- [Narrator] This is a production of PBS Charlotte.

This week on "Unspun," the politics of inflation and the economy.

Whether it's gas, groceries, or the high cost of housing, we blame the politicians for higher prices and the politicians blame each other.

But what can Washington or Raleigh really do about it?

Plus this week's top five, the money issues that voters care about most.

And remembering county commissioner chairman Parks Helms.

"Unspun" is next on PBS Charlotte.

In today's America, welcome to the spin game.

Believe me, I know I'm Pat McCrory.

When I was governor and mayor, I played the spin game.

I was played by the spin game.

But aren't we all done being spun?

Let's take the spin out of the world in here on "Unspun."

(dramatic music) Good evening.

I'm Pat McCrory and welcome to "Unspun," a show that tells you what politicians are thinking, but not saying.

In November, most of us will be voting at a nearby school, a church hall, a local library.

But what if those voting machines were located at the gas pump or the supermarket checkout line?

Or how about a voting machine next to the for sale sign of that house you wanna buy, but you can't afford?

Why?

Because many of us, this election is all about inflation and the economy and the political polls are asking about the other issues out there like crime and immigration and Israel.

But polls or no polls, inflation is something we all feel every day, every time we spend a dollar and get less for it, every time we cash a paycheck that doesn't pay the bills anymore.

How can inflation not be the number one issue of this upcoming election year?

Inflation is also the number one issue that a lot of candidates don't want to talk about.

But when you ask them how would they solve inflation, many politicians often change the subject because they don't have the answers and they don't really have any control.

Coming up later, I'll have the top five money issues that you, the voters, care about most.

But first, let's talk to someone who really understands what's causing inflation and the other problems in our economy.

Dr. Michael Walden is a retired professor and economist from NC State University and a longtime expert on what makes our economy work and sometimes not work.

Join us now is Michael Walden, professor... Former professor at NC State University in economics, one of the great economic experts in North Carolina and in the nation.

Michael, it's great to have you on our show "Unspun."

I'm kind of curious, when you economic people behind the scenes, the experts in the economy hear politicians like myself, whether you're a mayor or governor or president, take credit or get blamed for what's happening in the economy, what do y'all say to each other?

- Well, we understand the politics of that, but the reality is that there are many forces in the economy that the presidents don't control.

Governors don't control.

You know this from your experience.

Take for example, a situation we have right now with inflation and interest rates, et cetera.

That's largely being handled by the Federal Reserve, not by the Biden administration.

On the other hand, just to tell you that administrations can have an impact.

One of the reasons why we're seeing very high rates of inflation or have seen it, is there was six and a half trillion dollars pushed into the economy in a very short time period of time by both the Trump and Biden administrations in order to deal with COVID.

And it wasn't recognized that that could spark inflation, too many dollars chasing two bit goods and services.

But overall, the economy is really crafted by the private sector.

- You know, it's kind of interesting.

When I was mayor, for example, and implemented light rail, which was a multi billion dollar endeavor, the real impact of that wasn't felt for another decade.

When I was governor, we implemented major new university bonds, but the buildings weren't built until five years after I was out of office.

So the impact for many decisions being made aren't felt for the long term.

- You're exactly right.

I mean, for example, we're still feeling some of the positive impacts of the tax cuts that were took place during the Trump administration.

The Biden administration, of course, is pumping a lot of money into the private sector in terms of chip investments, climate change policies, et cetera.

We really won't know the impacts of that probably for 10, 15 or even 20 years.

So you're absolutely right.

That's another issue with respect to giving credit or blame to politicians.

Their impacts can happen long after they're gone.

- Well, let's get down to some of the specific issues where we as politicians or former politicians take credit for certain things that happen during our administration and get blamed.

Let's first talk about things like job growth.

You know, we created 10,000 new jobs or a 100,000 new jobs.

You hear Biden say it, you're a Trump, you say it, you've heard McCrory and Cooper say it.

When in fact, did we really create those jobs?

What was the major influencer in the job creation, whether it be in a state or city or in the nation?

- Well, government policies can't and can have an impact.

For example, I would argue that the tax cuts, big tax cuts we had in the Trump administration actually helped generate jobs.

But if you look in recent history with respect to COVID, we had a big drop in jobs during COVID with the shutdowns, but a very quick rebound.

And that was all the natural economy responding.

It really wasn't the Trump administration or the Biden administration responding.

Now, I will say that some of the job growth right now that's being generated is a result of some of the additional spending that the Biden administration got passed in Congress, as I alluded to the chip, spending on chip factories and climate change programs, et cetera.

So the federal government can influence job growth in terms of its own spending.

