Accountants and Journalists: Get the Facts Straight on the Revenue Measures and Stop Scaring People!
Dick Warrington was understandably concerned. The owner of Warrington Irrigation, Inc. in Ontario, Oregon had been led to believe — by his accountant and campaign literature paid for by banks and large corporations — that as a result of the corporate tax measure enacted by the 2009 legislature, his business would see a steep tax increase. According to the Argus Observer, Mr. Warrington “could be forced to close his shop and move into Idaho to stay competitive.” *
I spoke with Mr. Warrington this morning. He’s an open-minded, forthright and honest guy. And as we talked he and I quickly learned that Mr. Warrington had been misled and needn’t worry.
I asked Worthington if his business is an S-Corporation — “Does Warrington Irrigation, Inc. elect not to pay federal corporate taxes and pass through its profits to its shareholders as an S-Corp?”
“That’s right,” he said.
I explained that because his business is an S-Corp it will only pay $150 in Oregon corporate income taxes, up from the $10 it’s been paying. In other words, his taxes will only go up $140. (If his business had been a partnership or limited liability company (LLC) it would have to pay just a $150 entity tax, as well, up from $0. If he were a sole proprietor there would be no additional cost. )
Mr. Warrington said with a tone of relief, “I can handle that” and then offered to buy me a beer if I get out to his neck of the woods because he’d been worrying about the corporate income tax measure and I had put him at ease.
And unless Mr. Warrington and his wife have a combined yearly taxable income of $250,000 or more, his personal income taxes won’t go up a penny. I don’t know or care to know how much money they earn each year, but when he learned that fact about the personal income tax measure he convinced me, and I assured him, that they wouldn’t be affected by that measure either.
It’s understandable that Mr. Warrington was confused, given the level of misinformation the banks, large corporations and the out-of-state organizations meddling with our referendum system have been pumping out with their $1 million war chest and help from the Oregon Republican Party.
It’s a shame, though, that accountants and journalists who have a responsibility to read the actual measures are also confused and are scaring people like Dick Warrington and the public by not asking the right questions and drawing false conclusions.
The legislature targeted large corporations and wealthy couples, not the Dick Warringtons nor small businesses such as his. That’s why Oregonians need to vote “YES” on the measures if they make the ballot. That's the story accountants and the journalists need to tell.
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* If he moved his business to Idaho but kept customers in Oregon he’d still be paying Oregon taxes apportioned based on Oregon sales versus out of state sales.
Chuck Sheketoff is the executive director of the Oregon Center for Public Policy. You can sign up to receive email notification of OCPP materials at www.ocpp.org
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September 24, 2009 |
Chuck Sheketoff | Comments (66 so far)
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Posted by: Rep. Phil Barnhart | Sep 24, 2009 5:38:22 PM
Chuck, Thanks for this post. I have had contact with constituents with the same fears and the same misinformation. One older woman who lives in my district claimed she had been told by her "bookkeeper" that she would be put out of business by the corporate tax bill. After prompting, she told me she paid her business taxes on her personal tax return through her Schedule C form. In other words, she is a sole proprietor. As you correctly pointed out, the corporate tax bill does not apply to sole proprietor businesses. She would only pay more if her income exceeded $125,000 (She is single with no dependents) and that because of the effects of the other bill. When I told her that, she laughed. My impression is that her income would have to multiply several times over before that happy result occurred. After all, you only pay if you make a lot more than the average taxpayer. A married, domestic partnered, or head of household (Joint) return must show more than $250,000 in taxable income before the new rates apply.
It greatly concerns me if accounting professionals are misleading their clients about these bills. That would be unethical and actionable by licensing boards if it is actually happening. The reality is that the vast majority of Oregon businesses and business people will not pay the personal income tax increase at all (about 93%) and they will pay zero to $140 more because they are in business! These taxes will be paid by the wealthy and overwhelmingly by businesses that send their profits to out of state headquarters or shareholders.
Oregon needs this revenue to pay for schools, health care and public safety. We need a "Yes" vote if these measures are petitioned onto the January Ballot.
