionaire struction in light of past accusations from Cary, is a partner in the invest- that the board participated in over- ment company. priced, shady deals. In 2006, Goodnight and his wife, “We have to take a very careful, Ann, backed a $970 million bond for good look at the present real estate school construction, which voters ap- department. I don’t have any confi- proved. The funds might have been dence in it myself because of past per- used to pay Apex Olive for the land. formance,” said school board member In a telephone interview, Apex Ron Margiotta, a frequent critic of the Mayor Keith Weatherly described the school system’s land buys. relationship between the investment Other members of the school company and the school board as “to- board’s new majority, elected in Oc- In 2007 the Wake County School Board voted 6-2 to sell 9.4 acres in Wendell as surplus tally, totally weird.” tober and November on a platform of property for about one-fourth of its recent tax revaluation. (CJ photo by David N. Bass) “They were willing to pay top broader school choice and fiscal con- dollar for land that no one else was reformers have cheered, according to In 2007, the school board voted servatism, agree that changes need to willing to buy,” Weatherly said. The News & Observer of Raleigh. “We’re 6-2 to sell 9.4 acres of surplus land in be made. School board member John Te- in the education business,” said Chris Wendell to an adjacent church. A re- The school system’s real estate desco, who represents southeast Wake Malone, who represents northeast cent tax revaluation puts the value of division is taxed with finding suitable County, said the new majority would Wake County. “We’re spending way the property at nearly $600,000, but the sites around the county for new con- work better with county officials on too much time arguing over a piece of school system sold it for one-fourth struction. The school board has final land deals. ground.” that amount. veto power on any purchase, but it first “I see us being much more open A reverse deal cropped up must get approval from county com- to working with our municipal leaders Buy high, sell low the same year when commissioners missioners. and county commissioners, and work- bought land near downtown Apex for That’s caused strife in the past School board members took heat ing even closer to develop mutual a 30 percent higher price than a devel- because commissioners frequently in 2007 when they tried to buy land for goals for our agenda,” Tedesco said. oper had paid for it the day before, the have objected to land purchases, say- a new middle school in Rolesville, a He acknowledged that the previ- News & Observer reported. ing the school board wanted to pay too town northeast of Raleigh, for $75,000 ous school board likely overpaid for much. The commission now requires an acre. Appraisals estimated the prop- Apex Olive mix-up land. “I know there has been skepti- the board to get independent apprais- erty’s worth at $48,000 and $63,000 an cism in the past,” he said. als before it buys property. acre, respectively. One deal that drew a chorus of Malone said that he would con- Margiotta and his allies sparred After initially rejecting the high- criticism was for an 108-acre tract of sider surrendering real estate decisions with the rest of the board last month er price, county commissioners con- land south of Apex. The school board to the county commissioners, and over a proposed site for a new high sented in April 2008 to pay the greater agreed to pay $8.7 million for the prop- that the school board would follow a school in northeast Wake County, sign- of those two amounts after Rolesville erty that two appraisals later valued at “good, basic conservative philosophy” ing a letter dated Nov. 4 that urged a leaders said they would chip in about half that amount. The property’s tax in the interim. delay in the project until other options $3,000 an acre. value is nearly $4 million, according to “We’re going to be very smart could be vetted. In two other instances, the school a revaluation. with our cash — nothing along the A review committee is examin- board agreed to sell land at an appar- County commissioners torpe- lines of double the appraised price for ing four other sites for the school in ent deep discount and purchase land at doed the deal after learning that a a piece of property,” he said. “We’re Raleigh and Rolesville, efforts that a steep markup. real estate investment company, Apex going to look for good deals.” CJ PAGE 12 DECEMBER 2009 | CAROLINA JOURNAL

Rural setting, rigorous curriculum Asheville Charter Offers Innovative Learning Experience efforts to make that happen. State law currently imposes a cap Unconventional of 100 on the number of charter schools in North Carolina. Gottfried and her methods used staff would like to see that change. This not only would allow more cre- ative schools to open in the state, but to gain results it would help North Carolina to qual- By Karen Welsh ify for millions of dollars through the Contributor federal “Race to the Top” education ASHEVILLE grants. estled among the sweet-smell- Vilen said the cap can be removed ing pines and rolling hills of easily while keeping accountability western North Carolina is a measures in place. Nplace where students cultivate a rain Roger Gerber, director of the League of Charter Schools in North garden, not only to learn about nature, Carolina, said it’s unfortunate that but also the intricate system of hydro- state legislators continue to place arti- logic action of the plants that ultimate- ficial limits on charter schools because ly produces cleaner rainwater runoff. it puts the state at a competitive disad- In the classroom, students sit at vantage. tables, in beanbag chairs, on the rug, or “President Obama is redrawing under tables to read their books. the education reform battle lines, but The teachers call it learning; the Line graphs and theme papers line the wall at the Evergreen Community Charter our legislators continue to reject lift- School in Asheville. (CJ photo by Karen Welsh) kids think it’s a grand adventure. ing the cap,” he said. “They have even Welcome to Evergreen Commu- Vilen’s son Zak, a gifted seventh- “We rely on parent volunteers a asked Obama to reconsider his sup- nity Charter School, a successful edu- grader who has attended the school for lot,” Gottfried said. “They are required port of charter schools. The Senate has cational program located in the Haw four years, said he will never forget the to work two hours a month per par- always been the problem. They always Creek community in Asheville. expedition his class took last year to ent.” block it.” The idyllic and spacious 10-acre the Holocaust Museum in Washington, Anne Vilen said the school Gerber said it doesn’t help that rural campus is the perfect backdrop D.C. doesn’t have a PTA but relies on a va- Gov. Beverly Perdue doesn’t support for more than 400 children from kin- “We went really deep,” he said. “I riety of committees in which the adults Obama’s positive views on charter dergarten through eighth grade, who schools. found out about some things I would serve. are encouraged to use their five senses “She is not exactly enthralled have rather not known, but it allowed “We are task-oriented instead of to learn. with charter schools,” he said. “She me to recognize what happened, how complaint-oriented,” she said. “Our Best of all, everyone is required to never has been.” it happened, and why it happened. It ethic, across the board, is ‘if you see take daily recess breaks. For now, many children across gave me a perspective I would not oth- a problem, fix it.’ The school revolves The rigorous curriculum has the state will have to wait for school erwise have.” around solutions. We are invested in evolved steadily Class sizes choice. Evergreen Community Charter that philosophy.” School continues to do what it can to over the past 11 are also small and Although educators throughout meet the needs in its community; how- years, entwining informal, provid- the state would like to replicate suc- ever, it has to turn away 10 students for both environmen- School’s leaders ing the opportu- cessful learning programs like those every child they accept. tal and character nity for students to disappointed offered by Evergreen and other char- “It’s kind of depressing,” Ger- education. Stu- get to know their ters, state legislators are still blocking ber said. CJ dents are expected in N.C.’s cap teachers on a first- to become actively name basis. involved in the on number of Zak Vilen learning process. said he’s been It’s not surprising charter schools most appreciative to find children of the honest in- Visit our Wilmington regional page rock climbing, ski- teraction with his ing, snowboard- instructors. http://wilmington.johnlocke.org ing, or looking for birds on the top of a “We get to know a lot of them,” mountain during the regular course of he said. “We become friends with them The John Locke Foundation the school day. and get to know their character.” has five regional Web sites span- “Parents see it as a dedication The result is the children are ning the state from the mountains to balancing,” said Associate Director engaged in their activities and stud- to the sea. Anne Vilen. “We see kids in a holistic ies, continually learning beyond their way. We believe in effective and ef- school borders and excelling on annual The Wilmington regional page ficient teaching. We prepare our stu- yearly progress tests. dents to become lifelong learners.” As if that weren’t enough, the includes news, policy reports The curriculum is specifically de- school prides itself in being an envi- and research of interest to signed to help students think creative- ronmentally friendly, “green” campus. people in the coastal area. ly, and each expedition fully integrates Each week the school asks the children all subject areas. to bring waste-free lunches. Students It also features the blog Squall “We really strive to push kids out sift through the refuse to find reusable Lines, featuring commentary of their comfort zone,” said Executive items. The school also uses biodiesel on issues confronting coastal Director Susan Gottfried. “We want buses for its transportation needs. them to see life from a different per- One of the secrets to this unique N.C. residents. spective. Our focus, our emphasis is on public school’s success is the network authentic learning. We push our curric- of parents and guardians that willingly ulum in innovative ways, all the time.” help out at the school. The John Locke Foundation | 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 DECEMBER 2009 | CAROLINA JOURNAL PAGE 13

UNC, Military Sign Collaborative Agreement Campus Briefs North Carolina campuses in By Jay Schalin between a segment of the U.S. military organizational studies, supply chain November hosted two experts on Contributor and a state university system. management, leadership, and negotia- economic development in Africa. RALEIGH The MOA formalizes and extends tions. Both agreed that government-to- oday’s soldier is not the “grunt” a relationship of cooperation that has The process of negotiation is the government aid to Africa is not of old who enlisted because he existed for a long time, according to same for executives and combat offi- the way for economies to grow. had no other options (or was UNC vice president for communica- cers, Mulholland added at a press con- Entrepreneur June Arunga Tdrafted because he wouldn’t join on tions Joni Worthington. Four different ference after signing the agreement. He spoke to students at N.C. State, his own). He — or she — tends to be UNC schools offer degree programs on said that the skills learned in executive St. Augustine’s College, N.C. Cen- a highly motivated member of a fairly military bases, and soldiers can get on- training are invaluable for “captains … tral, and N.C. A&T. While mas- elite group who has thought deeply line degrees from other schools in the when they’re negotiating with a tribal sive state bureaucracies stifle free about his or her commitment to the na- system. leader or a foreign minister overseas, enterprise in Africa, Arunga’s ex- tion. At the signing ceremony, em- which happens pretty routinely.” perience in Ghana building a cell The 21st-century soldier’s pri- phasis was placed on areas where col- Furthermore, he added that the phone-based business — the Afri- mary tools are laboration can be mutually beneficial. transfer of knowledge works both can Liberty Card — shows how not the tools of USASOC spokesman Eric Hendrix cit- ways: “In turn, those experiences that entrepreneurship can overcome the past — rifles, ed the transfer of knowledge between our men and women bring back, I the worst obstacles. Her personal bayonets, or the military’s battlefield medics and am absolutely convinced, will better account illustrated Hernando de trenching tools. the emergency doctors at UNC Hospi- inform [academics] in how they ap- Soto’s thesis in The Mystery of Cap- The main tool tal’s trauma center. proach real-world dilemmas.” ital: property rights, stable gov- for today’s mili- While UNC is on the cutting edge Other subjects likely to see lots of ernment, and reliable infrastruc- tary personnel is of the latest medical research, the ur- exchange include the study of foreign ture enable economies to grow. knowledge. gency of battlefield surgery has pro- languages and cultures, engineering, In Arunga’s view, Africa offers a A c c o r d - duced a tremendous number of medi- computer science, communications, great deal of promise for entrepre- ingly, the Uni- cal advances throughout the centuries: and behavioral science. neurs who are creative and tough- versity of North the use of anesthesia, pre-operation Research and development is an- minded. Carolina system preparations, and many more. other area in which the expertise of the Arunga, born in Kenya, has and the North One new program will be to have two systems “dovetail” (as described a law degree from the University Carolina-based medic instructors undertake a resi- by Worthington). of Buckingham and is in the film U.S. Army Lt. Gen. John F. dency program at The military will industry as founder and president Special Opera- Mulholland UNC Hospitals contract with UNC of Open Quest Media LLC. Her tions Command in Chapel Hill. engineers and sci- speeches were sponsored by the (USASOC) have created a new “Mem- Bowles also called Collaboration entists to innovate John W. Pope Center for Higher orandum of Agreement” to provide a for the creation of in response to bat- on medical Education Policy through a grant guideline for increased collaboration a fast-track pro- tlefield needs. As from the Arthur N. Rupe Founda- between them. cess by which Hendrix explained issues expected tion. UNC system president Erskine retiring military before the ceremo- Dambisa Moyo, economist Bowles and the commander of the medics can receive to benefit nial signing, sol- and author of The New York Times Special Forces, Lt. Gen. John F. Mul- certification and diers in the field best-seller Dead Aid: Why Aid is Not holland, signed the MOA at the No- training and enter both parties often discover an Working and How There is a Better vember meeting of the UNC Board of North Carolina’s imperative need Way for Africa, spoke at UNC-Cha- Governors. USASOC consists of highly civilian health care for new technical pel Hill. In her book, Moyo con- trained, specialized units such as the work force to alleviate shortages. solutions that can’t wait for ordinary tends that the more than $1 trillion Army Rangers and the Psychological There is already a lot of exchange R&D processes to unfold. Having an in government-to-government aid Operations Group. They are headquar- between Kenan-Flagler School of Busi- agreement in place and establishing tered at Fort Bragg near Fayetteville. ness at Chapel Hill and the USASOC, fast-track procedures will speed up the wealthy nations have given Africa According to Mulholland, it is according to Bowles. Specific subjects process. over the past 50 years has trapped likely the first agreement of its kind studied by military personnel include Yet, the MOA also represents the the continent in a vicious circle of confluence of two giant government dependency, corruption, market bureaucracies, one known for its $640 distortion, and further poverty. toilet seats, and the other known for Moyo advocates innovative ways its six-figure tenured sinecures. And for Africa to finance development, with the likelihood that contracts will including trade with China, ac- be awarded speedily to provide our cessing the capital markets, and soldiers with the technology they microfinance. need comes the potential to create an A native of Zambia, Moyo entanglement of perpetually wasteful has a doctorate in economics from projects. Oxford University, a master’s de- While the agreement does not yet gree from Harvard University, have safeguards against such waste, and a bachelor’s degree in chem- Worthington said that the “rationale istry and a master’s of business for creating the MOA” is to “explore administration in finance from and examine the what-ifs” so that pro- American University. Her address cedures can be developed to address was part of the Business Across these problems. As the first agreement Borders Series hosted by the of its kind, it is an experiment. Frank Hawkins Kenan Institute of One thing that makes the state Private Enterprise and was partly such fertile ground for this agreement sponsored by UNC’s Center for is its large military presence. Bowles International Business Education noted that over 400,000 North Carolina and Research. CJ jobs are tied directly tied to the military in one way or another. CJ Compiled by Jenna Ashley Rob- inson, campus outreach coordinator Jay Schalin is a senior writer with for the John W. Pope Center for High- the John W. Pope Center for Higher Edu- er Education Policy (popecenter.org). cation Policy (popecenter.org). PAGE 14 DECEMBER 2009 | CAROLINA JOURNAL

