Tar Heel State Hit By Economic Downturn In a special broadcast from Durham, NC, Tell Me More focuses on the economic and political climate in the state. Journalists Jim Morrill, of The Charlotte Observer, and Glenn Burkins, of Qcitymetro online news source , discuss how the Tar Heel State is coping with the nation's current economic crisis.
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Tar Heel State Hit By Economic Downturn

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Tar Heel State Hit By Economic Downturn

Tar Heel State Hit By Economic Downturn

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I'm Michel Martin, and this is TELL ME MORE from NPR News.

Just ahead: President Obama's election shakes and stirs the national discussion on race. Some of the nation's leading scholars on race and ethnicity talk about this in just a few minutes. But first, we leave the Beltway way behind and take the show on the road. Today, we are broadcasting from NPR member station WNCU in Durham, North Carolina. And we kick it off with our weekly political chat. Joining us our Charlotte Observer political reporter Jim Morrill and Glenn Burkins, Editor of Qcitymetro.com, which serves the African-American community in the Charlotte area. Welcome to you both. Thanks for joining us.

Mr. GLENN BURKINS (Editor, Qcitymetro.com): Thanks for having me.

Mr. JIM MORRILL (Political Reporter, Charlotte Observer): Thanks, Michel. Welcome to North Carolina.

MARTIN: Well, thank you. Glenn, let me start with you. Unemployment figures just came out yesterday. It was not pretty - it was not pretty in this area, as in the rest of the country. Unemployment increased in each and every one of North Carolina's 100 counties during January, and 72 of those counties had a rate of 10 percent or higher. What's driving those figures here?

Mr. BURKINS: Well, a couple of things are driving those figures. One, North Carolina has always been a manufacturing state. And during a recession, manufacturing is hit particularly hard. But another factor that's driving it has been construction. North Carolina, and particularly Charlotte and the Raleigh area where you are, have been some of the fastest growing regions in the nation. And now that construction has slowed, construction on housing, construction - commercial construction, a lot of those people have found themselves out of jobs. And thirdly, in this region in particular, the big banks, the banks are - have been trimming staff and laying off. And it's pushing up unemployment rate.

MARTIN: Jim, I got the impression that this area, particularly the Research Triangle Area, has been somewhat insulated from downturns in the past in part because of the big banks and also because of the universities, the research companies in the Research Triangle. I take it that just isn't true right now.

Mr. MORRILL: Well, I think the Triangle is different than in the Charlotte area, too. I think the Triangle is benefiting from its high-tech industries, too, which I don't think has been hurt as badly as some of the things that Glenn was talking about. And, of course, you do have the universities and government in the Triangle area where you are. Here in Charlotte, the banks have been just, you know, bombed by all that dislocations in the market and by - the banking industry. One of our bigger banks, Wachovia, was taken over by Wells Fargo. The Bank of America is under siege, as you probably know. And a lot of people are losing their jobs at those banks.

MARTIN: Glenn, I wanted to ask you, because you are a small business owner, as well as a journalist: Has your business been affected?

Mr. BURKINS: Well, my business launched right in the worst of this, I guess. Well, we hope it was the worst in early December. And yes, it has been hurt from an advertising standpoint, as you can probably imagine. Companies are not advertising as they once were. We are an advertising-based company. And as retailers and restaurants and those types of businesses are seeing fewer and fewer customers, naturally one of the first places they look to cut back is in advertising. So I can't say my business has been hurt by the recession. I would probably say instead that it was just not the ideal time to launch.

MARTIN: And Glenn, while I have you, is - do have a sense of how minority communities are being affected? Is there - have you noticed any special impacts?

Mr. BURKINS: Minority communities are always adversely affected, more so than the broader community during times like this. As you know, Michel, the unemployment rate for African-Americans is always significantly higher than it is for the general population. At times, it's as much as twice as high, or nearly twice as high. Right now, the National Unemployment Rate is over 13 percent for African-Americans. I don't know what the North Carolina rate is, but I guess what would best characterize it what is a conservation that I had earlier this week with a young African-American who worked at a bank. He said for the first time in his life, he was unemployed. And I met him at a class for unemployed professionals who were dealing with the stresses of unemployment.

And this young man was, as I said, unemployed for the first time in his life. And that's something that you did not see so much of in the African-American community when I moved here. When I came to this area eight years ago, we had fast food restaurants that were literally offering signing bonuses just to get people in the door.

MARTIN: Hm. Wow. If you're just joining us, you're listening to TELL ME MORE from NPR News. We're doing a special broadcast from Durham, North Carolina, and we're talking about the impact of the economic crisis in this state. Our guests are journalists Jim Morrill and editor Glenn Burkins. They're both are talking to us from Charlotte.

Jim, the state government has to run a balanced budget, which is something that you'll often hear, you know, governors talking about. They say, look, we can't print money. We've got to balance our budgets, you know, no matter what. Governor Beverly Perdue announced her budget earlier this week. Any highlights that you can share with us? And how is she dealing with this situation?