Posted by: Kurt Chapman | Sep 24, 2009 6:07:43 PM
Chuck, once again please explain how the change from "income" to "revenue" for taxing corporations changes the mix.
Posted by: Pat Ryan | Sep 24, 2009 6:32:25 PM
It's also worth mentioning that AOI and NFIB who claim many small businesses among their membership proposed, early in the session taxing everyone a $300 minimum. No sliding scale.
Seems like this would have doubled Mr. Warrington's obligation, while saving the Biggest Boys, with gross sales over $100 million, around $99,850. about the price of a golf weekend at Pebble Beach for the crew.
I've got a minority share in my wife's small C-corp and these guys are not looking out for our interests.
Posted by: mp97303 | Sep 24, 2009 7:22:41 PM
So let me see if I understand this...my LLC, with NO TAXABLE INCOME will pay $150 in taxes? Does my neighbor, an individual taxpayer, with no taxable income have to pay the same?
What about the personal property taxes that my business has to pay on our tangible assets? I mean, we bought a lot of equipment and machinery this year, I suspect that is going to be a nice chunk of change. Does my neighbor have to pay property taxes on his furniture too?
Posted by: Chuck Sheketoff | Sep 24, 2009 7:24:18 PM
Steve, as noted in the footnote I've added, moving out of state does not avoid Oregon's taxes. If he moved his business to Idaho but kept customers in Oregon (which a 30 year-old business would likely do) he’d still be paying Oregon taxes on profits apportioned based on Oregon sales.
And as an S-corp he wouldn't be subject to Idaho corporate taxes just like he's not subject to Oregon's corporate tax rate. The company's profits are passed-through to shareholders as income on their personal income tax returns.
Kurt, I don't understand your question. If it goes to the issues raised by the post --- how accountants may be giving bad advice, how journalists are not asking the right questions, and how the measures really work --- ask it again but be more clear. If you are just trying to start an off point argument, don't ask it again.
Posted by: Garage Wine | Sep 24, 2009 8:16:05 PM
So, is it only C-corps who are on the hook for the new corporate minimum based on total sales?
Posted by: Kari Chisholm | Sep 24, 2009 8:17:57 PM
Kurt's question is relevant, only because some accountants may be misunderstanding or misusing that aspect. S-Corps, LLCs, and sole props are not affected under that provision too, right?
Posted by: Chuck Sheketoff | Sep 24, 2009 9:46:36 PM
Garage Wine: C-corps are the only ones affected by the $150 to $100,000 minimum tax scheme based on sales apportioned to Oregon (just as their profits under the applicable tax rate is apportioned based on sales).
Kari, S-corps, partnerships, LLCs and LLPs will pay $150, nothing more. Of those, only S-corps have been paying $10. It is a new "entity tax" for the partnerships, LLCs and LLPs.
Sole proprietors will not pay anything under the new corp tax scheme.
Posted by: Chuck Sheketoff | Sep 24, 2009 9:54:12 PM
mp97303 is trying to take the conversation off the issue - accountants and the media misleading people and not asking the right questions.
I won't debate mp97303's point any longer (and will start deleting off subject comments), but will merely point out that they pay the $150 "for the privilege of carrying on or doing business by it within this state." Unlike mp97303 or his/her neighbor, corporations, LLPs, LLCs and partnerships (any corporate or business structure) exist only because of the good graces of the legislature.
Posted by: Kari Chisholm | Sep 24, 2009 10:00:37 PM
To try and put a wrap on that... MP, if it helps, think of the $150 as an annual filing fee for the various services that the state provides. If you're running an LLC or S-Corp, that's not much of a hit.
It's basically a distraction from the point, which is the new higher rate for large-scale C-Corps.
Posted by: Brian Collins | Sep 24, 2009 10:02:35 PM
Thanks for the information, Chuck. Is there a website somewhere with complete and honest information about the revenue measures? That would be a great resource for those of us who are trying to defend them.
