To be charitable, coverage by The Oregonian of its state's economy and the twin ballot measures designed to right the listing ship has been inconsistent. There is, in this case, a possible reason for the behavior: The Oregonian recently changed publishers. Its present master was publisher of the Orange County Register until two years ago -- it goes without saying that the culture of Orange County, California should not be confused with the culture of most of Oregon -- and "has been consulting with media companies and private equity investors since then."
On the topic of Measures 66 and 67, is it possible that The Oregonian's editorial board apply Oregon values to its perspective on these measures, but that its recently-of-Orange County master dictates a party line based on still-fresh-in-the-memory Orange County mores?
Maybe so, and that would explain the ping-pong games played out in the past week's editorial pages. It's just not clear. Nevertheless, whether this marriage between The Oregonian and her Orange County groom will be blessed with longevity or with brevity remains to be seen. But the union lends the Oregon newspaper an identity in its transition: The Orangeonian.
Measures 66 and 67, by the way, are straightforward ballot measures. Oregon lawmakers, faced with a $4 billion hole in the budget last year, stanched the wound with all of its 2009 federal stimulus dollars but still suffered hemorrhage; lawmakers cut public services by $2 billion over the biennium and adopted one slight tax increase on Oregon's super-wealthy individuals and another slight increase by bringing its circa-1931 corporate minimum tax into the middle-twentieth century.
What has The Orangeonian said about the measures? That depends on which edition you read, and which writer. Three months ago, columnist Steve Duin took issue with the measures' critics who moaned about the proposed "less than one-tenth of 1 percent" increase on gross tax sales. "For many companies that, for years, have paid the $10 minimum," Duin asked "Who in the world considers that unreasonable?"
Talk about timing. Duin's column was published on October 28, just two days after the new publisher was named -- probably not enough time for the new guy to make it all the way around to Duin's desk and, ahem, introduce himself. Now, the whole Orangeonian finds a tax increase of less than one-tenth of 1 percent "unreasonable."
Consider the coverage of the past ten days alone. The Orangeonian lamented on January 4 that defeating Measures 66 and 67 will force $727 million in additional budget cuts when lawmakers return to Salem next month.
They have pledged to go to Salem during the upcoming February session to push for a smaller, mostly temporary package of tax increases that would help the state limp through its current crisis.
No one should be naive about the prospects for another significant tax package in the February session. Legislators would return to Salem just days after the election in no mood to consider more tax hikes.
But the anticipated budget cuts would be deep and harmful. It's one thing to insist now that failure of Measures 66 and 67 must be met by cuts, and only cuts, and another to actually find the votes in the Legislature to slice into the bone of Oregon's public services. The Legislature could tap a few hundred million dollars still held in reserve, but it's likely that lawmakers still would be confronted with a deficit of $500 million or more. Schools, community colleges and universities make up more than half of the state budget; they could not and would not be fully shielded from the cuts.
Yet its advice to voters, in the face of bone-deep cuts to public services? To children? To the elderly? To community colleges? "Vote no," the Orangeonian says.
During the past week, a number of letters to the editor have questioned The Orangeonian's thinking. One man declared,
This is exactly the wrong time to cut education funding. Oregon's economy, employers and residents need more investment in education, not less. Educating Oregonians produces higher state tax revenues as incomes increase. Educating Oregonians produces a more highly skilled workforce to attract companies.
Higher education research creates jobs for Oregonians. And investments in education support the regional economies in Portland, Salem, Eugene, Bend, Medford and in rural Oregon. Yes, it is difficult to raise taxes on business during a recession. But it is worse for business and for Oregon to continue to cut education.
To its credit, The Orangeonian has published a handful of op-eds from folks promoting the measures. But each has been saddled with a companion editorial that, say, private equity investors from Orange County, California, might find more appreciable.
Cary Mallon of Sandy wrote eloquently,
There are some necessities of life that must be provided to the community to benefit everyone. A partial list of the things we all need and benefit from are fire protection, police protection, clean water, clean air, utilities, transportation systems, schools, public health measures, financial regulations and safe-housing codes. The taxation and fees that pay for regulation of these things are the cost of citizenship.