Mr. MORRILL: Well, she is between a rock and a hard place, obviously. I mean, we're looking at a $2 billion budget deficit, a shortfall this year alone, and looking ahead at a $3 billion deficit, more than a $3 billion shortfall for the next fiscal year. So she's making cuts. So far, she's announced that she hasn't had to cut that many jobs, although that's going to be a distinct possibility out there.

But, you know, she's doing a lot of things. She's cutting apprenticeship programs at the Department of Labor, student after-school programs. She's closing some prisons, squeezing prisoners together in tighter cells, taking some money out of the lottery. You know, it's - there's been an education lottery. All the money is supposed to be earmarked for education. She's been transferring some of that money into the general fund. She's doing what she can. She's between, you know, just - has a very hard time.

MARTIN: She's also proposed raising some taxes, as I understand it, including a sharp jump in so-called sin taxes on beer and cigarettes, and she defended those increases in a rather blunt fashion. She said those of us who choose to use both two products can afford to suck it up. But how is this going over?

Mr. MORRILL: You know, it's changed. North Carolina has changed. I mean…

MARTIN: It's Big Tobacco country.

Mr. MORRILL: Yeah, it's changed up where you are. I mean, Durham is the heart of the tobacco industry, or was a heart of it, and she's talking about raising the tax on cigarettes a dollar a pack. You know, and even a few years ago, that would have, you know, raised an outcry from the legislature down here. But I think more people are beginning to realize that you don't have a whole lot of choices in this economy and you have to do things like that.

MARTIN: How much relief is the state expecting to get from the federal stimulus package?

Mr. MORRILL: Well, I think, the figure's about $6 billion for - altogether, and then some more money here and there. Some of that's going to go into education, and that's how Perdue is going to spend money on education. She's actually raising some of the education spending in part thanks to some federal money, which is the only thing that's being raised in this budget year.


Mr. MORRILL: Because you're looking at cuts in the universities. I'm sorry. You're looking at cuts in university programs. We had a story today about North Carolina Central University, up where you are right now, cutting programs because of the cuts.

MARTIN: And Glenn was talking about this young man whom he interviewed who'd been unemployed for the first time in his life. And just kind of the sense I get from you, Glenn, is what a shock this was to this young man. He really didn't know how even to think about his circumstances. And Jim, wanted I ask you, you know, what are you seeing out and about as you go about? Do you have a sense that people have fully taken in the depth of the issue? And do you - is there a sense that people are being changed long term by this?

Mr. MORRILL: Definitely, Michel. You can't go any place without meeting somebody who's either been unemployed or who knows somebody who's unemployed. My son plays for his school baseball team, and there are parents on that -parents of players on that team who are unemployed, and you talk about it in the stands. You talk about it wherever you are. You know, we work in the newspaper industry, and you know how secure that is right now. So, yeah, I think it is changing things. For how long, we don't know, but, you know, definitely it'll be changed.

MARTIN: And Glenn, you're telling us that you feel that, in a way, it's also changed some of the political conversations that people have been having. For example, you'd pointed out that there had been a lot of talk about illegal immigration in the run up to the statewide elections, but that subsequently those conversations seem to have kind of dissipated. Why is that?

Mr. BURKINS: Well, Michel, I think when everyone is fully employed, it's easy to focus on other issues. But right now with the unemployment rate being what it is and with the stock market being what it is and with people's retirement funds, you know, being as they are, and they're - and them seeing their housing cost fall, I think people right now have other issues that they're concerned about. They're much more concerned about the bread and butter issues than their own homes and are much less concerned about what's happening along the border.

MARTIN: And final thought, Jim. What are political leaders are saying about how long this is going to last, how bad things might get before things get better? What message are they giving the citizens of the state?

Mr. MORRILL: Well I don't think anybody knows. And I think they'd be the first to admit they don't know, either. I think what they're telling people is they have to take every contingency that they can. The city of Charlotte just announced yesterday, made it known yesterday that they're giving the manager authority to cut peoples' pay, cut the city employees' pay and maybe even lay people off. And they're not saying that's imminent, but they want to have the tools in case they've to do that. And I think people are just - the leaders are just saying we might have to this. It's going to - we can't assume it's going to get better before it gets worse.

MARTIN: And Glenn, if I can in our final minute that we have left, do you mind if I ask you, how do you stay, you know, focused and positive given the challenges you're facing, trying to run this business that you obviously think is important? How do you keep yourself focused?

Mr. BURKINS: Well, I just focus on the work, primarily. Economies come and go. I said earlier that it was not a good time to go into business, but you can't always pick your economy or you can never pick your economy. So what I try to do is just stay focused on the business itself, realizing that times will get better. We've gone through difficult times before. We're going to go through difficult times again, and the future really belongs to the people who can weather these trials.

MARTIN: All right, well said. Glenn Burkins is the editor of Qcitymetro.com. Jim Morrill is a political reporter for the Charlotte Observer. They were both kind enough to join me from Charlotte, North Carolina. Gentlemen, thank you so much.

Mr. MORRILL: Thank you, Michel.

Mr. BURKINS: Thank you for having me.

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