Fine Print - January 2011

The people pick up the tab
By G.D. Gearino

Everyone has a fuse, and when lit that fuse can ignite an extended rant on whichever subject an individual holds dear in his or her lockbox of rage. I am the possessor of several fuses — which explains why I don’t get invited to many parties — and here’s one of them: the widely misunderstood concept of public money, which apparently confuses the gatekeepers of news, an uncountable number of bureaucrats, more than a few academics and even most members of the very public whose money is routinely shanghaied by the people who tell them it wasn’t really their money in the first place.

That list of groups, by the way, reflects a descending order of blame. The public gets a pass because most of us subscribe to the naive belief (nurtured by politicians) that the taxes we pay are the only “public money.” In contrast, journalists know better — or at least they should — and hence get most of the blame for letting the routine appropriation of public money go unchallenged. I’ll cite three examples from the past year. Once you understand what I’m talking about, you’ll notice that it goes on all the time.

The first example dates back to Christmas ’09, when Gov. Beverly Perdue hosted a holiday party for the 20 or so prison inmates who work in and around the Executive Mansion. Both the Raleigh News & Observer and WTVD television in Durham reported on the event, and both found it necessary to point out that taxpayers didn’t foot the bill for the party. As the N&O explained: “The event didn’t cost taxpayers anything. During the year, the mansion is available for private receptions and fees from those events paid for the party.”

The only problem with that chirpy reassurance is that the Executive Mansion is, as the N.C. Department of Cultural Resources proclaims on its website, “the people’s house.” It belongs to the taxpayers, regardless of whoever lives in it or maintains it (which happens to be the Executive Mansion Fine Arts Committee, a creation of the General Assembly). What that means, of course, is that any fees generated by private events at the mansion also belong to taxpayers. So, yeah, we did pay for the inmates’ holiday hullabaloo. That’s OK with me — I don’t mind picking up the tab for some nonalcoholic eggnog for the prison work crew — but it’s alarming that our guardians in the media don’t challenge politicians every time one of them asserts that funds that come to the state from a source other than a direct tax payment somehow isn’t public money. It’s all our money. Every freakin’ dime.

Sadly, this wasn’t an isolated incident. A couple of months ago, the News & Observer again let a bureaucrat blithely wave away an expenditure as insignificant because it involved “private money” — in this case, the $142,000 spent on the search for a new president of the University of North Carolina. That cost was wildly over budget, but not to worry: As the paper explained, “The UNC system used private money, interest gleaned from unrestricted gifts given to the university over time” — the clear implication being that money donated to the public university doesn’t actually belong to the public. Just a couple of weeks later, the N&O was at it again. In an article about a trip to Las Vegas by five employees of the N.C. State Fair (an arm of the state Agriculture Department), the paper included what by now seems to be the standard boilerplate reassurance: “And, it isn’t costing the taxpayers a dime. The State Fair and its facilities are self-supporting, generating revenue through the annual 11-day fair and other events that are held at the fairgrounds throughout the year.”

Let’s ponder a financial brainteaser here. A private citizen makes a gift of money to a public university, to be used whatever way the university wishes. It’s clearly not the donor’s money anymore; he has given it away (and likely claimed a tax deduction as a result). But university officials who now have the funds take pains to refer to it as “private money.” So exactly whose money is it? Who does it belong to? Those same two questions apply to the Agriculture Department and Department of Cultural Resources. If someone pays to stage an event at the Executive Mansion or buys a ticket to the State Fairgrounds — both publicly owned places — they’ve surrendered that money to the state. But if those proceeds aren’t then taxpayer money, whose money is it?

I posed that question via e-mail to N&O Executive Editor John Drescher and got this reply: “I believe any money that the state of North Carolina possesses is considered by the state to be state money. Perhaps it would have been more precise for us to write that tax money was not used to fund the event and the trip.” The first sentence is a marvel of opacity. Between the words “believe” and “is considered,” there’s no firmness anywhere. It fails to address the central question: Isn’t it all public money? The second sentence simply reinforces the attitude that “tax money” is the only part of the public treasury that state officials have to answer for.

It’s bad enough that politicians and bureaucrats apparently believe that any money that flows into the public coffers by some means other than tax payments from citizens is theirs to play with as they wish. It’s infinitely worse when the people who think of themselves as the public’s watchdog provide the public-relations cover when that poaching occurs.