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Measures 66 and 67: What now?

By: Mike Salsgiver//February 3, 2010//

Measures 66 and 67: What now?

Mike Salsgiver//February 3, 2010//

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The election no one wanted has ended.

The people of Oregon have voted, and their voice was loud and clear: “We support the Oregon Legislature’s decision to permanently raise taxes on businesses and on higher-income wage earners.”

It didn’t matter that Oregon is in the depths of the worst recession in decades. And it didn’t matter that the construction industry – the state’s second largest economic sector – is facing a true depression with unemployment as high as 34 percent. It didn’t matter that there are virtually no private projects or activity under way, or that more than 37,000 construction jobs have been lost in two years.

None of these facts mattered. The conditions being faced by these and other unemployed Oregonians didn’t matter. The stark, desperate economic conditions facing Oregon’s small business owners didn’t matter, nor did their challenge of paying a tax retroactive to Jan. 1, 2009.

Yes, although it’s hard to believe, a majority of Oregonians voted to ignore these facts and increase taxes. Our state’s elected leaders said key services were threatened and there were no other choices … and a majority of voters believed them. These voters believed that an artificially inflated budget can be sustained by fewer private sector jobs, less private investment, and less private sector-generated revenues.

Just hours after the polls closed, business owner after business owner, employee after employee, called radio talk shows and posted blog comments alerting us that businesses were now making layoff decisions. Other businesses let us know they were making decisions to move their operations to nearby Washington, Idaho, Utah or Nevada.

Unfortunately, many economists forecast that this economic crisis will continue through 2010 and possibly into 2011 or beyond. Voters have now locked into place spending levels that needed a $753 million tax increase to support. This may not be sustainable during the 2011-2013 budget cycle.

So, as one of my members e-mailed me the morning after the election, now what?

The next immediate challenge is to try to impose a modified version of the Hippocratic Oath: “Do no further harm.”

Legislators this month return to Salem to hold a “short session.” Constitutionally, they are required only to rebalance the budget. However, as we saw during the 2009 session, the leadership will manage the legislative process by allowing hundreds of bills to be introduced, and then giving their sponsors and advocates a week to move them forward or watch them die. This process will require everyone participating in the legislative process to run (literally) from hearing to hearing to keep track of these bills.

Despite Associated General Contractors’ strong opposition to the permanent tax increases that are now law, we remain committed to joining our colleagues in the broader business community in discussions with Oregon’s elected leadership about how to achieve disciplined spending, and how to advance the cause of long-term structural tax reform.

Despite all this, perhaps the most important challenge in the “era of new taxes” will be for the business community to take a page (or a chapter or two) out of the public employee unions’ playbook. We need to learn how to develop and advocate a broad, pro-jobs, pro-growth agenda that is compatible with the values Oregonians hold dear. For nearly three decades, Oregon’s various business interests have done a poor job talking constructively with each other, let alone driving a common agenda that our elected leadership can enact and Oregonians can support.

We must learn to talk, argue, prioritize, coordinate, leverage and support one another in a way we haven’t done in a long time. If the recently concluded campaign is any indication, the foundation for making progress toward that goal has now been laid. It is up to Oregon’s business leaders to build on that foundation and move forward together.

For the sake of our employees and their families, for our businesses, and for Oregon’s future, there is no task more urgent.

Mike Salsgiver is the executive director of the Oregon-Columbia chapter of Associated General Contractors of America. Contact him at 503-682-3363 or [email protected].



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