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- It is hard to remember a time when there seemingly was such a fever pitch around things like the economy, social concerns, personal balance sheets, housing, healthcare, health, but also this year's debate, 2024, and passion in presidential politics will most likely dominate.

Welcome into the most widely watched and the longest running program on Carolina business policy and public affairs, seen for more than three decades across both North and South Carolina.

Speaking of politics, joining us later on on this program will be a sitting politician, Dale Folwell, North Carolina Treasurer.

But before that, we will unpack some of these issues at the beginning of this year and certainly of this week with our expert panelists.

And we start right now.

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On this edition of Carolina Business Review, Patrick Woodie from the NC Rural Center, L. Dean Faile of the York County Regional Chamber of Commerce and special guest, Dale Folwell, CPA, North Carolina State Treasurer.

(dramatic music) - Can we still say Happy New Year?

Happy New Year.

Welcome.

- Same to you.

- Glad to see you both.

Welcome.

- Thank you.

- Patrick, we'll start with you.

So here we are, beginning of the year, general assembly in North Carolina, getting ready to restart.

Probably another bruising year, no doubt.

Presidential politics on top of it.

A couple of questions, Patrick.

What would you like to see be a priority?

What do you think there's going to be as priorities?

- Well, certainly I think there's a lot of issues that are top of mind and we don't face many easy issues.

These are pretty complex, large scale issues.

But certainly, you know, as I talk to my colleagues and my counterparts, as I think about our work in the rural parts of North Carolina, workforce development comes right to the top of the agenda every time.

And that's really at all levels, all the way from early, from childcare and preschool aged children all the way up to adult level education.

And I think workforce development would be high on the agenda.

I also think it's time where, given the fact that our general assembly allocated a lot of money for federal dollars to some pretty ambitious and pretty important issues like broadband, like health and a number of other areas, water and sewer infrastructure, which also means a lot to us.

Transportation, housing, they're gonna be monitoring how those funds are rolling out and seeing if any adjustments need to be made because there's a time limit on the use of those funds.

- Priorities for the State House in South Carolina?

- First one, same thing.

Workforce development, like, you know, last year the state implemented the Department of Employment or Workforce Development with Director Floyd spearheading that, you know, this year will be kind of year two of that effort.

You know, what barriers do we need to break down?

How do we address more affordable workforce aligned housing issues, you know, affordable and attainable childcare.

You know, we have a real challenge in South Carolina with enough childcare, but those barriers that are preventing workers from getting back into the workforce, being able to improve that labor participation rate, those are top priorities in South Carolina.

- You know somebody once said, and you're kind of being flippant about it, but I think there's a large truth, and I'm assuming you're both gonna describe this in a similar way, and that is workforce development, none of these things would be a problem if we could figure out transportation and fix transportation, getting people in and out of urban cores around, not just around urban cores, Patrick, but also rural.

Dean, I wanna start with you and stay with you for just a second because Pennies for Progress in South Carolina has been wildly successful, at least for York County.

- Absolutely.

- And for the state, Pennies for Progress represents a simple, but has it been an easy way to raise funds for rapid growth in roads?

- Well, the rapid growth caused us in York County specifically to need that extra penny to maintain our roads, expand our roads.

Has it been easy?

No.

You know, voters are apprehensive about voting an additional tax on themselves.

You know, in this case we saw a real avenue to, with all the travelers and traffic coming into South Carolina, you know, here's a way to get others to participate because it's a penny on sales tax and it is really been phenomenal.

York County alone has raised over a billion dollars over the last 25 years to improve their roads.

- Okay, so Patrick, and we were talking before the show.

And you know, I turned to you and I said, does North Carolina have anything like that?

And you, you said there's a half cent sales tax in some community.

- A few years back, the general assembly allowed our local governments to decide an optional add-on additional sales tax that they could add by voter referendum has to be approved by voter referendum.

And I think we've struggled to see most of those referendums from my memory, have really struggled.