The 2009 Oregon Legislature debated, edited, re-edited and tweaked tax legislation that has been sorely needed. The final product resulted in a fairer tax structure for both business and individuals. A long-needed change in the corporate minimum tax was passed replacing the one-size-fits-all minimum of $10 with a sliding scale. A few individuals and couples earning far above the median will have a modest raise in rates.
The scalpel-wielding Legislature performed life-saving surgery repairing the state's budget. Shortfalls will be addressed by adjustments in tax rates in areas that not only increase revenue but improve the equality of the tax code. Only those who oppose any tax whatsoever view these repairs as unfair. Voters should leave the legislative surgery intact rather than destroy it with a sledgehammer.
Mallon's view is batted down by none other than the Oregon Republican Party's chairman, Bob Tiernan, who decried public expenditures for such things as state employees, their salaries and health care, and their retirement benefits, as well as "boondoggle energy projects."
The Orangeonian allowed space for Julie Sabala of Milwaukie to say,
My company, Educational Travel Services Inc., has been paying the $10 minimum tax since it was incorporated nearly 25 years ago, just like two-thirds of the companies doing business in Oregon. It's time we paid more. That's why we're voting yes on Measures 66 and 67.
Despite the overheated rhetoric from opponents of Measure 67, 97.5 percent of businesses won't pay any more than they do today, or will pay just $150. Most of the remaining 2.5 percent will pay just one-tenth of 1 percent of their Oregon revenue. That's a small investment in Oregon's critical services, especially when you consider that businesses in most states pay much, much more in sales taxes and property taxes.
So why would someone like me support a tax like this? Because it's fair. Most companies in Oregon depend on our public schools and higher-ed institutions to produce the kind of smart, high-functioning employees we want to hire. The future of our state's economy depends on critical investments in our K-12 schools, community colleges and universities today. And I know that bringing millions of dollars into our state's economy will keep local businesses -- like ours -- thriving.
Under Measures 66 and 67, Oregon will still have the fifth lowest business taxes in the nation and the lowest business taxes in the West.
But The Orangeonian itself sidestepped Sabala's arguments and published its own -- second -- editorial opposing the measures, even conjuring the "trickmeisters" of Richard Nixon's re-election committee. It does so with the old "pox on both houses" gambit, declaring that since the measures' opponents had been caught playing fast and loose, the proponents' behavior ought to be questioned too.
Why the need for this reinforcement of its stated position? The paper explains, "Now that ballots are in the mail so voters can act before the Jan. 26 deadline, the campaign has reached a new intensity."
Thanks to that "new intensity" -- and to polling that suggested Oregonian voters might indeed favor the measures -- The Orangeonian published three items last Thursday, including one by Mike Rosen of Southeast Portland, who expressed shock at the newspaper's editorial position -- and at its rhetoric.
It all makes sense to me, and that's why I'm shocked that The Oregonian's editorial board chose to not only oppose Measures 66 and 67, but also suggest that supporters are anti-business. Suggesting that the community choose between social services (such as care for the elderly and sick, public safety and schools) and local business is as false a choice as pitting a strong economy against a healthy environment. Without a strong local economy, we cannot support adequate public services and we cannot survive as a community, let alone thrive.
The measures ask our highest wage-earners, who have long paid the least percentage of wages to incomes taxes, to pay a little more and certainly no more than middle- and lower-income individuals. Today the poorest fifth of Oregon households -- with an average yearly income of about $10,000 -- pay about 8.7 percent of their income in state and local taxes combined. By contrast, Oregon's wealthiest 1 percent of families -- with average income of more than $1 million -- pay about 6.2 percent of their income in state and local taxes, according to the Oregon Center for Public Policy's "The Case for Progressive Taxation" by Juan Carlos Ordonez. And the two measures ask that thriving local businesses also pay a little more.
