Opinion: Progressives Made A Faulty Prediction
By John Hood
RALEIGH — My progressive friends are frustrated. They should be. After more than a decade of conservative governance, North Carolina has implemented many policies the Left disdains — from major tax cuts and spending restraint to regulatory reform and parental choice in education. The progressives’ primary political vehicle, the Democratic Party, is losing ground in voter registration, no longer commands a majority in any branch of government, and hasn’t won a federal election in North Carolina since 2008.
These trends have many causes, including long-term shifts in party identification across the region, superior Republican performance in candidate recruitment and campaign tactics, and the creation of a strong network of conservative institutions in North Carolina.
But progressives have played a role, too. They mythologized North Carolina’s past — making it seem more exceptional than it truly was — and then allowed their own mythology to shape their strategic and rhetorical choices. They insisted that North Carolina had historically outpaced the rest of the South because of higher public investment, so they predicted doom when the newly conservative legislature started cutting taxes and regulations in 2011 to promote private investment.
The progressives’ premises were faulty. North Carolina hadn’t consistently outpaced the rest of the region before 2010, and when it had there was scant empirical evidence that the Left’s favorite programs were responsible for the state’s economic performance.
Nor were their predictions borne out. North Carolina currently has one of the fastest-growing economies in the country, powered in part by inflows of people and investment from elsewhere.
Are there faster-growing states? Sure. But that doesn’t help the progressives’ case. Over the past four years, for example, North Carolina’s gross domestic product grew by an inflation-adjusted rate of 2.8% per year. Although that surpasses the national (1.6%) and regional (2.1%) averages, six states grew even faster: Idaho, Florida, Utah, Tennessee, Washington, and Arizona. Of those, only Washington could be construed as a progressive-run state — and it doesn’t have an income tax!
Making a couple of lists and eyeballing the top-ranked states in each can’t produce a definitive conclusion, I admit. That’s why I value empirical research on the subject. Over the past three decades, scholars have produced hundreds of studies that test the relationship between economic performance and one or more variables that state and local governments can reasonably expect to affect. Some of these studies lend support to the progressive view. Most do not.
One of the latest papers was published just a few days ago in the journal Public Choice. Authored by Richard Cebula, an economist at George Mason University, it examined migration patterns among American states from 2010 to 2017, in the aftermath of the Great Recession.
To measure the policy environment of each state, Cebula used a set of tax indexes from the Fraser Institute. After adjusting for income, climate, housing prices, and other variables, he found that lower-taxed jurisdictions tended to attract more people. “A one-unit increase in the overall tax freedom variable, say from 5.0 to 6.0, results in an 11.33% increase in the gross in-migration rate,” he wrote. Interestingly, in his model the effect was driven mostly by lower income and sales tax rates, not property taxes.
With all that having been said, conservatives don’t wholly disagree with progressives about the growth-enhancing potential of public investment. The quantity and, especially, the quality of services such as education and infrastructure do matter. A state with innovative, highly productive colleges and universities will tend to have stronger economic outcomes, all other things being equal. The same can be said about rigorous, well-run schools and plentiful, well-maintained highways.
What conservatives reject — because we’ve seen the data — is that the value of public investment is directly proportional to how much tax money is spent, and that public investment is more important than private investment. It isn’t. Private capital dwarfs public capital. Over the past decade, conservatives made it a priority to attract both financial and human capital to North Carolina. Their plan is working.
John Hood is a John Locke Foundation board member. His latest books, Mountain Folk and Forest Folk, combine epic fantasy with early American history (FolkloreCycle.com).
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13 Comments
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So, tell me John, why then has the NC budget bloated by nearly 23% since 2010 and the size of state government expanded by 18%?!?!? I thought it was the *progressives* who want to SPEND, SPEN,D SPEND — but they haven’t been in power in a decade! The GOP RINOs *talk* about restricting the government and shirking the swamp at every election, but they’re nothing but lies. They keep winning but the government keeps expanding! When will *TRUE* conservatives follow through on their promises? #hypocrites #VoteOutIncumbents
Again Mr Hood has left out pertinent information.