Posted by: rural resident | Sep 24, 2009 10:10:31 PM
Actually, almost all Oregon taxpayers will pay some additional income tax. One of the features of the tax bill was a reduction in the "width" of the 5% and 7% tax brackets. More income will thus be taxed at 9% than was formerly the case. This represents additional tax payments by those at the lower end of the income distribution.
There will also be some additional tax liability from changes to the "additions" (items taxable by Oregon that are not taxed on the Federal return) and "subtractions" (amounts that are part of Federal AGI that are not taxed, or not taxed in full, by Oregon) sections found on the Oregon tax return.
Comment deleted by editor because patently false AND not addressing topic.
Posted by: Boats | Sep 24, 2009 11:04:39 PM
Bottom line is that you are permanently raising taxes during the midst of the worst economic climate since the Great Depression.
That should be contested by any means necessary because this state's government is full of profligate wastrels.
Posted by: David Wright | Sep 25, 2009 12:34:16 AM
Chuck Sheketoff admonishing others to get their facts straight?
Thank you, Chuck, for a good laugh.
Here's the directly relevant comment on this topic:
It IS important to get the facts straight and to not mislead the public when debating issues such as these.
As evidenced in this earlier thread, however, Mr. Sheketoff is rather lacking in credibility on this very topic himself. In fact, Mr. Sheketoff still hasn't admitted his previous errors of fact in this debate, even after those factual errors were clearly shown to him.
"Hello, Kettle? This is the pot..." :-)
In any event, the legislature may have "targeted large corporations and wealthy couples" but in fact the vast majority of those caught in the crossfire (at least on the corporate side) have little or no Oregon taxable income (see the above-linked thread for details). In fact, as of 2006 fully 94.6% of all C-corps filing minimum $10 tax returns had $0 in Oregon taxable income (or a net loss) that year.
Why, if you consider "large corporations" to be, say, those with more than $50,000 in Oregon taxable income for the year (which seems a ridiculously low bar to me, but just for the sake of argument) -- that works out to a whopping 0.7% of all C-corps that filed the minimum $10 return in 2006.
Let me put that to you another way -- what proportion of those "large" corporations ($50K+ in taxable income) paid the minimum $10 in 2006?
Just 2.9%.
And as for misleading... let's look at how much of the additional corporate tax revenue this measure could be expected to bring in, and how much of that revenue will be raised from C-corps with no taxable income.
Using the latest available numbers for reference, if 20,803 C-corps paid the minimum $10 in 2006, that represents $208,030 in total income tax revenue from those minimum returns.
Raising the minimum from $10 to $150 would increase revenue from those corporations to $3,120,450, for a gain of $2,912,420.
Of course, those "large" corporations with $50K+ of taxable income from 2006 would contribute $20,020 of that gain.
No, I'm not missing any digits or commas there -- those big bad offending "large" corporations would kick in only $20K of extra taxes.
Leaving $2,892,400 of additional tax revenue to be paid by the "little guys".
So those sharpshooters in the legislature may need to work on their aim if they were "targeting" large corporations. Seems to me like an awful lot of collateral damage ($2,892K) to pick up just $20K from the big boys.
Posted by: David Wright | Sep 25, 2009 12:44:19 AM
Allow me to clarify a point from my previous post -- when I asked "how much of that revenue will be raised from C-corps with no taxable income", I actually failed to answer my own question. Mea culpa.
The $2,892,400 of additional tax revenue paid by the "little guys" does include those C-corps with less than $50K of taxable income for the year. Please excuse the oversight.
The amount paid literally by those with "no taxable income" would in fact be $2,756,740. As compared to $155,680 paid by C-corps with any taxable income at all, and $20,020 paid by C-corps with $50K+ of taxable income.
Posted by: Not going to say | Sep 25, 2009 5:43:57 AM
So what are the best ways to thwart deliberate efforts to mislead on this subject and good old fashion ignorance too? I think we also need to talk about what this money will buy citizens beyond it being a tax on Lake Oswego and Dunthorp basically.
Posted by: Chris Lowe | Sep 25, 2009 7:28:04 AM
What's the difference between this annoying twitter feed and having trackbacks which BlueOregon policy is not to use?
