NC Budget and Tax Center

This year marks the 50th anniversary of the start of the War on Poverty and Wednesday, January 8th in particular marks the 50th anniversary of LBJ’s speech in which America’s War on Poverty was declared. National media and political figures have been weighing in on whether the War on Poverty has worked, is a “Mixed Bag”, or has missed the mark. The Budget and Tax Center will be launching a blog series this month which will look in depth into the lasting effects of the War on Poverty, its successes, and the challenges that still lie ahead. We’ll also be doing some must-read myth busting as it relates to income and poverty.

What we do know is that the poverty rate has declined since the War on Poverty was declared, and it has declined even more significantly when supplements such as the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps) and the Earned Income Tax Credit (EITC) are factored in. What we also know is that even as productivity of workers has increased, wages have stagnated for middle and low income families and inequality has continued to rise.

The War on Poverty and associated safety net programs, which have been a lifeline for millions of families, have done their job to the extent that we have let them. Going forward it is imperative to make adequate and real investments in the programs that we know work in lifting families out of poverty such as the EITC and SNAP, but also to tackle the broader issue of wage stagnation and inequality by ensuring, among other strategies, that we have a minimum wage that reflects the cost of living in the 21st century, and by taking a long hard look at the racial and class inequity that still plagues our nation and our state.

NC Budget and Tax Center

There has been a lot of talk in the state, national and social media world about North Carolina’s reputation as of late, and it doesn’t sound so good. Governor McCrory has repeatedly stated that he was concerned about North Carolina’s brand and intended to rebrand the state to make it more business-friendly. Turns out, North Carolina is already competitive and further, the US Chamber of Commerce tells us “North Carolina is home to a collection of powerhouse research universities and a network of higher education. With innovative and high-tech enterprises spinning from places like the Research Triangle for more than 30 years, North Carolina ranks 12th overall for technology and entrepreneurship this year. The state has the 13th-highest concentration of STEM workers and ranks 4th for academic research and development intensity.”   Read More

NC Budget and Tax Center

The League of Women Voters North Carolina released a statement today opposing all tax plans under consideration in the North Carolina General Assembly:

June 3, 2013

The League of Women Voters of North Carolina, meeting in Charlotte for its 34th biennial convention, announced its opposition to tax plans now being considered in the General Assembly which promote unfair and regressive tax policies, including House Bill 998.  This opposition is in line with long-standing positions of the non-partisan organization.

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NC Budget and Tax Center

The Senate budget proposal currently being discussed in the Senate chamber will be passed without a review of the Senate tax plan. What we do know of that plan, however, is that it will subject food and prescription drugs to an increased sales tax, thereby further shifting the responsibility for funding government onto middle- and low-income families. As the graphic below from Together NC illustrates (click on it to see a larger version), middle- and low-income families pay a much higher percentage of their income on food and medicine than do wealthy individuals, meaning a much harder hit on their pocket books.

FoodMedicine2 (3)

NC Budget and Tax Center

The North Carolina Senate’s tax reform plan released today is long on promises and short on details. It is unclear how fair the purported “Tax Fairness Plan” will prove to be. Several red flags are raised by this plan, which should raise the alarm for all those concerned with a budget and tax system that supports economic opportunity and the foundation of economic growth.

One red flag is the surprising lack of details about how tax cuts will be offset by expanding the sales tax base enough to keep our vital services and infrastructure in place.

Another red flag is that this plan does not purport nor attempt to raise the same level of revenue as the state is currently taking in. The plan as outlined by Senator Berger will result in at least one billion dollars in revenue loss—revenue that could be dedicated to important and necessary services and infrastructure in the state. For example, one billion dollars is equal to the entire community college system budget in North Carolina. Read More