Carolina Journal Radio No. 899: Data help create a typical COVID-19 patient profile

From Cherokee to Kuretuk, from the largest city to the smallest town, and from the statehouse to the schoolhouse, it's Carolina Journal Radio, your weekly news magazine discussing North Carolina's most important public policy events and issues.

Welcome to Carolina Journal Radio, I'm Mitch Kokai. During the next hour, Donna Martinez and I will explore some major issues affecting our state. Election Day gets closer and closer. The John Locke Foundation hosted a recent online forum featuring some of North Carolina's top election experts. They discussed key themes and offered predictions for November.

George Floyd's death has prompted national conversations about police reform. You'll hear from one Tar Heel lawmaker who's disappointed about the direction the discussion has taken on Capitol Hill. COVID-19 caused a major shakeup on college campuses, including campuses throughout the University of North Carolina system. A higher education expert offers her thoughts about the university's response. And we'll discuss a new analysis of federal tax credits tied to electric vehicles. You'll learn why there's concern about possible fraud.

Those topics are just ahead. First, Donna Martinez joins us with the Carolina Journal headline. So exactly who is the most susceptible to the coronavirus? Well, we all want to know that for sure. Is it striking more in dense urban areas than in more rural areas?

And what underlying conditions are correlated with testing positive? Well, the John Locke Foundation's healthcare policy analyst Jordan Roberts has taken a look at a study that drills down into insurance claims related to COVID-19. He joins us now to reveal what all of this has found. Jordan, welcome back to the program.

Thanks for having me. Give us a little bit more detail if you would about the data that we're going to discuss. Fair Health, a nonprofit research organization, they collect private insurance claims. And so they have a repository of about 30 billion healthcare claims. So this is a massive sample all across the nation. It's a very representative sample. And they compiled some of those claims and, you know, broke it down by key variables such as age, gender, location, things like that to, you know, hopefully give a more complete picture of like you said, who are the, what are the characteristics of patients who test positive for COVID-19? So that's what this data is looking at, positive tests, and those individuals what characteristics they had. This could be really helpful to each of us to at least have in our minds a little bit of a more determination of the level of risk that we each face based on all this. Let's talk first about age.

Tell us what the claims show. Well, this is, you know, all across the nation, a nationally representative sample. What they found is that the majority of cases are in the 51 to 60 year old age range. And so this is, you know, typically consistent with what we knew from the beginning, those older and, you know, typically a little bit worse health and younger individuals were the most susceptible. But you know, the most striking thing to me is that 60% of the total cases around COVID positive cases around the country were those above age 51. So that leaves only about 40% of those positive cases in individuals below the age of 51.

That's really curious because if we connect this up to what's happening in North Carolina, we know the Governor Roy Cooper has now issued yet another statewide one size fits all mandate. This happens to relate to alcohol consumption, cutting off at 11pm. And so you would tend to think that if you're talking about people who are congregating essentially in restaurants that turn into bars late at night, that would be a younger crowd than this stat shows.

That's right. And you know, what we can hopefully glean from this data is that everyone can, you know, assess their own risk, you know, make the right determination for themselves, what activities should I participate in, and what I shouldn't. And you know, that's what we hope to achieve by putting out this this types of data. And we appreciate Fair Health for compiling these insurance claims for us. Let's talk a little bit about the gender situation, because I know that here in North Carolina, and again, the claims data we're talking about is nationwide. But here in North Carolina, if you look at the Department of Health and Human Services data dashboard, and you look just at the deaths from COVID-19 in North Carolina, it skews male, I believe it's 54% male, 46% female. So as we look at the insurance claims across the country, what do we find about gender and who is testing positive? So the the Fair Health data shows us that males, you know, a little higher, a little more susceptible to COVID-19.

