Pat McCormick, one half of the dynamic duo behind Oregonians Against Job Killing Taxes and its stalwart defense of bakeries throughout the greater Auburn, California, region, edified The Orangeonian this week with candor that at once revealed his contempt for Oregon's voters and shed light on how consultants of his sort manipulate public opinion. Oregonian voters are considering Measures 66 and 67, whose passage would approve lawmakers' plans to enact slight tax increases on the state's wealthiest individuals and most profitable corporations. Thousands of Oregonians have publicly expressed support for the measures, including small-business owners and organizations representing them. Passage will stave off further drastic cuts to Oregon's budget, especially in public services.
But McCormick and his other half, the alchemist Mark Nelson, oppose the measures as children oppose leafy greens, and they've employed well-documented tricks and sleights-of-hand to misinform and confuse voters. Most recently came the "bake shop" commercial -- one purporting to show Oregonian shopkeepers suffering financial ills, though it was filmed outside Sacramento, California, rather than in Oregon. Asked how his opposition team arrived at their choices, McCormick told The Orangeonian they "carefully tested voter sentiment in polls and focus groups
to find out what "voters think is the most important to them." They crafted their campaign message accordingly.
"Thirty-second ads don't lead to much detail about the nuances of two complicated tax measures," McCormick says.
Not surprisingly, their ads revolve around the idea -- much disputed by opponents -- that the tax increases will lead to job losses. For example, they focus on small-business people, who cut a more sympathetic figure than big companies. On Wednesday, opponents launched a new ad showing a bakery owner firing two employees, saying there was "no place left to cut" when her taxes were raised.
The Vote Yes campaign points out that the spot was filmed at a bakery in California. Critics of the ad say a bakery would need tens of millions of dollars in sales before the tax would equal the pay for two employees.
"They've been trying to find a poster child for months of a small business that is actually affected," says Scott Moore, spokesman for the yes campaign. "They couldn't find one, so they invented one."
McCormick says his campaign was "not trying to portray the specific business the bakery is in. We're saying it is emblematic of what happens."
In other words, McCormick is saying that too many facts muddy the waters of a voter's mind. Better that we paint in broad strokes, reinforcing general fears and swatting at reality-based data with "emblems." In bad times, people are fearful. Left to their own devices, they might take actions that help themselves. But do you really want hundreds of thousands of distressed people to help themselves? Isn't it better to let cooler heads with greater investments prevail? So, if, in the service of protecting those invested parties, certain facts are hidden, certain lies are told, certain nuances are downplayed and certain fears are amplified, it all comes out in the wash -- preferably AFTER the moment of truth has passed and the focus of so many voters has dissipated.
I really like how Walt Wentz of Forest Grove describes the Nelson-McCormick philosophy:
The tax guys are finally catching on they have to go where the money is – meaning that our beloved corporations, that have since 1931 gotten away with $10 a year in minimum state tax, may now (oh, horrors!) be required to pay $150 a year. Oh, agony ... agonnnneeee! To hear them howl about it, you’d swear they were going to have to fire all their employees, murder their families, set fire to their factories and commit hara-kiri on top of the blazing pyre – and then move to Mongolia.
Oregon’s corporate taxes are among the lowest in the nation, and our wealthiest people, the top three percent, apparently live here because they like the place – and because they get to pay a much lower percentage of their income in state taxes than ordinary working people do.
Naturally, when faced with the possibility of paying their fair share, the Astroturf movement funded by the corporations and banking interests do not bother with the facts; they just begin bellowing a few simple, artfully-crafted slogans: "Stop Job-Killing Taxes!" "All businesses will flee the state!" "The wealthy will move to New Jersey!" "We’ll all be murdered in our beds!"
Those thoughtful, dignified arguments are supposed to keep us distracted from the real problem, which is that the state’s essential services (including the schools) are already facing drastic cuts, and that still deeper cuts must be made if Measures 66 and 67 are defeated.
Murdered in our beds, too, Walt? Well, when you put it THAT way...
But it turns out that what McCormick calls "nuances" have real impacts on people's lives.
For example, Oregon State University President Ed Ray delivered some troubling news from the State Board of Higher Education to parents and families of OSU students in a letter this week. Seems budget cuts might affect Oregon's university students at all seven campuses, with the whole system absorbing a cut of about $20 million, but the public services programming -- extension services, agricultural stations and the forest research facilities -- taking another $11 million hit. The Cascades campus at Bend will lose $1 million alone.
And the pain doesn't end there.
The high school class graduating in 2010 looks to be the largest in Oregon's history - something that could cause enrollment restrictions on some campuses in the fall if the higher education budget is cut in the February legislative session. If OUS has to reduce its 2009-2011 budget by 5 percent - a loss of $37.6 million - about 900 new first-year and transfer students would be turned away, 267 faculty and staff would be lost, support for instructional, research and public service activities would be reduced and there would be an economic loss of $49.2 million. If the budget is cut by 10 percent - $75.2 million - 3,000 new and transfer students across the state would be rejected due to enrollment restrictions, 651 faculty and staff would lose their jobs, and the negative economic impact to communities would be $119.8 million.