COMMENTARY Pope Center Honors Professors Let the At Wake Forest, Duke, ECU By Jenna Ashley Robinson in classical studies, and John Given, as- Debates Begin Contributor sociate professor and director of classi- ecently I attended five events from Plato’s Republic. RALEIGH cal studies, both at East Carolina Uni- at UNC-Chapel Hill. Doing Given the declining enroll- or the second year, the Pope versity, won third place for their jointly so was part of my job, but ment in many humanities depart- Center’s Spirit of Inquiry Award taught seminar “Ancient Philosophical I enjoyed them thoroughly. They ments, why not seek more inspir- honored faculty at North Caro- Literature in Classical Studies.” They R Flina universities whose courses were were nominated by two students: Ash- included two lectures, two debates, ing methods? In a recent American ranked by a distinguished panel as the ton Pace and James Duffy, both cur- and a daylong program about free Scholar article, William Chace states best in the state. rently enrolled at ECU. speech and the First Amendment. that history majors declined from The award is named the “Spirit When nominating Given and One debate — between con- 18.5 to 10.7 percent of all college of Inquiry” to express what the Pope Stevens, Pace described the class as servative author Dinesh D’Souza students between 1970 and 2003, Center believes college courses should “worth taking not only for its rare and liberal religion studies profes- and English majors dropped from do — reflect a spirit of open-minded student-teacher ratio, but also for the sor Bart Ehrman — particularly 7.6 to 3.9 percent. exploration within enriching develop- stood out. Fourteen hundred people And such courses also should the guidelines of ment contrived as — students, faculty, and mem- include large writing components. an academic disci- the student interac- bers of the community — packed Requiring students either to sum pline. In addition to tion engaged in the an auditorium and hung on the up the arguments or to take sides their commitment process of inquiry.” participants’ every word, for an would help them develop the to open-minded in- On his Web site, event titled “God and the habit of organizing their quiry, the winning Given explains his Problem of Suffering,” thoughts to produce a courses also must teaching philoso- a deliberation about the coherent argument. be interesting, rig- phy. “My mantra existence of God in an era A course based on orous, and unbi- in teaching is that when secular humanism debates also would great- ased. Brandon Turner Peter Feaver the self-reflective (and beer and football) is ly reduce the potential for B r a n d o n Clemson Univer- Duke University student is the best assumed to dominate the political bias that many Turner, who cur- sity student. It is vi- campus. critics claim is pervasive rently teaches in tally important to Then it dawned on in academia. By their the Institute for learning that a stu- me — the debate format is very definition, debates the Study of Capi- dent at any level a fantastic way to learn! A JAY provide both sides of the talism at Clemson understand not lecture may be better for SCHALIN story. University, won only what he or delivering information in And many questions first place for his she learns, but also a straightforward manner, never die — the world is class “American how and why he or but a debate is a vastly still struggling with issues Political Thought,” she learns.” superior way to create and sustain framed by Plato and Aristotle, such which he taught F i f t y - s i x interest. It has elements of human as whether society is best ruled by a last year as a vis- John Stevens John Given students at eight drama that lectures lack. It is a con- small intellectual elite or by a broad iting professor at East Carolina Uni- East Carolina Uni- universities nomi- test and a competition, and people base of citizens. Wake Forest Uni- versity versity nated professors are naturally drawn to such things. And why limit courses to just versity. He was for this year’s con- Why can’t there be classes one form of information delivery? nominated by Jared Fuller, a sopho- test. A panel of judges looked at course that deal with the important ques- Lectures and debates are likely to be more in political science and president descriptions, answers to survey ques- tions in a format based on debates complementary — one to provide of the Young Americans for Liberty tions, student testimonials, and course instead of lectures? information, the other to inspire chapter at Wake Forest. syllabi to choose the winners from This is not about student and frame the issues more clearly. In making his nomination, Fuller among seven finalists. debates. Such debates and presenta- Lectures also can provide an over- described Turner as “the epitome of a The judges were Anne Neal, pres- tions are usually boring, awkward view or prevent the course from scholar, a professor, and a friend. His ident of the American Council of Trust- affairs, of benefit only to the par- being merely a series of snapshots willingness to engage his students be- ees and Alumni; John Allison, former ticipants. Instead, students would rather than a continuous whole. yond superficial textual discussions is BB&T chairman and CEO, who is now learn much more from people — ei- In an age when so many key to his teaching methods.“ a distinguished professor of practice ther professors or possibly graduate students are disengaged from their Peter Feaver, the Alexander F. at the Wake Forest University School students — who know the material studies, this might be one way to Hehmeyer Professor of Political Sci- of Business; Edgar Broyhill, president cold and who can formulate argu- re-engage them. ence and Public Policy at Duke Uni- and managing director of the Broy- ments on the fly. Real education begins with the versity, won second place for his class hill Group in Winston-Salem; former Debate-based classes won’t desire to learn. If students can be “American Grand Strategy after 9/11.” North Carolina Gov. James Martin; and work in all subjects, particularly inspired, the battle to educate them Feaver is also director of the Triangle George Leef, director of research at the those in the sciences and technol- is already half-won. Institute for Security Studies. From Pope Center. ogy. And which is more likely to June 2005 to July 2007, Feaver was on At the dinner, the Pope Center But the concept should lend get the blood flowing, just another leave from Duke, serving as the special also recognized professors whose gen- itself well to subjects like history, lecture, or watching two professors adviser for strategic planning and in- eral education courses at UNC-Chapel philosophy, and political science. battling it out and then jumping stitutional reform on the National Se- Hill and North Carolina State Univer- For example, instead of a standard into the fray with your own (writ- curity Council staff at the White House. sity were selected by students as the history or philosophy lecture on Ar- ten) opinion? CJ John Bailey, a 2009 Duke gradu- best. The Pope Center collected this istotle and Plato, their ideas could ate, called Feaver’s class “the best and information by polling students. CJ be made more vivid by two teach- most enjoyable class I have taken in ers debating, one using the ideas Jay Schalin is a senior writer with college. I have never been in a class Jenna Ashley Robinson is outreach expressed in Artistotle’s Politics and the John W. Pope Center for Higher that broadened my perspective of the way security strategy is formulated as coordinator for the John W. Pope Center Ethics, the other using the ideas Education Policy (popecenter.org). much as this class did.” for Higher Education Policy (popecenter. John Stevens, associate professor org). DECEMBER 2009 | CAROLINA JOURNAL PAGE 15

Opinion ‘Bottom-Up Strategies’ Don’t Require New Laws or Mandates n my efforts to reform higher I’m delighted Proposed by the More modest steps are also being education, I am constantly in to see new chap- Pioneer Institute taken. James Ceaser, Harry F. Byrd Jr. search of winning strategies. Over ters of groups Issues in 1999, the char- Professor of Politics at the University Ithe past year, I have moved from a such as: Students ter school concept of Virginia, has designed a course “top-down” to a “bottom-up” agenda. for Liberty, Young in has been adopted called “The American Political Tradi- That is, I have concluded that instead Americans for Lib- Higher Education by two colleges tion.” of federal mandates or new laws, our erty, the Network in Massachu- Tired of the narrow irrelevance universities will make greater strides of Enlightened setts — the state’s of much political science scholar- if we help parents and students make Women, Collegians Maritime Academy ship, Ceaser developed a course (“for better choices about college, if we for a Constructive and Massachusetts students, not professors”) that de- work with students and alumni to Tomorrow, Youth College of Art and fines democracy, introduces the ideas bring debate and new ideas to cam- for Western Civilization. And alumni Design. In return for less money from behind the nation’s founding, explains pus, and if we honor and encourage are active at Dartmouth, Bucknell, the state, these schools are free to set the role of the Constitution, and re- faculty who teach well and offer in- William and Mary, and Colgate — their tuition rates and admissions views American political movements. novative classes. and others, I hope. At one university, standards (and keep tuition revenues). He has begun to export this down-to- With this alumni are addressing the decline of Indeed, alternatives to the state Earth course to other schools. mind-set, in recent the core curriculum by creating their university and the traditional college Similarly, the Pope Center sup- weeks I attended own — one that students can adopt are all around us. For-profit schools ports a project to design an introduc- meetings of such voluntarily. now enroll nearly 10 percent of all tory economics course to address the groups as the students. Small, single-focus colleges economic illiteracy of today’s youth. Philadelphia 2) Shed light on what’s good and bad can teach students at lower cost and Society, the State The Pope Center has proposed provide a rich experience. And there’s 5) Light a fire under trustees Policy Network, that universities require faculty to always the option of getting a job (and University trustees should be the and the American post their course descriptions online facing reality four years early) rather conscience of schools, but often they Council of Trustees so that students and the public can than attending college. don’t even ask questions. So, why not and Alumni. At JANE know what is being taught. The State bring a group of smart, potentially all the meetings, Policy Network has additional ideas SHAW 4) Support faculty outspoken trustees together and help innovative ideas for transparency. Reformers can post The project most likely to break them build a “speaking up” mind- cropped up in both on Web sites such publicly available up today’s academic rigidity is the set? Help them become the seeds of a formal sessions information as: BB&T Foundation’s grants on the revolution. and private conversations. Here’s a • Salaries of state university morality of capitalism. The founda- All these ideas, while disparate, list, grouped into five categories. administrators and faculty have a few things in common. They • Graduation rates tion, headed by John Allison, has don’t require a broad consensus to be 1) Empower students and alumni • Instructional costs given such grants to 60 colleges and The Pope Center already seeks • Administrative costs (often universities. implemented, they don’t require new to empower prospective students with greater than instructional costs) They usually require that Ayn laws, and they don’t require much our booklet “College Bound: Make • Tuition increases (including Rand’s Atlas Shrugged be included in a administrative cooperation. They the Right Choices” by Jenna Ashley trends over the past 10 years) course and that all the students in the just require “small platoons” (to use Robinson, a guide that helps high • General education require- program be given a copy of the novel. Edmund Burke’s phrase) of concerned school students (and others) ask good ments One doesn’t have to be an Ayn Rand and committed people. CJ questions. We also work with students devotee to recognize that the con- who are trying to challenge the rigid 3) Develop alternatives to current in- tent of this book can create a tectonic Jane S. Shaw is president of the John ideological orthodoxy on so many stitutions tremor ripping through the socialistic W. Pope Center for Higher Education campuses. Partial privatization is one idea. assumptions of the academy. Policy (popecenter.org). Visit our Triangle regional page http://triangle.johnlocke.org

The John Locke Foundation has five regional Web sites span- ning the state from the mountains to the sea.

The Triangle regional page in- cludes news, policy reports and research of interest to people in the Research Triangle area.

It also features the blog Right Angles, featuring commentary on issues confronting Triangle residents.

