It's 505 and welcome in to a Thursday edition of the Carolina Journal News Hour, News Talk 1110-993 WBT. I'm Nick Craig. Good morning to you. Tariffs ranging from 10 to 41 percent are officially set to take effect today for multiple countries as the ongoing trade battle and war out of the White House continue. This comes months after the world was capitulated into spi a spiraling trade war following President Donald Trump's Liberation Day announcement, which happened back on april the second of this year.
The looming threat of tariffs has created a pretty significant amount of uncertainty for businesses across nearly every industry. as deadline after deadline for implementing tariffs have been repeatedly pushed back in an attempt to broker deals. The tariffs that went into effect on august seventh reflect a change in a rate from what was threatened initially during the Liberation Day announcement. Joseph Harris, a fiscal policy analyst over at the John Locke Foundation, tells the Carolina Journal, from april the second to july thirty first, announcements the average tariff rate among the included trading partners declined from twenty five percent to nineteen percent. Among the most significant rate reductions were Cambodia, 49% to 19%, Vietnam, 46% to 20%.
And on the other hand, Switzerland received the largest rate increase from 31% to 39%. In a July 31st announcement, 69 trading partners were included. Eight of these partners saw no change in their tariff rate from that early April announcement. Among the remaining 61 partners whose rates were adjusted, 19 experienced increases while 42 of those countries saw decreases. The average proposed tariff rate for all of those countries combined dropped from 25% in April to an average of 19% in the latest announcement.
The new ranking rates range from the low of ten percent, which is applicable to the United Kingdom, Brazil and the Falcon Islands, to a high of forty one percent for Syria. Joseph Harris said the United Kingdom, Brazil as well as others are subject to the lowest tariff rate of 10% in the July 31st schedule. placing them well below the average of all of the countries. Although many of the july thirty first tariff rates are lower than those announced in April, they still represent added trade costs that could result in higher prices for certain goods if those costs are passed along to consumers. India is set to face an additional 25% tariff for a combined 50% final rate, which is set to take effect in about three weeks, according to the folks inside the administration.
According to an executive order signed by President Donald Trump on August the 6th, the additional tariffs are in response to India's imports of Russian oil as well as the ongoing Russian invasion of Ukraine. In addition to the individual tariffs for each nation, there is already a 50% tariff on steel and aluminum that went into effect back on June the 4th, as well as a 25% tariff on automobiles and automobile parts. This is already impacting the industry and North Carolina manufacturers as General Motors recently announced a net tariff impact of more than $1 billion. That was in the second quarter of the fiscal year, and an estimated annual impact of $4 to $5 billion due to some of these new tariffs. According to GM, who manufactures those vehicles, as well as GM Defense, a subsidiary of GM, who also makes vehicles for the Defense Department, they have a facility in Concord.
Despite the overall reduction in average tariff rates since April, today's implementations still mark a substantial escalation in trade barriers for many countries, as businesses and consumers may soon feel the ripple effects as these added costs filter through the global supply chain and influence prices. We have been keeping a very close eye on tariffs and the impact here across the state of North Carolina. We've got additional details and our continuing coverage of that over on our website this morning, CarolinaJournal.com, where it's now 510, News Talk 1110, 993 WBT. For those that follow things that go on in the state of North Carolina, public policy and things of that sort, you may be familiar with certificate of need. It's also called CON, and it essentially is a process in which healthcare systems across the state of North Carolina, healthcare providers, have to go to the state of North Carolina to get a certificate of need to expand capacity.
We've got a new opinion piece from Mitch Kokai over at the John Locke Foundation. The headline, cutting down on con case confusion. He joins us on the Carolina Journal News Hour. Mitch, con has been a longtime discussion in the state of North Carolina. It's a little bit in the weeds on the policy side, but it has a huge impact on pretty much everybody from the mountains all the way to the coast.
