Opinion For Measure 28

Both The Nugget and The Bulletin editorially oppose Measure 28. Their arguments are not unreasonable. But in sum, they ask voters to sacrifice the good on the altar of the perfect.

Said The Nugget: "...there is a very real possibility that passing a tax increase to get us by for a few years will take the pressure off the legislature to enact real reform." Echoed The Bulletin: "What Oregon really needs isn't a three-year hike...Rather, as Kulongoski's predecessor emphasized last spring, Oregon needs permanent solutions."

In other words, we need the kind of "reform" that will keep the state from riding the revenue roller coaster that every now and then produces a crisis. Whenever state government's income suddenly falls well below the levels predicted at the beginning of a biennium, politicians beat drums for "permanent, stable funding," particularly for schools, which consume the largest single portion of the state general fund.

All the politicians pledge their best efforts toward this goal. But the goal is never reached. Why? Because, in my view, it's inherently impossible.

State revenues depend upon the economy, and the economy, while permanent, has never been stable. Oregon relies on personal and corporate income taxes for most of its general fund dollars. And while the state's total personal and corporate income rarely declines from one biennium to the next, the degree to which it rises varies greatly and in no regular pattern.

Some argue that Oregon would be better off if it didn't rely so heavily on the income tax. Many of these critics advocate a sales tax. Well, welcome to Washington. Oregon's northern neighbor has a high sales tax and no state income tax. But its revenues fluctuate as much as Oregon's. That's why Washington teachers took a day off from school to stage a demonstration in Olympia last week.

More sophisticated critics say:

The basic problem is overreliance on any one tax, whatever it may be. The solution is to use several forms of taxation, adding legs to the tax stool, in the familiar metaphor.

However, most states already employ a combination of the Big Three taxes -- income, sales and property -- to support state and local government and public schools. Their tax stools have at least three major legs. And despite that, all states today are facing serious governmental deficits because of the recent (current?) recession, and especially the stock market decline.

The stock market boom of the late 1990s produced capital gains that did wonders for governmental coffers, particularly in states with hefty income taxes. The market bust of the past three years has done the reverse.

Of course there are ways to temper the effects of economic fluctuation.

A rainy day fund -- socking away money in good times to be used as a cushion in bad times -- makes sense. But establishing such a fund is politically difficult, as Oregon's failure has demonstrated. And even if the state had created a modest reserve a decade ago, it would still be in trouble today.

So why vote for Measure 28? Because it would prevent $310 million in service cuts in the current (2002-03) fiscal year. And it would provide a little cushion (an estimated $412 million) for the next biennium. Yes, it's a Band-Aid, and Band-Aids don't cure cancer. But they do help with cuts and scrapes, fiscal or physical.

One problem with this debate is that, except for schools, most middle-class people can't see the effects of the current and projected budget cuts. They don't need or use state mental health services, or drug and alcohol treatment, or foster homes,or state-funded medical insurance. Most of the harm that Measure 28 seeks to avoid will be visited upon Oregon's least fortunate.

Asking those folks to suck it up while the Legislature once again rolls its rock up the Sisyphean hill of "permanent, stable funding" does not strike me as wise or fair.