But, you know, it's not by much. And what we've seen with a lot of these other studies that kind of confirm this is that it's about a 50-50% chance males and females, you know, can skew a couple points in either direction. But right now, it seems there's about a, you know, equal chance of getting it between genders. And what about health status? Because certainly we have found again, here in North Carolina, and in other states too, there's a big problem in the congregate living settings, older people, nursing homes, assisted living, etc, where people tend not to just be older, but to have multiple health conditions. Are we seeing that in the insurance data? Right.

So that's exactly what we're seeing. So what Fair Health did was they compiled a list of the 10 most common comorbidities that an individual had out of the pool of people that tested positive. And what they found was about 13%, I believe, of positive individuals suffer from kidney disease. And this was the most prevalent of these pre-existing conditions. And, you know, other conditions such as diabetes, hypertension, atrial fibrillation, these comorbidities that are typically common and typically more common among older folks. These are the types of patients that we're seeing most commonly in the hospital testing positive for COVID-19. So again, this is consistent with what we know from the early days of the virus moving into, you know, a couple months in here, but those that have a pre-existing condition or something that would, you know, predispose them to, you know, an attack by the virus, those are the ones that are more likely to get this disease. And you've actually included in your piece, which is available at johnlocke.org.

I would encourage everyone to take a look at this. The headline on this research brief is characteristics of COVID-19 patients. And this list of the top 10 is really interesting. Again, this is the percent of hospitalized COVID patients.

As you mentioned, the number one, chronic kidney disease and kidney failure, then type two diabetes, hypertension, atrial fibrillation and flutter, which I believe is a heart condition, heart failure. And as you go down the list, things like sleep disorders, chronic obstructive pulmonary disease, asthma, my husband happens to have asthma, and that's why we consider him high risk. So this is a really good profile, I think, for people to be able to assess what's going on in their own family.

That's exactly right. You know, what we're seeing now is, you know, there's so much data available, you know, concerning the disease coming from all different kind of sources, but you know, the best data available, I think, is stuff like this that, you know, paints the full picture, gives people an idea of what type of risk is most associated with a positive test for COVID. And that allows, you know, individuals, like you said, to assess their own risk to see, you know, what type of activities they should and shouldn't be doing.

And this is what we, you know, we should be getting from our public leaders. That's what the North Carolina Senate tried to include in the COVID relief package bill to get DHHS to release some of this data about, you know, who is hospitalized in North Carolina, what types of comorbidities that they have. Fortunately, that didn't make it into the final COVID relief package, but DHHS is, you know, slowly been updating their website, putting out more data, but you know, it's these characteristics of the individuals who have the worst bout with the disease that, you know, is really telling for the rest of the public, you know, how big is my risk? And this is the kind of data that tells us that.

Jordan, in your piece, you also take a look at the costs. These are, after all, insurance claims that are being analyzed here. What did we find out about testing costs, treatment costs, et cetera? It varies. And this is typical, you know, it'll vary by age and by the severity of, you know, the treatment that the individual needs. But it also just varies on, you know, what type of insurance you have because, you know, insurance claims and costs are kind of all dependent on negotiations between your specific insurer and that hospital or that provider.

So it can vary, but, you know, typically older people, more expensive, higher intensity treatment. And, you know, the cost can vary whether you're insured or uninsured. But one interesting note in the provider relief fund set up by the CARES Act, they set up a funding stream for uninsured individuals and providers can bill that portal to pay for uninsured claims.

And, you know, this was one of the big questions. People who are uninsured lost their insurance. How can they pay for it?

But what a recent report revealed is that a senior administration official said that that portal is not being used as much. So it's interesting now, but there is money available for uninsured. And, you know, we hope that nobody, you know, has to pay large out-of-pocket sums for this because the money has been provided. Jordan Roberts, he's the health care policy analyst here at the John Locke Foundation. Jordan, thank you. Thank you. Stay with us. Much more Carolina Journal radio to come in just a moment. Tired of fake news?