It really does because Certificate of Need determines how much health care supply we have in North Carolina. It's essentially a government permission slip, and any health care provider of any type who wants to build a new hospital or other health care facility, add some beds to an existing hospital, or even buy a major piece of medical equipment has to go to the government to get this permission slip. If they don't have it, they can't move forward with any of those types of projects.
Now, con from the vantage point of public policy, it's bad public policy. It basically reduces options for consumers and ends up raising costs. And so it would be a good idea to get rid of Certificate of Need or Con if possible. And that's something that the state Senate actually would do. This year, they put eliminating the Con laws, repealing the Con laws in their budget.
But because we have no final budget deal, that idea is still in limbo. And so the opinion piece that you're talking about says, well, If we can't get rid of con, maybe the next best thing at this point is for the courts to clarify some of the confusing rulings that come out with a lot of con cases. What typically happens is healthcare providers are always in competition with each other, and one way they compete is to try to get one of these certificates and stop their opponents or competitors from getting one.
So, one recent case involves 67 hospital beds in western North Carolina. The state decided that there was this need. For 67 hospital beds to serve a four-county area, and had some applications to get the con. The winning application came from Advent Health, which is one of these major healthcare providers that wants to build a new hospital in Weaverville. And then Mission Health, which runs a big hospital in Asheville, also wanted to add 67 beds to its existing hospital in Asheville.
But because the state regulators gave the con to Advent Health, Mission Health can't expand.
So Mission Health went to court. Mission Health's Argument against the Advent Health Con was that, wait a minute, anytime there's been a new hospital. That's been approved in North Carolina for a con. It has always had to have a licensed general operating room. This Advent Health proposal didn't have one.
So what gives? Why did regulators change the situation? They didn't really explain that they had changed this long-standing policy. And so Mission Health's legal argument was that that was an agency error, the agency being the Department of Health and Human Services, and that that error had substantial prejudice against Mission Health. The wording is important because in previous con rulings, The courts have said for a challenger to win a case, they have to show agency error and substantial prejudice.
And basically, Mission Health is saying, Look, this is an example of both agency error and substantial prejudice. Lower courts have ruled against Mission and in favor of the Department of Health and Human Services and, by extension, Advent Health.
So, Mission Health asked the state Supreme Court to take up this case, and it says in its petition to the court: Look, if you take this case, you can deal with some of these other rulings that have come out about Khan in recent years that are contradictory and confusing. We know that we have to show agency error and substantial prejudice. But there really hasn't been a clear definition of what is substantial prejudice. We think that this case shows it. Lower courts have said that it doesn't show substantial prejudice.
So, Supreme Court, please take this case to tell us what exactly is substantial prejudice so we can know and other parties can know moving forward with these con cases.
Now, it's interesting to note that against this proposal, both Advent Health and the State Department of Health and Human Services have filed documents saying, wait a minute. These may be some interesting issues to take up. This is not a case to do it because Mission Health didn't even prove there was any kind of agency error. If they can't prove agency error, it's a moot point. Don't take this case.
If you want to deal with this issue, wait for another case where it's more on point. But I think that the main point of this opinion article is that con cases are long, involved, take a lot of money, a lot of time. They're very confusing.
So it would be nice, whether if it's with this case or another case, for the state Supreme Court to step in and say, this is exactly what a con challenger has to prove to be able to win a case. This is what amounts to agency error. This is what amounts to substantial prejudice. That would make the proceedings go forward in a lot smoother way in the future. And for folks who are saying, why should I care about this?
Well, the sooner that these things get resolved, the sooner that the healthcare providers can start building these facilities, offering these services, adding more health care supply.
So that should mean more convenience, lower cost for the patients.
Now, the thing that would be best for more options, lower cost, more convenience would be to get rid of Kahn entirely, which the state senate wants to do. But if that's not going to happen, then the courts at least could make the process a little less confusing and have a little less contradictory rulings coming out. We'll continue the discussion on Certificate of Need with Mitch Kokai from the John Locke Foundation coming up after this. You're listening to the Carolina Journal News Hour. It's 22 minutes past the hour.