These budget cut plans were created to be used in case Measures 66 and 67 do not pass. The 5 percent budget reduction plan would be used if one measure passed and the other measure failed. According to the text of Measures 66 and 67 on the ballot, if Measures 66 and 67 pass they will provide revenue currently budgeted for education, among other services.
Then there's K-12 schools, where all those potential college students are still being prepared. The Yamhill Valley News Register wrote this week,
Failure of both measures would cost the county's public schools about $8.5 million over the 2009-11 biennium, according to the union and district calculations. McMinnville would lose $3.34 million - the equivalent of losing 18 school days or 42 teachers, according to Superintendent Maryalice Russell. Newberg would lose $2.53 million, equivalent to 35 teachers or 16.5 school days. The county's smaller districts would each have to deal with losses of roughly half a million dollars.
All seven of the county's school districts already have gone through several rounds of cutting staff, trimming programs and shortening school years.
Here's another case: "The Forest Grove School District could be forced to cut five more classroom days and reduce teacher pay before the end of the current school year," according to the district's business manager, Darin Davidson, as the Forest Grove News Times reported. Why the drastic measures? "...[A] $3.4 million cut could be needed if state budget reserves continue to fall and voters reject a pair of revenue-producing tax measures later this month," the News Times writes. "Davidson said the district’s balance sheet is 'hinging on whether the [tax] measures go through'."
The job cuts don't -- and won't -- with public school personnel if the measures fail. The South County Spotlight reports that six firefighter jobs -- including the fire inspector and assistant fire chief -- are being cut from next year's budget. The layoffs will begin July 1. The Spotlight reported that the job cuts "will bring extra work for [Fire Chief Jay] Tappan and the other seven remaining staff..." What did the fire chief say in light of the cuts? "We all love our people but we have to do what we have to do to balance the budget," Tappan said.
Lest we imagine that cutting the jobs was the first action taken, it isn't. The Spotlight explains that firefighters agreed last summer to a cost-of-living adjustment freeze.
Back in Yamhill County and McMinnville, mental health services and needed bridge repairs will be cut or canceled.
Commissioner Mary Stern said the county's Department of Health and Human Services could lose as much as $1.5 million for its drug treatment and mental health programs. "That's enormous," she said. "If it doesn't pass, then we're really hurting." Other programs would also see resources cut and workload spread more thinly. "There will be negative consequences if these measures don't pass," Stern said.
Failure of the measures also would be felt at the city.
Councilor Kevin Jeffries is worried about the interchange at Three Mile Lane and the Three Mile Lane Bridge. The project needs significant funding from the Oregon Department of Transportation, Jeffries said. If it takes a hit, the city is unlikely to get the money it needs. If the measures don't pass, "The chances of those being built is incredibly small," Jeffries said of local transportation improvements like the one McMinnville is eying.
I suppose drastic potential cuts like these are why a few more editorial boards recommended this week that voters approve the twin measures.
"What follows here is not dispassionate analysis. This editorial perspective is born of watching Oregon become ever poorer and realizing that defeat of measures 66 and 67 will accelerate that process," writes the Daily Astorian. "Oregon voters in 1990 made a decision that we would be poorer. Another way of putting it is that Measure 5 accelerated the process of Oregon's being a low-tax, low-service state. Since 1990, Oregon school children have endured an era of disinvestment in the public schools. The same thing has occurred in higher education. Public school parents have become used to funding through bake sales and bottle drives."
"For the great mass of Oregonians, the tax increases in measures 66 and 67 are as painless as it gets," the Astorian concludes. "We urge 'yes' on measures 66 and 67."
Student editors at the Advocate, the campus newspaper of the Mount Hood Community College in Gresham, opine similarly:
MHCC President John Sygielski wrote a message on the MHCC portal saying that if the measures fail, the impact to the college’s financial health is both significant and long-term. It means that MHCC, in 2010, would have to cut between $1.26 million and $2.83 million before this fiscal year ends in June. In the 2010-11 fiscal year, the budget will need to be reduced by $925,386 to $1,871,734. These figures represent a significant cut.
With a significant cut like this in the MHCC budget, that would mean that either students are going to pay more in tuition, instructors are going to lose their jobs or there will no longer be as many federal work-study programs available for students. Perhaps all these things will happen to relieve the MHCC budget.
People opposed to the tax hike say it will create more unemployment. But if business taxes kill jobs, then how is it that Oregon collects the nation’s fourth-lowest percentage of its revenue in business taxes and when the national unemployment level sits at 10 percent, Oregon’s unemployment rate is at 11.1 percent?