The John Locke Foundation | 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 PAGE 16 DECEMBER 2009 | CAROLINA JOURNAL

Town and County Wilkes revaluation delay Charlotte Puts Crime Onus on Landlords Blame the weak housing mar- By Sarah Okeson atic, where they are clustered,” he said. ket for delaying the revaluation of Contributor The new law, which was supported by the Greater property in Wilkes County. The CHARLOTTE Charlotte Apartment Association and The Real Estate and Wilkes County Commission voted harlotte plans to go after landlords of rental proper- Building Industry Coalition, is a watered-down version of to put off the reassessment from ties with some of the city’s highest reported instances a proposal that would have required all landlords to list 2011 to 2013 after learning that of crimes in a program city officials tout as a way to their properties and tell the city where they could be con- there haven’t been enough sales to Cfight crime. tacted. Raleigh, which recently started a rental registration make reliable valuations possible, The City Council recently approved the program even program, is requiring all landlords to register their property. reports the Winston-Salem Journal. though Mayor Pat McCrory expressed doubts, calling it “a “I’m very pleased with the compromise,” said Tommy State law requires counties to cover-up, a smokescreen, a mirage hiding a broken criminal Lawing Jr., president of T.R. Lawing Realty. “I think it’s a revalue all properties for tax pur- justice system.” very reasonable solution to the problem.” poses at least every eight years. The program, which debuts in June, will require land- Police had wanted all landlords to register their prop- In 2001, Wilkes officials decided it lords of rental homes and apartments that are in the top 4 erties because they say it can be difficult to contact land- should reappraise properties every percent of calls to police to meet with police and develop a lords during an emergency. four years. During the last revalua- plan to reduce crime at the property. Landlords who can’t For instance, in February 2008 police arrested two tion, the county used 1,000 “arms- reduce crime at their properties could be fined or see the people on drug charges at 806 Cantwell St. The owner is a length” sales — transactions that apartments shut down. The program is expected to affect San Diego, Calif., company called Seeker Acquisitions LLC, weren’t deed transfers or gifts to less than 0.5 percent of the city’s rental units. according to Mecklenburg County records. A letter police relatives — to determine property “It’s the worst of the worst that will be falling into the sent to the company has been returned, and they haven’t values. This year, while there have mix,” said Ken Miller, deputy police chief for the Charlotte- been able to locate the owner. The North Carolina Secretary been 1,700 deed transfers in the Mecklenburg Police Department. of State dissolved the company in December 2008 because it county, the county has been able The new law has drawn criticism hadn’t filed an annual report. to identify only 120 as arms-length from legal advocates who fear that it “There’s a chase,” Miller said. “It transactions. could deter tenants from reporting crime almost becomes a cat-and-mouse game “If we’re going to lower or and from neighborhood activists who with some landlords.” raise values, we’ve got to defend say it doesn’t go far enough. The three Police will determine what proper- it,” said Wilkes County Tax Ad- council members who voted against the ties should be targeted by looking at how ministrator Alex Hamilton. “We ordinance, Michael Barnes, Warren Turn- many violent crimes, property crimes, don’t have the data to make a de- er and Mayor-elect Anthony Foxx, had and calls for service are at properties termination one way or another. wanted the city to require all landlords during a year. They’ll come up with a One-hundred-and-twenty sales is to register their properties with the city. weighted score for each property with not a market.” McCrory and six other council members violent crime contributing the most to a Wilkes isn’t the only county voted for the law. home’s score. to push back revaluation because “It doesn’t give us all that we want,” Domestic violence isn’t included of a lack of sales. Watauga County said Dorothy Waddy, leader of the Clan- in crimes that could lead police to crack commissioners voted in June to ton Park neighborhood in Southwest down on a property’s landlord. push reassessment back from next Charlotte. “The real estate companies “I think everybody agreed they year to 2012. have been very actively involved in not didn’t want to have any process that wanting all absentee landlords to sign would inhibit someone who is a victim COPs to fund swim center up.” from calling,” said Mark Newbold, an at- Questions also have been raised torney for the police department. The Greensboro City Council about how accurate the process would be But Ted Fillette, lead attorney with voted Nov. 17 to fund a $6 million — and whether it’s the responsibility of Charlotte’s Legal Aid office, said the law shortfall for the Greensboro Aquat- landlords to monitor their tenants. could deter people from reporting crime. ic Center with hotel tax money, re- Michael Sanera, research director at the John Locke “Obviously, property managers who are concerned ports WGHP-TV. Foundation, said the city is forcing property owners to serve about having their property flunk could tell tenants not to Voters had passed a $10 mil- as cops — without compensation. “They’re singling out the call and run up their calls for service,” he said. lion bond referendum to build the owner of the property to take action against people who vi- Fillette also said high numbers of minor complaints to facility, a competitive venue inside olate the law when the police should be taking that action,” police from a property could land a home on the targeted the Greensboro Coliseum complex, Sanera said. “It’s an absolute travesty under the law.” list. but the city needed an additional But Miller said that landlords have a responsibility to “I don’t know that complaints about parties, dog bark- $6 million to meet the lowest con- try to reduce crime, too. ing, and loitering are necessarily very indicative of what are struction bid. “Property management has control in a way and le- high-priority neighborhood problems,” Fillette said. The city issued certificates of verage that we don’t,” Miller said. “To control behavior you Police estimate that at least 635 single-family homes participation — a form of debt that need to pull on all the levers, and one of the levers is the and 87 multifamily properties will be included in the pro- does not require voter approval — contractual obligation between the tenant and the landlord. gram. The council district that would have the most proper- to finance the construction. Hotel Crime is everybody’s problem. Every citizen’s problem. It ties targeted based on crime reported between September tax revenues will retire the certifi- is everybody’s responsibility to address it. Landlords have 2008 and August 2009 would be District 2 in northwest cates. a responsibility and a duty to protect the interests of safety Charlotte with 182 properties. The city wanted to approve on the properties.” The council district estimated to have the fewest tar- quickly the additional funding to Similar programs exist in many other cities including geted properties is District 7 in South Charlotte with nine take advantage of low construction Raleigh, Houston, and Minneapolis. Houston and Minne- properties. costs. apolis have reported drops in crime or calls for service at Police will try to determine what properties are used News & Record The of Greens- rental property targeted in those cities. as rentals by looking at property and tax records. They had boro reported that, even before city “On the average, they dropped about 26 percent in originally said that trying to determine which properties staff floated the idea of using COPs crime,” said Sgt. Alan Parish of the Houston Police Depart- should be targeted without requiring all landlords to reg- to pay for construction of the cen- ment. ister their properties could be inaccurate and lead the city ter, officials had to trim $3 million In Charlotte, 60 percent of residential crime in 2006 to focus on the wrong properties. It also could leave the city from the price of the project. took place in rental housing, and rental units had crime rates more open to a legal challenge. Among the cost reductions two to three times higher than owner-occupied housing. Police Maj. Eddie Levins has called the process a “best were moves to use lower-cost fin- Miller said the police might put more resources into guess.” ishes and a less expensive heating areas with multifamily rental housing that are targeted un- Miller acknowledged that identifying rent- and air conditioning system. CJ der the new law. al property will be harder without a full regis- “We put our resources where the crimes are problem- tration requirement. CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 17

Appeals Court Throws Out COMMENTARY The Cult of W-S’s Anti-Loitering Law The Next Big Thing • “Such person repeatedly pass- ing to or receiving from passersby, ou can call it the Cult of the the region — per capita incomes Court said the law whether on foot or in a vehicle, money Next Big Thing, the belief are lower in the Triad than the Tri- or objects” that the key to transforming angle or Charlotte area — but not criminalized • “Such person taking flight theY economy of most any place is a outstanding. Certainly nowhere upon the approach or appearance of a single, massive project. The eco- near enough to justify the massive permissible activity police officer” nomic development equivalent, if buzz the facility generated. • “Such person being at a loca- you will, of a game-winning grand Of course there might never By Michael Lowrey tion frequented by persons who use, slam in the bottom of the ninth. have been that sort of buzz had Associate Editor possess or sell drugs” And yet, these deals are typically state and local officials and the RALEIGH The U.S. Supreme Court previ- something so simple that they can news media asked the tough he state’s second highest court ously has found laws to be unconsti- be reduced to a single word or though obvious questions. has thrown out Winston-Salem’s tutional if they deterred a significant phrase. “We looked at the Dell project loitering ordinance as unconsti- amount of constitutionally protected Take Dell. Or aerotropolis. with rose-colored glasses,” said tutional.T In finding the law both overly conduct in their attempts to criminal- Or the Randy Parton Theatre. Or economic developer Rob Bencini broad and vague, the appeals court ize activities that the Constitution does if you’re from Charlotte or the to the Greensboro News & Record. not protect. noted that the ordinance did not re- Triangle, transit. Bencini has previously overseen quire proof of criminal intent. The constitutionality of loitering In the real world, things are economic development policy for Gary Mello got in trouble in a statues has come before the Court of neither as certain nor as Guilford County. big way on Aug. Appeals before. simple as the economic Sadly, those same 28, 2008. He was In State v. Evans development drones rose-colored glasses are arrested on three The North Carolina Courts (1985), the appeals charges of as- court upheld a make them out to be. And all too common when it saulting a gov- state law prohib- because the details do comes to economic devel- ernment official iting loitering for matter, these theoretical opment projects. (a police officer), the purpose of economic development Roanoke Rapids’ two counts of fail- engaging in pros- grand slams often have next big thing was sup- ing to heed a blue titution. Key in proved, in practice, to be pose to be an entertain- light and siren, its decision was strikeouts. ment complex built and one count of that the statute Consider Dell. MICHAEL around a theater headed loitering for the required proof of Lured in part by hun- LOWREY by Dolly Parton’s broth- purpose of en- specific criminal dreds of millions of er. The venture flopped, gaging in drug-related activity. A jury intent. dollars in state and local and local taxpayers got convicted him of a single count of as- The appeals court found that incentives, Dell Comput- hit with a big property sault with a deadly weapon upon a Winston-Salem’s ordinance was miss- er’s decision to build a computer tax hike to help cover the costs. The government official, plus the failing to ing this critical element. assembly plant in Forsyth County real question, though, is what best heed a blue light and siren and loiter- Hunter noted anyone who hands was seen as critical to the Triad’s describes Randy Parton: A has- ing charges. He was sentenced to serve out fliers, conducts a survey on a pub- efforts to revitalize the region for been or a never-was? between 19 and 23 months in prison. lic sidewalk, or is simply in an area the 21st century. After all, what Kinston, meanwhile, was sup- Upon appeal, Mello contended where drug arrests have happened or possibly could be more critical in posed to be transformed as compa- that Winston-Salem’s loitering ordi- drug dealers have visited could be ar- the information age than making nies flocked to build manufactur- nance was unconstitutional. The N.C. rested under the ordinance. computers? ing plants next to the local airport. Court of Appeals agreed. The appeals court also found A lot of things, actually, as Why? Because the airport was now “Because the Ordinance fails to the ordinance to be unconstitutionally the Triad found out when Dell called the Global TransPark and require proof of intent, it attempts to vague. announced recently that it was had a ridiculously long runway. The Fourteenth Amendment’s curb drug activity by criminalizing closing the facility after less than Nearly two decades later, those due process clause requires that laws constitutionally permissible conduct,” five years in operation. Those little factories still haven’t landed beside wrote Judge Robert N. Hunter Jr. for be clear enough so that ordinary peo- things certainly mattered. Dell’s the runway in Kinston. the appeals court. ple can figure out what is being pro- plant made desktop computers. Charlotte, meanwhile, The ordinance makes it “unlaw- hibited. In 1978, the N.C. Court of Ap- Desktops are nice and all, but the continues to pursue an economic ful for a person to remain or wander peals struck down a law prohibiting about in a public place under circum- members of the opposite sex from oc- demand for them has peaked as development vision built around stances manifesting the purpose to en- cupying the same hotel room for “im- businesses and individuals increas- a multibillion-dollar light rail and gage in a violation of the North Caro- moral purposes” as unconstitutionally ingly prefer laptops. street car system aimed at convinc- lina Controlled Substances Act.” The vague. More broadly, just because ing finance types from places like ordinance then goes on to list seven An average person would have you manufacture computers, it New York City, Boston, and San such circumstances: difficulty determining exactly what an doesn’t place you at the cutting Francisco that the Queen City isn’t • “Repeatedly beckoning to, “immoral purpose” was, the appeals edge of information technology. such a bad place to spend a few stopping, or attempting to stop pass- court held, and would have to guess Large-scale computer manufactur- years. Given the condition of the ersby, or repeatedly attempting to en- what activities were criminal. ing is still, well, manufacturing. city‘s two big banks, that hardly gage passersby in conversation” The appeals court found the Win- Having lots of semi-skilled work- seems like a viable strategy going • “Repeatedly stopping or at- ston-Salem ordinance suffered from ers put things together may have forward. tempting to stop motor vehicles” the same sort of vagueness. been a revolutionary industrial But then again, when have • “Repeatedly interfering with The Court of Appeals’ finding concept a century ago. It certainly mere facts ever stopped a commu- the free passage of other persons” that the loitering ordinance was un- isn’t now. nity from pursuing the Next Big • “Such person behaving in such constitutional likely will do Mello rela- And Dell paid like a large- Thing? CJ a manner as to raise a reasonable sus- tively little good. The appeals court scale employer of semi-skilled picion that he is about to engage in or upheld his other three convictions. labor. That is to say OK at around Michael Lowrey is an associate is engaged in an unlawful drug-related The case is State v. Mello, (08- $12 to $15 an hour, especially for editor of Carolina Journal. activity” 1054). CJ PAGE 18 DECEMBER 2009 | CAROLINA JOURNAL