But largely speaking, I would throw out at least an 80% number to say 80% of the decision to create jobs and 80% of the reason why good jobs are created lie in the hands of the private sector, private businesses, - In fact, if anything, the spending might incur short term job growth, but in the long run that debt might then cause a potential recession or depression in the long term.

- Oh, you're absolutely right.

In fact, I still give lots of talks and I gave one yesterday.

I'm always anticipating someone will bring up the question of debt, U.S. debt.

And yes, that is an issue.

There's been research to show that when we borrow more money at the federal level that pumps up interest rates.

And of course long run, in order to carry that debt, we're going to either have to raise taxes, which can be negative for the private sector economy, or it'll crowd out other programs like defense, some of which are very essential.

So that's certainly an issue where I think our federal officials have been negligent in terms of having an active policy that keeps the debt at moderate levels.

You know, however, in North Carolina we don't have that problem because we have a structure set up where we are...

The general assembly is limited to what it can borrow money for.

We don't have that at the federal level, - Although we do have a lot of unfunded liabilities that we don't count on the books.

The pension for state employees, the healthcare costs for both retired and current state employees, which is literally in the billions of dollars and most people don't even know it exists.

And in the long run, that impacts how much we have in our budget by probably, if I recall, 15 to 20% of my budget as governor was dealing with the unfunded liabilities.

- And you're absolutely right, of course, a lot of that was in the hands of the state treasurer, current treasurer Folwell has talked about the liabilities issue with respect to the state in terms of pensions, in terms particularly of healthcare.

And the problem here, and I know you would agree with me, governor, is that we don't see the consequences of happening until the long run.

And we live in the now, political people live in the now, consumers, citizens live in the now.

So we sometimes we have a hard time or we don't have a motivation to worry about those long-term consequences.

But you're exactly right, healthcare, general debt, debt for state employees, building up, those are all issues that eventually we will have to face.

- Now you brought up healthcare.

Healthcare is one of the major factors where government does have a great deal of influence, both good and bad in regulations.

I think what...

Some people say 20 to 25% of the economy is related to healthcare.

And of course the state and county governments have a huge impact on that in addition to the federal government.

- Well, you're absolutely right.

And I think from an economic point of view, what many economists would say is what we need in healthcare is more competition.

We've evolved into a system where we have very large healthcare conglomerates really dominating the healthcare system, that's not conducive to competitive pricing and competitive services, et cetera.

I think we need more ability for healthcare policies to go across state lines, but I'm really concerned about the size of the healthcare institutions.

And I think that is causing... That's a factor, at least, in terms of limiting competition, which generally means higher prices.

- So as we conclude this interview in the last minute we have, not only do politicians take credit for it or we accept the blame or we get the blame in TV ads, but voters often give us too much credit or too much blame for what's happening in the economy, whether it be gas prices or healthcare prices, or the price of the grocery stores and restaurants, which is really impacting us today.

What do you tell voters before they go in the booth regarding how much blame or credit a politician should get and how much is that related to things that are totally out of their control?

- Well, I mean, and I understand that people are busy with their lives, they're busy with their jobs, they're busy with raising children, grandchildren, et cetera.

They don't have time like I'm fortunate to have to think about these things.

Or you obviously were in a position where you could influence those things.

They don't understand how our economic system works.

And I think one of the starting points there is to try to, and I do this in my talks, is try to educate people a little more in common sense language that they can understand of how our economy works.

We have a very, very complex economy, but it's driven by the private sector.

So most of what's happens is derived from the private sector, policies can impact that.

And I think you're right, people like to simplify their world and they say, "oh, if gas prices are going up or down," they'll blame the president or credit the president.

And it's more complicated than that.

So this is just a matter of people being willing to hear different viewpoints and understand a little bit about economics.

- Professor, it's an honor to have you on and hope to see you sometime down the road and keep giving us advice on what's gonna happen in the economy.

I really do appreciate it.

- Thank you, governor.

My pleasure.

- Take care.

Next, PBS Charlotte's Jeff Sonier takes "Unspun" on the street to hear your thoughts on the politics of inflation and the economy.

- Yeah, whether you're stocking up at the supermarket or filling up here at the gas station, inflation is leaving a lot of our wallets on empty.

(mellow piano music) - Inflation, particularly has definitely skyrocketed over the past few years.

- Before I may spend maybe like $36 to fill my car up, but now it's close to 50.

(mellow piano music) - I learned to substitute, when something's high price, I shift to something else.

- I have to do meal planning, I have to do budgeting, and I had to make those hard decisions.

- I go to the grocery store, I can spend a $100 or more and I look, I don't have like three bags.

I'm like, "what did I just spend my money on because I have nothing."

And my kids like, "well, you just went to the store.

I mean, where's the food at?"

"Like, well, this is what we can get for what, you know, I have right now."

