-- Editor’s Note: This is part two of a two-part series on Sen. John Matthew’s view of South Carolina as a state with two personalities: the rich and educated and the poor and ignorant. Part two looks at how South Carolina’s approach to the economy and education varies from its sister states: North Carolina and Georgia.

South Carolina has put its hope in four things – cheap labor, cheap taxes, cheap land, and right-to-work laws, says state Sen. John Matthews, D-Bowman, and this approach has held the state back while neighboring states have moved forward.

“In today’s economy, that’s a recipe for disaster,” Matthews said recently.

It’s the tale of two Souths, he said, the old South – Arkansas, Louisiana, Alabama, Mississippi and South Carolina, and the New South – Georgia, North Carolina, Virginia and Tennessee. The New South is moving forward; the Old is falling behind.

“If you look at it, we’re investing less in education and skills, and they are getting more because they are investing more in human capital,” he said. “This state is too poor to invest in both tax cuts and knowledge and skills; those who invest in tax cuts won’t compete.”

The per capita income of Virginia is 104 percent of the national per capita income, he said, because Virginia consistently invested in knowledge and skills.

Matthews was explaining how the state is divided between the wealthy areas along I-85 and the coastal area versus the poor areas along the I-95 corridor, which goes from Jasper to Horry counties.

Of the counties along the I-95 corridor, Florence, Darlington and Dorchester began to close the poverty gap after the Great Depression, he said. Though Orangeburg has also begun to close its gap, this move didn’t begin until the year 2000, he said.

While Jasper County is beginning to show some growth, he said, the growth in both Jasper and Colleton counties isn’t real because it is caused by wealthier people moving into those areas, which inflates the numbers.

“The indigenous population there is actually worse off because the cost of living has gone up,” he said.

Likewise, he said, in Beaufort and Hilton Head, the indigenous population is not closing its poverty gap, adding that “If you don’t want to cut grass, make up beds or wait tables there, there are no jobs for them there.”

Matthews believes South Carolina should increase the tax on the sale of cigarettes and use some of the revenue on health benefits for the working poor.

The national Children’s Health Insurance Program funds health insurance for those children who fall within the poverty guidelines, with the federal government reimbursing four times whatever the state pays.

“South Carolina funds those children at 150 percent of the poverty level, but North Carolina funds them at 200 percent so their program is flush with cash. So is Georgia’s. Ours is starving,” he said.

Matthews supports increasing the cigarette tax as a way to raise revenue that he would use to bring that funding up to 200 percent, which would provide health care to 85,000 more children than are covered now.

“The children we are talking about funding are the working poor whose parents are working but without insurance benefits,” Matthews said.

With $20 million more, South Carolina’s funding would reach 200 percent, he said, and the other $80 million raised as a result could go to improve the state’s overall health care system.

He also thinks South Carolina should increase its funding for high schools.

“North Carolina spends 10 percent more on its secondary school systems, and their per capita income is 94 percent of the national per capita, 12 percent higher than ours,” Matthews said.

On the higher education side, he said, North Carolina spends $3,500 more per student than South Carolina does on its students, yet South Carolina’s tuition is higher.

“We are squeezing middle and lower income families out of attending college,” he said.

Families in counties along the I-95 Corridor must have two breadwinners making at least $11.50 an hour to be able to have a decent lifestyle – paying their bills, possibly going out once or twice a month and taking a two-night vacation once a year – and do the things a normal family does, he says.

“A child born into a single-income family is in trouble from day one,” he said, “because the family doesn’t have the resources it needs to provide the amenities a child would need for a quality life.”

In North Carolina, income is 94 percent of the national per capita income; Georgia’s is 96 percent. But South Carolina’s is 82 percent.

“South Carolina, though a poorer state, has higher costs of getting an education,” he said, adding that North Carolina has three five-star universities – Duke, North Carolina and North Carolina State – and South Carolina has none.

Clemson University is a four-star and the University of South Carolina a three-star.

North Carolina and Georgia invest much more money in education and intellectual capital development, he explained.

The senator pointed to North Carolina’s Research Triangle – Raleigh-Durham-Chapel Hill.

“The research triangle concept was started at North Carolina State,” he said, “They now have 17 professors in the National Academy of Sciences while we have one at the University of South Carolina and one at Clemson. These professors came up with 326 patents, 26 of which resulted in high-tech jobs in the high-tech arena, jobs that pay high wages.”

“While North Carolina was investing in knowledge and investing in people, we weren’t,” he said. “About three years ago, we started moving toward a knowledge-based economy, but they started putting their money in education a long time ago, and the research and development that occurs there results in developments that stimulate the job market.”

According to 2003 data, 1 percent of South Carolina’s school population is Hispanic, he said, but by 2018, 20 percent will be Hispanic.

“Part of what’s driving our poverty factor is that the immigrants who move into this state lack money, skills or knowledge,” he said. “We have to decide if we are going to invest in knowledge and skills or tax cuts – we are too poor to do both.”

Looking at South Carolinians from kindergarten to high school, 50 percent are drop-outs, Matthews said. The state’s student population is not getting its life skills in the home, so they have to get both their “hard and soft skills” at school.

Information he’s been shown indicates that every 5 percent increase in the dropout rate costs the state $100 million in correctional costs and a loss of $48 million in investments.

“The state is spending its money on the wrong things,” the senator said.

-- Nancy Wooten may be reached at 803-533-5540 or by email at nwooten@timesanddemocrat.com. Discuss this and other stories on-line at the www.TheTandD.com.

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