Oregonians shouldn't be fooled on state stimulus, taxes

July 29, 2009

It’s well known that Oregon has one of the highest unemployment rates in the nation. Officially only Michigan and Rhode Island have higher rates of unemployed workers. However, the unemployment rate only tells a part of the story. The rate excludes those who are working part-time but need full-time work, and those who have completely given up looking for a job at all. When these people are included, Oregon’s true unemployment rate reaches 23.5 percent– the highest in the nation.

The legislature should be concerned that nearly one of every four Oregonians can’t find full-time work to earn a living and support their families. Yet Salem’s response to our high unemployment was more government spending through an ill-conceived “stimulus” plan that has increased the state’s debt while producing few jobs.

Majority Democrats were convinced they could put people back to work by spending $255 million on minor, short-term deferred maintenance projects. These projects included replacing light bulbs, replacing carpet, and applying paint to state office buildings. Because the state borrowed money to pay for these projects, our children and grandchildren will be forced to pay for light bulbs, carpet and paint jobs that had worn out a long time ago.

Proponents of the spending plan have claimed it has created over 3,000 new jobs, but that’s only because the state counted any stimulus work as a job, whether the work lasted three hours or three months. The Associated Press recently found these jobs lasted an average of 35 hours. When measured in full-time, yearlong jobs, the AP found that the stimulus plan created the equivalent of 215 full-time jobs that lasted three months. The news report suggested that Salem politicians were “stretching the facts” to fool Oregonians into believing the stimulus program was more successful than it really was.

Sadly, most of the workers on these projects have returned to unemployment and are looking for full-time work. Contractors who have completed the stimulus projects are now seeking new projects, even though few are being put up for bid in this economy. One contractor told the Portland Daily Journal of Commerce that the stimulus plan was helpful but similar to “spitting in the ocean” of the recession.

Any employment gains from the state stimulus plan will be wiped out by the tax increases that were passed this year. A respected economist recently determined that Oregon would lose 43,000 jobs as a result of the corporate tax increase alone. Yet another economist found that the personal income tax increase would cost us an additional 36,000 jobs.

Like the stimulus program, these same politicians are attempting to fool Oregonians into believing that their tax increases will only hurt a select few. However, the facts show that the tax increases will hurt small businesses and others who bring jobs and capital to our state. Even worse, the analyses don’t include the higher gasoline taxes, higher vehicle registration fees and hundreds of millions of dollars in other new taxes and fees that Oregonians will soon have to pay. We are all desperately searching for an end to this recession, but the news from Salem is more debt, taxes, spending and regulation.

That’s bad for our economy and the nearly one in four Oregonians who need a full-time job.