Local Innovation Bulletin Board Audit Finds Major Problems Vanpooling Alternative With Raleigh Computer Upgrade hen it comes to transit overwhelmingly approved down- By Michael Lowrey adequately impressed by the benefits Associate Editor solutions, vanpools are sizing the county commission from resulting from the extra taxes they rarely given much consid- 19 members to 15. RALEIGH would pay, and rejected incorporation eration.W That’s a big mistake, says “This is our chance to send a n audit of a major upgrade of by a 61-percent to 39-percent margin. Michael Ennis of the Washington message,” says Joe Killian, a water Raleigh’s computer systems The incorporation task force had pro- Policy Center, who explains that utility worker and a leader of the has uncovered major manage- posed a tax rate of 5 cents per $100 mentA problems, reports The News & valuation. vanpools can be an extremely cost- movement. Killian notes that the re- Observer of Raleigh. “What are they going to offer effective transit solution. gion’s economy has been stuck in re- The city has responded by firing us?” asked Bonnie Oliver. “There are There are currently 20 vanpool verse for many years. Since 1970, the the project’s manager and hiring out- a lot of people living here whose sala- programs in Washington state, in- population of western New York has side consultants to help address the ries aren’t all that high. Every penny cluding six in the Puget Sound area. fallen by nearly 300,000 residents. shortcomings. counts.” King County’s program is the larg- More than 56,000 jobs have been lost Raleigh’s computer systems are Incorporation supporters were est in the country, with 826 vanpools in the last two decades alone. outdated. In July outspent by op- providing 2.3 million passenger The success of the downsizing 2008, the city be- ponents. Op- trips a year. movement comes despite the rela- gan a $30 million ponents raised In the Puget Sound region, tively small cost savings associated modernization Cherokee $6,944, while Sound Transit offers commuter rail, with having small town boards. effort, which in- those in favor light rail, and express bus service “They’re trying to say they’re cludes updating of incorpora- from suburbs to the cities of Seattle, unhappy, and they’re going to start its payroll, finan- to tion raised only Tacoma, and Bellevue. Such region- at the top,” says Tom Quatroche, a cial, and utility $3,136. The cam- al transit service, which primarily retiring Hamburg council member. billing systems. paign was acri- brings workers from the suburbs to Hamburg is one of the towns that An audit by Currituck monious, with and from their jobs in the city, are reduced the size of its town board. Ernst & Young allegations of most comparable to how vanpools “It’s easy, because they don’t looked at 27 sep- sign stealing and are used. see [downsizing] affecting them day arate elements of the project and found vandalism. King County’s vanpool pro- to day.” issues with all of them. In two-thirds “It’s been a great experience for gram carries more people than Not all government reform of the cases, these problems could Swannanoa,” said Dave Alexander, in- Sound Transit’s commuter rail sys- advocates support the downsizing cause significant cost overruns and/or corporation task force chairman. “This missed deadlines. tem and does so for $1 billion less a movement. Lenny Roberto, head of issue has galvanized the community Comments in the audit report in- year. Ennis found that the county’s Primary Challenge, which advocates probably like no issue has done before, cluded that the project was “managed and that’s been positive.” vanpools are also 2½ times more ef- leaner government and lower taxes, in an ad-hoc manner,” the “existing ficient than Sound Transit’s regional calls the movement “a distraction.” It’s not the first time efforts to project plans are poorly designed and incorporate Swannanoa have failed. bus services. Vanpools also have the flawed,” and “who is in charge and ul- potential to serve 20 percent more Similar efforts were defeated in the SF composting mandate timately accountable is not clear.” 1950s and the 1970s. riders for $20 billion less than the “We weren’t just looking for transit system’s light rail expansion San Francisco residents and someone to pat us on the back,” said Falls Lake regulations plan. businesses will soon be required to City Manager Russell Allen of the au- Raleigh and Durham officials are The key to vanpools’ efficiency separate out all compostable mate- dit. arguing over the timetable to extend is that users cover two-thirds of op- rial from their trash. This is the lat- The city dismissed the indepen- erating expenses, a far higher per- dent contractor overseeing the project water-quality rules for Falls Lake. For est step toward the city’s stated goal their part, Durham city and county centage than is common in regional of sending nothing to the landfill by after the audit was released in Septem- transit systems. ber. It is also spending $2.25 million on officials are calling for more regional 2020, reports Cheryl K. Chumley for cooperation and additional scientific “Regional growth projections the Heartland Institute. consultants to help fix issues identified and travel patterns show there is a by the audit. data, reports The Herald-Sun of Dur- Under the new regulations, ham. The cost of meeting the proposed large undeveloped market in van- Raleigh residents are already feel- residents and businesses will be is- new standards is also a major concern pool demand,” says Ennis. ing the impact of the flawed upgrades. sued bins with three different colors: to Durham officials. “Yet, expanding vanpools is The city was forced to delay the imple- a green one for composting food and Under the current timeline, draft typically not a priority for state and mentation of a tiered water-pricing yard debris; a blue one for bottles, system that had been scheduled to go regulations for the lake are due before local governments as other, more in- cans, and paper; and a black one for the end of the year, with final adoption efficient transit modes are marketed into effect on Dec.1 because the billing everything that can’t be recycled or system wouldn’t be ready in time. due as early as January 2011. and funded.” composted. The new pricing regime is now The proposed standards for Falls Individuals who fail to sort scheduled to go into effect July 1. To Lake are more stringent than those re- Political downsizing their waste properly can be fined close a gap in the water system’s bud- cently adopted for Jordan Lake. $100 per violation. Businesses can be get, the city increased water rates by 13 The rules for Falls Lake are ex- In western New York, voters’ fined $500 per violation. Residents percent. pected to mandate a 40 percent de- frustration with their local govern- also can be fined if they don’t sub- crease in nitrogen levels and a 77 per- ments is taking an unusual track. mit at least a cubic yard of refuse for Swannanoa incorporation fails cent drop in phosphorus in the lake. By Not content to remove incumbents composting each week. It’s not easy to form a new town comparison, the reductions specified from office, voters are eliminating Whether the new regulations in North Carolina. Just ask proponents for portions of Jordan Lake were 35 the offices themselves, reports USA make any sense is a different ques- of incorporating the Buncombe Coun- percent for nitrogen and 5 percent for Today. tion. ty community of Swannanoa. After phosphorus. In 2009, four towns have con- “In the corrugated box indus- successfully lobbying the General As- There’s no firm estimate as sidered citizen-initiated referen- try, recycling has been cost-effec- sembly for permission to form a town, to how much it might cost to meet dums to reduce the size of their tive,” notes Max Schulz, a senior the drive failed at the ballot box, re- such standards. Durham officials town boards from five to three. In fellow at the Manhattan Institute. ports the Asheville Citizen-Times. fear it might cost the city and county all four cases, voters approved the “But for aluminum cans, it’s not. Under state law, one of the final a combined $500 million or more. reduction. This is more about making an steps in creating a new municipality is They also question whether it’s And in Niagara County, voters eco-statement.” CJ obtaining the consent of voters. Those even technologically feasible to meet living in the proposed town were not the proposed standards. CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 19 Seeking to Upset Status Quo, Gate City Demands New Leadership

By Sam A. Hieb finally voted re-election — to ers elected Knight, however, they also Contributor to fire Mitchell explore reopen- passed a $20 million bond referendum GREENSBORO Johnson by a ing the landfill. for the city’s natural science center. elcome to Greensboro, North 5-4 vote, with B a r - Despite his fiscally conservative Carolina’s “political outlier.” Yvonne John- ber’s proposal stance, Knight said he supported the That’s the way John son — who had sparked pro- science center bond. WLocke Foundation President John publicly de- test from East “I did a lot of homework on the Hood described the Gate City follow- fended the city G r e e n s b o r o issue, and I am convinced there will be ing the November municipal elections. manager — vot- residents. The an economic impact,” Knight said. While Hood’s post-election analysis ing against the city has since is- But he added that before the city noted that Democrats remained “firm- motion. Bill Knight Yvonne Johnson sued a request pursues other bonds for capital proj- ly in control of urban politics in our R e s t o r - for proposal ects and infrastructure, “we need to state,” Greensboro was the “outlier” ing confidence in the police depart- (RFP) from companies that can pro- know what the impact is going to be. because voters elected a new mayor ment was a major campaign issue for vide a waste disposal alternative, such Bonds are not free money.” and City Council based on a plat- Knight. Current Police Chief Tim Bel- as a biodiversion plant or a gasification Another major criticism of form of fiscal conservatism. Although lamy — who was assistant chief under plant. Yvonne Johnson’s administration was Greensboro’s council is officially non- Wray before becoming his permanent Knight said the council would ex- that it did not pay enough attention to partisan, registered Republicans now replacement — announced in Novem- plore all options, with an eye toward the budget process. Knight says that have the majority. ber that he would retire next year, so what’s most cost-effective. will change under his leadership. The mayor’s race was particular- the force will be under new leadership. “If someone is coming with a “The city council, in my mind, ly surprising. Bill Knight — a retired While Knight coherent plan to ignored the budget last year. It’s go- certified public accountant who had has been careful address waste ing to get a really hard look,” Knight never held political office — defeated not to criticize Bel- disposal that will said. “We’ve got to do things in a very incumbent Yvonne Johnson. Before she lamy, he also noted Problems in save the taxpay- prudent way and figure out how we’re was elected mayor in 2007, Johnson that the force has ers a lot of money, going to pay for it.” served many years on the City Coun- “lost a lot of the Police Department then I’m bound to Knight will not be the only new- cil, so she was definitely well-known. leadership struc- pay attention to comer in Greensboro city government. But while Knight’s victory may ture in the last three leading cause it,” Knight said. While several familiar faces will be sit- have surprised many, there also was or four years.” for vote Greensboro ting on the new council — including a sense that Greensboro was ready “The big also faces a stag- Mary Rakestraw in District 4, Trudy for serious change. The city has been thing is we need dissatisfaction gering debt load. Wade in District 5, and Robbie Perkins seemingly embroiled in one political to have a well- A recent report at-large — first-timers Jim Kee, repre- controversy after another, mostly sur- respected police by the Civitas In- senting District 2, and Danny Thomp- rounding former City Manager Mitch- force. That’s one of stitute found that son, holding another at-large seat, ell Johnson’s handling of issues inside the reasons why we have city govern- Greensboro taxpayers face $2.5 billion promised to bring fresh perspectives to the city’s police force. ment, is to provide for public safety,” in debt and unfunded obligations. As the council during the campaign. In January 2006, Johnson locked Knight said in a phone interview after a result, residents certainly will face a Knight also praised new City then-Police Chief David Wray out of the election. future tax increase, Civitas tax policy Manager Rashad Young, who took his office after a report by a private in- The city also faces a controversy analyst Brian Balfour noted in an op- over in October after serving as city vestigation company stated that Wray over its White Street municipal landfill. ed in the Greensboro News & Record. manager in Dayton, Ohio, for several discriminated against black police of- The landfill was closed to household “Taxpayers and workers will bear years. ficers. waste a few years ago, and the city the brunt of politicians’ short-sighted “He’s got some good ideas,” Wray eventually would resign, now trucks its garbage out of town. spending binges with a lower standard Knight said. “He’s the man in charge, but the controversy simmered for The expense prompted council mem- of living,” Balfour wrote. and the council will not micromanage three more years before the council ber Mike Barber — who did not seek At the same time Greensboro vot- city staff.” CJ Help us keep our presses rolling Publishing a newspaper is an ex- Visit our Triangle regional page pensive proposition. Just ask the many http://triangle.johnlocke.org daily newspapers that are having trouble making ends meet these days. It takes a large team of editors, re- The John Locke Foundation porters, photographers and copy editors has five regional Web sites span- to bring you the aggressive investigative ning the state from the mountains reporting you have become accustomed to the sea. to seeing in Carolina Journal each month. The Triangle regional page in- Putting their work on newsprint and cludes news, policy reports and then delivering it to more than 100,000 research of interest to people readers each month puts a sizeable dent in the John Locke Foundation’s budget. in the Research Triangle area. That’s why we’re asking you to help defray those costs with a donation. Just It also features the blog Right send a check to: Carolina Journal Fund, Angles, featuring commentary John Locke Foundation, 200 W. Morgan on issues confronting Triangle St., Suite 200, Raleigh, NC 27601. residents. 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John Locke Foundation | 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 The John Locke Foundation | 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 PAGE 20 DECEMBER 2009 | CAROLINA JOURNAL

