Sockeye Blog Archives

In 2011, Oregon legislators gave away $93 million in new tax breaks for big corporations. We don't think that matches Oregon's priorities.

1. Based on the average cost for a week of school for all Oregon school districts.

In 2011, Oregon legislators gave away $93 million in new tax breaks for big corporations. We don't think that matches Oregon's priorities.

1. Based on the average cost for a week of school for all Oregon school districts.
2. Based on "tuition buy-down" for the biennium. Source: 2013-15 OUS Legislative Request (page 21).
3. Based on an average cost per position per year.
4. Based on an average award of $1,438 per year (2010-2011 school year). Source: Oregon Student Assistance Commission 2010-11.
5. Based on an average cost per employee per year . Source: Oregon State Police Budget Department.
6. Based on an average cost per case per year. Source: Department of Human Services Budget.

If you’ve read the Oregonian at all in the past couple of years, you know that they’ve embarked on a crusade against the Public Employees Retirement System (PERS). This began when the paper was taken over by conservative publisher N. Christian Anderson III and intensified when they hired Erik Lukens to run the Editorial page. (See our series on his right-wing views here.)

They’ve spent an inordinate amount of newsprint slamming the pension system, despite the fact that it’s one of the best-run, best-funded public pension plans in the country. Today, the Editorial Board made their big play, calling on the legislature to make PERS reform a priority in the next session.

It’s no surprise that they’d continue beating this horse. But what is surprising is the extent to which the Editorial Board has decided to insult the intelligence of their readers in doing so. Here are the five dumbest things you’ll read today, all courtesy of the Oregonian Editorial Board:

If you’ve read the Oregonian at all in the past couple of years, you know that they’ve embarked on a crusade against the Public Employees Retirement System (PERS). This began when the paper was taken over by conservative publisher N. Christian Anderson III and intensified when they hired Erik Lukens to run the Editorial page. (See our series on his right-wing views here.)

They’ve spent an inordinate amount of newsprint slamming the pension system, despite the fact that it’s one of the best-run, best-funded public pension plans in the country. Today, the Editorial Board made their big play, calling on the legislature to make PERS reform a priority in the next session.

It’s no surprise that they’d continue beating this horse. But what is surprising is the extent to which the Editorial Board has decided to insult the intelligence of their readers in doing so. Here are the five dumbest things you’ll read today, all courtesy of the Oregonian Editorial Board:

1. “As a measure of how powerfully public sentiment has turned against the retirement program, consider its introduction into the secretary of state's race. Challenger Knute Buehler wants to use the office's audit function to track PERS costs and – by the way – he'd like voters to know that incumbent Kate Brown voted against a significant piece of the 2003 reforms during her time as a legislator.”

Really? This one actually left me speechless. The fact that Knute Buehler is campaigning on PERS has nothing to do with public opinion, and everything to do with partisan politics.

It’s like saying the public has turned powerfully toward returning to the Gold Standard, because it’s part of Ron Paul’s campaign platform. 

2. “We're aware of no move to create a defined contribution plan here by citizen initiative, but pushing Oregon's public pensions in this direction is not a new idea. In fact, PERS crunched some numbers in 2010 and determined that placing new public employees in a defined-contribution plan wouldn't save much money – if any – for several decades, as Tier One, Tier Two and post-2003 employees would still get their defined-benefit plans.”

Soooo, the main argument for moving Oregon to a “defined contribution” plan is that we’d save money, but it wouldn’t actually save any money for decades, if ever. If you needed any evidence that the Oregonian’s anti-PERS crusade is about politics and not about finding actual pragmatic solutions, there you have it.

3. “Why should the public sector be exempt from the economic pressures that have established 401(k) plans as the private sector standard?”

Let’s say you have two young kids, a girl and a boy. The boy accidentally breaks his favorite toy (because that’s what boys do) and he demands that you break his sister’s favorite toy in order to make it “fair.” That’s what the Oregonian is arguing for here.

4. “The program's investment shortfalls are driving up taxpayer contributions even as schools, cities and other government entities cut back on service.”

Let’s be clear—it was the Wall Street meltdown that hurt PERS returns, like every other investment portfolio. In fact, before the crash, the PERS rates that employers were paying were at historic lows. Wall Street greed put the squeeze on PERS accounts, just like it put the squeeze on everyone else.

5. “One sure way to spend smarter is to control the diversion of public funds from schools and other core services to the seemingly bottomless PERS pit.”

