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State has too much debt already

10 AdobeStock 276423886 1024x606Thanks to the fiscally responsible policies of the North Carolina General Assembly, state government has some $5 billion in unspent funds and unanticipated revenues in its General Fund.

And thanks to the fiscally irresponsible policies of Congress and the Biden administration, North Carolina will receive another $5.2 billion in “COVID-19 recovery” funds that will be borrowed from Chinese investors and other holders of federal treasuries.

Gov. Roy Cooper and his aides have looked up at that towering, tottering mountain of one-time cash and taken its measure. They think it’s too small.

So in the 2021-23 budget proposal he just released, the governor is recommending that North Carolina borrow another $4.6 billion for capital spending on schools, colleges, universities, museums, and other government facilities. Some of these projects are clearly worthwhile. Others are pork-barrel giveaways. Still others are somewhere in the middle — nice-to-haves, let’s say, though hardly must-haves.

I’ll say two positive things about Cooper’s debt scheme. First, it is true that, all other things being equal, it is better to borrow when interest rates are low than when they are high. Second, Cooper proposes that the new debt be issued as general-obligation bonds, meaning that North Carolina taxpayers will get to vote on the package in a bond referendum.

But even at low interest rates, borrowing is costlier than paying cash. And Cooper proposes to put his massive borrowing spree on the ballot in an off-year, low-turnout election. A better approach would be to be put state government’s current surpluses to effective use, including a concerted effort to pay down the state’s already burdensome debt load.

While the state currently has $4.1 billion of General Fund debt on its books, that’s not its only fiscal obligation.

The state has also promised pension and health benefits to current and former public employees. North Carolina’s pension fund is better funded than that of most states, but not yet fully funded. And the unfunded liability for retiree health benefits is staggering: about $28 billion.

This big hole in North Carolina’s financial position is hardly invisible. Governor Cooper sees it. His budget even included a $150 million deposit into the reserve for health benefits. Given the current surplus, however, this is also pitifully inadequate.

With more than $10 billion in cash to spend, we don’t need to borrow another $4.6 billion. Instead, the state legislature should convert that one-time surplus into ongoing benefits for North Carolinians.

First, I recommend that lawmakers put $1 billion into the state’s pension fund, $2 billion into the state’s retiree-health reserve, $500 million into dedicated reserves for disaster relief and the state’s turbulent Medicaid program, and $2 billion into the state’s rainy-day reserve.

In the latter case, that would take the rainy-day fund to $3.1 billion, which comes to about 12% of last year’s General Fund budget. Most economists believe 2021 and 2022 will be banner years for economic recovery. I certainly hope so. But having a healthy cushion of operating expenses in the bank is a sensible precaution, and will keep North Carolina from having to raise taxes or cut programs with a meat cleaver if bad news comes.

As for the remaining cash, I think the General Assembly should do a combination of capital investment and debt reduction. We absolutely need to upgrade key state assets, from education and health institutions to prisons and courthouses. We can do that while also paying down some of our $4.1 billion in bonded indebtedness, which consumes hundreds of millions of dollars a year that could be devoted to future operating expenses or tax relief.

Keep in mind that I’m only talking about North Carolina’s one-time cash. The state is projecting robust revenue growth next year, which can fund essential services and pay raises for public employees.

Politicians make some of their worse decisions during the “best” of times.

Fiscally speaking, that’s where North Carolina is right now.

The governor erred in proposing a new borrowing spree. Lawmakers should pursue a wiser course.

Downsize me!

03 clutter downsizeAmong the many unanticipated effects of our year of COVID-19 lockdown at home has been the urge to clean out and, for some, to downsize. Folks of my generation have been pondering downsizing for some time, and many, including moi, have actually done it. The rest are still talking about it.

Award winning novelist Ann Patchett and her hubby made the clean out, downsize their possessions effort, and she wrote about it recently for The New Yorker. She began by tossing out dishtowels with images of dogs, birds, koala bears, and more, but that was just a warm up. Eventually, out went etched crystal champagne flutes, insect repellant from prior decades, brandy snifters, dolls from her childhood, bottles of dried up glue, and silver trays, vases, serving utensils, and a tea set. Ditto multiple colanders, pencils, old campaign buttons, and a bowl and collar belonging to a long-gone dog.