And as for Oregonians' capacity to comprehend all those "nuances" that Pat McCormick would rather gloss over, Portland native Rebecca Groff is a good example of one who apparently has no trouble comprehending nuance.
I'm almost 30 years old now, looking at my future as an adult native Portlander, and I'm discouraged. The trees are still green, grass lush, air fresh, but the quality of our schools and other public services have deteriorated. Oregon kids go to school three weeks less than kids in other states, and learn in the second biggest classrooms nationally. My days attending public school are the "the good old days" now, and it's about to get a lot worse if Measures 66 and 67 are overturned in a couple weeks.
I want to raise kids here and give them the same opportunity to love Oregon I had as a kid, but that just seems impossible in the current climate. Oregon is teetering on disaster, and I'm ashamed. Education and public services that protect our most vulnerable citizens are deteriorating in the face of the global recession, and some Oregonians seem to be OK with that. Schools and public services are somehow OK because they are not facing doomsday, just really painful cuts. We are encouraged to vote "no" on measures that will force avoidable pain on kids, the disabled and elderly Oregonians.
Opponents of Measures 66 and 67 say that if the measures pass, businesses and wealthy Oregonians will move out of Oregon. That's doubtful. The real migration is likely to be young people who want to start families, pay taxes and participate in their community. There are a lot of people who don't want to live in a state where education is terrible and streets are unsafe because police are understaffed. I don't want to continue to pay a bigger relative share of taxes than big businesses. A lot of great young teachers I know will probably leave Oregon because education is underfunded and undervalued. If the measures don't pass, they won't have jobs anyway, and they'll have to leave.
For now, I'm going to keep the faith I had as a young person growing up in Oregon, and join with all the other middle-class Oregonians who have been paying more than their fair share for quite some time. I'm going to vote "yes" on Measures 66 and 67. I'm going to thank my legislators for being brave enough to increase taxes on businesses for the first time since 1931 to protect the Oregon Health Plan and public schools. I'm going to keep on believing there's a chance that when I'm the elderly neighbor on the block, I too will marvel at how good the kids have it. I'm going to vote "yes" for the future of our Oregon.
Finally, as for the terrific damage that opponents suggest will occur to Oregon's business climate, it turns out that even after passage of the measures, Oregon will still be one of the best corporate environments in the nation -- and this comes from the Tax Foundation, as reported by The Orangeonian!
"Economists understand that taxes have consequences. But the effect of Measures 66 and 67 on most businesses and individuals in Oregon will be minimal, and the state will remain one of the lowest business tax states in the country," writes Patrick Emerson, associate professor in the economics department at Oregon State University. Emerson explains,
According to the conservative Tax Foundation, even with the new taxes, Oregon will rank 14th in lowest tax states. Thus Oregon businesses are neither excessively burdened by taxes, nor likely to find greener pastures elsewhere. The effect of the new taxes on employment is therefore likely to be very small, and may be more than offset in the short run by jobs preserved in social services, public safety and education.
Rejecting these new taxes will, however, likely lead to very severe and long-run consequences on the Oregon economy through the decline in investment in education. The positive economic effects of education are empirically well-founded. Economic research by Eric Hanushek of Stanford University has found "significant growth effects" from the improved cognitive abilities that result from investments in education. Claudia Goldin and Larry Katz of Harvard have found that a large part of what explains the phenomenal economic success of the United States in the 20th century is the investment the country made in education.
The same is true for states: More-educated states tend to be more economically successful than less-educated states. It's no accident, for example, that the state of California built the world's best system of public higher education and saw its economy grow to the 10th largest in the world and become a key engine of growth for the U.S. economy in the second half of the 20th century.
So how is Oregon currently doing in terms of public investment in education? Miserably. In K-12, Oregon currently ranks 49th in the nation in terms of class size and has a school year that is three weeks shorter than the national average. In higher education, Oregon ranks 41st in terms of per-student funding. The percentage of Oregonians earning a college degree is actually decreasing through time. Clearly we are not currently on track to create an economy characterized by healthy growth and job creation and we cannot afford to fall any further behind.
It's also important to note that private businesses benefit directly from public investment in education: Research by Enrico Moretti of the University of California at Berkeley has found that businesses enjoy increased productivity from locating in cities with a large share of college graduates. In other words, a highly educated population makes businesses more productive.
The Oregonian editorial board and others have argued that we should hold out for something better and reject Measures 66 and 67. But the country and the state are in the midst of the worst economic crisis since the Great Depression. We don't have the luxury of waiting for something better. Research has shown that even temporary disruptions in education can have lifetime consequences for students. Inarguably, the state needs to fix its broken revenue system, and we should all demand that it do so soon. But we need the temporary fix that 66 and 67 provide right now. Without investment in the education of Oregon's children, the future economic prosperity of the state is at risk.
I guess Oregonians can stand a little nuance. That bodes well for Oregon voters, but not so well for the consultant class, hm?