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Of course the "taxable income" piece here is highly relevant. Large corporations are able to use dodges that keep them from paying their fair share of taxes for services from which they benefit extensively because of their size.
Maybe some of those loopholes should be taken on directly, but a minimum tax is captures the variety probably more fairly and less subject to variation according to the relative lobbying power of the corporations.
Posted by: Chris Lowe | Sep 25, 2009 7:30:12 AM
Which is why misleading information, whether due to ignorance or deliberate lying to try to defeat this law is rotten and should be called out. Thanks Chuck!
Posted by: Kurt Chapman | Sep 25, 2009 7:56:27 AM
Chuck, I'm not trying to start an off topic issue or argument. Many have been told that the legislature also changed computing taxation on corporations from net income to gross revenue. I was merely asking if that was true. If it isn't please let us know. If it is, but I'm somewhat misguided please let us know. If I'm correct please let us know.
Posted by: Bob Wiggins | Sep 25, 2009 9:31:50 AM
Kurt, the legislature added to the corporate income tax a new minimum tax based on gross receipts (revenue). Even if a C corporation has no taxable income subject to the income tax, it will now have to pay a minimum tax based on its Oregon gross receipts. The basic rate is 0.1% of gross revenue (before cost of goods sold and expenses), though there are brackets, so the actual rate can end up somewhat higher than that.
Chuck, on your new friend from Ontario, you are incorrect on the result if he moves to Idaho. Since his business is an S corporation, even under current law, his pass-through income would be taxed at 7.8 percent if he were an Idaho resident, rather than Oregon's current 9 percent. And of course, if his business improves, under the new law, the top marginal rate in Oregon would be 11 percent, the highest in the country.
Bob Wiggins
Posted by: David Wright | Sep 25, 2009 9:53:11 AM
Kurt, here's a link to the relevant bill (as helpfully provided by Chuck a few months ago).
Effectively what the bill does is create a sliding scale for the corporate minimum tax, which is based on "Oregon Sales". I'll let others explain how that differs from gross revenue.
The actual tax is not based on sales/revenue, it's still a percentage of taxable income. But now corporations with no taxable income at all will be subject to a minimum that starts at $150, and increases as the corporation's Oregon Sales increase. Look at page 2 of the linked PDF for the effective brackets of minimum tax. For example, a corporation with $1M in Oregon Sales (however that's determined) would be subject to a $1,000 minimum tax, regardless of taxable income amount (or even net loss for the year).
To put that in perspective, under the corporate tax rates in the bill, a corporation would need a little over $15,000 in Oregon taxable income to owe $1,000 under the regular tax plan. So for such a company, the minimum would apply if they had less than $15,000 of taxable income for the year.
The bill also creates a new $150 "entity tax" on partnerships, and increases the minimum for all S-corps to $150.
Continuing my earlier point -- how many of those "targeted" large corporations are partnerships or S-corps? Guess those folks get caught up in the net as well.
You see, this bill could have easily targeted large corporations (if you want to base that definition on gross sales) by making the higher-sales brackets large (which it certainly does), without making the lowest-sales bracket $150.
Funny, by the way, how all the talk on this site has been about just increasing the minimum from $10 to $150, and not about how that minimum can go up to $500, or $1,000 -- even up to $100,000 depending on gross sales.
It also introduces weird scenarios because of the bracket system, which unlike with personal income taxes is not a marginal tax. Not that this is going to be a common occurrence, but say your corporation on December 31 has a total of $499,990 in Oregon sales, and the company is just breaking even so no profit or loss. That would mean a minimum tax of $150. But if on the last day of the year you make a $20 sale -- oops, now you're up to $500,010 and subject to a $500 minimum. That $20 in sales just cost you another $350 in taxes.
If you want to take more money from bigger corporations, there are better ways to structure such a system than this, which ends up tagging a lot of "little guys" in the process.
Posted by: LT | Sep 25, 2009 10:13:34 AM
Very interesting, David.
Did you speak with anyone on Revenue committee about this?