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I'm Mitch Kocai. Amid the COVID-19 pandemic, North Carolinians still face a major election this fall. A recent online forum from the John Locke Foundation focused attention on key election issues.

Republican consultant Jonathan Feltz offered his overall assessment. This election season, even before COVID-19, was going to be dominated by Donald Trump. Democrats right now, what they are trying to do is they want to run purely as generic Democrats. They don't want to answer any specific questions. They want this entire election to be about Donald Trump. As long as his faves and unfaves are not going the way that that Republicans would like for them to go, that's that's what they want to do. And again, I can't stress enough how much they want to avoid answering specific questions. Cal Cunningham, just like Senator Jeff Jackson predicted, he has spent most of his time in the basement dialing for dollars. He doesn't want to talk about which taxes he's going to raise.

He doesn't want to talk about how much he supports protesters out in Portland, Oregon, threatening the federal police officers and local police officers. He just wants to keep this as a referendum on Donald Trump. Once COVID hit, the election really did turn then to instead of it being about Trump and his handling of the economy, it's now about Trump and his handling of COVID. And again, Democrats, they're really focused on more about perception rather than reality. And they want this to be right now, there's perception that Donald Trump has not handled this perfectly.

And there's, you know, there's some things he could do better, some things he could do worse. But at the end of the day, you don't see a lot of folks around the country who have a real good handle on this. And so the shutdown governors like Roy Cooper, Governor Beshear out in Kentucky, places like that, they want to really keep this as a referendum, like I said, purely on Donald Trump and what people think about Donald Trump. And so he is going to be a big, big part of this election cycle.

Consulted to Brad Krohn has worked largely with Democratic candidates in his political career. He sees an analogy from 40 years ago. This is the second time in my lifetime that we're seeing an anchor election.

And that being an anchor from Donald Trump pulling down the rest of the ticket. Other one was in 1980. And Donald Trump is working hard every single day to make Jimmy Carter look good. Um, there's one thing different between basically three things different between Jimmy Carter and Donald Trump. Jimmy Carter has honor, character and some integrity.

Um, I'm not paying that much attention to the head to heads. I am looking at the demographic data. And I'll tell you, the demographic data is scary for President Trump and the impact that it could have down the Republican ballot. The president's losing white professionals in the urban counties here in North Carolina. He is losing unaffiliated professionals and mid level service industry workers, voters in the suburban counties.

And he's losing white Democrat 50 year old and older voters in rural North Carolina who have had a tendency to cross over. It's the first time in my professional career in 30 years of doing this that the Republican crossover vote in the cross tabs shows a crossover vote. A Republican voter is going into the ballot box and willing to support a Democrat close to 8.5%.

Generally, it's 3 to 4%. The crossover vote for the Republicans is the highest that I've ever seen in its flight from Donald Trump. Now, the good news for the Republicans is that Joe Biden doesn't have any coattails.

So very similar to 1980. This is a campaign where it's every candidate for himself or herself. You're listening to highlights from a recent John Locke Foundation forum on the 2020 election.

Republican consultant Jim Blaine points to one key factor. This election is about one thing. It's about the coronavirus and COVID-19. If any candidate is talking about anything other than how to respond and deal with that issue and how that issue impacts the economy, schools, health, they are completely off message and off base.

I don't think anybody will listen to them if they're trying to talk about other things. Everything is about coronavirus. The voters are looking at how politicians are handling the coronavirus and COVID. I think we've seen at the national level and the state level a deterioration in voters' opinion of both Cooper and Trump's handling of the coronavirus. Now, the problem for Republicans is Cooper's starting point was about 70% approve of his handling and Trump's starting point was about 55% approve of his handling. So Cooper's probably down to about 55% approve of his handling. Trump's down to about 35%. So Republicans are just getting clobbered because of Trump's handling of the virus. So you actually think Trump's performing the best of any of the state-wide candidates in North Carolina and I think at best he's in a tie with Biden probably a little bit behind right now.