His statement “The progressives’ primary political vehicle, the Democratic Party, is losing ground in voter registration.” Implied that Democratic Party is losing ground in voter registration to the Republican Party.
Mr Hood failed to mention that since 2020 Unaffiliated/Independent voters now out number the voters in either the Democratic or Republican Party. By the numbers, the Unaffiliated/Independent voter has rejected both the Democratic and Republican Parties.
As of October 29th, 2022, North Carolina had about 7.4 million registered voters. Their partisan affiliation was roughly split between three groups: Democrat, unaffiliated, and Republican, with a slight lead to unaffiliated voters. Specifically:
2,495,097 or 34% were registered Democrat;
2,637,581 or 36% were registered Unaffiliated;
2,221,179 or 30% were registered Republican; and
50,511 or 0.7% were registered to another party.
“Unaffiliated/Independent voter has rejected both the Democratic and Republican Parties” Not really true for everyone, as an independent, I simply don’t wished to be pigeon-holed during the primaries AND have my voter history labelled so obviously while it’s so publicly accessible. We are the only state in the South that has “name only” voter reg queries.
@Brett: why are you afraid to let the public know your voting history? I, for one, am *proud* of every vote I’ve cast and have nothing to be ashamed of.
As Speaker Moore said on Wednesday during the COS press conference, the Dems ran the state debt into the roof. The GOP took over and got us back to fiscal sanity, and even bolstered our rainy day fund without having to borrow MORE money from the federal gov. Dems seem to have bought into modern monetary theory, not realizing the current state of inflation and thus hardships was directly caused by the printing of money during the plandemic. Basic economic principles are lost on the majority of Americans, and then they buy into the lie that you can just print money and somehow it magically retains its value. Either fiscal idiots or malicious…maybe both. Not sure. Now it’s time to use Article V to do the same thing to the federal government. HJR235!!!!
@Brett: Fiscal sanity!??!? Are you serious? Under Moore & Berger, the state budget has increased EVERY YEAR and now stands at 23% more than in 2010. The “so called” fiscal responsibility is now calling for an expansion of entitlement programs (Medicaid) and an expansion of NCDOT budget (even though they have failed to account for almost $6B in spending over the past 3 years). The current NC GOP is nothing more than RINOs. #hypocrites #VoteOutIncumbents
We have some RINOs, yes…but we were in debt up past our eyeballs and then the GOP balanced the budget. Let’s not also forget they did this while cutting taxes. 2021 Appropriations Act is also set to further tax cuts through 2027.
Just look at 2016 debt to GDP for NC:
https://web.archive.org/web/20160301194713/https://usdebtclock.org/state-debt-clocks/state-of-north-carolina-debt-clock.html
Compared to now:
https://usdebtclock.org/state-debt-clocks/state-of-north-carolina-debt-clock.html
As you can see, numbers are getting better, not worse.
Isn’t it interesting that the so called conservatives r now pushing for Medicaid expansion in North carolina
It is. What seemed to be the “compromise” is a loosening of certificate of need to get this done. Apparently if the GA agreed to expansion terms, the Dems and Cooper would agree to the loosening of CoN. I personally don’t support it, but I surely support a full repeal of CoN.
Chuck, that’s because the new norm in politics is to buy your Votes with your money 🤬
We want our $1725.00 monthly payment to our needy student families for taking thier children to school. Ok we all know it just a social justice payment program but the Wake County Progressive School Board had the backbone to vote it into action. We have still got 5 progressive votes on the Johnston County School Board that could vote our $1725.00 monthly payments into being reality but all they want to do is promise this off the record? They still promise us that our social justice programs are going to be financed by having the property revaluation moved up to every 4 years instead of 8 years but that is all the action we have seen from our progressive democrats here in Johnston County! We want ours too JOCO!!!
https://www.wral.com/do-the-right-thing-wake-county-grandparents-demand-at-least-1-725-for-school-transportation-reimbursement/20735243/
Money isn’t the issue. Culture is.
NO!!! The issue is STUPIDITY!!!!!