Welcome back to the Carolina Journal News Hour, News Talk 1110-993 WBT. Don't forget, if you miss any portion of our show, weekday mornings, 5 to 6, right here on WBT, you can listen to it after the fact on your own time by checking out the Carolina Journal News Hour podcast. It's available in Google Play, Apple Podcasts, Spotify, anywhere you get your shows. Search for the Carolina Journal News Hour, tap the subscribe or follow button, and you'll get a new program delivered each and every weekday morning. It's the Carolina Journal News Hour podcast.
Download and subscribe now. Mitch Cokei of the John Locke Foundation continues with us on the Carolina Journal News Hour. He's got a brand new opinion piece up, the headline, Cutting Down Con Case Confusion. That's referring to certificate of need across the state of North Carolina.
So there's a couple of different angles and areas to take this conversation. North Carolina consistently has been on the top of the list, and it's not where you want to be for the most expensive health care in the United States. We've seen multiple surveys over the last couple of years that show that. A lot of that is being attributed to certificate of need. And Mitch, as we follow these legal processes go down and there's a variety of these various cases across the state, you're putting a huge burden on the state court system on something that many folks believe should just be struck out by the General Assembly.
And unfortunately, that has yet to happen. But I can only imagine the burden that that's putting on the court system with these same similar cases time and time and time and time again, anytime somebody's ruled against in a certificate of need. Yeah, you see these court cases arise in two circumstances. One is that multiple healthcare providers try to get a con, only one gets the con, and so the losers will sue. The other occasion is that there is not even a competition, but just one provider gets one of these certificates, and then competitors who didn't even apply for the con will say, well, wait a minute, there's something wrong with that application and try to block it.
So there are a lot of different cases moving through the courts at various stages that deal with certificates of need. I think if the Supreme Court does take this case or one of the others that are out there and clarifies what a challenger to a con will have to prove to be able to win, that would make things a lot easier. As we said, the easiest option would be. For the state house to go along with the state senate and say, we're just getting rid of this con process entirely. But if we're going to keep having it, then the rules in the court system that deal with Who can challenge a con?
When are they going to be successful? Making those as clear and simple as possible would help everyone because the ultimate goal should be not having as much restriction on health care supply, letting there be more health care supply, and so that the health care providers could spend more time building their facilities, getting their equipment, doing what they need to do to serve patients, rather than spending time in courtrooms fighting it out over who can get this government permission slit. Mitch, I think for those that follow politics, maybe even not that closely, they're familiar with the healthcare lobby. This exists up in Washington, D.C., and imagine it exists pretty heavily here in North Carolina as well. Those various entities have been very much in favor of these certificate of needs for quite some time.
As you talk about, competing providers can go into an area and try and box their competition out. I would imagine that probably plays a large part into why maybe we've seen dozens of other states move forward with revoking certificate of need, yet North Carolina not only has it, but has one of the most restrictive anywhere in the nation. That's right.
Now, back in, I believe it was the 70s that this started, the federal government required state governments to have a con process. But then during the Reagan administration in the 80s, that requirement was gone. The Reagan administration folks running this said, wait a minute, this is completely against anything you know about economics, that if you restrict supply, that you're going to lower costs. No, you're actually going to raise costs and you're going to give people fewer options.
So once that happened, about 15 states got rid. of con law. And it doesn't mean that they don't have health care in those states or that their health care is worse than it is in other states. But North Carolina has maintained its certificate of need regime and it has one of the strictest. And you mentioned the healthcare lobby.
It's interesting because these health care providers, including all of the major health care providers, will fight tooth and nail against each other in these individual con cases. But when you ask them, well, wouldn't it be better to just get rid of them? They say, no, no, because what they want to do is they Want to do is have the entrenched interests fight it out rather than allowing some new health care provider to come in. That's one of the reasons why if some outside providers who aren't already in an area of North Carolina, if they'd like to enter the picture, the folks who are already there will fight them tooth and nail against it. If some provider that's not a major health system wants to open a clinic or some sort of surgery center, that's always fought.