So it's interesting to hear this experience in York and obviously, it's built around an issue that's probably on the minds of every citizen of York County.

You know, maybe there's some lessons to be learned there, but we do have the flexibility of that option, but it hasn't gone quite so well.

- How has North Carolina been able to win over the public on a adding a penny sales tax?

- Well, excuse me, in South Carolina we've got now 30 counties that have a penny sales tax and it's always specifically for some sort of given activity.

In York County, for example, it's roads, Lancaster County uses theirs more for capital projects.

So they were able to build a courthouse for theirs.

Others, sometimes it'll add that penny.

It'll be a combination of maybe roads and some sort of education initiative.

So it's really has to be a key initiative in that given county and that the voters can recognize as this is a real need for us and we need to address it.

And then you're right, there's a real challenge to make sure you get the messaging out to the voters so that they understand the real needs of that extra penny.

- And they're building their case around a very specific need.

It sounds like, and therein may lie, the difference in kind of the experiences the two states have had so far.

- The one thing North Carolina has done in front of South Carolina was Medicaid expansion.

I mean, it was, as you well know, Patrick.

It was bruising for many years.

- Many years.

We worked on that issue for eight years.

- And finally became law in the Old North State.

How is it going?

- I think it's going really well.

The rollout began on December 1st.

The latest numbers I've seen is we're approaching 300,000 new enrollees.

The estimate is that there's between five and 600 uninsured people that meet the requirements meet the eligibility requirements for Medicaid expansion.

From what I've seen, the department under Secretary Kinsley's leadership has done a really good job of rolling it out in a seamless fashion.

We have an ability to look at the data and see how's it going county by county, we have some data that tells us how many eligible people there are by county.

And we can see where are they signing up, where are they not, where do we need to direct resources to in order to get 'em signed up?

And we certainly are paying attention to that at the Rural Center, that 600,000 uninsured are disproportionately rural citizens.

This will be a huge shot in the arm to the economy.

It should help attract more providers.

But our healthcare workforce challenges were already daunting.

They remain daunting in some ways.

Medicaid expansion will just, the attention has got to focus from Medicaid shift, from Medicaid expansion to really focusing on getting that healthcare workforce growing and headed in the right direction.

- Dean does this embolden South Carolina lawmakers to really look at this and expand it and actually make it law.

- It must, I mean, we are behind on this effort.

North Carolina has really shown that this works.

We're leaving dollars on the table.

We're not insuring folks in a way that we need to in South Carolina.

And the Medicaid expansion is a real tool that we've been missing out on.

I think the appetite is there now.

I think, you know, South Carolina legislative body is looking at things in a way that's more broad based than once maybe.

And so I think that'll be a real topic of conversation this year.

- Thank you guys.

Stay with us.

Before we go to our guest, coming up on this program, I wanna promote a couple programs in the first quarter of this year that are gonna be important.

The first one is our Insiders program.

This is always fun when you get a view from the inside from Insiders.

And those Insiders include people like Susie Shannon from the South Carolina Council of Competitiveness, also, I'm sorry, Sarah Fawcett.

I always wanna say Farrah Fawcett, but Sarah Fawcett is the head of the United Way in the Midlands.

She's always a good sport about that.

Chris Chung from the Economic Development Partnership of North Carolina and Don Thompson from the Diversity Movement, it is always a compelling thing.

And then also, secretary Harry Lightsey from the South Carolina Department of Commerce will also be a guest on our upcoming show.

Our special guest now has been an elected official for at least three decades, but you could describe him as anything but a typical politician self-described as a, and I hope I get this right, 'cause he'll probably correct me, social conservative.

He is now responsible for the Tarheel State's finances at some of the highest levels.

Joining us again is the North Carolina State Treasurer and candidate for Governor of North Carolina Dale Folwell, your Honor, welcome to the program.

- Well, thank you for having me.

- Was that accurate social conservative?

- It's accurate that I'm known as someone who attacks problems and not people, which is what we need more of in our society these days.