Apologies if you did, but I heard there were some people unhappy last June because people talking publicly about great ideas had never talked to legislators on relevant committees ( W & M or Revenue).
The guy from AOI was on OPB's Think Out Loud and he kept talking about studies and where Oregon ranks in "competitiveness". He said we would only get out of the recession when private employers rebound. Does he think private employers who deal with customers will be aided if some of their customers who work for public employers are laid off? I really wonder how people like that would fare in an audience not made up of their "base" but a college crowd or a church basement on Sunday morning, or a civic group like City Club or Rotary or some other group not defined by what sector they work in. Do people like the folks at AOI believe that no one who works in the private sector knows someone whose job is in some form of public employment (incl. police and fire, local government, schools, etc.)?
Here are some ideas for future debates:
Discuss all this out in the open (from what I have seen, OBA was operating on a strategy of "the fix is in", and as with any other open public process, no one who makes a private deal can guarantee that others not in the room will go along with it).
Advocate publicly for a specific proposal and answer questions more intelligently than "we have a study".
For instance, for those who want us to believe that taxes "kill" jobs and tax cuts created them, just how many Oregon jobs were created after the Measure 30 election? In which counties? How many manufacturing jobs, retail jobs, clerical jobs, technical (from technology to jobs like actuarial)jobs, outside sales jobs, construction jobs, medical jobs, etc. ? There isn't payroll or other data from a source not associated with a political movement to provide that information?
If someone has a store, restaurant, etc., do they really think business will increase if public sector employees are laid off? Or isn't it a "job killer" to lay off public sector employees because REAL work only happens in the private sector?
There are people (incl. one Republican I know) who think that tax credits for jobs created ("we got a tax credit for adding a technician to our staff") might be more efficient than "we'll give you a tax credit and you promise to create jobs".
From what I heard on Think Out Loud, this is not 2003 all over again. One problem the anti-taxers may have is that 2002-3 was NOT that long ago for people affected by the cuts after all the gimmicks involved with Measure 28 and 30 turned out not to have magic pots of money. Cuts which happened after those measure elections affected real people.
Posted by: LT | Sep 25, 2009 10:21:36 AM
"the top marginal rate in Oregon would be 11 percent, the highest in the country."
For those not accountants, etc., let's see if I have this straight.
If the "marginal rate" applies to say, over $100,000, and the man who moved to Idaho has taxable income of $100,987, then he pays the lower rate on $100,000 and the 11% rate on $987. Is that correct?
An element of effective communication is making sure the audience understands what you are talking about. That is why some organizations penalize people who talk in jargon to an audience who may not be familiar with jargon (such as legislative committees which have a jar for everyone to contribute every time they use initials without explaining who they are talking about).
Posted by: mp97303 | Sep 25, 2009 10:24:42 AM
@Chris Lowe -- Large corporations are able to use dodges that keep them from paying their fair share of taxes for services from which they benefit extensively because of their size.
Can you substantiate these "dodges" you talk about? Please be specific.
Can you provide a reference in either the IRS tax code or the ODOR tax code giving a definition to "fair share of taxes."
Thank you.
Posted by: mp97303 | Sep 25, 2009 10:25:56 AM
@ Kari -- think of the $150 as an annual filing fee for the various services that the state provides
Fine, as soon as the state implements a filing fee for individual returns of $150.
Posted by: mp97303 | Sep 25, 2009 10:30:46 AM
@Chuck --Accountants and Journalists: Get the Facts Straight on the Revenue Measures and Stop Scaring People!
As a business owner since 1993 and as an ACCOUNTANT, let me call bulls**t on you. You are doing nothing but scaring the people into believing that businesses are not paying their "fair share" whatever that is supposed to mean. When in fact, they are paying EXACTLY what the IRS and ODOR stipulate they must pay, just like you and I do as individuals.
Now, if you can document some criminal act of tax evasion by an Oregon based company, please do so now!
