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Dean BakerDon’t get shut out of next Wednesday’s N.C. Policy Watch- N.C. Budget and Tax Center Crucial Conversation luncheon with one of America’s most important and insightful economists, Dean Baker.

Click here to register

Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is frequently cited in economics reporting in major media outlets, including The New York Times, The Washington Post, CNN, CNBC and NPR. He writes a weekly column for theguardian.com, The Huffington Post, Truthout and his blog, Beat the Press,, which features commentary on economic reporting. His analyses have appeared in many major publications, including The Atlantic, The Washington Post, the Financial Times, and the Daily News (New York). He received his doctorate in economics from the University of Michigan. Read More

NC Budget and Tax Center

When it comes to educating our children, the public is pretty clear in understanding you get what you pay for.

In a recent poll released by High Point University, 72% of respondents said they would favor a tax increase to raise teacher pay in North Carolina to the national average. These results are similar to a Public Policy Polling survey conducted in November which revealed that 68% of North Carolinians opposed cutting funding for public schools to provide taxpayers a tax cut.

Despite North Carolinians’ willingness to pay to ensure adequate funding of our public schools so that children can be better prepared for a 21st century economy, legislators moved in the opposite direction this past legislative session. Not only were teachers, whose salaries ranked 46th in the nation in 2012, denied a pay increase this year, but the salary incentive for teachers who earn master’s degree was eliminated and additional cuts were made to professional development and recruitment programs.

The legislature further undermined the ability of public education to prepare children for their future by reducing funds available for instructional supplies and textbooks, increasing teacher to student ratios and cutting funding for teacher assistants.

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Not that it’s at all surprising, but new analysis from experts confirms that Gov. McCrory and his allies are dead wrong once again with their latest crowing about the drop in North Carolina’s official unemployment rate. Put simply, thee Guv is confusing a labor market collapse for good news. This is from the wonks at the N.C. Budget and Tax Center:

“RALEIGH (January 28, 2013) — North Carolina’s unemployment picture is much worse than it appears on the surface, according to new numbers released by the N.C. Division of Employment Security today. Although the unemployment rate dropped to 6.9 percent in December, this is due almost entirely to a historic collapse in the state’s labor force, not to genuine gains in employment.

Over the last year, the labor force shrunk by 110,930 workers—more than 2.5 percent—to the lowest levels in three years.  Read More

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.

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When the N.C. General Assembly passed a controversial overhaul to the state’s taxing system last year, the promise out of the mouths of Republican sponsors was that it would put more money back in taxpayers’ pockets.

But that’s not the case, the Associated Press found today in a factcheck its reporters conducted on the state’s new tax plan.

“It’s true that the state’s income tax rate is going down for every taxpayer in 2014,” the news agency wrote in an article published today. “But that does not mean all taxpayers will actually pay less to the state government over the coming year.”

That premise of lower tax bills, which has been echoed and repeated by Republican Gov. Pat McCrory, was scrutinized closely at the time of the bill’s passage and debate, with many calling foul on the claims including Cedric Johnson of the N.C. Justice Center’s Budget and Tax Center.

BTC data on N.C. tax increases under new plan

BTC data on N.C. tax increases under new plan

Johnson, in a report published in August, estimated that the bottom 80 percent of North Carolina residents will pay more in taxes under the new tax plan while needed services were slashed and the wealthiest in the state would see reductions in their tax bill. (Disclosure: N.C. Policy Watch is also a part of the N.C. Justice Center.)

The Associated Press took another look this week at the changes to the state’s tax code for 2014 and agreed that the tax breaks promised by lawmakers would not materialize for many people in the state.

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