Boy, do I relate to Patchett’s article!

Her cathartic experience seems to have spanned quite a bit of the COVID year. Mine, however, lasted only about 2 frantic weeks, courtesy of Uncle Sam’s military moving schedule. Every day was the same. I awoke and began asking myself the same series of questions about thousands of items, not unlike Patchett’s collection of lifetime detritus.

1. Do I want to keep this, and if not, who wants it?

2. If no Precious Jewel or friend wants it, what do I do with it?

3. Is this something a charitable organization could use, and if so, which one and will it pick it up or do I have to get it there?

4. If that avenue is closed, is the item recyclable or is it fated to take up space in the landfill?

It was emotionally and physically exhausting to the point that Precious Jewel and a Tennessee friend who had come to help called in a professional organizer to get me through the last few days.

That said, I do not miss anything. Occasionally, I wonder what happened to some piece of furniture or kitchen implement I once enjoyed using, but I really do not care. I am not sure I achieved what organizing guru Marie Kondo describes as “sparking joy,” but I am considerably less burdened by my belongings and enjoy using what I have and remembering how individual belongings came into my life. The bottom line is that no one — repeat, no one, needs several dozen pairs of black pants in various sizes and styles, not counting the black leggings that have been my daily sartorial choice during COVID.

Patchett and those downsizing and clearing out during COVID face a circumstance I did not pre-COVID. Charitable organizations that traditionally accept all sorts of donations are struggling. Many are concentrating on human services — food banks, health clinics, child care, educational needs, to the point that other needs and services are on back burners. In addition, charities need cold hard cash more than they need our household goods and memories. Their in-person fundraising events have come to screeching halts, and volunteers who are only too happy to help have been unable to gather. Charities, like most other aspects of life, will ease back to “normal” over time.

The year of COVID has focused us on the core of our lives — our families, our health, the overall quality of our lives. It has established yet again that belongings, even treasured ones, do not make us happy. Our relationships do. Unburdening ourselves of possessions confirms that.

Deciding who leads a university can get complicated

16 Back up Darrell T Allison Headshot Edited 1024x741Who runs the university? What university are you asking about? Well, for example, Fayetteville State University, one of the 17 institutions that are part of the University of North Carolina, now known as the UNC System.

Clearly, the recently appointed chancellor of FSU, Darrell Allison, is the leader of that institution. But others share his authority. Allison reports to FSU’s board of trustees, a group of 13 that includes the student body president and other members appointed by the legislature and the UNC System’s board of governors. But Allison reports directly and primarily to the president of the UNC System who has the power, subject to concurrence from the board of governors, to fire the
chancellor.

If Allison has a single boss, it is the university president. But if you ask any chancellor he or she will tell you multiple people and groups must be pleased or the chancellor’s job is in jeopardy. He or she must also work with the institution’s trustees.

It is complicated enough already, but other constituents must be pleased. Near the top of the list is the institution’s faculty. Unhappy students can also bring a chancellor down. So can passionate fans of the university’s athletic teams. Donors and alumni groups can feel that the chancellor is their employee and should listen to their directions.

All these interests and groups present potential problems for every new chancellor. Wise ones will understand that while you cannot always please everyone, you must always take care to minimize friction and consider different opinions that relate to the university.

What is really tragic is for the situation to be poisoned from the beginning, but that is what has happened to Chancellor Allison. From the time his appointment was announced, opposition and concerns about his lack of experience in higher education and the process of his appointment arose from the faculty senate, the school’s alumni association, and the student government association’s president.

Previously, Allison served as a trustee at his alma mater, North Carolina Central University, and as a member of the system’s Board of Governors where he chaired its committee on Historically Minority-Serving Institutions. In 2018, Allison became the national director of State Teams and Political Strategy for the American Federation for Children, an organization that promotes school choice and was once led by Betsy DeVos.

From the beginning of the UNC System in the early 1970s, chancellors’ selection followed this procedure, taken from a UNC-Chapel Hill document describing the process: The chair of the university’s Board of Trustees, will oversee the search committee to find the new chancellor. Committee members represent the University’s Board of Trustees, faculty, staff, students and alumni. Community members will be able to provide input throughout the process. The committee will make recommendations to the full Board of Trustees, which will vote on candidates to recommend to the UNC System president who will then recommend a candidate to the UNC Board of Governors, which will elect the new chancellor.