We remember that one of the things that happened with Khan in the state Supreme Court in the not-too-distant past was a newborn eye surgeon who wanted to do surgeries in his own vision center, didn't have a con. He went to court to fight it. The state Supreme Court basically is allowing him to go forward with his suit, but they kicked it back to the trial level.
So that case is going to wind on for several more years before it could ever get a final decision. Right now, it's just a mess in terms of how this process plays out in the courts. Anyone who wants to Add hospital beds, build a new hospital, buy this major piece of medical equipment. They can basically estimate that it's going to take years and probably tens of thousands, if not hundreds of thousands of dollars to finally get permission from the government to do what they ought to be able to do without government permission and just serve customer demand. It's incredibly restrictive and it again impacting the citizens of North Carolina is a large part as to why health care is so expensive in this state.
Mitch, your piece is cutting down on CON case confusion, con case confusion. Where can folks get those details? They can read it at Carolinajournal.com. And in fact, CarolinaJournal.com has a lot of stories on cons.
So if you're interested, just go in there, search for CON. You'll see plenty of articles and they will probably make you shake your head. We appreciate the details this morning. Mitch Kokai from the John Locke Foundation joins us on the Carolina Journal News Hour. It's 535.
Welcome back to the Carolina Journal News Hour. Good Thursday morning to you. News Talk 1110, 99.3 WBT. Turning our attention to some statewide news this morning. North Carolina Governor Josh Stein has officially signed a stopgap spending measure into law.
Doing that Wednesday evening, earlier in the week at the Council of State meeting, he called it a quote band-aid. He also signed a bill aimed at cracking down on squatters and vetoed a bill to expand school choice, which is likely to set up another override battle with the Republican-led legislature. At Tuesday's Council of State meeting, the governor said in response to the budget: We've got teachers and students counting on real raises. We've got law enforcement who need real raises so that they can address the vacancies that exist throughout state government and in local government. Inflation is real, and there is no pay raises for state employees in this mini budget.
House and Senate budget writers have been stalled on a full budget deal since June and July, as the leaders of the two chambers continue to have major disagreements on how to deal with tax cuts and some other major policy items across North Carolina.
However, they do indicate that they are still trying to negotiate towards a final budget deal. It's unclear if that is actually going to happen in this legislative long session, with only a couple of voting days scheduled for the rest of the year out of the North Carolina General Assembly.
So that mini budget has been officially signed and now goes into law.
However, the governor also vetoed a bill that would make North Carolina eligible for a new federal tax credit program for donating to certain K through 12 educational scholarship programs. The legislation in the state, House Bill 87, passed late last month, and it seeks to allow the state to participate in a new federal program designed to increase funding for private schools, homeschooling, and other educational expenses. This new federal program was established under President Donald Trump's one big beautiful bill, and that of course has been now fully in the process of being fully implemented by the Trump administration. The federal bill passed in early July requiring states to opt into the tax credit program and establish some rules for qualifying organizations that people can donate to. In North Carolina, the State Educational Assistance Authority would establish the rules and keep a list of qualified organizations.
Individuals wanting the full seventeen hundred dollar for dollar tax credit would only be able to get it by donating to one of those groups. That is on the qualified organization list from the State Education Assistance Authority. The North Carolina House approved the program in a 69 to 47 vote last week after the state senate approved it 30 to 19 in the early part of last week as well. Supporters of the legislation noted its potential to further the GOP-led General Assembly's prioritization of offering alternatives to public schools across the state of North Carolina. The school voucher program has been incredibly popular over the last couple of years as North Carolina is set to spend more than $500 million on its school voucher program.