From the Liberty Library Book review

• Time is running out on preventing Iran from developing Eureka Man: From Ancient World to Modern Science nuclear weapons — and President Obama’s soft approach to diplomacy • Alan Hirshfeld, Eureka Man: The Life and Legacy of Archi- earlier copies, hundreds of years after he set pen to papyrus. makes that threat even more urgent. medes, New York: Walker Publishing Co., 2009, 242 pages, The literary record of Archimedes is based on three parch- So writes New York Times best-selling $26.00. ment codices that once resided in the library of Alexandria. author Dore Gold. Two of them have disappeared, though further copies had In his new book, The Rise of By Hal Young been made. “The third survives but, in the utmost of iro- Nuclear Iran, Gold shows how Ira- Contributor nies, only through a singular act,” Hirshfeld says. “Having nian leaders have manipulated the RALEIGH outlived its usefulness as a mathematics text, the book was West expertly to buy time to develop aiders of the Lost Ark” proposed a quest for a Biblical erased.” nukes. artifact which disappeared before the birth of Christ; While Archimedes wrote on scrolls of papyrus, the in- Through diplomatic duplicity “National Treasure” suggested hidden messages lurk vention of parchment and vellum, made from animal skins, — saying one thing at the negotiating inR the founding documents of our country. In between those provided a more permanent base for later editions of the table while doing the opposite — Iran two fictions is a true story nearly as dramatic, involving a mathematician’s work. It was also more expensive, and has exploited the negotiation process discovery which could have advanced modern science and scribes often recycled discarded documents by a process by not only developing uranium to mathematics by centuries, uncovered only when a lost doc- of scraping, bleaching, and washing to remove old writing. weapons-grade levels covertly, but ument was purchased by an American technology magnate This marginally effective procedure often leaves shadows also gaining time to do so. whose identity remains as hid- of the older text underlying the In his book, Gold warns that den as the long-lost text. new, and like Mendelssohn dis- if we ignore the lessons of the past, Alan Hirshfeld’s Eureka covering Bach’s manuscripts future diplomatic efforts certainly Man is a fascinating new biog- among the fish wrappers, schol- will fail. This doesn’t mean that raphy of the Greek mathemati- ars have been able to recover engagement won’t work, Gold says, cian and scientist Archimedes, priceless source documents but we need to change our approach the one we remember for leap- from very mundane reuses. drastically and keep military options ing from his tub with the shout The surviving codex was on the table. “I have found it!” when the ris- hiding under the text of a 12th- Otherwise, Iran will become a ing bathwater suggested a solu- century liturgical manual when nuclear power and provide a nuclear tion to a knotty problem. The a Danish scholar discovered it umbrella for terrorists around the naked run through the streets in a Constantinople church in world. Learn more at www.regnery. of ancient Syracuse is almost 1906. If the monk who created com. certainly fictional, Hirshfeld the palimpsest hadn’t taken a says. What is true, though, is short cut washing the docu- • The Institute of Economic the tremendous impact the ment, the only known copy Affairs’ recent book The Legal Founda- “Master of Thought” had on of one of Archimedes’ works, tions of Free Markets brings together the development of geometry Method of Mechanical Theorems, nine experts in law and economics, and physics, reasoned through would have been lost. delving into the interface between with a numerical system that What makes this discov- the legal system and the economy. had no zero, or indeed, no dig- ery remarkable is Archimedes’ The book blends historical analysis, its as such — only letters, like discussion, found nowhere else, economics, and legal theory. the Romans used. of how he approached a class of The authors shed light on such While Archimedes was problems in solid geometry. His issues as whether common law foremost a theoretician, like technique of imagining an infi- systems are better than codified law Leonardo da Vinci he was val- nite number of cross sections of systems; the relationship between ued by pragmatic leaders for the solid is a fundamental pro- natural law and government law; his ability to contrive remark- cess in calculus, the calculation whether systems of law evolve able weapons. Apparently, of a Riemann sum. within societies or are imposed from Archimedes considered this Calculus was formalized above by government; and the role applied science unworthy of in the 18th century by Isaac of human rights, as guaranteed by notice, preferring to discuss ab- Newton and Gottfried Leibniz, constitutions. More at www.iea. stract math and geometry with who worked independently of org.uk/. other scientists of his era. It was left to ancient historians each other without the knowledge of Archimedes’ pioneer- to document his startling machinery, which allowed the de- ing work. What might have happened if Arabic or Renais- fenders of Syracuse to snatch invasion craft out of the water, sance mathematicians had been able to build upon the an- • Riding in an open-topped for example. cient Greek’s discovery, just as they had in other situations? convertible through Dallas on But his military acumen went far beyond gadgetry. Calculus could have been defined centuries earlier than it Nov. 22, 1963, Lyndon B. Johnson Hirshfeld shows the Master of Thought not only provided was, opening the possibility that math, physics, and other heard a sudden explosive sound at hardware, but also outlined training and tactics that made sciences could be lifetimes ahead of where they are today. 12:30 p.m. The Secret Service sped Syracuse nearly impregnable. His carefully positioned cata- The travels of the document from ancient Alexandria him away to safety, but not until pults and crossbows decimated invading armies long before through many changes of possession (about half of them le- 1:20 p.m. did he learn that John F. they reached the city walls. And he cannily dispersed the gal) to its most recent sale at Christie’s auction (in spite of Kennedy had been assassinated. limited personnel, giving them specific duties to defend the the intervention of the Greek Orthodox patriarchate) make In November 22, 1963, historian city. “Archimedes was simultaneously defense secretary, up the adventure-story aspect of the book. Hirshfeld enjoys Steven Gillon tells the story of how five-star general, and one-man Skunk Works, devising ad- the yarn and tells it well. Johnson consolidated power in the vanced weaponry and formulating, if not implementing, There are a few passages where the author, a phys- 24 hours following the assassina- strategy,” he says. ics professor, dwells lovingly on Archimedes’ explana- tion. Based on scrupulous research The one thing Archimedes could not leverage was citi- tions of particular problems. Frankly, even as an engi- and new archival sources, this zens’ loyalty; when the city fell, it was due to betrayal, not neer I found these a little mind-numbing and chose to gripping narrative sheds new and assault. In a way, it was consistent that the elderly math- skim a page or two to get back to the narrative portion. surprising light on one of the most ematician died from a blow from behind. These are only minor distractions in a perfectly written-about events of the 20th The second half of the book, “A Palimpsest’s Tale,” is readable account that stretches from the shore of an- century. Visit www.perseusbooks- as gripping as the first. The works of Archimedes, like most cient Sicily into every laboratory in the Western world. group.com to learn more. CJ ancient texts, are completely lost in the original. What we When it comes to fundamentals of science and math, know of his writing comes from copies transcribed from eventually we all discover Archimedes. CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 21 A Strong Federal System Offers Best Protection Against Tyranny ith the renewed interest in eral form of government because they ety is neither the state nor national affairs. … Everywhere men are leav- state sovereignty and feder- believed that people in a particular government. He argues that political ing behind the liberty of the Middle alism as alternatives to the state were more similar than different. society starts with the family, which Ages, not to enter into a modern Wcurrent march toward centralization, And in many ways, they were correct. associates with other families, forms a brand of liberty but to return to the Americans forget that states can abuse People referred to themselves primar- village, and gives authority to its lead- ancient despotism; for centralization power, too. ily as being “Virginian” or “North ers. Villages form provinces and give is nothing else than an up-to-date ver- State lead- Carolinian” and not “American.” authority to that government, and so sion of the administration seen in the ers have abused It was believed that people in the on. Meanwhile, individuals have the Roman Empire.” power, and state states would enact laws that reflected right to contract with other individu- According to the Founders, governments prob- their beliefs. What might be consid- als to form associations and the like. people give authority to government, ably will do so ered unjust in Connecticut, to use one The Founders admired Althu- beginning at the local community, again. Defenders example, might be considered fair in sian thought and the Dutch federation moving then to the state and onward of centralization Delaware. Tyranny, it was believed, in which he lived. Althusius’ ideas to the national level. In essence, fami- highlight those was less likely in a federal system. also influenced the philosopher David lies created villages, villages created facts when at- The Founders’ sense of federal- Hume, who likewise influenced many local governments, local units created tempting to nullify ism was informed by an understand- Founders. the states, and the states created the arguments call- ing of the Dutch philosopher Johannes To say that the American Revo- national government. ing for a weaker TROY Althusius (1557-1638). When the lution and the French Revolution were Long before there was a United national govern- KICKLER Founders declared independence more similar than different is absurd. States of America there was a North ment. The abuses from Great Britain, the action seemed Leaders in both revolutions, to be Carolina. Long before North Carolina, of power at the state level prove only more attuned to medieval times than sure, were products of their times. there were towns and villages and that one should question government a product of the Enlightenment. The Yet one wanted to start something families. actions constantly at the state, nation- Founders were not trying to over- new while preserving what was good Americans are starting to reclaim al, and local levels. Watchdogs should throw King George III; they were and true. The other sought destruc- the Ninth and 10th Amendments, but exist at each level. trying to form what they considered tion while ushering in a new age that states’ rights should not be “the be all Although all government has to be a more just government while resorted to age-old tyranny. and end all.” Federalism should be the potential to be draconian, it is far preserving their liberties as English- The latter, the French Revolution, alive and well within a state’s borders, better for you and me to deal with a men. King George III was the modern, shocked Alexis de Tocqueville: “The too. CJ smaller and weaker government than progressive one, who made justifica- old localized authorities disappear a gargantuan one whose size instills tions for the unitary state. without either revival or replacement, Dr. Troy Kickler is director of the fear and discourages criticism. In Politica (1603), Althusius and everywhere the central govern- North Carolina History Project (www. The Founders believed in a fed- argues that the first political soci- ment succeeds them in the direction of northcarolinahistory.org). Stay in the know with the JLF blogs Visit our family of weblogs for immediate analysis and commentary on issues great and small www.JohnLocke.org YOUR HOME ON THE WEB FOR The Locker Room is the blog on the main JLF Web site. All JLF employees and many friends of the foundation post on this site every day: http://www.johnlocke.org/lockerroom/ NORTH CAROLINA PUBLIC POLICY Creating your own personal Key Account at www.JohnLocke.org is a great starting place for tracking the critical public policy issues facing North Carolina.

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The John Locke Foundation, 200 W. Morgan St., Raleigh, NC 27601 | 919-828-3876 PAGE 22 DECEMBER 2009 | CAROLINA JOURNAL

Short Takes on Culture Book review The Founders’ Endorsement Beck Provides Ammo for Arguments • Glenn Beck, Arguing with Idiots: How “Sicko” are shocking. The idea that •The Founding Fathers Reconsidered on the radio his sextet for piano and to Stop Small Minds and Big Government, Cubans have a longer life expectancy

