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Allies….and the Misinformed

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In mid November 2008, shortly after the Obama election and at a time when the entire U.S. economy, for several months, had been rapidly sinking, Professor Peter Brews, Associate Professor at the Kenan-Flagler Business School (UNC-Chapel Hill), spoke to a luncheon group in Charlotte about the, then current economic situation. Most striking was his opinion that, although there was plenty of blame to be shared, the underlying cause of our problems was the fact that Americans, American businesses and governments at all levels had been living beyond their means for over 25 years! This simple, yet insightful analysis certainly resonated with the luncheon crowd and I believe is the proper place to start when looking for a solution.

We all know what has happened since November 2008—the economy has tanked—both the American people and companies have suffered tremendous financial losses and job losses, leaving economic havoc in their wake. For people and companies, a degree in economics is not required to understand that spending must be drastically reduced, with corresponding adjustments in lifestyle and structure. And that’s precisely what you have seen over the past 15 months as all struggle to pay their bills, keep their homes and rescue their businesses. Many have failed.

But what about governments, specifically Charlotte city and Mecklenburg county governments? As a close observer of local governments, I have seen far too little on the part of elected officials or government bureaucrats that would indicate empathy or understanding of the plight of our taxpayers. Unlike small companies that employ a majority of our citizens, bonuses have continued to be paid, no one has lost his job and salaries and benefits have not been reduced. For the most part, it has been business as usual, with a continuation of business incentives, financial commitments such as the Elizabeth Avenue trolley and more plans for long term projects.

If ever, now is the time for a complete overhaul of our local governments to reflect the economic conditions and losses that have occurred and to relieve the over-burdened taxpayers, in the highest taxed city and county in North Carolina, and here’s how:

REDUCE, IMMEDIATELY PROPERTY TAXES AND SPENDING BY 20 PERCENT. Cease all business incentive programs. Government cannot create jobs, but it can create a positive business climate with low taxes, a safe environment, simplification of business rules, regulations and red tape, good infrastructure and good schools. It makes no sense to pay incentives for business to relocate here, while at the same time driving business away with high taxes. It gets back to just what is the proper role of government and while Charlotte is spending every dime on uptown glitz, it has overlooked the basics that make a city great.

PRIVATIZE ALL CITY AND COUNTY SERVICES AND FUNCTIONS, when those services and functions can be provided by the private sector. Except for police and fire, everything should be examined….such as garbage collection, utilities, DSS, the airport….a long, long list. The private sector will perform these services just as good or better and most importantly reduce the size and power of government, bringing it closer and more responsible to the people. Big government brings with it the cronyism and corruption that we have seen in city and county government, particularly in DSS and housing and neighborhood development.

STOP ALL CONTRIBUTIONS TO NON-PROFIT ORGANIZATIONS: For example, did you know that 42 percent of the Arts and Science Council budget is from city/county taxpayers—-over $4 million dollars? And that is just the tip of the iceberg of the gifts dozens of non-profits. Eliminating gifts to non-profits would save taxpayers millions of dollars and eliminate the conflicts of interest when bureaucrats and elected officials serve on the boards of directors of these organizations. How can a city or county manager or elected official objectively serve on the board of a non-profit organization that comes to the government for taxpayer funds??

REDUCE ALL GOVERNMENT EMPLOYEE PAY AND BENEFITS BY 15 PERCENT: This would save $35 to 40 million and reflect the situation now facing the private sector. Why should government be protected in severe economic downturns while the suffering private sector continues to pay all the government salaries and benefits? Many observers feel that we have reached a time when government workers, considering pay, healthcare and retirement benefits, receive more than corresponding jobs in the private sector. For example, the city of Charlotte is now paying 3 city managers—the current manager, well over $200,000 a year and two managers in retirement, who each receive over $100,000 in pay and benefits, for life. Where can you work 20 years, as in government and retire with a large pension plus benefits? We have let government grow completely out of control folks!!

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