Measures 66 and 67 address the long-standing insult to all Oregonians who pay taxes: that our most profitable state corporations (two-thirds) have paid no more than $10 in taxes annually. An amount they've paid since 1931. These measures are a modest and equitable solution that impacts only 2.5 percent of individual taxpayers and generates $727 million -- not enough to fully fund existing programs, not enough to avoid the already $2 billion in cuts to state services in the last legislative session, but enough to avert outright and unnecessary disaster. Without this money -- and without a doubt -- we will lose necessary care for our elderly and sick, lose school days and teachers (in a state that can shamefully boast one of the shortest school years in the nation) and lose state troopers to further erode public safety for us all.
The Orangeonian's position led Rosen, he wrote, to "redouble my efforts in support of Measures 66 and 67. This weekend I will be distributing signs to businesses in my neighborhood and beyond that proclaim their support to help pay for public services."
The Orangeonian paired Rosen's opinion with that of Lauran Paine of Salem, who opposes the measures but unwittingly caught onto The Orangeonian's new flavor: "Can you spell 'C-a-l-i-f-o-r-n-i-a?" she writes. The newspaper's third item in that edition came from Jack Roberts, Oregon labor commissioner from 1995 to 2002. Roberts' anguish is palpable:
[A]s ballots are mailed out Friday, many of us will face a choice we'd rather not have to make.
We should start by recognizing the fundamental difference between our federal and state budgets. During a recession, the federal government can both increase spending and cut taxes; states such as Oregon, which must balance their budgets, cannot. From a purely economic standpoint, raising taxes and cutting spending have a similar impact. While President Barack Obama was right when he said that raising federal taxes during a recession is the last thing you want to do, for states, raising taxes is not necessarily worse than cutting spending.
I'm all for cutting wasteful spending, but unfortunately that isn't what we're talking about here. If Measures 66 and 67 are defeated, both state and local governments -- including schools -- will face a painful round of cuts in basic services. To pretend otherwise is to ignore the reality of the past 20 years. Meaningful reductions in waste and inefficiency take time to identify and implement; immediate budget cuts require reductions or eliminations in programs today.
I've never understood the economic reasoning of those who wring their hands when a private business reduces its employment but clap their hands when government lays people off. And try as I might, I have been unable to construct even a hypothetical example of hardship or unfairness that truly shocks the conscience if these taxes pass.
The Oregonian's story of a company with $18 million in sales that claims it cannot manage a $15,000 unanticipated increase in one expense item without laying two people off strains credulity. Nor am I convinced that a couple making $500,000 a year can't scrape together $4,500 to pay additional taxes simply because it wasn't withheld from their paychecks.
Many of those who argue that this is the wrong time to impose "job-killing" taxes say they would have supported them if they were temporary. But if raising taxes during a recession is as bad as the ads say, a temporary tax now would be just as damaging, even though the temporary tax increase Gov. Vic Atiyeh and the Oregon Legislature passed in 1982 argues otherwise. In fact, it seems that tax increase (which was passed during a recession) may have helped lay the foundation for Oregon's prosperity in the 1990s.
I believe that making these increases permanent unwisely limits our ability to fold them into broader discussions of the more meaningful structural tax reform we desperately need. But that does not outweigh my concern about the cuts now facing local school administrators, city managers and county administrators along with state agencies. I simply cannot in good conscience vote no and hope that the short special session next month will succeed where last year's regular session failed.
Consequently, I'll be holding my nose and voting yes on Measures 66 and 67.
Strangely, The Orangeonian let two items be printed on Friday that whipped its editorial position and those who authored it. Joe Rodriguez, former superintendent of the Hillsboro School District,
Amazing. The Oregonian's editorial board wants us to vote no on Measures 66 and 67 and to wait so "the Legislature can do better ... whether in the February session or in 2011 and beyond." A wise man, the Rev. Martin Luther King Jr., once wrote, "'Wait' has almost always meant 'Never.'"
The editorial board acknowledges that Oregon has a serious budget crisis, but its solution is to defeat the legislatively approved tax increases and hope that future legislative action will result in businesses supporting changes to Oregon's personal and business tax structures and the "kicker" to provide more stable state revenue. Really? Past history does not lend itself to that conclusion.
The editorial board's hope that voting "no" and waiting will result in future legislation that has business support to change Oregon's taxation system is a pipe dream. And to think the anti-tax/anti-government folks will rally behind tax reform that stabilizes state revenue is delusional. The editorial board is wrong.