I think Forrest and Tillis are in a mess right now. I think if the legislative and state-wide elections in North Carolina were held today, there's a pretty good chance you'd see a wipeout for Republicans. Fortunately, the election is not today. It's a hundred days from now and to some extent I've got to think things can't get any worse.

I would have told you the same thing three or four weeks ago. Some observers have raised questions about the election's integrity. Republican consultant Jonathan Feltz explains why both parties have helped generate those concerns. One of the reasons our elections have traditionally have always worked so well through the years has been people have an active faith in the process being fair and active faith in the process not being corrupted. And when there has been corruption issues, it's been caught, it's been caught by the organization that was supposed to catch it. But now, I mean, you had a little bit of this in 2016, but now for the first time in our nation's history, you've got both sides including President Trump actively undermining faith in the system. And so I think you'll be looking at two different issues when it comes to ballot security on election day and that one is the reality of is there fraud, is there not fraud, but the other issue is the perception that's being pushed by both sides very actively. When I worked in Afghanistan teaching candidates how to run for office, one of the first lessons I learned very quickly after my first session teaching candidates, I would open it up to questions at the end of the class. And it was about 45 minutes to an hour of the candidates just yelling at me about ballot security and about voter fraud.

Now, this is in a third world country that has a lot of fraud and whatnot, but I would have to manage that on the front end. But one of the issues was they just had no faith in the system. And when I pointed out that their system worked very much like ours did in terms of a local board of elections and their case, it's the local Independent Election Commission and it was local folks who are who are making the rules and enforcing the rules.

They just couldn't believe that whatsoever. And so one of the big problems both parties have right now is that both parties are actively pushing the idea that there is a huge potential for fraud. Count consultant Brad Crone, the longtime Democrat, among those who hold concerns about an increase in balloting by mail.

I have no faith whatsoever in the U.S. Postal Service. That's the only issue that I agree with Donald Trump on is privatizing the United States Postal Service. And you saw in New York in the primary recently you had it took them three weeks to count ballots because they had continuous to get ballots. If there's a security issue, it's not necessarily with the North Carolina Board of Elections.

It's going to be with the U.S. Postal Service and their ability to deliver the mail point to point. Republican Jim Blaine disputes the notion that the U.S. Postal Service will play a larger role than North Carolina's own state elections board. But Blaine places the elections board's influence in perspective. Democrats have partisan control of the elections board in North Carolina. They're trying to bend the rules and change the rules to give themselves an advantage. It's been what they've been done for 20 years. Unlike, I think, most conservative or Republican consultants on our side, you know, I don't I think that's just kind of the nature of the game.

That's the way they're going to go. The media is not going to call him out on it. Instead of sitting here and crying about it, Republicans need to be thinking about how to take advantage of those rules. That's Republican political consultant Jim Blaine, one of the featured panelists in a recent online John Locke Foundation forum. It addressed key issues in the 2020 election. We'll return with more Carolina Journal radio in a moment. If you love freedom, we've got great news to share with you. Now you can find the latest news, views and research from conservative groups across North Carolina all in one place. North Carolina conservative dot com. It's one stop shopping for North Carolina's freedom movement at North Carolina conservative dot com. You'll find links to John Locke Foundation blogs on the day's news. Carolina Journal dot com reporting and quick takes. Carolina Journal radio interviews, TV interviews featuring CJ reporters and Locke Foundation analysts, opinion pieces and reports on higher education from the James G. Martin Center for Academic Renewal, commentary and polling data from the Civitas Institute and news and views from the North Carolina Family Policy Council.

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I'm Mitch Kokay. The death of George Floyd has prompted national discussion about police reform. But at least one North Carolina congressman is disappointed about the direction that conversation is turned.

Republican Richard Hudson represents the eighth district. I'm disappointed by the fact that we had an opportunity to make real bipartisan and meaningful reform. I'm disappointed that Democrat leadership seems more interested in passing a bill through the house than having actual solutions signed into law. And I'm disappointed the bill before us today punishes good police officers.