Opponents of the program, however, say it would effectively divert Federal revenues to nonprofits without placing any accountability requirements on private schools that may ultimately receive the donated funds through those nonprofit charities. They also noted that similar tax credit schemes don't exist for many other charitable organizations such as those that support disaster relief. The Democrat governor said in a statement on Wednesday, quote, School choice is good for students and parents, and I have long supported magnet and accountable charter schools because public schools open doors of opportunity for children in every county of this state. Congress and the administration should strengthen our public schools, not hollow them out. Cutting public education funding by billions of dollars while providing billions in tax giveaways to wealthy parents already sending their kids to private schools is the wrong choice.
Those comments there from Democrat Governor Josh Stein are very similar to what we've seen with previous Democrat governors like Roy Cooper. Similar comments from Stein earlier this year as the major divide between Republicans and Democrats continues to exist on school choice. Senate leader Phil Berger clapped back at this, saying either you support school choice or you don't. Governor Stein could have made North Carolina a leader in school choice and parental freedom by signing the Educational Choice for Children Act, but instead he's attempting to usurp the General Assembly's authority to set tax policy.
Now, it's relevant, of course, while Senate Republicans do have the veto-proof majority, House Republicans need one Democrat to come across the aisle to move forward with a veto override. As we've seen over the last two weeks, there have been a variety of Democrats across the state that have been willing to do so. And it is important to note because this original legislation, again, House Bill 87 did pass with two Democrats voting in favor of it: Representative Shelly Willingham, the Democrat out of Edgecombe County, and Representative Carla Cunningham, the Democrat out of Mecklenburg County. We saw both of them work with Republican legislative leaders last week to override eight veto override, or override eight vetoes, I should say, signed by Governor Josh Stein. And you would suspect that this legislation also could be going down the same path as lawmakers.
Are expected to be back. Potentially, there is a voting day coming up at the end of this month for lawmakers to make their way back to Raleigh. We'll see if they'll do so, potentially dealing with things like continued Hurricane Helene relief, potentially some more veto overrides. We'll keep an eye on those details right here on the Carolina Journal NewsHour. In some other statewide news this morning, the North Carolina Labor Commissioner in Luke Farley has announced that his department has recovered more than $2.5 million in unpaid wages for workers across the state over the last fiscal year.
Many of these workers have waited months or in some cases even years to get their money. The recovered wages come from thousands of complaints investigated by the Department of Labor's Wage and Hour Bureau. It enforces the North Carolina Wage and Hour Act, which ensures that employees receive the compensation that they're legally owed. The cases involve a wide range of violations, including unpaid final paychecks, withheld commissions, overtime shortfalls, as well as improper deductions across industries such as construction, retail, hospitality, health care, and manufacturing. Farley told the Council of State earlier this week, That is the money that was earned by hard the hard work of North Carolina's workers, and they deserve every penny.
Our department is determined that they deserve every penny of that. And so my job as the commissioner is to do so. But the job of the department as a whole as well is to stand up for those workers that aren't paid their promised wages. And I will tell you, just from a personal perspective, somebody failing to pay what they promised a worker is personally offensive to me. And our wage and hour bureau is aggressively pursuing wage and hour cases against the people who aren't paying for what they promised.
A spokesperson for the Department of Labor told the Carolina Journal in an email that the wages recovered were paid to about 1,800 employees and ranged from $50 for one person to a whopping $347,000 for another individual as well. Most of the wages collected were were collected through the Department of Labor. Farley added that out of the $2.5 million that was recovered, it represents the ability to pay rent, buy groceries, and plan for people's futures. North Carolinians who believe that they have not been paid properly are asked to contact the Department of Labor. There are links on the Department of Labor website where you can reach out and go through the process.
If you believe that some of your wages have been withheld inaccurately, you can go through that process. Information on that exists this morning over on the Department of Labor website. We've also got a link this morning on our website as well, CarolinaJournal.com. The headline: Labor Department recovers over $2.5 million in unpaid wages for workers. Yeah.