Here’s a real and easy to understand fact: Tax breaks in Oregon have grown by $3.4 billion just since 2009. The amount the state is projected to lose because of tax breaks has grown by 12% in the last five years. In terms of harmful budget impact on Oregon’s schools and critical services, nothing even comes close to our runaway tax breaks and loopholes, many of which go to large corporations and the rich.

And yet? The Oregonian has never once editorialized about the billions we’re losing through these tax breaks. Instead, they spend all their time fretting about what they think a shop teacher should make when he retires.

I'm sure we all remember School House Rock's production of How a Bill Becomes a Law. It was cute, catchy, and an easy way for government teachers to keep students engaged.

But times have changed. So here's Mark Fiore, Putlizer-prize winning cartoonist, with an updated version of the lesson; here's How a Bill Becomes a Law -- ALEC-style:

I'm sure we all remember School House Rock's production of How a Bill Becomes a Law. It was cute, catchy, and an easy way for government teachers to keep students engaged.

But times have changed. So here's Mark Fiore, Putlizer-prize winning cartoonist, with an updated version of the lesson; here's How a Bill Becomes a Law -- ALEC-style:

Curious what ALEC's influence and impact looks like in Oregon? Check out our three-part series coverage here.

The corporate-backed Council On State Taxation released their latest annual report on state and local business taxes, showing that Oregon is now tied for the lowest business tax rate in the nation.

The corporate-backed Council On State Taxation released their latest annual report on state and local business taxes, showing that Oregon is now tied for the lowest business tax rate in the nation.

For years, we’ve hovered in the bottom five states, but we’re now tied with North Carolina for the lowest taxes on business in the entire country. The question we now need to ask is: How much longer can we afford to have this dubious distinction?

You might remember a couple of years ago, when Oregon’s corporate lobbyists teamed up with the Tea Party to campaign against Measures 66 and 67, which were modest (and largely temporary) tax increases on corporations and wealthy households to pay for schools and critical services. To hear the lobbyists tell it, those tax increases were the equivalent of thermonuclear warfare.

But here’s the reality: The vast majority of businesses in Oregon now pay a corporate minimum tax of $150 (up from $10). Even larger corporations have a corporate minimum of about one-tenth of one percent of their overall revenue.

Meanwhile, the state continues to give away billions of dollars in tax breaks, many of which go to large corporations. At the same time legislators were cutting school budgets, the amount we’re projected to lose to tax breaks has increased by $3.4 billion.

According to the Legislative Revenue Office, corporations are projected to pay just 6% of the taxes that helped pay for schools, health services, and public safety in 2011-13. That’s down from 6.6%  just two years before, and down dramatically from the share they paid in the 1970s.

And that all adds up to a deep disinvestment in the things that make this state attractive to businesses and families alike: Our schools, our basic infrastructure, investments in higher education, a healthy environment, etc.

Here’s what we mean:

Class Sizes: Oregon now has the third highest class sizes in the country. At a pupil to teacher ratio of 20.3, Oregon is better than only two states: Arizona and Utah.

Class Sizes, Cont.: In order for Oregon to have class sizes at just the national average, we would have had to hire 9,000 more teachers last year. Instead, we laid off hundreds of teachers.

Class Sizes, Cont.: Class sizes in Oregon high schools increased by 28.6% from 2009 to 2011.

Per-Pupil Spending: Oregon spends 7 percent less per pupil than the national average.

Higher Education: Oregon is 45th in the nation for per-pupil spending on higher education. Only five states spend less on colleges and universities than we do.

Way back in the golden days of 2010, an appearance by President Obama in town could bring out hundreds of Tea Party protestors from around the metro area, equipped with signs like “Where’s the Birth Certificate?” and “Keep Government Out of My Medicare.”

Sure, they were outnumbered even then by liberal protestors, but the Tea Party crowd could still put on a real show. My, what a difference a couple of years makes.

Way back in the golden days of 2010, an appearance by President Obama in town could bring out hundreds of Tea Party protestors from around the metro area, equipped with signs like “Where’s the Birth Certificate?” and “Keep Government Out of My Medicare.”

Sure, they were outnumbered even then by liberal protestors, but the Tea Party crowd could still put on a real show. My, what a difference a couple of years makes.

Today, as you no doubt know, President Obama is in Portland for a fundraiser. In response to his visit, Americans For Prosperity organized a “welcome” rally for the President in the South Park blocks. (Obama was originally scheduled to appear at the Portland Art Museum, and apparently nobody told AFP the plans changed.)

And in the middle of one of the most contentious and important presidential contests in recent history, the AFP rally drew, literally, tens of people. Attendees numbered just under 40, and that includes people who were just wandering by and stopped to listen.