- Your Honor, let's talk about not just the credit rating of North Carolina, but the idea that North Carolina for a long time has been fiscally conservative, AAA rating, et cetera, et cetera.

Very one of the largest pension funds, not just in the country, but on the globe.

When you look at some of the larger economic issues in the US and certainly historic levels of US debt, does that concern you and how do you think about positioning North Carolina to protect from any kinda whipsaw in those kind of debt markets?

- Well, my comment will be a little bit like a country music song, so I'm gonna build you up then I'll burn you down.

The buildup is that the lapel pen I'm wearing, NC stands for nothing compares.

I wouldn't trade places with any other state treasurer in the United States based on some mathematical examples I'm getting ready to give you, maintain the AAA bond rating, retiring 66.0% of the state debt over an eight year period of time.

Governor DeSantis brags about 20%, we're on the path of retiring 60%, eliminating the corporate income tax.

The personal income tax has been cut in half over the last 12 years.

These are the reasons why North Carolina just didn't jump up on the table as number one for business outlook and business activity.

It's been a long process of strategy and discipline that have put us in this position.

Unfortunately, we're facing a tremendous threat in North Carolina and across the country.

That threat is our federal government.

Warren Buffet told all of us 38 years ago, it's hard to be as smart as your dumbest competitor when we are saving billions and billions of dollars, balancing our budget, building surpluses, establishing rainy day funds, and making the investments in broadband across North Carolina.

When you're dumbest competitors, the federal government who is raising the price of everything on everybody, it's about a third of everything we've saved at the state treasurer's office has been wiped out with the increased cost of light bulbs and electricity and paper towels.

Our national debt situation is the biggest single biggest national security issue of my lifetime.

The amount of interest paid on the debt this year is going to exceed the military budget.

So whether any of the governors across the United States, if we're actually gonna be the states of the union instead of the state of the Union, the governors are gonna have to figure out how to save our country.

Because Washington DC is addicted for money, addicted to money, and they need to be about the business of balancing their budget, sending a signal to the bond market and start to retire $34 trillion for the national debt.

- You think it's a crisis?

- Yes, it's a crisis because there's no indication that anybody's doing anything different.

The reason your viewers are so exhausted about this is that they thought they knew who they were voting for, but the people they're voting for are not taking care of the problem.

You know, it's not enough just to be on this great panel and talk about issues.

Eventually somebody has to fix them.

This is a serious issue for North Carolinians and for our country.

- Patrick?

- Treasurer Falwell.

It's a pleasure to be with you.

T I want to give you a chance to talk a little bit about what I think is one of the real unsung heroes of state government, and that's the local government commission.

And I find as I talk about the importance of it to our rural communities and our rural local governments, and a lot of people don't know that such a thing exists and it's been around a long time.

You directly oversee it, it's part of your responsibility.

As our state treasurer, I'd love to get your perspective on the LGC.

Its work over time.

Its importance today and particularly its importance when it comes to maintaining the physical health of our, particularly our smaller, more rural, local governments.

- The Local Government Commission was founded nearly eight decades ago on the back of the bankruptcy of Asheville, North Carolina after the depression.

We're very proud of the people of the Local Government Commission.

And we oversee the issuance of debt by over 1200 entities, a hundred counties, 548 cities, water and sewer district, airport authorities, universities and hospitals.

All we're really looking for at the local government commission is competence, good government, transparency, lack of conflicts of interest and audits.

That's a very important function.

Yeah, we're very proud of the people at the Local Government Commission.

But it's important to realize when you have a job at like the State Treasurer of North Carolina, you wear all these hats.

It's important to realize that you're sort of like former Congressman John Lewis.

It's okay to get into good trouble every day.

And when you ask tough questions of some of these local entities, sometimes they don't like somebody asking any of these questions.

But our job is to partner with them to get the governance, the transparency, the conflicts and the competency back into local government.

- Thank you.

- Secretary of Folwell.

Go back to a minute, to a comment.