Posted by: jodywiser | Sep 25, 2009 11:09:11 AM
As income taxes go, it is true that Oregon’s personal income tax rate and brackets structure is amongst the highest in the country. That's the way has to be in states without a regressive sales tax. Our personal income tax system asks families to pay more than they would in most other states. It helps make up for revenue Oregon isn’t collecting from sales tax. If Mr. Warrington did more to Idaho, he might pay a lower income tax rate on some of his income, but he'd add 5% in sales tax to his costs. He wouldn’t necessarily come out ahead.
What's been missing from Oregon's tax system is a way to get c-corporations to help pay for their share of the advantage of being in a state with no sales tax. The tax changes enacted with HB3405 are expected to bring the state $260 million in additional revenue in the next biennium. That's not much, but it's something. As Chuck has pointed out elsewhere, according to the COST study, if we were asking the same of businesses as the average state, our new structure would need to bring in $3.2 BILLION not $260 million. It’s hard to understand the consternation over the changes.
Obviously, if having low business taxes created jobs, we’d have one of the lowest unemployment rates in the country rather than one of the highest.
Posted by: Lance Comfort | Sep 25, 2009 11:21:27 AM
OK, let me be as direct as I possibly can on this. The state of Oregon does not need more tax revenue. They need to get control of their spending and use what they already have. Just two years ago the Governor of Oregon lamented how we needed to increase taxes while cutting vital services to make up for the decreasing tax revenues due to the recession. Oregon cut its school year back so that we had the shortest school year in the nation, while at the same time we paid among top 5 highest taxes in the nation. Oregon tax revenues continue to increase every year, but our government continues to overspend that growth. Not one person reading this would call that a good way of running their own household, so why do we let our legislature continue down this path?
Increasing taxes during this downturn is going to hurt Oregonians, regardless of how small this tax is. When you combine that tax with the drop in sales and financial insecurity of the market you're going to get business owners looking for safer harbors. The politicians keep telling us . . . 'it's an insignificant increase, and it will bring lots of additional revenue the state desperately needs.' But it will only continue the downward economic spiral that they have already created. Or has anyone not noticed the record unemployment in Oregon? According to an article in the Wall Street Journal('Soak the Rich, Lose the Rich' May 18, 2009). Between the years 1998 and 2007 no-income tax states created 89% more jobs and had 32% faster personal income growth than their high-tax counterparts.
How about they start spending the money they already have better first. If they can show some real gains there, then I would be happy to pay more on my tax bill, but we ARE NOT GETTING OUR MONEYS WORTH!!!
Posted by: mp97303 | Sep 25, 2009 12:03:42 PM
@jodywiser:What's been missing from Oregon's tax system is a way to get c-corporations to help pay for their share of the advantage of being in a state with no sales tax.
Can you please elaborate of what you mean by that.
Posted by: gl | Sep 25, 2009 12:12:16 PM
from defend oregon "These reforms protect nearly $1 billion in vital services..."
how many families making over $250k, and corps (paying a propsed $150) does oregon have to reash the $1,000,000,000 mark???
Also from Defend Oregon "Corporate minimum tax: Two‐thirds of corporations that do business in Oregon currently only pay a $10 corporate minimum tax. That includes Sprint*, Macy’s, Merrill Lynch*, Eli Lilly* and many national corporations"
So those companies did not pay a penny above $10 in taxes to the state of Oregon?
Posted by: mp97303 | Sep 25, 2009 12:21:29 PM
@lance
Using an article by Arthur Laffer is hardly the way to be taken seriously here.
Posted by: t.a. barnhart | Sep 25, 2009 1:50:01 PM
when did David Wright take over for Joe White?
Posted by: Pedro | Sep 25, 2009 2:03:49 PM
So job ONE in defeating the anti-school, anti-senior crowd is to make sure that every Oregon voter understands who is paying the tax increases and who is not.
If this discussion is any inducation of the comming campaign then we need to start blanketing the state with fact sheets explaining the truth and showing voters where to go to get an honest evaluation of all claims and soon. The Republican'ts will be buying a lot of air time to trumpet the same lies we've all heard before.
Let's not just react after the lies start this time. Let's get out in front wuth the truth!