This is very personal to me. My community lost one of our own. George Floyd was born in Fayetteville and members of his family still live in our community. I was honored to be asked to speak at his memorial service where I promised his family and our community I would work to create real and meaningful reform. After listening to many leaders in our community, as well as talking to many here in Congress, it became clear that a lot there's a lot that Republicans and Democrats agree on. We agree on banning chokeholds, increasing police accountability and information sharing, improving training, reforming no knock warrants, and increasing the use of body cameras. The reality of our divided government is that for any legislation to become law, it has to pass the Democrat controlled house, the Republican controlled Senate and be signed by the Republican president. The Democrats introduced this legislation with no input from Republicans and jammed it through the committee without accepting any constructive input or amendments. Now many Republican amendments would have strengthened this bill like increasing the penalty for lynching and blocking unions from protecting bad cops. This bill also removes qualified immunity for police officers. That means any police officer can be dragged into civil court by any disgruntled person they ever come in contact with.

And we all agree bad cops shouldn't be able to hide behind qualified immunity. Representative Ben Klein and I introduced an amendment that would have earned the support of a majority of this house and would have solved this problem, but the Democrats wouldn't allow it. Now, why would they do that? My colleagues across the aisle may have the votes to pass this measure in the house, but this legislation is already dead on arrival in the Senate and the president would never sign it. They would say to the families who mourn the loss of life. They would say to the people who marched for justice that 100% of nothing is better than 80% of what they propose in this bill. They want you to believe the failure to get real reform is the fault of the Republicans when they shut us out of the process and they blocked us from having an open debate in the Senate. Wake up America. The Democrats in Congress hope you aren't smart enough to see the truth. Wake up and demand that your elected officials work together to get you the reform that all people of good will demand.

Tell them to stop this charade while there's still time. We owe it to the memory of George Floyd and to good police officers who risked their lives every day to protect us. I'm committed to continuing to fight for meaningful reform and for healing in our communities. And I asked my colleagues on both sides of the aisle to stop the political games and answer the cries heard across this country. That's Representative Richard Hudson speaking recently on Capitol Hill.

Hudson is a Republican representing North Carolina's 8th congressional district. We'll return with more Carolina Journal Radio in a moment. We're doubling down on freedom.

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I'm Mitch Kokay. The University of North Carolina system faces a lot of scrutiny and criticism from higher education watchdogs. But those same watchdogs can give credit when credit is due. Jenna Robinson is president of the James G. Martin Center for Academic Renewal. She recently offered an online presentation for the John Locke Foundation. Robinson focused on higher education's role in addressing the COVID-19 pandemic. In a lot of places, non-essential research has been suspended. And so if you don't have to do essential research, you're not coming into the lab.

You're at home as a professor. But the research that has been ongoing, a lot of it has pivoted to be about COVID. And a lot of the research that has been ongoing for years about coronaviruses is now coming to attention because people are realizing just how very important this kind of basic research is that is done at universities.

And that includes universities in North Carolina. And so we've seen there's a coronavirus expert actually at the UNC Gillings School of Public Health. And he's been working on coronaviruses for years. And there are a lot of different aspects of what has to be studied in order to get us past this pandemic. Obviously, a lot of universities are studying vaccines, including here in North Carolina. But there's also testing has to be studied and developed.

Antivirals and treatments have to be studied and developed. And of course, we've seen that there's a lot of innovation in medical equipment that is also coming up. Duke University was one of the institutions that for years has been using a method of re-sterilizing medical equipment. Their director of occupational and environmental safety says that they've been using this in some of their labs to reuse masks and other medical equipment.

And now they've shared it with, of course, the rest of Duke Hospital, as well as just the world at large to let them know how you can reuse your N95 and your other PPE by using this process. And of course, we've seen NC State pivoting from other kinds of textiles into making PPE that is so needed right now. This has really showcased that a lot of what goes on at universities is incredibly important.