By R.B. Bernstein winds. The first few measures of the New York: Threshold Editions, 326 than U.S. residents may have a lot to Oxford University Press piece hooked me. pages, $29.99. do with the deprivation imposed by I later tracked down the record- the Communist regime. “While Cu- ew topics in American history ing. It’s Naxos 8.570790 and contains By Melissa Mitchell bans eat to stay alive, we eat to kill generate more heat these days both the sextet and a quintet for piano Contributor ourselves. They do not have up-to-date than the Founding Fathers. and strings. RALEIGH cars, so they exercise more,” says Beck. FShould we revere them for their efforts What’s so good about this o be truthful, the only reason I In the chapter “In Defense of to erect the framework of our more music? Thuille could write lovely decided to read Glenn Beck’s Capitalism,” Beck provides factual in- than two-century-old constitutional melodies — the kind that stick in your book, Arguing With Idiots: How to formation about the failure of socialism republic? Should we revile these head long afterward — and these two StopT Small Minds and Big Government, and shows how government programs “dead white males” for their unwill- pieces are full of them. His harmonies was because I was curious about him. like Fannie Mae and Freddie Mac, Am- ingness to erase America’s “original delight the ear, and his rhythms are I had seen him on various Fox News trak, and the U.S. Postal Service are sin” of slavery? engaging. The two are rather different shows, and I had listened to his TV costly failures. Had R.B. Bernstein of the New in character: the sextet is a very sunny show on my satellite radio, but I could Using the example of the 10 per- York University Law School answered piece while the quintet is more dark not discern if he was an emotional nut cent tax Pennsylvania levied on alco- either of those questions with an and dramatic. or an informed pundit. hol sales in 1936 to help the victims of emphatic “yes,” it’s likely his latest The sound on the disc is gor- It is no secret that Beck does not the Johnstown Flood, Beck explains book would have suffered. Instead geous, and the performers (the like most elected officials, but his dis- how temporary taxes are never tempo- Bernstein explores those questions Chantily wind quintet, the Gigli string like and distrust of the Obama admin- rary. The damage caused by the flood from multiple angles. Though brief, quartet, and pianist Gianluca Luisi) all istration tops his list, and he is on a 73 years ago cost $40,000. Not only is his work offers a good entry point for play with obvious conviction. crusade to stop what he sees as policies the tax still in effect, Beck says, “greedy any reader considering a leap into the Try this delightful and inexpen- that will destroy our nation and our legislators have raised the tax to 18 literature of the founding era. sive CD. You’ll be glad you did. way of life. The percent.” More- One of Bernstein’s more in- — GEORGE LEEF goal of Arguing over, “Since 1936, teresting emphases is the extent to With Idiots is to Pennsylvania has which latter-day politicians of various teach people how collected over stripes tied their policies to those of to win arguments $15.4 billion from the founding generation. “Franklin D. •Vincent Andrew Hartgen: His Art with people who, this tax.” Roosevelt,” he writes, “who embraced and Legacy Beck says, “have My favor- a pragmatic, experimental approach By David Hartgen big mouths and ite chapter is “U. to the problems of government, regu- Wildflower Lane Publishing small minds.” S. Presidents: A larly sought to align himself and his The book is Steady Progres- administration with the founding David Hartgen, a nationally filled with great sion of Progres- fathers.” known transportation expert and information, but sives.” In this That approach failed FDR in John Locke Foundation policy ana- before I could chapter, start- 1937 when he sought to pack the lyst, has left the realm of transpor- appreciate and ing with Teddy Supreme Court with New Deal apolo- tation to produce a book about his absorb the infor- Roosevelt, Beck gists. “The plan sparked a firestorm of artist father. mation, I had to takes most of criticism and controversy,” Bernstein In Vincent Andrew Hartgen: His overcome two the presidents writes. “To many Americans, it ap- Art and Legacy, David, his brother hurdles. First, I of the last 110 peared that Roosevelt had challenged Stephen, and art book author Carl found the yellow years to task for the founding fathers, and lost.” Little chronicle the career and artwork notebook back- their progressive Bernstein’s work will help read- of Vincent Hartgen. Vincent’s career ground on the views. “Anyone ers understand why Roosevelt and spanned 70 years and produced over book’s pages ir- who’s listened to other 20th-century politicians sought 1,800 known major works and several ritating until I got used to it. Second, me for more than five minutes knows the founders’ “endorsement.” thousand sketches. As head of the the textbook format with footnotes that I hate almost everything progres- — MITCH KOKAI art department at the University of and boxes filled with comments and sives stand for,” states Beck. He notes Maine at Orono, he taught over 10,000 cartoons surrounding the text left me how they believe that the Constitu- students. wondering if these boxes should be tion is an evolving document, distrust Some might classify the volume read before, during, or after the text. wealth and big business, and believe • Sextet for Piano and Winds as a coffee table book, but it is far I considered not reading these quips, big-government programs solve prob- Composed by Ludwig Thuille more. The book tells of the struggles but I realized these asides provide hu- lems. “While Bush may have been Pianist Gianluca Luisi and hardships that Vincent faced as morous relief in the midst of serious progressive-lite, Obama is an extra- a young man and throughout his life, and disturbing information. strength version, willing to push the I’ve been enjoying great music including the death of his father the With health care reform the No. progressive agenda farther than most since I was a teenager and long ago day before Christmas in 1934, which 1 topic in America, Beck’s chapter on supporters could’ve ever fathomed,” became acquainted with the famous prompted Vincent to leave the Uni- universal health care is a must-read. says Beck. composers — Bach, Haydn, Mozart, versity of Pennsylvania for a year to Beck provides documented informa- When I first saw the dust cover Beethoven, Chopin, Brahms, etc. — help at home. tion that debunks the many talking of Arguing with Idiots, with Beck’s Nazi and many others who are less well- Vincent is an inspiration. He points supporting government health stance on the front cover and his tear- known but still immensely enjoyable. retired at age 69 but continued to care. From the statistics about the num- streaked face on the back, I was certain Having explored the classical work into his 80s, producing a major bers of uninsured in the U.S., the health that Glenn Beck would prove to be an repertoire for more than 40 years, show at age 75 and again at age 80. care mess in Massachusetts, and the emotional nut. But I was totally wrong. it’s rare for me to come across a good Even in the final months before his truth about the Canadian and United After reading his book, I found that composer I hadn’t previously known, death at age 88, he continued to paint Kingdom health care systems, Beck’s he is a well-informed writer and an but I recently did. That composer is and draw. book reveals the truth behind those American who deeply cares about this Ludwig Thuille (pronounced “Teel”), A wonderful book for the bud- talking points. county’s slide into socialism, and I am a German who lived from 1861 to ding artist and art lover. Beck’s revelations about the fal- now yearning for an argument with a 1907. While driving, I chanced to hear — MELISSA MITCHELL CJ lacies within Michael Moore’s movie liberal. CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 23 Two Lively Whodunits Expose Causes of Current Financial Crisis • Johan Norberg, Financial Fiasco: How America’s In- what are now called “troubled”) loans. The GSEs New Deal’s handling of it. President Hoover began fatuation With Homeownership and Easy Money Created were encouraged by the politicians, because hom- several “social engineering” programs. President the Economic Crisis, Washington, D.C.: The Cato Insti- eownership is “the American Way.” Franklin Roosevelt denounced them but built on tute, 2009, 186 pages, $21.95. When buyers still couldn’t afford houses, down them when in office. He tried heavy spending and payments were cut and in many cases eliminated. price fixing, and he abandoned the gold standard. He • Thomas E. Woods Jr., Meltdown: A Free-Market Look Creditworthiness was not checked. These were bad extended the Depression for eight years and caused a at Why the Stock Market Collapsed, the Economy Tanked, business practices, but with government’s encour- second depression in 1937. and Government Bailouts Will Make Things Worse, agement and backing, risk seemed slight. Other bad Norberg recounts that President Harding came Washington, D.C.: Regnery Publishing, 2009, 194 examples are described in another new book, The into office in 1921 during a depression. He lowered pages, $27.95 Sellout, by Charles Gasparino, which notes that the taxes, halved federal spending, and did not try to pre- top Merrill Lynch executive never found time to learn vent wages from falling and companies from com- By George Stephens about his firm’s multibillion-dollar “warehouse” of peting with each other. Bad companies were wound Contributor collateralized debt obligations. He was fired, but a up, while the competitive ones got more capital RALEIGH successor did not ask to see details on the assets that and cheaper labor. The economy grew by 6 percent ohan Norberg is a historian from Sweden. Thomas were generating billions in losses. in 1922, and unemployment fell from 4.9 million to Woods is an American economist. Both have writ- The Community Reinvestment Act required 2.8 million. The recovery took a year, and few know ten lively, readable “whodunits” on the causes of that banks not “redline” lending based on the racial about it now. Harding is remembered for the “Teapot Jthe current financial crisis and the responses of busi- makeup of neighborhoods, even if loans had to be Dome” oil scandal, but he deserves to be known for ness and government. made to people who could not repay them. The act his successful, free-market solution to a depression. They blame both sectors, but also provided fed- In the recent crisis politicians they identify the Federal Reserve as eral funds to organize “rode madly off in all directions,” un- the primary culprit, while Woods communities to lobby der public pressure to “do something.” adds wryly that the Fed is rarely men- for government action They tried “bailouts” and “stimulus” tioned as the culprit, only as the sav- to solve their prob- spending. Norberg says that to make ior. As crisis creator it is followed in lems. financial storms less severe we should importance by Fannie Mae, Freddie Is the market “remove the safeguards and untie the Mac, and the Community Reinvest- economy prone to safety nets.” ment Act. The books identify and de- sudden and inexpli- Woods gives specific prescrip- tail similar causes and effects. cable episodes of mas- tions: let firms go bankrupt (the assets Opinion makers have told sive business error, are there but need to be reorganized), Americans that the free-market econ- asks Woods? No. The abolish Fannie and Freddie, stop the omy has failed, but we do not have cause is not capital- bailouts, cut government spending, a free economy. Market greed has ism, nor greed, nor end government manipulation of been fingered, says Woods, which is deregulation, but money, put the Fed on the table, close like saying that airplane crashes are rather the Federal Re- the special lending windows, and end caused by gravity. The failures were serve’s interference manipulation of money. And, as he re- caused by government intervention. with interest rates. minds us, the Austrians told us so. The Federal Reserve held interest rates too low, too He summarizes the Austrian business cycle theory Another who forecast the housing collapse long, so there was a surplus of money for the same developed by Ludwig von Mises, Friederich Hayek and recession, in 2006, in writing, was Peter Schiff, goods and services, which is inflation. The monetary and others, which shows that if interest rates are who runs an investment fund and is now listened to surplus sent unwarranted signals to go ahead with lowered naturally, as for increased saving, the mar- respectfully. He believes: “The crisis is still in front projects and deals. ket works smoothly. If they are forced down by the of us, and I think it’s going to be horrific. And my Fannie Mae (created by the New Deal) and Fed, it seems that there is plenty of money for proj- fear is that the government is going to continue to Freddie Mac are congressionally chartered “govern- ects when there is not. It is bound to lead to a bust. make the same mistakes that have made this crisis ment-sponsored enterprises” (GSEs) which enjoyed Norberg echoes the importance of Austrian theory. inevitable. … The government responds by seizing privileges and tax breaks. They bought mortgages Both authors examine parallels between the more power, and we surrender more liberties, and from the banks, packaged them, and sold them to current financial collapse and the Great Depression more of the Constitution is shredded, all in the name investors, so the banks could quickly make more (of (caused principally by high tariffs), along with the of trying to solve problems.” CJ Books authored By JLF staFFers Selling the Dream Why Advertising is Good Business