Hats off to Chuck for this post
Posted by: Not going to say | Sep 25, 2009 2:37:06 PM
Pedro:
Word. And to make a reference to the movie Napoleon Dynamite, I would vote for Pedro too!
Great discussion all BTW and what a wonderful forum for this.
Posted by: John Calhoun | Sep 25, 2009 5:13:50 PM
Gl,
The taxes don't raise $1B, but the assumption is that the state will lose federal matching funds if the tax revenue at stake is cut. Keep in mind that there are two taxes at issue, both corporate and high income individuals.
Posted by: LT | Sep 25, 2009 6:11:00 PM
"The taxes don't raise $1B, but the assumption is that the state will lose federal matching funds if the tax revenue at stake is cut. Keep in mind that there are two taxes at issue, both corporate and high income individuals."
I seem to recall when GOP ran the legislature that there was a big debate----to be able to provide federal matching funds for some worthy program could have required more Oregon revenue than was available, and Republicans on Ways and Means didn't want to do that.
Fine---if they are honest enough to say "we would rather not have the federal matching funds, than to raise another dime in revenue". Then their base could say GREAT! and the people who believe that the matching funds would go to a good purpose could say "You are against funding____ because you might have to raise taxes? So___ doesn't matter to you? Handy information to have for the next election.
Fundamentally, this is about who has the right to express and act upon their own opinions. If all of Oregon was anti-tax voters, Republicans would still control the legislature. That is the sort of "voters have spoken" (who gets elected to public office) that many don't want to talk about!
Posted by: Lance Comfort | Sep 25, 2009 7:22:45 PM
TO: mp97303
Really? That's all you've got in response? No counter to my argument? Just "Using an article by Arthur Laffer is hardly the way to be taken seriously here." If you're going to disagree at least try and use some measure of thought. That was hardly worth the energy it took to move the digits that typed those words. This is the reason we lost to George W. twice. Too many of my fellow Dems with their heads in a place that doesn't promote thought. I can respect disagreement, but not following blindly like a lemming off an economic cliff. Finally, the statistics I mentioned from the Wall Street Journal originated from such 'right-wing' entities as Ohio University and the University of Colorado. (That last sentence should be read with as much sarcasm as one can muster.)
Posted by: mp97303 | Sep 25, 2009 8:07:29 PM
@Lance
As has been shown many times before, the internet has one great shortcoming...an inability to convey sarcasm, tone or facial expression.
My comment was not meant as a criticism of you, but of many here who look to dismiss anything they disagree with for the slightest of cause. Arthur Laffer would be that cause. Anything he has to say would be dismissed out of hand without regard to merit or fact.
My apologies for my failure to convey my true sentiment.
Posted by: Lance Comfort | Sep 25, 2009 9:37:11 PM
TO: mp97303
Ooops, ... guess I kinda went over board that just a tad. Thank you for your clarifying comment. Well taken. I guess I was expecting brutal opposition to my opinion. I'm not sure what I'm going to do if other Dems start thinking in similar fashion.
Posted by: LT | Sep 25, 2009 10:01:56 PM
Which university economist in the last several years has verified that the Laffer curve exists?
Or is it such an article of faith that it needs no confirmation?
Posted by: Ron Morgan | Sep 25, 2009 11:45:40 PM
"Between the years 1998 and 2007 no-income tax states created 89% more jobs and had 32% faster personal income growth than their high-tax counterparts."
Of the states with no personal income taxes, Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming, only Alaska is riding out the recession without a catastrophic shortfall in their budget, because they have oil wealth. Nevada and Florida, always boom and bust states, are just at the beginning of their problems since their economies lived and died with the housing/real estate.
bubble. I wouldn't trade Oregon's troubles with theirs.
It's difficult to argue with a general statement that the Oregon legislature or the government mismanages the money it has without any specifics. Our population has increased about 11% over the last ten years, demand for services go up. We aren't a household, we're a state.