This traditional process assured that every constituency would have some voice in the selection process even though it would be the president who made the final recommendation to the system’s board. This process was changed last year essentially to provide the president with the power to ignore the campus search process unilaterally and select any person to recommend to the Board of Governors.

The university president has every reason to seek a chancellor who will be a good partner. But it is a mistake not to bring into the selection process representatives of other groups the chancellor must serve.

As almost 50 years of university history has shown, a collaborative search process can find a person who will be the president’s strong partner without inflaming the kind of opposition that now faces Chancellor Allison.

You can Walk Away from hypocrisy

05 Hypocrasy WarningIt's becoming outright depressing to witness the gross hypocrisy taking place in America and permeating our daily lives. Many of us try to avoid this disorder, but to no avail, falling victim to mass depression, overeating, alcoholism and untimely suicides. It's horrid, devastating, and it's everywhere! Hypocrisy is present at all government levels, our local communities, our educational systems, businesses and even our churches. With no end in sight, it's spreading unbridled at epidemic proportions.

The sad truth is that here in America, we have only ourselves to blame. Slowly over the decades, we allowed politicians (both Democrat and Republican) to become much too powerful and greedy, allowing subversive and self-serving corruption to prioritize serving their country and the American people with fairness, justice and even humanity. Our entire political system is corrupt and vile. Americans' welfare and safety are no longer a priority or concern of most wealthy and elite elected political operatives. This is evident in law enforcement's weakening and the disregarding our Constitutional rights and the rule of law. Justice is not being served, and it is evident in the neglect we see in addressing many serious issues such as the southern border crisis, the advocacy and defense of criminals over victims' rights, condoning the inhumane treatment of women and children in the hands of known criminals who beat, rape, abuse, and sell them into sexual slavery.

The Americans who support and encourage this despicable and inhumane behavior are not third-world despots. They are wealthy, fat and arrogant bureaucrats that we elected and are staying in power by changing, manipulating and ignoring the rule of law. These people are the richest amongst us and can ignore the laws that we have to abide by.

This situation will not have a happy ending for future generations of Americans unless we come to our senses and start calling out those basking in this hypocrisy. I'm talking about regular everyday citizens in our community. The ones that sit on non-profit organizations and advocate for women's rights, protect them from abuse, support right to life or choice agendas, advocate for children, or any of the dozens of social service programs created to serve the poor and underserved.

These same people actively support the agencies, parties, people responsible for the policies and actions that are causing these atrocious inhumane acts. Acts that are tearing America apart one Constitutional Article at a time.

Here's my message: In the end, that uneducated child, that sick and infected migrate worker or MS13 gang member or similar undocumented criminal, child molester, rapist, or murderer will suddenly and without notice change your life forever, and not in a good way.

America is in a deep state of denial. Nothing good is going to come out of our current situation. So, while we collectively romance the criminals, attempt to disarm the innocent, dismantle our laws, embrace and defend policies of inhumanity on the southern border as the Mexican cartel gangsters continue their reign of terror by throwing six-month-old babies in the river and throwing three- and five-year-old little girls over a fourteen-foot border wall then running away. You may be curious as to why they would do such a hideous act when they could have walked those youngsters into American through an unguarded opening just a few hundred yards away.

Well, here's why: first, it was an intentional act of hostile aggression by the Mexican cartels who wanted to send a pointed message to America. They intended those children to die from the fall so America would have blood on their hands, giving the anti-border wall folks more talking points.

Second: the cartels were sending us a pointed message that they were in control of the border and had the power and wherewithal to do anything they wanted, including murdering children at will.

Those of you who are reading this and still have control of your conscience but are having trouble sleeping at night may want to know of an organization that feels your pain and anxiety. This organization professes that if you think you cannot support the kind of policies and hypocrisy taking place in America, they encourage you to WALK AWAY from it. Walk away from the people, policies and politics that conflict with your American values. There is peace of mind when you surround yourself with people who value others' rights, the Constitution, and American values. Color, creed or ethnicity doesn't matter. Everyone is welcome except the hypocrites. Check it out at www.walkawaycampaign.com.

Thanks for reading Up & Coming Weekly.

