by Chris Neeley
1/12/05

There's an age-old story about a young college student who kept bouncing checks. One day the student's father called and said, "Son, I need you to stop writing bad checks. It's wrong to spend money you don't have." The student replied, "But Dad, how can I be out of money? I still have checks in my check book!"

We've all the heard this story before and maybe some of us know it all too well. The student continues to spend money he doesn't have until one day his father is forced to close the account and put him on a budget. The student must either learn to live within his means or do without.

Herein lies the problem with the politicians in Raleigh. They are spending more than the taxpayers can afford to pay. And with less than two weeks until the start of another legislative session, some of our leaders in the House and Senate are already preparing us for some more bad news. We now face at least a $1.2 billion in excessive spending for the next budget cycle. Now who do you think is going to be asked to pay for all this excessive spending? That's right -- you and me -- with higher taxes!

The truth is, North Carolina's citizens cannot afford to pay any more in taxes. We already pay the highest corporate and personal income taxes in the Southeast. Our combined sales tax is 12th highest in the nation, our gas tax is the 11th highest nationally and our debt service has quadrupled since 1996.

One would think that with all those taxes the politicians would have plenty left over to give back. Unfortunately, that's not the case here. The politicians' annual spending spree, which amounts to about three times the rate of inflation and population growth, has cost our state thousands of jobs and an opportunity to be a major competitor in the new global economy of the 21st Century.

The good news is that there is hope. Starting this session the legislature and the governor have an opportunity to begin the process of getting our house in order by supporting a real Taxpayer's Bill of Rights (TABOR) amendment to limit government spending.

A TABOR is a constitutional amendment that limits the growth of tax revenue and government spending to the inflation rate plus population growth. The amendment would require that surplus revenue be returned to the taxpayers through tax rebates or tax cuts. In addition, voter approval is needed to approve any tax or debt increase.

How much would a Taxpayer's Bill of Rights amendment improve North Carolina's economy? AFP Foundation Distinguished Scholar Dr. Barry Poulson, the nation's foremost expert on TABOR, recently found that had a TABOR amendment been enacted in North Carolina in 1995:

• At least $1.4 billion would have been returned to taxpayers in tax rebates or tax cuts;

• The current state budget mess would have been avoided, with $1.9 billion having been put away in a budget stabilization fund by 2001;
• The state would currently have $400 million in an emergency fund to use during economic slowdowns or unforeseen disasters like a hurricane.

Now is the time for the legislature and the governor to get serious about their spending problem and learn to live within our means by supporting a Taxpayer's Bill of Rights amendment. Let's make our state a better place to do business and raise a family.