That's been the budget story ever since the session started in January: Legislators kept putting off fiscal Decision Day, hoping an economic recovery would come and let them add to the revenue side of the ledger. Instead, economic growth steadily slowed, dragging down revenue projections with it. Finally, lawmakers were forced to raise taxes to avoid massive spending cuts. (And that was before Sept. 11.)
For Democrats, the budget fight is also the story of the struggle over redistricting in the House: Can they s-t-r-e-t-c-h their voter support to cover more districts than the 62 out of 120 they currently hold?
And if they do, will that help get progressive programs passed? Maybe. But not necessarily.
Redistricting, like the budget, accentuates all of the fault lines that keep the Democrats from being an "organized party," as Will Rogers observed long ago. Conservatives, moderates and progressives are all party members--and whites and blacks. African-American voters are the most reliable Democrats and tend to live in distinct communities. When it comes to drawing district lines, therefore, there's a basic tension between splitting black communities--which would help party chances in more than one district--or drawing what're called majority-minority districts, assuring that when the returns are in, there will be more black members in the legislature, if fewer Democrats overall.
Wake County's a good example. Currently, one House district is majority-black, and overwhelmingly Democratic--so much so that the Republicans didn't even put up a candidate against incumbent Rep. Dan Blue, a leading black Democrat who is now running for the U.S. Senate. Meanwhile, four of the county's six other House seats are held by Republicans, including notoriously right-wing Rep. Russell Capps. A Democratic redistricting plan seeks, among other things, to draw a new district for Capps that he can't win.
The whole point of the Democrats' plan, in fact, is to put as many Republican voters in as few districts as possible, which means of course that no Republican legislator is going to support it. Thus the Democrats need--almost literally--every single one of their 62 members to pass the redistricting scheme. But they don't have them. Five black Democrats are holding out, saying the plan spreads African-American voters too thinly in its effort to gain Democratic seats.
These five, including their leader Toby Fitch (D-Wilson), are quite willing to align themselves with the Republicans to get what they want, and the GOP--for obvious reasons--is happy to give it to them. So Democratic House Speaker Jim Black was forced to pull the redistricting plan off the floor last week and negotiate with Fitch & Co., further extending a session that--by tradition, if no longer in practice--is supposed to be limited and part-time.
Redistricting was on Democratic Rep. Phil Baddour's mind last week when he was honored by the progressive North Carolina Justice and Community Development Center. The Goldsboro lawmaker was cited for helping kill off the state's "payday lending" law, which allowed finance companies to charge low-income borrowers astronomical interest rates (up to 400 percent a year) by rolling their loans over every week. Baddour is white, and comes from a district in Wayne County that he describes as pretty conservative. But the district includes Goldsboro's black community, giving him a progressive cushion that, as Baddour says, "let's me be me."
The most serious progressive challenge came from Fitch and other black House members who, as the heart of the self-styled "Gang of Eight," forced a little fiscal equity on the Democrats over the summer when it came to the issue of which taxes to raise, and on whom. The fact that the House is so closely divided, plus the fact that the "Eight" are so solidly entrenched in their own districts, with no need to appeal to conservative voters, combined to give them enormous leverage over the General Assembly and Gov. Easley too. (Also in the "Eight" are Democrats Blue, Mickey Michaux of Durham and Bob Hensley of Wake who is one of two white members.)
While the budget and tax fight is over at least for the moment, the sharp downtown in the economy since Sept. 11 will reopen it with a vengeance next year unless Congress acts to increase revenue-sharing funds to the states.
With the legislative session winding down, how are progressive forces holding up overall?
The Budget. It isn't good, but given the economy, it wasn't going to be. Senate Democrats, despite their 35-15 majority, got the hot potato out of their hands as fast as they could (and without voting on any tax increase) by the simple tactic of leaving out critical mental health programs. House Democrats repaired the damage. The final budget is "prudent," in the opinion of progressive guru Dan Gerlach of the North Carolina Budget and Tax Center, in that it averts deep cuts in social spending without resorting to gimmicky accounting. Projected spending is up about 4 percent. The only group that took a direct hit: State employees, who got meager $625 raises (between 2 and 3 percent). Their health insurance is still free, but if they're paying for family members, the rates went up 30 percent.
Taxes. The Senate Democrats, after the fact, offered a menu of regressive tax increases, including higher sales taxes. House Democrats adopted Gerlach's idea of balancing sales tax increases with a state version of the federal Earned Income Tax Credit (EITC), essentially a small subsidy ($388 a year maximum for a family with two children). The "Gang of Eight" went further, insisting that income taxes be increased on those in the highest bracket. The final compromise raised the top income-tax rate, but only by half of what the gang wanted, and raised the sales tax from 6 percent to 6.5 percent. But no state EITC.
Lottery. It's still hanging around, and looking more alluring every time state officials review sagging revenues. Church groups have moral objections, but others dislike the fact that lotteries raise revenues disproportionately from low-income folks. So far, Easley has missed the chance to balance his goal of getting a lottery for education with progressive tax reform--higher rates for the rich and a state EITC--that would protect lower income citizens.
Clean Air. Easley supported, and the Senate Democrats passed, a bill to force Duke Power and CP&L to clean up smokestack emissions from their 14 coal-fired power plants. Ratepayers were to pay the tab--about $200 million a year. The legislation has stalled in the House, however, with industrial companies--which use lots of electricity--bolstering their case against higher rates with evidence of the recession's impact on manufacturing. The Sierra Club's Molly Diggins says the fight in the House over redistricting has gotten so bitter and partisan that it's not clear any other significant environmental legislation will be acted on this session.
Campaign Finance Reform. Alive, but just barely, and the prognosis is uncertain, according to the Center for Voter Education's Jesse Rutledge. All that remains of the original Voter-Owned Elections Act, which was designed to make public financing an option for candidates in elections for every state office, is public financing for N.C. Supreme Court and Court of Appeals candidates. The money would come, not from taxpayers now, but from lawyers. The Senate Finance Committee has met twice in recent days on the bill but hasn't voted on it. A third meeting is scheduled for Oct. 17. Proponents, Rutledge says, have their fingers crossed that the Democrats will vote the bill out of committee and then approve it on the Senate floor Oct. 18, letting them concentrate on House passage next session. The Senate Democrats' caucus decides all issues in private. And for six years, the decision has been to block campaign finance reform.
Death Penalty. So far, the only major progressive advance is on capital punishment. Both houses passed, and Easley signed, a bill barring executions of people with mental retardation and establishing a system by which the courts can decide whether defendants are mentally retarded or not.