Mm. Good morning again. It's 552. Welcome back to the Carolina Journal News Hour News Talk 1110-993WBT. Continuing our discussion on certificate of need this morning, we had an opinion piece that ran over at Carolina Journal last month by Christy Gupton, and the headline is, I drove to South Carolina for an MRI to avoid higher prices from NC's con laws, that's certificate of need.
She writes in her piece, while opinions differ on North Carolina's certificate of need laws, I wanted to share a personal story that may resonate with others seeking affordable health care and coming short. About a year ago, my son needed a shoulder MRI. As I began shopping around, I was dismayed by the high prices I found locally. The sticker shock inflated to the $5 plus $1,000 range for this simple image at a few facilities. Albeit lower in a cost, even the independent radiology practices were still too expensive.
Then I recalled that in 2023, the South Carolina legislature ultimately repealed its certificate of need laws, a bold move to open up health care competition across their state. I thought to myself, why am I not looking for this MRI just over the border in South Carolina? And surely the certificate of need repeal has had time to drive down prices there. And it turned out that my instincts were right. I found an MRI of the shoulder without a contrast at a lovely independent ortopaedic practice in Fort Mill, South Carolina for just $330 cash.
I didn't need to haggle with insurance or struggle through the prior authorization process. I just texted my direct primary care doctor and he sent the order. I paid online and my son and I made our way to Fort Mill on a cool spring morning last year. It was a short 90-minute drive. When we checked in, the excellent staff took great care of my son.
I walked back to the area where they'd purchased a new MRI machine and watched them set up my son for the procedure. When I returned to the waiting area, I was greeted with a cup of coffee and settled in for about 30 minutes. Before I knew it, his images were complete and they made a digital copy of it for us to take with us. Because I'd paid $330 ahead of time, we were all set.
Next we enjoyed a nice lunch and did some shopping. I know our modest spending in Fort Mill that day didn't make national headlines, but those dollars could have stayed in North Carolina if the price had been right. I think the grand total we spent just over the North Carolina border was approximately $700 that day. a sum that I would have gladly paid in my home state if that were possible. The lowest price for just the MRI, excluding lunch and retail shopping, was between two and five times what I spent on everything we consumed in South Carolina that day.
The article from Christie Gupton goes on to say, I know I'm just one person and North Carolina didn't miss that money, but what if ten what if ten thousand other North Carolinians followed my lead and voted with their feet? Taking their dollars south of the border. Fort Mill is just a stone's throw from Charlotte, one of the state's most populous cities. Atrium Health and Novant have some of the highest prices in the nation. what happens when word gets out that our Southern neighbors have allowed competition to do what it does best, reduce costs.
When you're paying cash, the law of supply and demand still applies, and in fact, it works very well. Members of the North Carolina General Assembly should be listening to their constituents who can vote for them or not. I know the allure of listening to lobbyists from the state hospital groups must be strong, but the needs of your voters in your home districts should be a higher priority. Your constituents need to save money on health care. High health care costs are burdensome to state citizens and too many local hospitals are doing financial harm to their communities.
We need better choices and opening up the marketplace to new entities that will compete for our business will lower the overall cost and yield happier citizens.
Furthermore, North Carolina's employers who offer health plans to their workforce need more choices too. They have a legal requirement to apply a fiduciary standard of care when overseeing how those health plan dollars are spent. More choices will help our state's job creators also comply with the fiduciary standards that are impossible to achieve in today's health care economy in the great state of North Carolina.
So, as we've talked about throughout the show this morning, certificate of need continues to be a major discussion and a major financial burden for those throughout the state of North Carolina. This opinion piece headlined, I drove to South Carolina for an MRI to avoid higher prices from North Carolina's con laws is written by Christy Gupton. It's available on our website, CarolinaJournal.com. That's going to do it for a Thursday edition. WBT News is next, followed by Good Morning BT.
We're back with you tomorrow morning, 5 to 6, right here on News Talk 1110 and 99.3 WBT.
