NC JUSTICE NEWS: Budget Breakdown + Wage Theft On the Rise + Backwards Budget .5K

June 5, 2012

BUDGET CUTS: A closer look at education, Medicaid, transportation

Last week, the North Carolina House presented its budget proposal, which failed to entirely restore cuts made to key public investments made in the 2011 budget. The Budget & Tax Center is releasing a series of posts about the budget's dirty details, including analysis of the budget's impact on:

  • K-12 education, which received a boost in funding – but only in one-time money, meaning public schools will face another round of damaging cuts next year.
  • Health & Human Services, which had its funding expanded by 3.65%, but will still be underfunded for Medicaid, anti-tobacco efforts, and mental health programs.
  • Community college investments, which under the new budget will still be below pre-recession levels, leaving fewer resources and costly tuition for students.
  • The Clean Water Management Trust Fund, which aids in rehabilitating crumbling water and sewer lines. Last year's budget reduced funding for the program from $100 million to $11.25 million for both 2011-12 and 2012-13.
  • Public transportation, which had its funds reduced by more than $150 million due to the continuing budget.

The House budget may have acknowledged a need for reinvesting in key public structures, but the proposal only presented a series of quick-fixes: temporary and partial restoration of cuts that still leaves North Carolina moving backwards.

WAGE THEFT: Underpayment of workers on the rise

Wage theft – the illegal underpayment or non-payment of workers’ wages – is on the rise. Claims have increased by an incredible 400 percent over the last decade, and data shows that documented wage theft cost North Carolina workers and their communities almost $4.7 million in one year. Unfortunately, these numbers don’t even represent the complete scope of wage theft in the state, with many workers remaining silent out of fear of losing their jobs. Low-wage workers are more likely the experience wage theft, but workers from all areas of work are at risk. As a recent Yes! Weekly article points out, “Many workers don’t understand their rights, and some employees are counting on it.”

Wage theft can be devastating for families as well as their local economies, as it keeps money and taxes out of local economies. During this time of economic upheaval, it’s crucial for policymakers to ensure that existing wage laws are enforced and that all businesses are held accountable for their actions.

The NC Justice Center’s Worker’s Rights Project has been traveling across the state to present “Know Your Rights” trainings for workers, which address topics such as wage and hour laws and wage theft protections. Contact Ajamu Dillahunt at 919-856-3194 or to ask about a workshop at your organization or community group.

ECONOMIC MOBILITY: North Carolinians struggle more than U.S.

The American Dream is built on the belief that if you work hard enough, you can get ahead, no matter where you started from. Yet the "rags to riches" experience is increasingly hard to come by, particularly in North Carolina.

Economic mobility is harder for North Carolinians than average Americans and our neighbors in the Southeastern region, according to a new report from the Budget & Tax Center. Widespread income inequality directly correlates to lower economic mobility, and geography, education, socioeconomic background, and race also play integral roles. 63 percent of African Americans who start out in the bottom quarter of the income distribution are likely to stay there as adults – nearly double the rate for white Americans.

Without adequate investment in education, job training programs, tax credits, and policies that promote family well-being, North Carolina families will continue their struggle to get ahead in life.

EMPLOYMENT WOES: Workers still struggle despite improvements

Despite improvements in North Carolina’s unemployment rate in recent months, the state’s labor market continues to struggle, as large numbers of workers face chronic unemployment due to the fundamental absence of available job opportunities.

During the Great Recession, the state’s employment rate fell faster and farther than in recessions in 1981, 1990, and 2001, and as a result, the state’s labor market has taken longer to recover, leaving more workers unemployed for longer periods of time, according to a new report by the Budget & Tax Center. By this point in previous recoveries, North Carolina's job losses had been replaced and the state's economy was experiencing positive employment growth. This past April, North Carolina's economy entered the 52nd month since the beginning of the recession in December 2007 with a 9.1 percent unemployment rate. In 1985, 1994, and 2005, the state's unemployment rate stood at 5.4 percent or lower at the 52nd month.

As lawmakers gather in Raleigh to grapple with the challenges of high unemployment and an anemic recovery, they must recognize the reality facing the state's labor market, and face the daunting task of shifting its workforce towards industries that could experience long-term growth and stability.

CRUCIAL CONVERSATION: Lawrence Lessig on corrupt politics

Americans' trust in government is at an all-time law, points out Harvard Law Professor Lawrence Lessig in his book Republic, Lost, due in part to a belief that special interests have taken over the country's political system. "There is a feeling today among too many Americans that we might not make it," Lessig said. “Not that the end is near or that doom is around the corner, but that a distinctly American feeling of inevitability, of greatness – culturally, economically, politically – is gone."

Join NC Policy Watch and Common Cause of North Carolina for a very special Crucial Conversation breakfast with Prof. Lessig on Tuesday, June 12 at 8:00 a.m. at the Center for Community Leadership Training Room at the Junior League of Raleigh Building, 711 Hillsborough Street in Raleigh. Contact Rob Schofield at 919-861-2065 or with questions.

BACKWARDS BUDGET .5K: Race for the backwards budget on 6/19

To raise awareness about the “Backwards Budget,” Together NC is convening the first annual Backwards Budget .5K! on Tuesday, June 19. Participants will race backwards around the Halifax Mall to shine a spotlight on the legislature’s backwards approach to the state budget.

The race begins at 12:00 p.m. in the grassy area on Halifax Mall behind the North Carolina General Assembly, at 301 N. Wilmington Street in Raleigh. Backwards Budget .5K T-Shirts will be available for all registered participants as will refreshments. Click here to register and for more information.


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