NOTHSTINE: Coopers meager talk on tax cuts

Governor Roy Cooper speaks during Kidonomics

One of the most misleading phrases used by Gov. Roy Cooper is the term “corporate tax giveaways.” A simple Google search of “Roy Cooper” and “corporate tax giveaways” produces a plethora of examples of the governor using this class warfare rhetoric across the state.The line, perhaps an effective one given its frequent use, conjures up images of fat cats on private jets partying with an endless supply of cigars, whiskey, and women. Meanwhile, thousands of feet below, school children toil in medieval squalor. Students are studying hard to make the state more competitive for the future, but supposedly are blocked from having all the resources they need to achieve. Cooper, of course, implies that tax cuts, or returning money to businesses, will harm investments in education.While speaking at the Charlotte Chamber of Commerce at the beginning of this month, Cooper implored area businesses to eschew tax cuts for more spending. “In my conversations with CEOs about jobs in North Carolina, the first question they ask me is not what is your corporate tax?” Cooper declared. “The first question is ‘do you have the people who can perform the jobs that I can create?'” (CEOs considering North Carolina for business are probably much more knowledgeable than politicians when it comes to the cost of doing business in a state). At any rate, Cooper added that tax cuts for businesses and investment in education is “pretty much an either-or choice.”This either-or view takes a very dim and meager outlook on returning property to people and businesses through tax relief. While Cooper secured a narrow victory because of drummed-up chaos on social issues, his rhetoric, along with some Democrats in the state, is tied to outdated class warfare and the reckless budgets of the past. Cooper can afford to moderate given the political realities in the legislature by offering lip service to “targeted middle-class tax cuts.” Of course, he stops any talk of tax relief right there, preferring to wager more on government over entrepreneurs and the people who take risks to create jobs and grow the economy.The good news is another larger-than-expected surplus and responsible fiscal management by the legislature has ratcheted up the debate on the expansion of tax cuts. The Senate proposal (Senate Bill 325), along with tax cuts mostly beneficial to the middle class, cuts the corporate rate by one quarter of a percent over the next two years. From 3 percent down to 2.5 percent by 2019.Strong budget management and comprehensive tax cuts are a major reason for growth and expansion across the state, making North Carolina one of the best places in the nation for business. Many at the Chamber of Commerce know this well, so Cooper at least receives credit for attempting to make his case to what should be a more skeptical audience.But the “either-or” line is pessimistic pandering. Every business dollar taxed is a dollar removed from the company and removed from production and economic investment. Lower business taxes have resulted in higher wages and lower unemployment. This nation has suffered from lower rates of growth over the last decade, which are symptoms of too much regulation and lack of entrepreneurial risk-taking. North Carolina legislators are responsibly charting an alternative course for this state.Investment in education is important going forward too, especially in a state with population growth and economic innovation. But throwing more money at education does not necessarily produce better results. This is exemplified especially by our current education system, especially with less dollars reaching the classroom and increasingly gobbled up by administrative staff and costs. Almost 40 percent of the general fund goes toward education.Republicans are right to consider higher teacher pay but to balk at throwing more productive money at a status quo system. Promises of better education and schools are often an easy way to get the citizenry to part with their earnings, which is why Cooper is parroting those lines across the state. However, the General Assembly’s commitment to tax relief, including for businesses, is not merely “corporate tax giveaways,” but an invaluable investment in freedom and human flourishing.
Ray Nothstine is a member of the North State Journal’s editorial board, separate from the news staff. Unlike other newspapers, the North State Journal does not publish unsigned editorials; the author or authors of every editorial, letter, op-ed, and column is prominently displayed. To submit a letter or op-ed, see our submission guidelines.