The message of the rally was—weirdly—more pro-coal than anti-Obama, as if the fossil fuels industry is underwriting Americans for Prosperity (oh wait -- they are).

The rally even featured James Buchal, the Oregon Republican Party’s candidate for Attorney General, who downplayed the impacts of the coal industry. “[W]e hear about the health effects of coal dust. It's gonna kill us all; it's gonna make us sick. Look, coal miners can live in this stuff for 30 and 40 years without getting sick.”

Despite the low turnout (I saw walking tours of historic downtown sites that had more people than this rally), KOIN Local 6 was there with a three-person crew to cover the rally—even doing a live shot from the event.

Pew Research Center conducted a national survey this month and discovered that the public overwhelmingly supports raising taxes in order to help our economy and make the tax system more fair.

Check it out:

Pew Research Center conducted a national survey this month and discovered that the public overwhelmingly supports raising taxes in order to help our economy and make the tax system more fair.

Check it out:

By two-to-one (44% to 22%), the public says that raising taxes on incomes above $250,000 would help the economy rather than hurt it, while 24% say this would not make a difference. Moreover, an identical percentage (44%) says a tax increase on higher incomes would make the tax system more fair, while just 21% say it would make the system less fair.

Does this sound familiar? It should. Survey after survey have shown these same results: voters support tax increases. They support raising taxes on corporations and the wealthiest to make the system more fair. And they even support broader-based tax increases when it comes to protecting priority programs and services, like schools.


It'd be great if our elected officials around the nation would pay attention to these very clear reports of what voters want. After all, Congress is poised to determine whether to extend the Bush tax cuts on households making above $250,000 any day now -- precisely the polling question Pew presented to its participants.

But while the Democrats' plan appears to fulfill this public sentiment, extending tax cuts for only middle-class families, the Republican plan would extend the tax cut for the nation's wealthiest households -- exactly the opposite of what the public wants. (Economists calculate that the Republican plan would cost the nation an additional $80 billion in 2013 alone.) 

Let's talk about the figure $3.4 billion. Why 3.4 billion? It's no magical number. It's also not how many beans are in the jar, or how much Mitt Romney spent on car elevators last year, or how many pecks of peppers Peter Piper picked.

It is, instead, a very real example of what we like to call "spending priorities."

Let's talk about the figure $3.4 billion. Why 3.4 billion? It's no magical number. It's also not how many beans are in the jar, or how much Mitt Romney spent on car elevators last year, or how many pecks of peppers Peter Piper picked.

It is, instead, a very real example of what we like to call "spending priorities."

You see, $3.4 billion is the amount that tax breaks increased in Oregon since the last biennium. Not to be confused with the total amount of tax breaks that the state gives away each year, this is only the amount of additional dollars lost to tax giveaways since 2009.

After giving away $28 billion in tax breaks between 2009 - 2011, the Legislature allowed tax breaks to grow unchecked and even voted to increase tax breaks, amounting to a projected $31.4 billion in tax giveaways this biennium. This is a $3.4 billion increase in tax breaks all while state legislators were slashing school budgets, public safety, and human services.

What if...

Just "for fun," let's take a look at how our state would be faring right now if we had that extra $3.4 billion to spend...

Check it out:

An additional $3.4 billion (per biennium) would allow Oregon to increase spending where it matters by nearly 25%.**

That's a lot of money! It's actually pretty hard to conceptualize what that means for real Oregonians in real life. So let's give it a try: What would $3.4 billion "buy back" for Oregonians?

It's actually quite staggering:

  • With the increased K12 funding, we could work to lowering classroom sizes back to adequate levels and re-open many of the K12 schools that were closed in the past two years-- because the state could afford to hire 6,500 new teachers.
  • Human services' increased budget could prevent families from having to decide between buying groceries or heating their homes in the winter -- by providing heat assistance to every low-income household in the state (which is about 30% of the state's population.) Currently, Community Action agencies are able to provide heat assistance to about 1 in 5 homes that qualify for -- and need -- this assistance.
  • The state could additionally help 2,000 seniors stay at home through Oregon Independence Project as well as assist 6,000 additional families with quality and affordable day so parents could continue to work to earn a paycheck.
  • With the extra funds in public safety, Oregon could hire more than enough troopers to fill the gap between what is authorized and how many staff they can actually afford and still have plenty of funds left over to help out the counties that are struggling with their local enforcement budgets.
  • At the higher ed level, Oregon could not only prevent the tuition increases anticipated through 2015, but could afford additionally to roll back the tuition increases of the past several years.

And, yes, even after all that "spending," there'd still be funds left over for a rainy day fund.