It can be harnessed to serve the public. And I think, you know, we lose sight of that sometimes when we're criticizing universities for doing things that are frivolous or trendy or too expensive that there is a lot of innovative and important research that goes on at universities. And I think that right now is a good time to give universities credit for that important work that they're doing. Will colleges ever return to normal? Will college life after the COVID-19 pandemic resemble life before the health scare? I hate the phrase new normal, but I think that will be what happens at least for a little while. I think we're going to see an impact on sporting events because I think even if a lot of things go back to normal, there will be restrictions on large gatherings and sporting events are the quintessential large gathering, right?

You get a bunch of people together in a stadium. That is not the healthiest way to behave when you've got a pandemic going on. So I think that there will be some changes. But I also think that the financial situation in the future is going to be different. Obviously, endowments have been hit very hard.

We don't know what the stock market is going to do in the next few quarters. A lot of people are unemployed, which means that family finances are not where they were. And then, of course, state budgets are being hit as well.

And so I think that those three financial realities mean that, yes, UNC might get this one-time money from the federal government and from the state of North Carolina. But next year, when there is, say, a 10% budget deficit, every institution in the state is going to have to take a cut, and that includes the UNC system. And so I think that right now administrators should be looking at ways to cut costs in the future. And we're seeing it happen all over the country. Syracuse just announced that top administrators and coaches were going to take a 10% pay cut. They're doing a hiring freeze. I think that we're going to see more and more of that. And I think that our leaders in the UNC system should be considering measures like that as well.

That's Jenna Robinson, president of the James G. Martin Center for Academic Renewal. As the University of North Carolina system looks at budget cuts, what parts of the budget deserve the most scrutiny? I hope that the cuts go to non-teaching staff. The costs of faculty salaries have not really changed over the years. Once you factor in inflation, once you factor in the growing number of students, faculty has been pretty steady. The number of faculty to students, the number of the faculty pay. But there's been an enormous growth in administrative professionals on campus.

And I think those areas are the easiest to cut without hurting the academic mission of the institution. Will the COVID-19 pandemic have an impact on university enrollment? Are students going to want to return to campus?

Will parents want to send them back? The tuition has been increasing lately, but they still do a great job of keeping tuition low compared to a lot of universities around the country. That said, I think that a lot of students and parents are going to be looking at less expensive alternatives, especially if they feel safer staying closer to home. So I do think we probably will see more students looking at community colleges as an option.

I mean, as a parent, I wonder, you know, gosh, would I want to send my child, you know, across the country or even across the state to an unknown place when there's this uncertainty still going around? And I mean, obviously a lot of students just got sent home by their universities and may be inclined to stay there. Now, I don't think that's going to be a majority of students.

Most of them that I've heard from have said, this is terrible. I want to go back to school. But I think that people are going to be looking at the financial reality and we may see a surge at the community colleges. Students are going to start wondering, especially, you know, why am I spending, why am I paying this athletics fee? Why am I paying this health fee for a health center I can't use, for athletics I can't attend?

And I think that, you know, parents are going to ask those questions too. The pandemic could prompt a new look at some of the costs linked to higher education in North Carolina. The UNC system has already made the decision to reimburse students for the partial dining and housing that they would have been paying for. And so in some ways it's kind of, you know, compensating the university for the hit they took on those reimbursements. Robinson says the pandemic is bound to have a major impact on university finances. Endowments like everything else are down right now. I think we'll have to come out the other side of this before we know what, you know, what the bottom line is for those endowments because the stock market has been bouncing all over the place. So, you know, once we come out the other end we'll know finally, like, what was the total, you know, effect on endowments from this pandemic. But undoubtedly they're not going to be where they were. And private giving, obviously people are being very careful with their money right now.