Posted by: rw | Sep 26, 2009 8:49:56 AM
Per Ron - I've seen people previously come to Oregon as medical services seekers. A sister of a friend left WA state and moved here to get her extensive back surgery on the public dime! Meanwhile, folks, locals around me, could not get the services they needed! She lost her job while assembling a huge passle of documentation on her injury. Assessed where she had to go to get her needs taken care of on the dole. And selected the family member who resided in teh state that best has served her.
Smart lady.
Hard to swallow.
Could not believe her brother was open about it!
Oregon seems to continue to be regarded as a destination! Mostly it's based on lifestyle. FOlks would rather be poor in Portland than in Salina, OK. :)
Posted by: rw | Sep 26, 2009 8:55:47 AM
gl asked a good question. I'd like to see the clarifier viz how much tax those giants really have paid. Are they saying that the ten dollar minimum is too low, or that this is ALL they have paid? I'm absolutely interested!
Posted by: rw | Sep 26, 2009 8:58:28 AM
"It’s a shame, though, that accountants and journalists who have a responsibility to read the actual measures are also confused and are scaring people like Dick Warrington and the public by not asking the right questions and drawing false conclusions."
I gave up that trope ten years ago, my friend. I respect journos. Am a fan. But have little respect for most of those in media - a press release is handy filler. If well-written, it passes through like grease thru a pig's alimentation.
Posted by: LT | Sep 26, 2009 10:43:18 AM
Thank you, Ron.
I have a question for Jack Roberts. His background should equip him to answer this question:
Sometimes in the news there are stories like "The economy created _____jobs, which was more/fewer jobs than predicted".
OK, that assumes some neutral source of job creation data.
About this whole "job killing taxes" slogan---Measure 30 election was in early 2004. Russ Walker & Co. had claimed that if they won lots of jobs would be created, if they lost then lots of jobs would vanish.
So Jack, how many jobs were created in 2004? Was it a minimal number or a dramatic number? How many private sector, how many nonprofit sector, how many public sector.
One other thing. If the measures qualify, it would be nice if someone from BO (or maybe a team) could contact all 90 legislators and ask them if they support the legislatively passed taxes being upheld. If they say yes, their names should be public so we can thank them.
If they say no, then they should be asked how they expect to fill the budget hole without gimmicks.
We deserve to have all legislators (and candidates) on record on this issue.
Posted by: David Wright | Sep 26, 2009 12:15:36 PM
When did t.a. become the drive-by -- or I suppose in your case, "pedal-by"? ;-) -- ad hom guy?
If my facts are wrong, show me where.
If the conclusions I draw from my facts are wrong, show me how.
But at least I do use facts to construct an argument. :-)
Posted by: David Wright | Sep 26, 2009 12:34:34 PM
LT, no I did not speak to anyone in the legislature about this. Are you suggesting that only those who actively participated in the creation of this legislation are allowed to talk about it now?
The system is working as designed. The legislature did its job, and when the work product is questionable the people have an opportunity to put that product to a public vote. At that point, it is fair for others to point out the pros and cons of the legislation in question and debate whether the product should be retained or rejected. Even if they never spoke to a committee member or sat through a hearing when the legislation was being created.
And by the way, while I do think this particular bill could have been better designed, keep in mind that the topic of this post was about how certain elements are misleading the public about the nature/effects of the bill. Mostly I was attempting to point out that the original poster has also been misleading the public about the nature/effects of the bill.
Partly that's an effort to encourage people to question Mr. Sheketoff's analysis. He's not always wrong. But he's wrong often enough that his conclusions ought not always be accepted at face value, as is rather encouraged here on this site.
And partly it's an effort to get people to think about the bigger picture issue of whether legislation will actually accomplish what it theoretically sets out to do. If, as Mr. Sheketoff claims, the legislature really was "targeting" big corporations, I believe it is worthwhile to really think about whether they will hit their target, and if they could have hit that target more directly without adverse effect on others. In other words, setting aside for a moment the question of whether their goal was valid, did they even do what they set out to do? If not, or if there were too many "side effects" of what they did, then that certainly is worth consideration, don't you think?
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Posted by: stevenovick | Sep 24, 2009 5:31:01 PM
Idaho, of course, has significantly higher taxes on corporations than Oregon ...