That has been, you know, a big change for us.

(mellow piano music) - It affects everybody, but particularly when you realize I have X amount of money coming every month, that's not gonna change.

- You need to learn to adjust and it's good to build up savings.

- Yeah.

- And be frugal.

- Yeah.

- That's the way you kind of beat inflation.

- One day I just sat at my kitchen table and I looked at all my bells and I said, "I can't do this on my own.

I need some help."

- Yeah, and whether it's gas or groceries or everything else that costs more than it did before, well, inflation is one of those things that money experts like Dr. Walden calls regressive, which means it has the most effect on those who can least afford it.

Pat?

- Thanks Jeff.

You can really see their pain.

So what do you think about the issue?

Email us your thoughts on how you see the politics of inflation and the economy to unspun@wtvi.org.

(dramatic music) Tonight on our top five countdown, we've got the top five money issues that voters care about most.

In fact, let's go to the top five.

This is a tough one for all of us 'cause we feel the pain when we especially go to certain places to buy the things that we need.

And nothing I'm gonna say will surprise you, but let's start out with number five.

Actually, number five's a little division in our country.

But political candidates, especially President Trump and President Biden often bring up the stock market because when the stock market is going down, there's a large segment of people who are depending upon their 401s who are going, "what's the president doing?

Why is the president impacting the stock market?"

And when it's going up, both President Biden and President Trump take credit for it, even though they may have no impact on it, they're gonna take credit when the stock market's going up because the appeal especially to people who have been in the stock market for 20 or 30 years, are now depending upon it in their retirement.

So it's a huge issue that can work for and against politicians.

Number four, medical cost.

Medical cost.

Listen, I've just been through this in my family after my wife had an operation, you just get bill after bill after bill.

And those people who might lose their job, they've gotta look for COBRA.

And then the premiums keep going up and up and up.

And what are people doing?

They're afraid to even go to the doctor because they're not sure they can afford it.

So medical issues is a major issue that impacts them personally and also family members.

If your mom and dad are sick, they may have to get the bills and figure out how are they gonna pay for 'em or will they lose their home or something else.

Medical bills is a huge national issue and will continue to be in this national election.

Number three, the one that politicians don't want to talk about at all.

And that is food prices.

This is both at restaurants and especially at the grocery stores.

We're all going to the grocery store and having shock about how much milk costs, how much eggs cost, how much bacon cost.

And it's just really impacting us at this point in time.

It's the one that scares the politicians more than anything, the food prices.

Number two, housing, rents, values.

Young people are going, "we can't afford a house.

We can't buy a house."

Especially those between 20 and 30 as interest rates go up and right now, who's gonna get the youth vote can be dependent upon the youth being so angry about not being able to afford either rental prices or the purchase of homes.

And number one, the one that we're reminded of every single day as we go down the road because the price of gas is listed right there.

And I find myself driving down 85 and going, "okay, what is it today?

Is it 3.25 at this gas station or is it 3.35 or 3.55?"

And I will literally make a decision going down the road on which gas I can save a dollar or two on.

And that's true with everyone at this point in time.

Especially those who are living paycheck to paycheck.

Inflation will be the biggest issue in the upcoming presidential campaign.

(dramatic music) Next up, PBS Charlotte's Jeff Sonier joins me on our "Unspun" one-on-one segment.

Jeff- - I hope you've been watching, hope you've been watching the headlines this week.

'Cause that's where the questions come from.

I ask them, you answer 'em.

That's why we call it one-on-one.

- You're already trying to be tough with me.

Just like a typical reporter.

- All right, let's get into it, all right?

I saw your top five moments ago.

You did not mention taxes.

Isn't that also an issue that voters care a lot about?

- That's the first time I'm gonna compliment you because that's actually a good question.

Yeah, taxes are huge, but the dilemma is right now, taxes haven't yet gone up because of inflation, but they're about to.

In fact, you're seeing legislation at the national, local and state level about fees, you know, airline fees and hidden fees on the credit cards and other stores and even vacations in hotels.

Because everyone's trying to jack up their prices because they're being impacted by inflation, especially wage inflation and fuel inflation.

And that usually follows a year or two after the initial inflation occurs.

And so taxes will be a major issue in the upcoming election.

Actually right now there's... Joe Biden's recommending that some of the tax breaks that were initiated during the Trump administration be reversed because of the deficit.

But at the same time, that will also impact inflation.

It's a damn if you do and damn if you don't.

- Locally, they're also talking about a tax increase, the mayor and the city manager.

You were mayor.

Have voters changed when it comes to how they regard tax increases?

It used to be a heck of a fight anytime you'd even mention a tax increase in- - I don't think voters have changed.

But the voters' input has changed in this issue because the entire city and county elections are determined in the Democratic primary now, and taxes aren't the biggest issue in the Democratic party.