By John Hood President of the John Locke Foundation

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

www.praeger.com PAGE 24 DECEMBER 2009 | CAROLINA JOURNAL

COMMENTARY Do-Nothing Ethics Commission hen the North Carolina qualities of North Carolina’s public State Government Ethics servants. Act was signed into law One has to wonder what Win 2006, many hoped that unethi- exactly is the point of having an cal conduct on the part of public Ethics Commission if it is not going officials in the state would at best to take its role as an investigative or decrease and at worst be exposed enforcement entity seriously. and investigated. Unfortunately, Do we really need to have 10 neither has been realized. salaried employees to file finan- The high-profile cases of for- cial paperwork and offer advisory mer Speaker of the House Jim Black, opinions? Also, the eight commis- former state Rep. Mike Decker, sioners who are expected to serve as former N.C. Lottery Commissioner a public watchdog have been silent Kevin Geddings, former U.S. Rep. in the face of the state’s continuing Frank Ballance, former Commis- ethics crisis. sioner of Agriculture Meg Scott The commission has entirely EDITORIAL Phipps, and others led to the estab- too much discretion to ignore or lishment of a more formal dismiss complaints. And ethics entity for the state since the General As- of North Carolina. sembly controls the purse Economic Forecast There was hope strings of the Ethics Com- that establishing a proac- mission, how can the com- tive Ethics Commission mission effectively police Gloomy For 2010 would thwart unethical the same entity that makes behavior from public of- its existence possible? he state’s political establish- smelting plant that closed in 2002. ficials. However, in nearly Since it is difficult ment has a Christmas present Hundreds of jobs were lost. Even three years of existence, to legislate “doing the for every North Carolinian: a though the dams continue to produce the commission has done right thing” with an Ethics Tlump of coal. Make that two lumps if clean electricity, and pay taxes to local little. Not a single reso- LES Commission whose mem- you happen to be an entrepreneur or communities, state officials want to lution of note has come MERRITT bers are appointed by po- employee. seize the dams. In an October filing, as a result of any Ethics litical leaders and whose The General Assembly — with Secretary of Commerce Keith Crisco Commission investiga- funding is controlled by the blessing of the Perdue adminis- told federal energy regulators that tion, even though several dozen those about whom it may receive tration — continues to toy with the Alcoa’s “failure to contribute in any complaints have been submitted or an allegation of wrongdoing, the private economy as if its actions have manner to the economic health and referred. media become even more relevant no impact on job formation, capital well-being of North Carolina … has For example, media reports to counter public corruption. investment, or economic growth. Busi- left the state no choice but to act to indicate that former Gov. Mike It also is essential that inde- nesses with connections to policymak- save this resource from [Alcoa’s] ne- ers, and employers the establishment glect, by becoming the conscientious Easley allegedly failed to disclose pendent organizations such as the hopes to woo, are showered with operator of this invaluable resource a seemingly inappropriate rela- Foundation for Ethics in Public favors. Companies that lack political for the public good.” tionship with homebuilder Nick Service assist the media in expos- juice are punished. And instead of Translation: No business in Garrett, but this went undetected, ing cases of corruption. We are a keeping government limited to its core North Carolina is safe from a vindic- or perhaps unchallenged, by the nonpartisan, nonprofit organiza- functions — law enforcement, essen- tive political class. Ethics Commission. Meanwhile, a tion that does not rely for financial tial pubic services, needed infrastruc- • The state keeps lavishing Board of Elections investigation of support on the potential or actual ture — state officials continue to waste taxpayer incentives on favored busi- Easley made a criminal referral to subjects of complaints. Since we do taxpayers’ money on projects that are nesses — including successful ones. In the Wake County District Attorney, not accept any government money, better left to the private sector, or not August, Novartis landed roughly $40 and a federal grand jury is report- we are able to freely, fairly, and undertaken at all. million in state and local tax breaks to edly looking into possible campaign forthrightly examine all complaints Raleigh’s populist response to expand its vaccine production plant. finance violations by Easley and we receive without fearing retalia- the recession is both telling and pre- And in mid-November, Perdue an- his donors and is asking how his tion. dictable: nounced a new package of $20 million wife, Mary, obtained her position Conflicts of interest and politi- • This year’s General Assem- in state and local taxpayer giveaways (and subsequent 88-percent raise) at cal influence are much less likely bly imposed a $1-billion-a-year tax to Talecris, North Carolina’s largest North Carolina State University. — hopefully absent — when the increase and broadened the tax base biotech firm. The company recently These are only a few of the investigative, referral, and report- so that a host of services were added had raised more than $1.7 billion from possible violations of honest ser- ing processes are in the hands of to the revenue rolls. The increase was investors. vices law the federal grand jury a nongovernmental, nonpartisan unnecessary and will be used to in- For decades, North Carolina presumably is investigating. None entity like the Foundation for Ethics crease spending rather than close any politicians have treated the state’s of these issues appears to have been in Public Service. Our donors, com- anticipated deficit. The 2009-10 budget private economy as their personal investigated by the Ethics Commis- plainants, witnesses, and the greater came in at more than $20.4 billion — ATM. This crony capitalism has left sion. public expect, and will receive, $800 million more than was actually entrepreneurs and their employees Earlier in the year, Ethics nothing less than unconditional ob- spent in the previous fiscal year. vulnerable to the whims and fetishes Commission staff said on several jectivity. CJ • Gov. Bev Perdue continues of elected officials. occasions that the fact that there to champion a hostile state takeover The economy will rebound, but a have been no substantiated cases Les Merritt, North Carolina State of four hydroelectric dams in central lasting recovery requires lower taxes, resulting from allegations submit- Auditor from 2005-09, is executive North Carolina that have been owned streamlined regulations, and a legis- ted to the Ethics Commission dem- director of the Foundation for Ethics in and operated by Alcoa for 90 years. lative climate that respects property onstrates the ethics and high moral Public Service. Why? The governor and her legisla- rights and the rule of law. Sadly, it’s tive allies apparently don’t like Alcoa. hard to find those items on lawmak- The dams powered an Alcoa ers’ Christmas lists. CJ DECEMBER 2009 | CAROLINA JOURNAL PAGE 25

EDITORIALS COMMENTARY Call Out the Reserves Election Sends North Carolina should increase rainy-day fund Mixed Signals he State of North Carolina is and spared affected employees and now scrutinizing the monthly vendors a sudden, painful jolt. he 2009 election cycle is a the school system’s unpopular and financials of two western coun- The John Locke Foundation’s Joe prime example of how politi- unsuccessful combination of forced ties,T Swain and Yancey. They’ve fallen Coletti recently wrote about these is- cal trends are sometimes hard busing, mandatory year-round under the fiscal thumb of state of- sues in a policy paper. He argued that Tto spot when they’re approaching, schooling, and bureaucratic arro- ficials because a combination of slack not only should North Carolina dou- hard to describe when they arrive, gance. revenues and excess expenses has ble the reserve requirement for state and hard to flag when they’ve run Republicans also won a pulled their general fund balances government to 10 percent of spending, their course. number of contested mayoral and below the 8 percent minimum that but the state also should adopt several Around the country, conserva- council races in smaller communi- North Carolina localities are expected other reforms to improve the budget- to maintain. ing process. For example: tives and Republicans were jubilant ties across the state. But they don’t The irony is, of course, that the • The budget bill should be about the outcome of two guber- typically draw the media attention State of North Carolina has itself nev- available at least 72 hours before law- natorial races in Virginia that the big-city races do. er set aside as much as 8 percent of its makers vote on it. and New Jersey watched So what are we to General Fund budget as a rainy-day • Fiscal policies should be evalu- closely this year for signs make of all this? reserve. Its target has been 5 percent, ated and adopted on the basis of look- of a GOP resurgence. But Well, the national and the balance has been below target ing five fiscal years into the future, not the story was a bit more story is pretty clear. In a number of times over the years. just the two fiscal years in a budget muddled here in North most of the key contests Inattention to budgetary trends biennium. Carolina. around the country, Re- and reserves can’t entirely explain • The second-year budget of the Back in the 1990s, publicans were far more the recent state budget crisis. At the biennium ought to be a realistic one, Republican gains in legis- motivated to turn out approach of the Great Recession last building in program growth rather lative and congressional than Democrats, which year, just about every state govern- than assuming flat budgets that rarely seats were preceded by is to be expected after ment in the United States experienced occur in reality. Republican or conserva- JOHN two cycles of being wal- a drop-off in expected revenue and • While budget analysts of all tive successes in munici- HOOD loped and nearly a year spending increases in public-assis- stripes might agree so far, Coletti also pal politics. It wasn’t just of watching left-wing tance programs. argues for a constitutional limita- current GOP state chair- government in action Even a fully funded savings tion on the annual rate of spend- man Tom Fetzer’s win for Raleigh in Washington. These things do, reserve wouldn’t have eliminated the ing growth, a Taxpayer Protection mayor in 1993 that signified the indeed, go in cycles. Democrats got need for incoming Gov. Beverly Per- Amendment similar to Colorado’s. trend. Republicans also did well in riled up after losing a 2004 presi- due to cut billions of dollars from the The Left dislikes spending caps, other cities. By the late 1990s, there dential election they thought they’d authorized budget to bring expenses arguing that they constrain legislative were Republican mayors in Char- win and got busy electing Demo- and revenues in line. But a healthy re- discretion. lotte, Winston-Salem, Durham, and crats to local, district, and state serve would have made her job easier, Exactly. CJ Wilmington. Greensboro’s mayor offices in 2005 and 2006. Now, the was the only one to remain Demo- Republicans are staging a come- cratic throughout the period. back. The 2009 balloting yields a On the other hand, economic strikingly different picture. Demo- worries and a popular backlash No Longer Low-Tax crat Anthony Foxx defeated Re- against President Obama’s fiscal publican John Lassiter in the race and health care policies can only Our state is going the way of New Jersey to replace Pat McCrory as mayor of put Republican candidates in a Charlotte. Since McCrory had been position to win close contests. But or decades, the conventional computation of sales tax rates puts the only GOP mayor of a large N.C. there are no guarantees. Against wisdom goes, North Carolina North Carolina’s average at just over city, you’d think that would com- that tailwind, the Democrats took has had a relatively high mar- 8 percent, the eight-highest tax rate in plete a Democratic sweep of all the the Charlotte mayor’s race for the ginalF tax rate on individual income. the nation. top mayoral posts. first time since Harvey Gantt lost to Our corporate tax rate also has Regarding property taxes, many But in Greensboro, of all Sue Myrick in 1987. In the Queen remained high by national standards. North Carolinians may not believe places, the incumbent Democratic City, which went solidly for blue While these taxes are very visible, this, but our rates remain fairly low mayor Yvonne Johnson fell to candidates in the 2008 cycle as well, prompting complaints from profes- by national standards. If you look at Republican challenger Bill Knight, Democrats ran a better campaign — sionals and retirees and dire warn- property-tax collections per person, who ran on a fiscally conservative as did Greensboro’s new mayor, the ings from corporate executives, the for example, North Carolina ranks platform. Republicans also now conservative Knight. conventional wisdom continues, the 38th. But we used to rank even lower have a majority of seats on the Charlotte turned left, Greens- state’s property and sales taxes are than that. Greensboro City Council. (The races boro turned right. But now starts low by national standards. The result Overall, then, North Carolina is are nonpartisan, but the candidates the Big One — the 2010 election is at least a wash, it was said, if not a not a low-tax state. We haven’t been a made no secret of their party affili- cycle for federal and state offices. “low-tax” ranking for the state. low-tax state in a long time. Last year, ations.) The stakes couldn’t be higher, with This conventional wisdom is out North Carolinians paid 9.8 percent North Carolinians on the right redistricting to follow in 2011 and of date. of personal income in state and local side of the political spectrum had Obama’s agenda still largely on the North Carolina still has a high taxes, putting us slightly above the na- another significant election victory drawing board. Candidate filing and economically destructive income- tional average and 20th in tax burdens to celebrate. In Wake County, voters here in North Carolina starts in tax burden. But now, after years of nationally. ratified the conservative takeover February. Politics takes few vaca- of the school board by giving John tions. CJ state and local tax hikes, we levy one Are we New Jersey, the top- Tedesco the last of the four seats up of the highest tax rates on retail sales taxing state with an average burden for grabs this year. A majority on John Hood is president of the John in the nation. Our property taxes have of nearly 12 percent of income? No, the board now favors getting rid of Locke Foundation. been creeping up, as well. not yet. But we’re not Texas (43rd) or The latest Tax Foundation Florida (47th), either. CJ PAGE 26 DECEMBER 2009 | CAROLINA JOURNAL

