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Hein
Since 08 Mar 2005
1314 Posts
Possessed
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Hein
Since 08 Mar 2005
1314 Posts
Possessed
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 Fri Jan 15, 10 3:44 pm |
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| Quote: | A great beauty of the American federal system is that any of the 50 states can offer its policies as an experiment for others. So the nation owes some gratitude to Oregon for testing whether it is possible for a state to tax its way from deep recession to prosperity.
Oregon's unemployment rate is 11.1%, among the nation's highest. But Oregonians are now voting by mail whether to endorse a pair of tax increases passed by the legislature last year: one to raise the state's top personal income tax, to 11% from 9%, and another to raise the business income tax, to 7.9% from 6.6%. Both tax hikes would be retroactive to January 1, 2009.
The legislature and governor argue that only the state's wealthiest 2.2% percent of residents will pay this tab. Nonetheless, the liberal Portland Oregonian has editorialized against the new taxes, which it says would target "the very businesses and employers that Oregon is depending on to lead an economic recovery, start hiring again and pay the wages that support state services."
The battle in Oregon is a case study in the political drama now unfolding in many states. Essentially, it's about whether a state's wealth belongs to its public employee unions or to everyone.
The public unions are the primary drivers behind the Oregon tax hike campaign. In recent weeks, national powerhouses AFSCME and the SEIU have poured close to $1 million into the state campaign to secure passage. Oregon's public employees have one of the sweetest deals in America. Their average pay is about one-third higher than that of private Oregon workers, and Oregon public employees don't have to pay anything toward their health-care benefits.
In the last budget, the Democratic controlled state legislature doled out a $259 million pay raise to the government work force, even as the state was facing a near $1 billion deficit. In the last three years, the state has added 25,000 new public employees while losing 40,000 private sector jobs. The union TV ads say the tax hikes are needed to preserve schools, roads and public services.
The 11% income tax rate will make Oregon's income tax about twice as high as the national average. Businesses in Portland can move across the Columbia River to Vancouver, Washington and pay zero income tax. Oregonians used to argue they didn't have to pay a state sales tax. But the current tax proposal imposes a first-ever "gross receipts tax" on certain retail and wholesalers. This is a disguised sales tax.
Despite the state's well-earned reputation for sympathy with all manner of liberal causes, Oregon voters trounced two major tax-hike initiatives in 2003 and 2004. Now Oregon has reached a crossroads. If Oregon enacts these tax hikes to fund its rising public payroll after a severe recession and amid a slow recovery, we'll revisit the state in the future to see how many private workers are still there to pay the taxes. |
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Hein
Since 08 Mar 2005
1314 Posts
Possessed
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| Fri Jan 15, 10 3:50 pm |
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Same reason Hood River needed a gas tax.
So it can pay for the Cadillac health insurance benefits package the city employees get.
And a wind farm? Same deal.
and a ....
get the picture? |
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Mark
Since 20 Jun 2005
3678 Posts
I need my fix because I'm a
Naishaholic
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| Fri Jan 15, 10 4:07 pm |
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| Hein wrote: | | Quote: | A great beauty of the American federal system is that any of the 50 states can offer its policies as an experiment for others. So the nation owes some gratitude to Oregon for testing whether it is possible for a state to tax its way from deep recession to prosperity.
Oregon's unemployment rate is 11.1%, among the nation's highest. But Oregonians are now voting by mail whether to endorse a pair of tax increases passed by the legislature last year: one to raise the state's top personal income tax, to 11% from 9%, and another to raise the business income tax, to 7.9% from 6.6%. Both tax hikes would be retroactive to January 1, 2009.
The legislature and governor argue that only the state's wealthiest 2.2% percent of residents will pay this tab. Nonetheless, the liberal Portland Oregonian has editorialized against the new taxes, which it says would target "the very businesses and employers that Oregon is depending on to lead an economic recovery, start hiring again and pay the wages that support state services."