It's services are the biggest issue and therefore the city council and the county commissioner are trying to provide services and they don't want to cut the services to any of their constituents that they depend upon to get votes in the primary.

So the old conservatives that used to go, "you're not gonna raise my taxes anymore.

I can't afford to live here in Charlotte, I'm gonna move to Lincoln County or Cabarrus County or Union County because you're kicking me out of this area.

I can't afford it anymore.

That voice is never heard now in the general election, because we're one party city and we're one party county at this point in time.

- A little different in Raleigh though, right?

- Different in Raleigh, we have a Democratic governor, Republican legislature, but the Republicans really control the show as long as they have a majority.

So we're having tax cuts, not tax increases.

And right now the budget's in pretty good shape, at least if you don't count the unfunded liabilities, which neither the governor nor the legislature wanna talk about.

- You know, they used to say all politics are local, but these days it seems just the opposite.

All politics are national.

Why do national issues keep spilling over into state and local races?

- Well, sadly, it's a matter of the media, we're losing a lot of our local media that used to cover these local issues.

So the people are only hearing about the national issues because look at the change in the newspapers and the number of reporters that cover city council, county commission, and even school board meetings.

It's nothing like when you and I... You were attacking me when I was mayor during all those years.

The reporters just aren't there anymore like they were in the past.

So they changed the subject to national issues, which people can appeal to.

- This is Bill eight... No, excuse me, 965.

It's a house bill that would require North Carolina and NC State to play UNC Charlotte, Appalachian State, and East Carolina every year.

One of those three schools in football or basketball.

Do you vote yes- - Absolutely.

And I'd add Western Carolina and North Carolina A&T to that also.

And maybe even Pembroke, especially in basketball.

They have good basketball programs.

But Carolina and State, with all due respect to the Carolina State fans, they don't wanna risk a loss to a lower level team, at least perceived lower level team.

This goes back to the seventies when East Carolina used to beat both State and Carolina and they said we're never playing them again.

I think it's happened with Appalachian State recently with Matt Brown in Carolina.

- Last quick question.

You mentioned economy a lot and inflation a lot.

You mentioned there's a song that kind of hits home with you think voters when it comes to taxes.

- Well, you know, I'm an old Beatles guy, so a George Harrison song by the Beatles "Taxman."

And this is at a time when the Beatles were making a lot of money in their early '20s, and yet after they got their final net bill, they had no money left because about 90% of their income was being taken by the English or Great Britain government.

In fact, at that point in time, the Rolling Stones who were also famous and making a lot of money, they moved to France to avoid the English taxes.

So George Harrison wrote this song called "Taxman."

- Yeah, lyrics, "if you drive your car, we'll tax the street.

If you sit down, we'll tax the seat."

Those lyrics hit home today- - He even mentioned several British politicians in that song, Mr. Heath and so forth.

So it was a direct assault toward politicians raising the taxes even on the rich, because what the rich did in Great Britain, they just left.

- Yeah.

Thank you, governor.

That's this week's one on one segment.

♪ I'll tax the street ♪ ♪ If you to sit ♪ ♪ I'll tax your seat ♪ ♪ If you get too cold, I'll tax the heat ♪ ♪ If you take a walk, I'll tax your feet ♪ ♪ Taxman ♪ (dramatic music) - To wrap up our show, each week we've got a segment we're calling Backspin, where we'll give thanks to good public servants for the things they've done in the past, but maybe weren't recognized for the good work they did.

You know, back in March of this year, I was sitting in the back pew at the funeral of Parks Helms.

Sitting with me was Harvey Gantt, Richard Vinroot and Ed McMahan.

It was during this service that I think each of us realized that we never took the opportunity to say thanks to Parks for his incredible service as a former state representative and former chairman of the Mecklenburg County Commission.

Like mayors Gantt, Vinroot and myself, Parks also lost a statewide election.

You know, the great state of Mecklenburg can't win a statewide election, but he kept making a positive difference.

Parks was a Democrat, but he partnered with Republican mayor Richard Vinroot, to implement City County consolidation for our police and parks and planning commission.

He collaborated with me on light rail and during that time, Parks had never got hung up over who got the power or who got the credit.

A rare political trait, and he was always willing to compromise in a divided government.

His love and a service to our state was second to none.

Parks Helms, our region misses your wisdom.

Thanks for your leadership.

You made a positive difference.

Well, that's the reality as I see it and as it was, thanks for joining us.

I hope you'll come back next week where we'll explore the politics of campaign ads.

That's on our next "Unspun," where we'll tell you what politicians are thinking but not saying.

Goodnight folks.

(upbeat music) - [Narrator] A production of PBS Charlotte.

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