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Reinhard's Folly

Once more, the Classic Oregon Republican proves he is simply a liberal Democrat wearing a tie.  The moment was D-Day, 2002.  Reinhard, faced with the ultimate wartime decision, did what all proper soldiers do -- stormed the beach for his party.  (In Reinhard's case, the Oregon Democratic Party.)

06/06/02 -- David Reinhard
Time for a budget deal -- and a tax hike

I 'm not going to say this again:  It's time to raise taxes. 

Yes, it's time for the Legislature to include a small and temporary income-tax hike in a budget deal with Gov. John Kitzhaber. It's time, alas, for compromise on everybody's part -- legislative Republicans and Democrats and Kitzhaber. 

Everybody's proven they can win some and lose some over the last months of budget shortfalls and special sessions. Now everybody needs to win some and lose some in one bipartisan package. Everybody needs to give and get a little. Forget the blame game. Oregon simply cannot afford another round of ideological trench warfare in Salem. This Legislature and outgoing governor -- together -- need to produce something pragmatic and go home for good. 

How to cut the state's $880 million shortfall? Here's a suggestion for a doable deal that will at once please and displease all parties. 

First, there is no budget shortfall in Oregon.  The Republican budget for the next biennium is billions of dollars higher, not lower.  The much-trumpeted "shortfall" is a monetary difference between what government wants to spend and what the Pubbies want to give it.  The Pubbies want to give it less of an increase than it wants. Now, we'll move on to some other of Reinhard's points.

I'm not going to say this again.  It's time for a tax cut.  A drastic tax cut.  It's time the income tax was slashed by half, and time that capital gains taxes were totally eliminated. 

(It is time, in fact, that the property tax was outlawed in Oregon -- since if you live in a state with property taxes, there is no such thing as private property.   In a state with property taxes, private citizens lease their land from the government.  If you buy your neighbor's house for a rental, you are only purchasing his lease.  In Oregon, you never finish paying for your property, and if you fail to make your payments, the government will kick you off the place.  Get old, get sick, lose your job, have all your money stolen, it doesn't matter.  If you "paid off" your mortage one week or one decade ago, it doesn't matter. Live long enough for the assessor to jack up your property value to the point that your fixed income won't  pay the property tax, it doesn't matter. That property isn't yours.  Fail to pay the owner, the government, and either out you go or your kids get the bill when you die.  If they can't pay it, they're on the street.  Thus is property tax in the end also a hidden type of death tax..  People who cannot grasp this simple premise are known as "sheep.")  .  .

It's time that the Oregon tax stool had one, easily visible, almost impossible to raise, leg.

Mr. Reinhard's approach is a hard rein on everything that is good for Oregon.  His approach indicates that he has never heard of John F. Kennedy, who successfully worked to cut taxes to bring America out of a recession.  (Or of the similar Reagan-inspired tax rate reductions that dramatically increased  treasury revenues in America.) He is obviously  unaware that our Nineties economic boom began in 1994, when Newt Gingrich and an influx of conservatives set in place their beastly clampdown on the previosly unrestricted runaway spending and brutal tax increases of six decades of Democrat congresses. Clearly, he has not heard of the new low Russian flat tax that is generating strong income for their treasury, and strong benefits in terms of the economy.  In like manner, he has missed the fact that  Ireland's recent adoption of Reaganomics (deliciously draconian income and capital gains tax cuts) has that nation in it's first eonomic boom since the snakes left.

Putting it in terms even a moron can grasp, you don't shoot the goose that lays the golden eggs.  You treat her like royalty, and encourage her to replicate her lovely species. 

The problem in Oregon isn't a bad economy.  It's a liberal Democrat governor who has vetoed more than 200 bills by Republican legislators who were attempting to fix the economic mess he has made of things.  The answer to an economy that is struggling because business is strangling isn't to tighten the grip on its throat.  The answer to our problems is to make government the servant of the people, not their landlord.

Increasing the tobacco tax is perhaps the dumbest idea of all.  People who are well off won't blink an eye.  The only people who will be hurt by that are the poor.  The tobacco tax should be eliminated, not raised.  Unless, of course, Mr. Reinhard and his Democrat pals can come up with a graduated version that charges the rich more to buy a pack of cigs.  Yes, that's it.  A tobacco tax that's based on the income tax model.  Now, take a look at this.

Kitzhaber and the Legislature can secure another $124 million by disconnecting Oregon's tax code from the recently changed federal code for the purpose of business investments. Why should Oregon businesses receive a state tax break when we're hitting smokers, who are overwhelmingly low-income? This "disconnect" should be sunsetted, so it's seen as only a response to a temporary budget shortfall. 

Did you follow that one?  Business shouldn't escape unfair treatment if we're going to unfairly tax the poor.  We must be unfair to everybody if we are going to be fair about this.

Amazing, isn't it?  He get's paid for doing that.

The rest of Mr. Reinhard's D-Day attack on fiscal sanity was equally off base.  He talked of the need for compromise.  This seems to him like some noble stance.  Shall we define the word? 

Finally, it's hard to believe that potential tax-hike foes would be immune to the same reality Kitzhaber and legislative Democrats and Republicans must confront: No side gets everything it wants in divided government -- compromise is as essential as it is unpalatable -- and Oregon's little war
of attrition has gone on long enough.

Compromise to a Democrat means that when you support the 2nd Amendment and he doesn't, you give up your gun rights.  Compromise to a Democrat means that when you want to lower taxes and rein in spending, and he wants to raise taxes and increase spending, the in-between position is to raise taxes and increase spending.  And that, friends, is exactly what Reinhard's "solution" does -- raise taxes in support of increased spending.

Good old David's approach to PERS reform is to begin with alteration of the mortality tables.  That does have a practical advantage.  It means that by altering the original bad deal we made, and because of dramatic improvements in medical science, some of the PERS recipients may possibly live long enough to have their homes taken by the government for failure to pay their property taxes.

God save us from what the Oregon mainstream media defines as "conservative."   According to them, it's any Republican who agrees with liberals.

© 2002 Oregon Magazine. 

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