People have taken losses on their own, you know, their own portfolios. And so absolutely that private giving to universities is probably going to be slow for a long time. I think universities are going to see smaller revenue streams from every source that they get money from.

You know, from private giving, from tuition, from state budgets. And so it really will be a time of bell tightening. The new normal at UNC schools will require innovation. Flipping the classroom would, I mean, we've already shown, there have been studies that show that flipping the classroom does work, that watching a lecture asynchronously works and then having the Q&A in person. And I can see, you know, a professor only needing, you know, the classroom, the physical classroom for half as much time as he did by doing it the traditional way.

And so I think that you could get some really good space use out of doing that. What about the impact for student loans? There are going to be a lot of different impacts because right now for some student loan payments have been suspended. Students aren't, they're deferred, put into forbearance. I don't remember which word they're using, but students are not expected to make payments right now if they have a federal loan.

So obviously that's an instant effect that it's going to have. But if students have fewer family resources, they're going to borrow more. Already borrowing has been going up a lot. So I think that we will see, we will see more borrowing.

Robinson ended on a positive note. This silver lining in higher ed is that we're going to see a lot of innovation. And we've already seen it, professors having to make this switch in two weeks. And, you know, there have been hiccups for sure. But I think that there has been a lot of innovation.

People have started talking about, you know, different ways to deliver, what are the best practices. And I think that that's the silver lining. That's Jenna Robinson, president of the James G. Martin Center for Academic Renewal. She delivered a recent online presentation for the John Locke Foundation. We'll return with more Carolina Journal Radio in a moment. Real influence.

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I'm Donna Martinez. Would it surprise you to learn that the Federal Electric Vehicle Tax Credit actually forces average Americans to subsidize rich Californians? Well, that is just one part of the troubling story of the EV tax credit.

This was enacted by Congress in 2008. A recent watchdog report is really focusing attention more on exactly who is qualifying for this credit. And two John Locke Foundation analysts have been looking at the data behind the credit. They join me now. Don Vandervoort is senior fellow with the John Locke Foundation and Dominic Coletti is research intern.

Welcome to you both. So Dominic, let's start with you. Tell me why you decided you wanted to look into the data behind this credit. It's been going on for more than 10 years and frankly a lot of people probably forgot about it. Yeah, well first, Don alerted me to it when the Treasury Inspector General for Tax Administration, or TIGTA, released a report basically outlining lots of fraud and abuse of the electric vehicle tax credit. And he asked me to take a look at that to see what I could find out about the tax credit, its implementation, and the fraud associated with it. And what we discovered, like you said, is that not only is it rife with fraud, it's also being used to basically, like you said, subsidize wealthy Californians and the people who are paying the price for that are average Americans.

So Don, you have been interested in electric vehicles for a long time. You've written a number of pieces about it available at johnlock.org. Were you surprised at the results of the watchdog report that Dominic looked into this? Well, in a way, you know, the fact that there is a federal program that seeks to incentivize some policy, the fact that it might have some fraud associated with it was not a surprise. But the fact that the beneficiaries are so skewed or biased to a certain economic class was surprising. So tell me how that works then.

So who qualifies for this? And how does it end up being that it's wealthy people who are taking advantage of this? So on the individual side, what people do is when they buy an electric car, they can then on their tax return for the next year, they can claim that as a credit.

And that's a big one. Yes, it I believe it goes up to $8,500 is the most you can claim for a fully plug in electric vehicle. Now, that doesn't necessarily include all cars that we might think of as electric. And it definitely doesn't include hybrids, you can't get the full tax credit for say, your run of the mill Toyota Prius. However, what people so once people claim it, that's that when people have bought an electric car, sorry, then they go ahead and claim it. And that's how you become eligible for this tax credit. You're not necessarily fully eligible, you're eligible depending on the type of car. So a fully electric car, that's how you get the full $8,500.

