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WATCH NOWThe Battle for Senate Heats Up in Georgia | Inside the StoryWatch Here


'Pledge' Influences Tax Debate

BY Rob Christensen
by Rob Christensen on 7/13/01.

While the General Assembly is tinkering around the edges of the tax code - considering closing corporate loopholes and giving counties more taxing power - prospects for a major across-the-board tax increase are uncertain.

One major reason: The Pledge.

Never heard of it? Well the state legislature has. And The Pledge has played an important role in shaping how North Carolina has responded to the state's budget crisis.

A majority of the North Carolina House - 62 members of the 120 members - signed a campaign pledge last year to "vote against any tax increase."

The Pledge was an effort by Citizens for a Sound Economy, a national anti-tax group headed by Boyden Gray, the White House legal counsel under former President George Bush and an heir to a Winston-Salem tobacco fortune.

The group has a strong North Carolina chapter - with six full-time staffers - headed by Chuck Fuller, a savvy political pro who ran the Senate and gubernatorial campaigns of Republicans Lauch Faircloth and Robin Hayes.

The group made a major push to convince House candidates to sign the no tax pledge - eventually convincing 53 Republicans and nine mainly conservative Democrats. (Eighteen members of the 50-member Senate also signed the pledge.)

"We came up with tax pledge as a way to hold people accountable when they went back into office," Fuller said.

The group conducted a grass-roots campaign last fall, distributing 100,000 pieces of literature. The group said it had 135 volunteers that knocked on the doors of 42,000 households in swing House districts.

On Monday, Citizens for a Sound Economy left telephone messages with the 62 House members who signed the no-tax pledge, reminding them of their promise.

Holding a narrow 62-58 margin in the House, the Democratic House speaker, Jim Black, was not in a taxing mood anyway.

But the thought of political commercials in 2002 attacking lawmakers who reneged on their pledge was not a pleasant one for Democrats to contemplate.

"I think it helped shape the debate from the standpoint that there is a fear factor," said Brad Crone, a Democratic political consultant. "Lawmakers see it as a political threat that is hanging over their heads."

The Pledge has prompted a debate about the question of what is a tax?

This week, the House passed a bill to close three corporate tax loopholes with the help of 10 signees of the no-tax pledge, including all nine Democratic signees.

The Democrats said the legislation was about tax equity, not raising taxes. Fuller said the loopholes raised revenue and were therefore tax increases.

Next week, the House is expected to consider a local-option sales tax, giving counties the power to raise taxes. Fuller said a vote for the local-option bill would not be viewed as a violation of the tax pledge.

The rhetoric is already beginning to escalate. The Citizens for Sound Economy this week blasted the "liberal big spending politicians in Raleigh." And the state Democratic Party replied by describing Citizens for a Sound Economy as "an advocate for the special-interest corporations."

Sounds as if The Pledge may be a topic of discussion in the 2002 election.