You made, you know, facing the crisis with the national debt, you know, South Carolina was the leading, had a leading population growth this past year.

North Carolina was number five.

What can you do?

I mean, you know, the Carolinas, we're so interconnected, and I know you are in North Carolina, but how have you been able to reach out to your counterparts in South Carolina and work with them to maybe address some of these challenges on fiscal health?

- Well, I stand on the shoulders of Treasurer Loftus from South Carolina.

I've learned a lot from him over the years, and I'm thankful for that partnership I've had for the last seven years.

But as I said earlier, all of your viewers of accustomed to this term, state of the Union, it's gonna have to be the states of the union that address these important issues.

And directly, I related to your question as we move forward, we have to make sure that we're watching the pennies and the paperclips.

I think state governments are gonna have to really consider zero based budgeting because if the federal government has an addiction for something that's ended up costing you more money through inflation, when you pump gas in your car or you go to the grocery store, it's a really big deal.

And secondly, I think the states are gonna have to create a separate set of financial statements to figure out just how dependent they are on this federal government who cannot curb its appetite or addiction for money to see how vulnerable these states are on this funding that was promised, but may not come.

- You know, you're running for governor, are you, and this is not meant to be dismissive.

Are you trying to leverage your fiscal responsibility, and quite frankly, a good reputation you've made in the state even before being treasurer as well into the highest office in North Carolina.

And what does it take to win that office?

- Well, what I'm trying to do is just take advantage of what God gave me.

I'm not the IQ person in this race.

I'm not the richest or the tallest or the most hateful or the loudest, but I'm the person who has a reputation of seeing what needs to be seen, being humble enough to listen for what needs to be heard, and have the courage, not the rage.

It's funny that rage is inside the word courage, to have the courage to act on what needs to be done.

And there's so much that needs to be done at DMV, at DOT, at DHHS, at the Board of Elections.

All of these are cabinet level positions that report back to the governor of North Carolina.

And my reputation is to attack problems and not attack people.

And going back to your opening comment, we've lost sight of the meaning of words.

The root word of governor is to govern.

It's a verb.

The root word of conservative is to conserve.

It's a verb.

The root word of liberal is to liberate, to set economically free, as I've had the opportunity to do as a former motorcycle mechanic and garbage collector who ultimately took classes at Winston-Salem State and UNCG.

So if we could just get back to the root words of what these words mean, I think we got a real shot at actually solving these problems.

The challenge is that we have conflict entrepreneurs in our country, people who are making hundreds of millions of dollars on keeping this country divided.

We can no longer do that.

And if you're conservative, you have the responsibility of explaining a conservatism without offending people.

There may be people in the studio when they get that last bit of toothpaste.

They take a pair of scissors and they cut the tube into, there may be people in the studio when that bar of soap gets real thin, they just put it on top of the new bar of soap.

Don't raise your hand.

That's what conservatism is.

Or turning your spigot off when you brush your teeth.

Every single person in both these states is conservative in some way, shape, or form.

And we have a responsibility of as public servants of explaining really what conservatism is without offending people.

The party that I joined nearly 50 years ago was based on conservatism, common sense, courtesy.

Let's get these other three right.

Humility, humanity, and ethics.

That's the party that I joined nearly 50 years ago.

- Patrick?

- So you're one of the few people, not a whole lot of people that have been able to, I mean, you've been in public services for going on 30 years now in different roles twice statewide elected office.

There's not a nook or cranny of this state that you haven't been in and having experienced and don't understand the great diversity that makes North Carolina, North Carolina.

Talk a little bit about if you're successful in your race for governor, do you have a particular vision or things you'd like to see happen for the smaller places that make up our state?

- I was asked by a national newspaper the other day, you know, what's the first thing we're gonna do?

I said, we're gonna hire people who will answer the telephones.

No one calls the state government to book a cruise.

They call the state government because they have an issue and they need something resolved.

If you work at state government and you cannot answer your telephone, then that means you're not hearing from your customer.