Something like a plug in hybrid, you're going to get a little bit less. So how is it then that someone could buy a vehicle that maybe doesn't meet the requirements, go ahead and claim the tax credit on their tax return? Wouldn't that be flagged by the IRS? You would think. And therein lies the story.

Exactly. So the take time report said that the IRS needs a way to be able to check that. But the reality is that the agency is not doing a very good job of going through and actually verifying that the VIN number on the vehicles is the type of vehicle that's eligible for the credit. Now that sounds kind of crazy because, all right, I'm going to give them the benefit of the doubt and say it's more complex than perhaps what we think. But if there is a VIN number and if you can check that to see yes or no, it meets the requirement for the credit, why is that not happening?

Wish I could tell you. And apparently the IRS responded in to the watchdog report and said, there's really not much we can do about this? Yeah. And that's the scary part as a taxpayer to know that. So that's what's happening with fraud in the system. This issue of who is actually qualifying for the credit, who's buying electric vehicles, it turns out it's wealthy people and the state of California has really an outsized role in this. Don, tell us about the role that California plays here. Well, the fact is that there are a lot of more high-end electric vehicles and I won't name names.

So you have to have a little bit of capital before you go out and make this kind of purchase. There seems to be a large number of well-to-do folks in California who are interested in buying these high-end vehicles. So much so that the statistics are completely skewed.

Yes. How prevalent is California in this program? California makes up 40% of all claims for the electric vehicle tax credit.

And if you include the rest of the West Coast, you're looking at more than half. So the vast majority of the country isn't claiming this credit at all. People just aren't buying electric cars in Louisiana, for example, where somewhere – where under a thousand people actually claimed this tax credit. The idea behind it was that this would make the electric car more appealing for the average American. But part of the issue is that these are high-end electric vehicles.

So even an $8,500 tax credit doesn't make that necessarily cheaper. The other issue is that even as more low-end electric vehicles have started to become available, there just isn't the infrastructure to support them in a lot of states. So it's not a practical buying decision one way or another. And really, California and some other West Coast states are the only places where it is practical to own an electric car. Because you've got to plug it in.

You've got to charge up the battery. Exactly. And so you can't really go beyond, let's say, the West Coast with it. Here in Raleigh, you could maybe drive the car, plug it in at home. But you can't go too far because there just aren't that many charging stations across the East Coast.

Whereas on the West Coast, you could pretty much go the entire state of California. So that's the issue on why California is outsized in the program. But Don, this was also supposed to be all about helping to save the planet, clean the environment, et cetera.

And as it turns out, these cars really aren't having much of an impact on the environment either. Right. And that's the underlying policy question, which is we would hope that incentives like this would be furthering a policy that makes sense. In this case, it doesn't.

And we've talked about that. But even the EPA's Scientific Advisory Board recently reviewed the electric vehicle incentives program. And they pointed out these are not more efficient than other gasoline vehicles. And they don't help in terms of greenhouse gases, at least not right now, while our electricity generating system is heavily geared toward GHGs. Because you've got to charge the battery.

So where does the power come from to charge the battery? It all comes from fossil fuel primarily. So you're really just shifting the emissions. And that's really the flaw in the underlying policy. And we see the policy is now being implemented with fraud. Well, it's a really interesting situation related to the federal electric vehicle tax credit. Turns out that average Americans are subsidizing wealthy Californians. We've been talking to Dominic Colletti and Don Vandervart here at the John Locke Foundation.

They've been looking into the data. Gentlemen, thank you very much. Appreciate it. Thank you. That's all the time we have for Carolina Journal Radio this week.

Thank you for listening. On behalf of my cohost, Mitch Kokay, I'm Donna Martinez. Hope you'll join us again next week for another edition of Carolina Journal Radio. Carolina Journal Radio is a program of the John Locke Foundation. To learn more about the John Locke Foundation, including donations that support programs like Carolina Journal Radio, send email to development at johnlock.org or call 1-866-JLF-INFO.

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