The battle in Oregon is a case study in the political drama now unfolding in many states. Essentially, it's about whether a state's wealth belongs to its public employee unions or to everyone.
The public unions are the primary drivers behind the Oregon tax hike campaign. In recent weeks, national powerhouses AFSCME and the SEIU have poured close to $1 million into the state campaign to secure passage. Oregon's public employees have one of the sweetest deals in America. Their average pay is about one-third higher than that of private Oregon workers, and Oregon public employees don't have to pay anything toward their health-care benefits.
In the last budget, the Democratic controlled state legislature doled out a $259 million pay raise to the government work force, even as the state was facing a near $1 billion deficit. In the last three years, the state has added 25,000 new public employees while losing 40,000 private sector jobs. The union TV ads say the tax hikes are needed to preserve schools, roads and public services.
The 11% income tax rate will make Oregon's income tax about twice as high as the national average. Businesses in Portland can move across the Columbia River to Vancouver, Washington and pay zero income tax. Oregonians used to argue they didn't have to pay a state sales tax. But the current tax proposal imposes a first-ever "gross receipts tax" on certain retail and wholesalers. This is a disguised sales tax.
Despite the state's well-earned reputation for sympathy with all manner of liberal causes, Oregon voters trounced two major tax-hike initiatives in 2003 and 2004. Now Oregon has reached a crossroads. If Oregon enacts these tax hikes to fund its rising public payroll after a severe recession and amid a slow recovery, we'll revisit the state in the future to see how many private workers are still there to pay the taxes. |
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 Hit right on the head.
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Blue
Since 03 Jul 2007
469 Posts
I used to be
Obsessed
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| Fri Jan 15, 10 9:11 pm |
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| Hein wrote: | Same reason Hood River needed a gas tax.
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Not being HR resident I haven't follow this one. Has it passed or failed?
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bajakiter
Since 16 May 2007
58 Posts
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| Fri Jan 15, 10 10:09 pm |
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| I love how the first thing they cut is what hurts the public the most- schools, police, ext.. just to force Oregonians into thinking that the tax hike is necessary. If they would actually look at cutting excess in government, they could lower taxes! I wonder if Oregonians realize that the state budget has already gone up 44% since 2001 when the population has only increased about 10%? |
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shred_da_gorge
Since 12 Nov 2008
1346 Posts
Da Hood & Da Wood
XTreme Poster
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| Fri Jan 15, 10 11:09 pm |
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| Hein wrote: | Same reason Hood River needed a gas tax.
So it can pay for the Cadillac health insurance benefits package the city employees get. |
Read the text of the proposal. It would only be used for road repairs (money that used to come from the state). Nothing to do with health insurance. Do you use roads in Hood River?
I thought this was a kiting forum? |
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shred_da_gorge
Since 12 Nov 2008
1346 Posts
Da Hood & Da Wood
XTreme Poster
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| Fri Jan 15, 10 11:27 pm |
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| bajakiter wrote: | | If they would actually look at cutting excess in government, they could lower taxes! |
And if they lowered corporate taxes more businesses would come, and if they lowered state income taxes more employees would stay... (I pay slightly less now that I moved to that bankrupt state south of OR - speaking of excess government waste - and that's even with a substantial pay increase).
"Taxachusetts" had a decent approach when I was younger: reasonable corporate and income taxes and a 5% sales tax on everything but necessities (groceries, everyday clothes, toilet paper, etc). When times were good people consumed and the revenue from 5% met budgets well, and they managed a rainy day fund instead of a kicker (which costs nearly as much to return the surplus). They even had a tax deduction on rent (back in the days before subsidizing the building and lending industries). Also the 5% made calculating taxes and tips pretty easy.
Not that I'm advocating having to pay 5% on new kite gear! 
