Over 16 percent of all personal income in America in the first quarter of the year was in the form of a government check, an all-time high. Meanwhile, state unemployment trust funds are running dry, like the one in Raleigh which has borrowed $470m. from the feds and probably will require a payroll tax hike in the near future. Then there are the lavish benefits Mecklenburg County supplied to a relatively large segment of the local population as tax revenues surged over the past decade.
The common theme is the end of free money. Inflation and tax hikes are poised to zap the nation’s great wealth creating machine even as unemployment chugs along at a 10 percent rate. Taxes on job creation obviously will not help and the erosion of earning power via inflation will reduce the standard of living across the board. Inflation spikes will mean a real cut in the value of government benefits, no doubt driving calls to “adjust” them upward.
The inflection point for jurisdictions like Mecklenburg and North Carolina will come when — if ever — they choose to put the interests of the most productive members of society on par with, let alone ahead of, those of the least productive. As I see no understanding of this matter among our almost uniformly dullard leaders state or local, I do not foresee this change ever happening.