tag:blogger.com,1999:blog-3471471289744825428.post2607370393394224238..comments2024-03-11T00:31:41.186-07:00Comments on The Oregon Economics Blog: Economist's Notebook: Taxes and the Rainy-Day FundPatrick Emersonhttp://www.blogger.com/profile/17242234148546323374noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-3471471289744825428.post-10905892045004814002010-02-10T23:17:38.682-08:002010-02-10T23:17:38.682-08:00Patrick,
If we are putting a number in the consti...Patrick,<br /><br />If we are putting a number in the constitution, percent of gross state product or personal income is a heck of a lot better...and yes, the numbers that the Task Force recommended are too low (I got 'em raised, but not high enough)....If OCPP did its <a href="http://www.ocpp.org/cgi-bin/display.cgi?page=iss080108" rel="nofollow">study today</a> we'd be recommending even higher figures than we did two years ago. Also, keep your eyes on the constraints on spending from the reserves...as we pointed out they undermine the use of the funds, masking the amount that's really available.<br /><br />I wish I knew how to embed http://www.springercreative.com/?cartoon=456 in your blogChuck Sheketoffhttps://www.blogger.com/profile/17438141936099145464noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-41723522268003357392010-02-10T23:00:14.812-08:002010-02-10T23:00:14.812-08:00Jeff and Chuck,
Forgetting the permanent parts fo...Jeff and Chuck,<br /><br />Forgetting the permanent parts for the moment, my main point was that it is lamentable that we had to resort to tax increases in a recession at all. With a substantial rainy-day fund we could have had a counter-cyclical counterweight built right in.<br /><br />Nobody is asking, but if I were king it would be fixed at 5% of state GDP. Much higher than most suggestions. That would give us about $7.5 billion, which would have probably covered, but only just the current combined shortfall when all is said and done.Patrick Emersonhttps://www.blogger.com/profile/17242234148546323374noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-31826985626806370052010-02-10T16:58:55.820-08:002010-02-10T16:58:55.820-08:00I don't think we need to start over with a new...I don't think we need to start over with a new model..M67 put some of the income back into the corporate income tax, and what's needed now is a better review of why that tax is so anemic - but the Leg has been unwilling to look at the structural changes, such as the change to single sales factor apportionment, which alone saved Intel about $50 million a year! If we had a better reserve and a better way of taxing <a href="http://www.ocpp.org/cgi-bin/display.cgi?page=iss070605corprof" rel="nofollow">corporations who have seen their profits rise far faster than our tax collections </a>, we'd be fine at the state level. At the local level we have much bigger challenges due to Measures 5 and 50. A little fine tuning to keep up with technology change like move from phones to cable would help, but bigger changes are needed. And the two big system changes that need to happen is to take the power-to-the-minority-for-raising-taxes out of our constitution and initiative reform that makes it harder to propose or refer so that we can restore power in the Legislature.Chuck Sheketoffhttps://www.blogger.com/profile/17438141936099145464noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-57255658863659669302010-02-10T16:47:24.876-08:002010-02-10T16:47:24.876-08:00There's a certain rhetorical purpose to downpl...There's a certain rhetorical purpose to downplaying these measures, but we shouldn't overdo it. The fact that they're permanent means future legislatures will have a bit more breathing room. These were listed as $700 million measures, but actually, the'll net the state billions in coming years.<br /><br />While I agree with you that we need to start over with an entirely new revenue model--and especially that now is the IDEAL time to do such a thing--I thought the measures were about as close as you ever get to perfect legislation. They restored progressivity, addressed some long-standing taxing embarrassments, and will in fact support critical services. <br /><br />Move forward, but don't lament this nice success.Jeff Alworthhttps://www.blogger.com/profile/02930119177544342495noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-49482417915009785552010-02-10T11:39:57.228-08:002010-02-10T11:39:57.228-08:00Chuck,
You are right, there are aspects of the pe...Chuck,<br /><br />You are right, there are aspects of the permanent increases I have no beef with (the corporate minimum, for example). I do have a beef with the permanent part of 66. But mostly I would have liked to see permanent changes to the tax system discussed within a broader discussion of tax reform and revenue stability. That said, I am well aware that I live in a ivory tower world where the messy political realities don't intrude.Patrick Emersonhttps://www.blogger.com/profile/17242234148546323374noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-28825919793475523302010-02-10T11:00:13.417-08:002010-02-10T11:00:13.417-08:00Patrick, all of the business groups wanted, in som...Patrick, all of the business groups wanted, in some form or other, the corp minimum tax change to be permanent. And the permanent portion of Measure 67 -- increased rate on taxable income in excess of $10 million, is all dedicated to the state's rainy day fund. So what's your beef with that?<br /><br />That said I stand with you in saying that now is the time to create a better (we already have two) rainy day fund. How ironic will it be if the corporate kicker kicks because the Leg reforms the runaway BETC?!Chuck Sheketoffhttps://www.blogger.com/profile/17438141936099145464noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-1854085913150552372010-02-09T23:00:31.903-08:002010-02-09T23:00:31.903-08:00Send to the Oregonian, Patrick. This is pretty com...Send to the Oregonian, Patrick. This is pretty compelling.Fred Thompsonhttps://www.blogger.com/profile/02979504812638374338noreply@blogger.comtag:blogger.com,1999:blog-3471471289744825428.post-39897432941754216222010-02-09T09:34:29.260-08:002010-02-09T09:34:29.260-08:00Why should the taxes have been temporary? That wou...Why should the taxes have been temporary? That would have been a move which would replicate what you're complaining about here--a measure that doesn't affect the broken tax structure. The code has been tilted further and further towards the top end for 20+ years; 66/67 were tiny steps toward restoring some balance. A temporary tax would just put us back where we were before. The reason not everyone needed to shoulder the burden this time is becuase most of "everyone" has been picking up the slack of the wealthy minority for years.Torridhttps://www.blogger.com/profile/17771589020554233601noreply@blogger.com