EDITORIAL BRIEFS Young Firms Key to Job Growth

nemployment figures continue to paint a bleak picture for American workers. Unfortunately, policymakers often fo- Ucus on the wrong types of businesses as keys to job creation, argue Carl Schramm, Robert Litan, and Dane Stangler of the Kauffman Foundation in The Wall Street Journal. The conventional wisdom is that “small businesses” — a term generally defined to in- clude all companies with fewer than 500 em- ployees — account for half of all jobs and is a potential engine for job creation. That view is not quite right. “The more precise factor is not the size of businesses, but rather their age,” say Schramm, Litan, and Stangler. Census Bureau data show that virtually all net job creation since 1980 has occurred in firms less than five years old. Without new business- es, the number of jobs in America would have been decreasing for many years. The authors recommend four measures to encourage new businesses: What Really Caused the Recession? • Welcome immigrants seeking scientific training to U.S. universities. From 1995 to 2005, fter being married for 30 years, my wife And after the modest recession of 2001, that frequently reminds me that economists are fuel came courtesy of two sources — the Federal immigrants founded or co-founded a quarter of different. We look at the world in a different Reserve and foreign investors. Standard operating all U.S. high-tech firms. wayA than most people. A good example is the cause procedure during a recession is for the Federal Re- • Unleash academic entrepreneurs. Allow of the recession. Most agree the recession began in serve to lower interest rates and pump money into academics to use the technology licensing of- the housing market. We had an enormous run-up in the economy. Beginning in 2001, the Fed did this. fice of any university as long as royalty-sharing housing prices, housing construction, and home- But there was a difference. Although the agreements are honored. buying during the early and middle part of this production side of the economy began recovering in • Provide easier access to capital. Lending decade. The collapse of this bulging housing market 2002, jobs didn’t start to come back until mid-2003. standards vary too much based on the condition ultimately brought the entire So the Fed kept its foot on the money accelerator of the general economy. More flexible lending economy to its knees. well into 2004. This provided ample cash and credit standards are appropriate when the economy is But this begs the question — fuel — for the now booming housing market, and weak. of what set up the housing mar- the increased homebuying and price appreciation • Make it easier for firms to go public. ket for its fall. The conventional that resulted kept renewing the spark. Provisions of the Sarbanes-Oxley Act make it answer is greed, incompetence, Another source of money for the housing difficult for companies to attract investment. and a focus on short-run gains at machine was from foreign investors. Globalization the expense of long-run losses. has enriched many foreign countries, and in some Fighting malaria The explanation given is that of these countries saving rates are extremely high. homebuyers snapped up cheap So such countries generated huge pools of new One of the arguments for limiting carbon mortgages offered by lenders funds, and since housing in the U.S. appeared to be emissions is that global warming will increase who were out to make a quick MICHAEL such a good investment, many of these funds made the number of deaths from malaria. It would buck, and builders simply tried WALDEN their way here in the form of mortgage investments. be much more cost-effective to fight malaria to keep up with the demand by This action made the housing spiral go higher and through better access to medicine and preventa- constructing more homes. higher. tive measures, writes Bjorn Lomborg of the Co- Economists have two problems with this So what ultimately pulled the housing spiral penhagen Consensus Center in The Wall Street explanation. First, why would greed suddenly down? In a word ­— concern — concern at the Fed Journal. show up this decade and in the housing market? that the housing market had reached levels which Some global warming models show that Our training tells us that the motivating factor for weren’t sustainable. Ultimately, the Fed pulled the by 2100, an additional 3 percent of the popula- businesses — profit — always exists, and we as- plug on the housing market by increasing inter- tion will be at risk of catching malaria. To com- sume any business wants to make as much profit est rates and limiting credit availability. The Fed bat this, sharp cuts in carbon emissions are be- as quickly as it can. Likewise, buyers will make thought there would be an orderly retreat in the ing proposed, costing $40 billion a year by 2100. decisions which (they believe) will lead to greater housing market, with housing appreciation rates “Malaria is only weakly related to tem- happiness for them. settling down to “normal” levels of between 2 perature; it is strongly related to poverty,” notes The spark for the conflagration came in 1997 percent and 3 percent annually. Instead, optimism Lomborg. when the income tax code was changed for home in the housing market quickly turned to pessimism, The most commonly used anti-malarial sellers. Before, for the seller of a home to escape and the retreat became a rout. drug, chloroquine, is becoming less and less tax on any profit made from the sale, the seller had What are the lessons? First, things always effective over time as the malaria parasite de- to purchase a home of equal or comparable value look different with the benefit of hindsight. Many velops resistance to it. An alternative therapy within 18 months. mortgages that look bad now looked good at the In 1997 the requirement for buying another time when credit was cheap and plentiful and home including the drug artemisinin exists, but costs home was removed. Now, any time a person sold values were skyrocketing. Second, motivations are about 10 times as much as chloroquine. his home, profits for most homebuyers automati- important, but there has to be support — fuel — to The Copenhagen Consensus Center esti- cally were kept tax-free. Suddenly people began support continuing trends. Which leads to the mates that spending $3 billion a year on anti- looking at homes much more as a tax shelter. Al- question — are we putting these lessons to good use malarial drugs, additional mosquito nets, and most immediately home sales began to rise, as did today? CJ environmentally safe indoor DDT sprays could home prices. But for the spark really to catch, fuel cut the number of deaths from malaria in half had to be added in the form of cheap money and Michael Walden is a William Neal Reynolds Dis- within a decade. CJ plenty of it. tinguished Professor at North Carolina State University. DECEMBER 2009 | CAROLINA JOURNAL PAGE 27 What a University Is Not his year, 2009, has been an annus faculty members to teach whatever is reinforced by reward systems that inflexible way of thinking. Adminis- horribilis for the University of they want. It does not exist to allow incentivize the wrong kind of behav- trators should forget the politics and North Carolina system. Per- administrators to push initiatives in ior. Bad administrators, for example, lead the university. Our accomplish- Tmanent budgets have been cut in the which the broader academic commu- are paid much more than valuable ments should persuade the public and range of 6 to 10 percent and many nity or public is uninterested or that teachers and researchers. politicians of our value. activities frozen. will generate little value. Researchers • A liberal interest group. The • A community college. The At N.C. State, a highly publicized should not look on it as a home for university should not be in the busi- public needs to understand that its scandal involving their pet interests. ness of trying to move federal and university system is not an exten- former first lady Instead, a public university state policy in a leftward direction. sion of its community colleges. The Mary Easley has should improve the human condition But that is precisely what some want latter are adept at providing technical fueled legal pro- and add to our knowledge base. It it to do. A number of professors, par- competencies more narrowly tailored ceedings and cost should always do this with particular ticularly in the humanities and social to particular professions. Universi- the chair of the sensitivity to the needs and interests sciences, see themselves on a mission ties should provide foundational board of trustees, of the people who support it with to mobilize a grass-roots movement of knowledge and vital skills that allow the chancellor and their tax dollars. When we say this is young people dedicated to particular graduates to be valuable citizens and the provost their the “people’s university,” we should social causes. Sometimes administra- productive and successful members positions. mean it. tors think it is their job to cozy up of a world in which critical think- At UNC-Cha- With this in mind, the univer- to the state’s political establishment ing, communication, and leadership pel Hill, external ANDY sity should ground its teaching in the rather than lead their organizations. abilities are essential for success. As a auditors released TAYLOR basic values of the society that birthed Again the behavior is reinforced. Dis- result, reading Plato and Melville, un- a report that was and reared it. Collectively, courses senters are frozen out of the decision derstanding democratic theory, solv- critical of the cam- should provide a broad and coherent making process. Resources are often ing quadratic equations, and knowing pus’s bloated administrative structure, education. Research in all disciplines distributed as a reflection of identity what a molecule is are all very impor- and a variety of events revealed many should tackle large questions and find politics and ideology, not performance tant to the public university student, in the Carolina community continue answers that elevate the quality of life; and value generated for students and regardless of what she wants to do to be intolerant of First Amendment that bring about peace and prosperity, the public. after graduation. Exposure to the rights. freedom, and fairness. When it acts like a political inter- breadth of life and its challenges, not As painful as all of this has Unfortunately, this does not hap- est group, a public university will be the mastery of a technique, is the cen- been, the climate of crisis provides an pen as much as it should. Our cur- a successful one. It molds thousands tral feature of a good public university opportunity for the people of North ricula are full of esoteric and discon- of hearts and minds, has privileged education. Carolina and the leaders, faculty, and nected courses. In many disciplines, access to influential policymakers, North Carolina’s public and the students at the system’s 16 campuses the material taught is often a reflec- and is heavily supported by the public people of its universities would do to reflect. Administrators and faculty tion of passing “fads” or the political treasury. But when it does, it also well to remember these things as the need to reassess their behavior. Along interests of vocal faculty. Professors destroys the public’s trust and fails in crises abate. If we do, this tumultuous with the public, we must remind undertake research in narrow and its basic mission. period, traumatic as it is to some, will ourselves of what a public university scattered subfields, regurgitating Instead, a public university must actually have been valuable. CJ should be. A nice place to start is to knowledge that has little relevance to foster diverse viewpoints and allow understand what a good public uni- their students’ futures and real-world ideas to compete in an open market- Andy Taylor is Professor and Chair versity is not. problems. They are often experts, not place. Students should draw conclu- of Political Science in the School of Public • A vanity project. The univer- because they are good, but because sions after succumbing to the force of and International Affairs at N.C. State sity system does not exist to allow what they study is so small. All of this argument, not bowing to a professor’s University. The Travesty of Civil Trials for Terrorists

s it me, or has the whole world military tribunals at Guantanamo before a military commission and radical jihadists. turned upside down? Bay — notwithstanding White House executed with the approval of the What will be put “on trial” is I don’t know about you, but I spin — the nation must conclude that Supreme Court. George W. Bush’s foreign policy and Iwas stunned by the Obama adminis- President Obama and his advisers Why the exception now? the CIA’s methods of interrogation. tration’s decision to try Khalid Sheikh believe that what transpired on 9/11 For the life of me, I cannot Somehow there will be leaked intel- Mohammed — the was a crime and not an act of war. understand why we would give a ligence. self-confessed This decision formalizes the propaganda platform to an animal Muslim extremist Web sites mastermind of Obama administration’s willingness who participated in and planned the around the world will post their hate- the Sept. 11 at- and intent to treat terrorism as a law deaths of thousands of our fellow filled slant on what transpires at the tacks — and four enforcement matter. citizens. trial. of his accused What concerns me the most is For the families and the memory It will be a recruiting tool for al- co-conspirators in that Obama and his administration of the victims of the horrific 9/11 ter- Qaida and its network. a civilian court in are so politically correct and subservi- rorist attacks, this decision is devastat- After World War II, the Nazi New York City. ent to the left wing of the Democratic ing. And it will make New York City hierarchy was put on trial at Nurem- This decision Party and the ACLU that they would an even more high-profile target. berg. The Nuremberg trials were defies reason and MARC grant constitutional rights to terrorists. Now, these terrorists will be just military tribunals. common sense. ROTTERMAN With a civilian trial, KSM and his few short blocks from Ground Zero, The world recognized that the Are we not at cronies will be given the same rights City Hall, police headquarters, and Nazis were not just everday criminals, war with Osama as an American citizen. They will the Brooklyn Bridge. but monsters who had committed bin Laden and have the same presumption of inno- While the security concerns crimes against humanity. By criminal- al-Qaida? cence and the same legal protections. stemming from a trial in New York izing terror, Obama is setting a very Is there no longer a war on ter- Historically, we have not given enemy are real, I believe that the NYPD and dangerous precedent. One which I ror? combatants access to our civilian other appropriate law enforcement fear will embolden our enemies. CJ Does the Obama administration courts and the rights afforded Ameri- agencies can handle them. believe that what occurred on 9/11 can citizens. But make no mistake about it, was a criminal act or crime against During the Second World War, what we are about to witness will be a Marc Rotterman is a Senior Fellow humanity? in 1942, eight German saboteurs were media circus that will jeopardize our at the John Locke Foundation and a former With the announcement by At- caught after being put ashore by a national security and that will give political appointee in the Reagan admin- torney General Eric Holder to forgo submarine. They were tried in secret aid and comfort to our enemy. the the istration. PAGE 28 DECEMBER 2009 | CAROLINA JOURNAL Parting Shot

NON-PROFIT ORG. U.S. POSTAGE Easley Scandal is Theme for New Lottery Game (a CJ parody)PAID By Kevin Geddings events, do not give ley friend McQueen Trustees, served RasA LEasley’sEIGH, NC real estate Gaming Correspondent200 W. MORGAN STREET, #campaign200 contribu- Campbell; Wilm- broker for the CannonsgatePERMIT #1766 purchase. RALEIGH, NJESUP,C 27 GA.601 tions to politicians ington developer Campbell later went to work for Al- ottery players will soon be able like Easley, and are Lanny Wilson; and len’s development company. to place bets on who ultimately not even registered Charlotte developer Wilson provided more than $12 gave former Gov. Mike Easley to vote.” Gary Allen. million in short-term financing for the Lthe last-minute, 25-percent discount on Public records The possible Cannonsgate development. He has fi- a choice waterfront lot near Emerald indicated that Ea- choices are: nanced other projects developed by Isle in 2005. The name of the new game sley paid $549,880 • Gary Allen Allen. Easley appointed Wilson to the will be “Cannonsgate: Who Made the for the lot, but evi- only N.C. Department of Transportation Deal?” dence uncovered • McQueen Board. North Carolina Education Lot- and reported by The Campbell only “This game is gong to be great. tery director Tom Shaheen came up News & Observer • Lanny Wil- Cannonsgate, like Watergate, is a scan- with the idea while watching the re- of Raleigh showed son only dal that you don’t have to add ‘gate’ to, cent televised State Board of Elections that he received a • Allen and and that is cool,” Shaheen said. hearing on Easley. While the hearing 25 percent discount, Campbell Tickets will go on sale Jan. 1. addressed only potential election law or $137,470, im- • Allen and Odds for the game will be de- violations, Easley is also the target of a mediately prior to Wilson termined using a parimutuel system, federal investigation. acquiring the prop- • Campbell much like horse racing. Payouts will News reports have documented erty. “Once the feds and Wilson vary based on the total number of tick- Sample “Cannonsgate” lottery that he took a free car, discounts on find out who did it, ticket. (CJ spoof graphic) • Allen, ets purchased and the amount played real estate, and free campaign–related our lottery players Campbell, and Wil- on each alternative. airplane flights while he was serving will be able to cash in,” Shaheen said. son “Vegas hasn’t set an early line, as governor• Pag e from12 2001 to 2009. “That Players can purchase• T H ticketsE LOC ofKE- LETTER• None of the above but I think Lanny Wilson should get a Cannonsgate deal is a real problem for fering eight choices, and the nine- Allen, the Cannonsgate develop- lot of action,” Shaheen said. the former guv,” Shaheen told Carolina member Lottery Commission will er, had to receive important environ- When asked about the lottery’s Journal. determine the winning answer at the mental permits from the Easley admin- plans, U.S. Attorney George Holding “I think this will be a great way conclusion of the federal investigation. istration in order to proceed with the — who’s in charge of the federal probe to help our gaming folks become bet- Shaheen said the game will cen- development. Easley appointed Allen of Easley — called it “an idiotic idea. If ter citizens,” Shaheen said. “Surveys of ter around three men who testified at to the Wildlife Resources Commission. the state goes through with this game, our lottery players reveal that nearly the election board hearings: Raleigh Campbell, appointed by Easley employees of the U.S. Department of all of them are ignorant of current real-estateS a brokerv ande longtimet Eash- eto the N.C.D Statea Universityte Board! of Justice will not be allowed to play.” CJ

Featuring Former Speaker of the House Newt Gingrich Wednesday, January 13, 2010 Embassy Suites 201 Harrison Oaks Blvd. Cary, N.C. For more information, visit www.JohnLocke.org/events Newt Gingrich