$3.4 billion

An additional $3.4 billion in revenue is not a fantasy number  -- it represents real funds Oregon would have if the Legislature had maintained, rather than increased, our total tax expenditures. (Did you read that right? We're not even imagining what our state would look like if our legislature rolled back tax breaks or increase tax rates -- just that they had, you know, chosen not to give away more tax breaks.) But, alas, our Legislature's spending priorities were to increase tax breaks and slash funding to the programs that matter. (In fact, the Legislature also permitted a scheduled tax break for wealthiest Oregonians to go through at the same time, further diminishing the state's ability to fund imporrtant programs.)

Mad? Good. Me too.

** How'd we arrive at these numbers? We projected the 'spending' of the extra $3.4 billion revenue based on the proportional spending of actual General Fund dollars by the Legislature last session.

Let’s face it, the news today can be downright depressing. It’s important to remember that things aren’t all bad — in fact, there are some really great things happening around us all the time. Introducing, The Bright Side of Life!

Happy Friday, folks! What a busy week! We've got just the one link to share today -- but it's a good one!

Let’s face it, the news today can be downright depressing. It’s important to remember that things aren’t all bad — in fact, there are some really great things happening around us all the time. Introducing, The Bright Side of Life!

Happy Friday, folks! What a busy week! We've got just the one link to share today -- but it's a good one!

You've probably already seen it, seeing as how it's gone viral, but here's the awesome video (featuring Rep Tina Kotek, among other Oregon celebrities) that will "teach me how to brushy."

Man, even when the Oregonian Editorial Board is reporting on some genuinely good economic news, they just can’t help themselves from ginning up a class war against teachers and other public employees.

Man, even when the Oregonian Editorial Board is reporting on some genuinely good economic news, they just can’t help themselves from ginning up a class war against teachers and other public employees.

In the case of today’s editorial, it’s some painfully passive-aggressive jabs at the folks who educate our children and keep us safe.

After delivering the news that Oregon’s economy is improving (thanks only to the private sector, according to the online headline), Erik Lukens & Co. dive into this:

“The weakest employment sector: government employment, with many of the job losses coming in education. All told, the state shed 1,200 government jobs, after seasonal adjustments, in June. But that's not a big reason for concern.”

Not a big reason for concern? Tell that to the mother who had to explain to her child why his favorite teacher got fired. Tell that to the student, who’s now crammed into a classroom with 36 other kids struggling to be taught. Tell that to the teacher, who’s now unable to pay rent or buy food at local businesses.

Then, Lukens and friends dive into a six-paragraph argument about—I guess—why the private sector is better than the public sector. And just in case you haven’t figured out their blatant political agenda yet: Yes, they find space to attack public pensions.

It’s painfully obvious that the Oregonian is following the lead of the state’s most powerful corporate lobbyists. They’re trying to drive a wedge between working Oregonians by demonizing (or at the very least, belittling) the work done by teachers, nurses, firefighters, and other public workers.

It’s their way of distracting you from the fact that their beloved tax breaks have grown out of control, even while we cut school budgets.

Frankly, if the Oregonian were interested in helping to create a better future for all Oregonians, they’d say something like this:

“There’s some great news out today about Oregon’s economic health. In most sectors, we’ve increased jobs and are providing opportunities for Oregon families. Unfortunately, there’s also some bad news, as the reports show big drops in jobs among teachers and public employees who provide basic services.

“While we should applaud the growth in private sector jobs, we have to recognize that the loss of teachers and other education professionals means we’re disinvesting in the services that will safeguard our future. Worse, we’re shortchanging the next generation of Oregonians by sticking them in overcrowded classrooms and taking away critical educational opportunities.

“The future of this state depends on us investing in our schools and basic infrastructure that allows families and businesses to thrive.”

KATU invited me to debate Kevin Mannix about two ballot measures: Our Corporate Kicker for K12 initiative and Mannix's proposed repeal of Oregon's Estate Tax.

Check it out:

On the off chance you don't have 26 minutes to watch the debate, here's the bottom line: When we're cutting school budgets, cramming kids into overcrowded classrooms, and closing down schools, the last thing we should be doing is giving away more tax breaks to large corporations and the wealthy.

KATU invited me to debate Kevin Mannix about two ballot measures: Our Corporate Kicker for K12 initiative and Mannix's proposed repeal of Oregon's Estate Tax.

Check it out:

On the off chance you don't have 26 minutes to watch the debate, here's the bottom line: When we're cutting school budgets, cramming kids into overcrowded classrooms, and closing down schools, the last thing we should be doing is giving away more tax breaks to large corporations and the wealthy.