It's 9.25% down here now - way to help small business grow, Governator. |
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eric
Since 13 Jan 2006
1867 Posts
XTreme Poster
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| Sat Jan 16, 10 12:00 am |
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| As a public employee, I would much prefer a Toyota, or Honda health care plan--possibly a Ford. GM? No thanks--bailed them out once already. |
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blowhard
Since 26 Dec 2005
2028 Posts
Windward
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| Sat Jan 16, 10 8:01 am |
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The idea that some folks are less important than others
is the real problem
we are all equal.
Because some folks are more successful is no reason to hit them on the head.
If we do they will figure a way to become less sucessful (tax dodges).
In this state without the federal dollars from the timber sales which used to pay for schools,roads etc,
we need to come up with an equitable tax for the loss of revenue from timber sales.
Hong Kong did a 20% flat tax and it proved to be too much ,so they lowered it to 15%
not too hard would it be?
exceptin for all the accountants out of thier meaningless unproductive jobs |
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forrest
Since 21 Jun 2005
4330 Posts
Hood River
Hick
CGKA Member
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| Sat Jan 16, 10 8:50 am |
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| Flat tax would be ideal in my opinion. Encourage saving and would be the most fair across all income brackets. |
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Mark
Since 20 Jun 2005
3678 Posts
I need my fix because I'm a
Naishaholic
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| Sat Jan 16, 10 8:52 am |
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| Forrest wrote: | | Flat tax would be ideal in my opinion. Encourage saving and would be the most fair across all income brackets. |
Totally fair. That's why it won't happen here.
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Moto
Since 03 Sep 2006
2698 Posts
Still a gojo pimp!
Moto Mouth
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| Sat Jan 16, 10 9:08 am |
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nwpolitics kicks ass 
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mschulz
Since 29 May 2007
530 Posts
Reno, NV
Addicted
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| Sat Jan 16, 10 9:31 am |
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You can tell Phil and Nicole are off kiting. Usually this would be locked. Ha.
I agree, Flat tax the only way for equality - Rich or poor.
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MS |
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Mark
Since 20 Jun 2005
3678 Posts
I need my fix because I'm a
Naishaholic
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| Sat Jan 16, 10 10:44 am |
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| mschulz wrote: | You can tell Phil and Nicole are off kiting. Usually this would be locked. Ha.
. |
Ps My brand is better than your brand.... bwahahahahahahaaha 
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TWIN-FIN
Since 24 May 2006
805 Posts
Portland, OR
Hot Monkey
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| Sat Jan 16, 10 11:21 am |
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Oregon land of the free programs would never allow a flat tax. I think it’s the legislators pride and joy, a sales tax free state.
I’m with you guys, and have been saying it for the last 5yrs, Oregon needs a sales tax.
Blowhard wrote:
| Quote: | In this state without the federal dollars from the timber sales which used to pay for schools, roads etc,
we need to come up with an equitable tax for the loss of revenue from timber sales. |
Oregon should legalize Timber Sales (KGB) that would flat out fix the revenue problem and get our state out of its current deficit in quick order |
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genek
Since 21 Jul 2006
2165 Posts
East Po
KGB
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| Sat Jan 16, 10 11:44 am |
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Or they could have a budget plan that's not guaranteed to fail. You can't budget an unknown quantity (state's income for next 2 years) without expecting to come up short once in a while. If you refund all the surplus you'll be screwed every time there's a shortage. I know it won't pass, but a rainy day fund would do a lot more good in the long term than raising taxes, which only fixes the current crisis but gets us nowhere for the next economic downturn.
The biggest issue that needs to be fixed is the differential between what is budgeted and the actual state income. You could raise taxes to 50%, but once you start budgeting for that 50% you're inevitably going to come up short sooner or later and you'll still have a crisis because some public agencies will be stuck without money they were promised. At the same time there's no incentive for the state not to budget the full 50% that they're expecting because then they just have to return the surplus. Whoever came up with this system probably wasn't very good with high school math and problem solving.
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