Covid, classrooms and corporations

Covid dominates North Carolina’s Governor’s race, and it likely will determine the outcome. But there’s another big difference between the two candidates. It gets less attention, but matters more for the future. 

It’s an issue that North Carolina has debated for more than 60 years: What is the best way to build a better future – cut taxes or invest in public education?

As he runs for a second four-year term, Democratic Governor Roy Cooper frames the choice as “classrooms or corporations.” He says the Republican-majority legislature has passed tax cuts for big corporations and wealthy individuals at the expense of public education.

 
Republican Lt. Governor Dan Forest supports the legislature’s tax cuts. Like Republicans in the legislature, he supports vouchers and tax credits for parents who send their children to private schools.

This debate goes back to the 1950s. That’s when North Carolina emerged as an economic powerhouse, attracting industries from across the country and around the world.

Governor Luther Hodges (1954-1961), a retired textile executive, made his mark as an industry hunter. The state offered companies lower taxes as an inducement for locating factories here. Low taxes – along with less regulation, low wages and low unionization – became North Carolina’s calling card in corporate boardrooms.

But a competing philosophy emerged, championed by Governor Terry Sanford (1961-1965), the patron saint of North Carolina’s post-World War II progressives. 

Sanford said North Carolina should focus on better education as the best foundation for the future. As Governor, he prevailed on a reluctant legislature to levy a sales tax on food to pay for an ambitious education program.

Jonathan Yardley wrote of Sanford in The Washington Post in 1985:

“Teacher salaries went up 22 percent, a statewide system of community colleges was established, the North Carolina School of the Arts was created; the foundation was laid by Sanford for the more sophisticated and expensive educational improvements that may prove to be the chief legacy of the state’s most recent ex-governor, James B. Hunt Jr.”

Governor Cooper, like Governor Hunt (1977-1985 and 1993-2001) subscribes to the Sanford philosophy. So did Democratic Governor Mike Easley (2001-2009), who like Sanford passed a tax increase to fund education improvements. 

For decades, there was bipartisan support for what was called “North Carolina’s civic religion” of investing in public schools to promote economic development. Republican Governor Jim Holshouser (1973-1977) supported statewide kindergartens and big pay raises for teachers. Republican Governor Jim Martin (1985-1993) pushed for Reagan-like tax cuts in his first term but also supported the Basic Education Plan to boost public schools.

Because of a booming economy – and rising tax revenues – North Carolina could both cut taxes and spend more money on schools. When Republicans took the House in 1994, they and Governor Hunt agreed to pass big tax cuts. Then, in 1997, key Republicans supported Hunt’s billion-dollar-plus plans to raise teacher pay to the national average and expand the Smart Start early-childhood program.

The bipartisan consensus shattered after Republicans took both houses of the legislature in 2010. They focused on passing billions of dollars in corporate tax cuts, and education advocates say public schools have suffered.

The legislature also has directed money to private schools. That’s another echo of the 1950s, when private schools emerged as an alternative to integrated public schools. 

This election offers North Carolinians the clearest choice between these dueling philosophies since Sanford ran for Governor in 1960. Today’s headlines focus on Covid, health care, face masks and how fast to reopen schools and businesses in the pandemic. But the future may ride on the choice between classrooms and corporations.