Making the best of things

07 IMG 6382Hey you! Is the world too much with you? Reality got you down? Tired of putting up with stuff? Like Joe in “Showboat,” are you “tired of living but scared of dying”?

Congratulations, you have come to the right place. As the emcee in “Cabaret” said, “Leave your troubles outside. In here life is beautiful. The girls are beautiful. Even the orchestra is beautiful.” Today’s lesson will be how to be happy. If this sounds a bit Polly Anna-ish, or even if you don’t know who Polly Anna was, take a chance any way, read the rest of this stain on world literature. Either you will be glad you did or you will waste three minutes of your life which you might have squandered on something equally trivial. The choice is yours, read on MacDuff or turn the page.

Let us begin with our old friend Alice in Wonderland. She has the formula for happiness in the face of adversity. Jefferson Airplane suggested to “Go Ask Alice/ I think she’ll know.” Turns out the Airplane was correct. Alice reveals how to be a cockeyed optimist in her Chapter entitled “Pig & Pepper.” Learn how Alice turns limes into margaritas. Alice is lost in the woods when she comes upon a house. She sees a fish dressed as a footman go to the house to knock on the door. The door is answered by a footman who has the head of a frog. A lesser mortal might have quietly backed into the woods as mutated footmen seldom bode well for the casual observer. Alice is made of
sturdier stuff.

She marches up to the house but has a frustrating conversation with the Frog footman. Realizing the Frog is not going to help her, she opens the door herself and barges inside. Not to mix metaphors, but the house is not like that of the Three Bears. There is no porridge but it is occupied by three unpleasant beings: the Cook, the Duchess, and her Baby. The kitchen looks like a scene from the Three Stooges. Instead of throwing pies at each other, the Cook is dumping way too much pepper in the soup while throwing pots, pans and kitchen utensils at the Duchess and her Baby. The Duchess is sneezing. Her baby is alternating between sneezing and howling. It’s a pretty wild scene, lacking only hungry wolves, a mob of Oath Keepers, and a school of flying jellyfish to be double plus ungood.

Alice, being a good-hearted sort, becomes quite concerned that the Baby will be seriously injured when a flying sauce pan nearly takes off the Baby’s nose. The Duchess, having been invited to play croquet with the Queen, exits stage right tossing the Baby to Alice. Alice catches the Baby which is bucking and writhing around in her arms while making a disturbing snorting noise. Alice takes on the role of Protective Services carrying the struggling Baby outside to avoid further kitchen flying objects. “If I don’t take this child away with me,” thought Alice, “they’re sure to kill it in a day or two, wouldn’t it be murder to leave it behind?”

Once outside the Baby commenced to grunting instead of howling. This disturbed Alice. Looking at the Baby she noticed its nose had become turned up. It began to appear to be more of a snout than a nose. Its eyes had shrunk into pig like beady marbles. She told the Baby “If you’re going to turn into a pig, my dear, I’ll have nothing more to do with you.” After a bit more time, the Baby began seriously grunting. Alice looked again and sure enough, the Baby had turned into a pig. Alice put the Pig/Baby down and “felt quite relieved to see it trot away quietly into the woods.”

Now here comes the lesson of today’s column wherein Alice makes the best of a bad situation. A lot of people would be freaked out by a Baby morphing into a pig. A lot of people might have considered such an event catastrophic for the Baby. A lot of people might have considered selling the Baby to a barbecue restaurant. But not Alice. She looks on the bright side. Alice relentlessly acts like two fried eggs by keeping her sunny side up. The reverse of the Pygmalion transformation of a statue into a lady does not dismay her in the least. Alice thinks: “It would have made a dreadfully ugly child but makes a rather a handsome pig, I think.” She then “began thinking over other children she knew; who might do very well as pigs if one only knew the right way to change them.”

So, there is our lesson for the day. If circumstances go awry, find the positive buried deep within the muck. Look for the rather handsome pig in every situation. Reframe reality to see the good even if it means you are delusional. Be like the old song: “You’ve got to accentuate the positive/ Eliminate the negative/ Latch on the affirmative/ Don’t mess with Mr. In-Between.”

Another plus is there is no proof that dinosaurs became extinct because their diet consisted solely of Blooming Onions from the Outback Steakhouse. Chow down!

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