Look before leaping to new system

In a recent column, I outlined three ways that North Carolina’s system of government differs from that of many other states, including our neighbors. First, I observed that our state constitution unambiguously gives the legislature primacy over public policy while dividing and weakening our executive branch. I also pointed out that North Carolina funds our public schools and roads mostly with state revenues, not local taxes, and that our levels of public indebtedness have long been among the lowest in the country.

I was pleasantly surprised to receive lots of reader response. Newcomers welcomed the opportunity to learn more about the place they’ve chosen to call home. And many natives took the opportunity to either praise or condemn North Carolina’s distinctive public institutions.

For the record, while I’m more on Team Praise than Team Condemnation, I’ve long been in favor of reducing the number of separately elected offices in North Carolina, thus consolidating executive power in fewer hands. To recognize the existence of a tradition, however venerable, is not necessarily to favor it holding on to it indefinitely.

I believe constitutions are essential for constraining political ambition, safeguarding individual rights, and establishing the “rules of the road,” so to speak. But I also believe constitutions, like all human institutions, are imperfect. They ought to be amended from time to time. The fiscal rules embedded in the U.S. Constitution, for example, are manifestly inadequate and should be amended to require a balanced operating budget — a rule already prudently applied to most states and localities.

Before changing North Carolina government’s operating system, however, we need a firm grasp of its current effects. Take property taxes, for example. Because counties fund only 24% of our public-school expenses, on average, and have no role in funding or administering roads, North Carolina’s property-tax burden is comparatively light.

How much lighter? According to a Tax Foundation analysis of Census Bureau data, property-tax collections were approximately $1,176 per North Carolinian in 2022 — higher than in Tennessee ($976) but quite a bit lower than in South Carolina ($1,444), Georgia ($1,469), Florida ($1,686), and Virginia ($2,019). On average, property taxes make up 27% of state and local tax revenues across the country. In North Carolina, it’s 22%.

Some households and businesses are especially sensitive to property taxes, which must be paid regardless of one’s net income in a given year. If the North Carolina General Assembly through legislation, or lawmakers and voters through constitutional amendment, decide to shift more funding responsibility for schools and roads to localities — in order to reduce income taxes, say, or to keep gas taxes from soaring — localities would respond at least in part by raising property taxes.

Now consider the separation of powers. The General Assembly is, by design, the most powerful entity in North Carolina government. It is my experience that, no matter how hard people try, they struggle to offer an opinion about our legislature-heavy system of government that isn’t heavily influenced by ideological or partisan preference.

When I began covering North Carolina politics in the late 1980s, we had a Republican governor and an overwhelmingly Democratic legislature. Most conservatives thought we should rebalance the respective branches. Most progressives thought the balance was just right — or that the state’s governors were, if anything, a bit too powerful.

Today, with the roles reversed, conservatives typically champion the prerogatives of the legislative branch and progressives favor strengthening the office of the governor.

When I survey the academic literature, I find some evidence that, all other things being held equal, giving governors a line-item veto tends to reduce spending levels over time. Other than that, I see no consensus in the literature about the effects on spending, taxes, regulation, educational attainment, or other policy outcomes of legislatures exercising more or less power vs. governors.

That’s not necessarily an argument against, say, shortening the ballot. It is an argument for tempering our expectation that such a reform would produce anything other than partisan consequences.

John Hood is a John Locke Foundation board member. His books Mountain Folk, Forest Folk, and Water Folk combine epic fantasy and American history.