And Mark Oberzil of Forest Grove writes in the same edition,
So, The Oregonian's editorial board has come out against Measures 66 and 67, and has come out pretty squarely against Democrats, who are mentioned at least seven times in the editorial and posited as culprits working against the interests of Oregonians. That doesn't seem very balanced.
The editorial board suggests that Republicans and business groups would heartily support "better ways than Measures 66 and 67." That sounds like congressional Republicans saying they'll support health care reform -- if it's done over from the beginning and done their way. Republicans tend to believe, as Ronald Reagan famously put it, that "government is the problem." So what "better ways" are they going to support, unless by "better," the board means lower or no taxes or smaller or no government?
At the core of this line of thinking we find good old Trickle Down – the idea that a rising tide will lift all boats. Problem is, a lot of people can't afford boats. This idea has been around since Reagan, and during all that time the wealthy have gotten a lot wealthier while the middle class has gotten smaller. So in the final analysis what The Oregonian editorial board seems to be saying is this: "We still believe in Trickle Down, and if it hasn't worked, it must mean the rich aren't rich enough yet. After all, just look at all the poor and unemployed there still are."
So think about this: Our state government buys American, hires American and sub-contracts American. Who will really create the jobs America needs right now? You may think state spending is socialism, but just try telling that to a cement contractor, a school teacher, a firefighter, or a police officer.
The weekend brought a full raft of opinions.
On Saturday, The Orangeonian accepted another whipping from House Speaker Dave Hunt and Senate President Peter Courtney.
The Oregonian editorial board's opposition to the special election ballot measures, based on the belief that rejection of Measures 66 and 67 would lead Oregon out of this recession, strikes us as a most dangerous kind of wishful thinking.
The time for the business community and the Legislature to come together around these proposals was last spring. To be clear, we were close, but late in the session, it was the corporate lobbyists who walked away from the table. Still, the basic structure of our final package came directly from the business community, as did the total dollars raised.
Instead of acknowledging the sacrifices made by all our citizens, the editorial board puts more weight in the hurt feelings of banks and big corporations. Instead of rejoicing that the solutions spared more than 97 percent of Oregonians and businesses, the editorial board is really urging more cuts to education, public safety and health care. The editorial board knows we are simply not going to foist new taxes on middle- and lower-income Oregonians. So in the end, the editorial board's answer is to reject the measures and make the cuts. How disappointing.
Bob Wiggins, writing for the acronym-challenged Oregonians Against Job Killing Taxes, explained that his investors in his venture fund didn't like the measures because they might have to pay a little more in taxes, something approaching their fair share. Arthur Graham, writing on behalf of Yes for Oregon, the measures' proponents, said that, like himself, most of Oregon's wealthiest individuals and employers benefited from access to public services, provided at public expense. As one who had a challenging childhood, Graham identified with those children whose lives are being most negatively impacted by current budget cuts and those assured if the measures are defeated.
How can we even begin talking about reducing school days or increasing fees on middle-class families when most corporations doing business in Oregon pay just $10 a year? It's wrong. And when I think about the millions of dollars that are being spent on the campaign to defend that $10, words fail me. These tax increases aren't steep. They won't stop me from having dinner at Genoa or buying a new pair of shoes. To be precise, I'll be paying an additional $180 on every $10,000 I bring in over $250,000. $180 is a nice dinner. If I can afford to pay that tab, I can afford this one.
A recession is an important time to question priorities. What should ours be? Protecting our education system, or preserving a $10 corporate minimum that hasn't changed since 1931? Making sure poor kids aren't going to bed hungry, or making sure that a family that makes $260,000 doesn't have to pay an additional $180 a year? (That's about $15 a month.)
And what was The Orangeonian's response to Graham's note about fairness?
In some of its strongest, most vitriolic language yet, it published another -- yes, a third -- editorial against the measures, declaring, "Don't believe it. Measure 66 is not about fairness."
The philosophy behind Measure 66 is that a majority of voters can force 2.5 percent of taxpayers to shoulder the extra load. You can call that whatever you want, except fair.
Can we call it a solution?