That means you can't solve their problem.

Secondly, and I carry this map around all the time, just to remind everyone that the state border doesn't end at Charlotte and Raleigh.

There are people who live out here who could literally, as you know, Patrick, drive to Tallahassee, Florida quicker than they can Raleigh, North Carolina.

That's how big this state is.

The second reason I carry this map around, whether it's South Carolina or North Carolina, is Hayek, the famous Austrian economist, told us that money does not know where the border is.

Money will go where it's invited and stay where it's welcome.

So when we were in lockdown mode and people with all this population on the border of other states and people could drive seven miles and get a hamburger and a haircut in York, South Carolina, they're gonna drive seven miles and get a hamburger and a haircut.

My point is, is that understanding that the state border does not end in Charlotte and does not end in Raleigh.

And there are tremendous needs west of Charlotte, tremendous needs east of Raleigh, and there are actually tremendous needs in the urban districts.

We need to find a way to meet our transportation needs without putting a toll on people.

I don't think I could have ever, ever attended college if I had had to drive on a toll road to work my three jobs and take classes at West Salem State and UNCG.

So meeting these transportation needs, thinking outside the box, inside the box, using both sides of the box, but more importantly, having the courage to ask the right questions.

That's what it's gonna take to get us beyond the situation and to be able to protect and defend ourselves against the federal government's addiction for money.

- We have less than three minutes.

- Quick question.

Affordable income aligned housing in Catawba County just couple of weeks ago.

They're facing that challenge.

Many counties in the South Carolina facing it.

How do we address that?

- Well, you can't unpack that in three minutes in using your criticism, but it's an important issue.

It's an important issue because when you're low fixed income or like I was for a third of my life, you have to live further and further away from your work when everything's costing you more to get to work.

These are tremendous issues and it's also locked into our employment crisis.

We have an employment crisis at the Mecklenburg County Jail.

We have an employment crisis at the state government.

You have employment crisis in York, South Carolina.

I'm a Quaker.

And one of the roots of the Quakers are to be fair and just, and when you have conversations, you have conversations in circles, not looking at the back of people's heads.

And so we need to have a conversation about this very important issue.

But we also need to understand that there are so many things even within our tax code that's making our employment crisis even worse.

The state of North Carolina, you can only deduct $5,000 out of your flexible spending account for childcare.

It costs $17,000 to keep a kid in childcare in Wake County this year.

So everybody says you can't see the forest for the trees.

Sometimes you need a CPA, a tree person who can figure out what tree needs to be repaired so that the whole forest can be healthier.

And that, I think is a long term answer to affordable housing.

- Yeah, I don't mean to be flippant.

You're talking about being a conservative and talking about putting the bar of soap on the old one.

I haven't thought about that, but don't tell me that you wash your paper towels too.

- No.

- Okay.

There was a limit.

Charlie Monnger did that.

He just passed away, by the way.

- I do know that.

And I know anybody and you know, I do want to thank you for your service, your Honor.

I wish we had more time to unpack this and, and go down the list.

We didn't talk about the divestment list, we didn't talk about Local Government Commission nearly enough.

But thank you for your service to this point.

- Or hire a prescription drug cost, which maybe we can talk about at some point in the future.

- Weight loss drugs and the impact on it.

Yeah.

Thank you.

But thanks for being on the program.

- Thank you and happy New Year and all of our resolutions should be to let's come together as a society and let's really attack the problems that we're all facing.

- Thank you.

I hope you get a chance to do that.

Dean, nice to see you.

Thanks for making it great.

Glad to be here.

- Yeah, thank you Always nice to see you, Patrick.

- Thank you, Chris.

Great to be here.

- Thank you.

Thank you for watching our program.

If you have any questions or comments or like to watch past programming, go to Carolinabusinessreview.org.

Very neat and short to type in, I'm kidding, of course, but Carolinabusinessreview.org.

Thank you so much.

Happy New Year.

Until next week, I'm Chris William Goodnight.

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