Tax increases are not the answer

Oregon has a problem. Our spending is skyrocketing and our revenues are plunging. The federal government avoids this dilemma by flagrant borrowing and printing more money, while Oregon has a constitutional requirement to maintain a balanced budget. Reaching a balanced budget is easier said than done. It is time to change the way Oregon creates our state budget and spends our tax dollars.

The current system reminds me of the farmer who had hoped to earn $80,000, but ended up only earning $50,000. When his neighbor asked him how his harvest had gone, he said he lost $30,000.

Every biennial budget begins with a generous "estimate" of what should be included in it. This proposed budget, called the Essential Budget Level (EBL), is the new budget's measuring stick. The co-chairs of the Ways and Means Committee create their budget and only show the reductions or "cuts" from the proposed EBL. This strategy of disclosing only cuts from the next EBL, instead of providing an open comparison to the current budget, can distort and mislead.

For instance, the Head Start program provides many benefits to pre-kindergarten children. How was Head Start's funding affected by the co-chairs' budget? The line item for Head Start in the co-chairs budget indicates a 10 percent cut from the EBL. In reality, Head Start is getting a million dollars more in the proposed 2009-2011 co-chairs' budget than Head Start received in the 2007-'09 budget.

Notwithstanding Oregon's severe revenue reductions, the governor and legislative leaders are determined to expand welfare programs and raise taxes to pay for it. One proposal is to double the number of middle-income families who can qualify for health benefits. To pay for such an expansion in health-care caseload, the Democratic leaders have made a deal with Oregon's 26 largest hospitals to add a sales tax to their hospital bills. In addition, there is to be a sales tax added to all Oregon health-care insurance policies. But those taxes are not enough, so the Democratic leaders also will be proposing a 2 percent income tax increase on Oregon's successful business owners and other high-income earners.

Our tax-and-spend elected officials just don't get it. They don't understand that when government takes over health care, the costs don't go down, they just get transferred and paid by a different group than those receiving the benefits. If Oregon taxpayers think health care is expensive now, just wait until it is "free."

The Democratic co-chairs' budget is to be funded with $800 million in tax increases. Just think of it. Nearly a billion dollars of new taxes are proposed when 243,000 Oregonians are out of work, businesses are closing, homes are being foreclosed and food stamp applications are at record highs. What are the Democratic leaders thinking?

California voters just sent their government-proposed tax increases back to Sacramento on a platter. If Oregon Democrats continue to promote $800 million in new taxes to balance Oregon's 2009-2011 budget, I expect they will receive the same treatment. Have Salem's leaders forgotten Measure 28 and Measure 30?

Oregon's Republican legislators understand that Oregonians want their Legislature to live within its means, just like Oregon families are having to do. The Republicans may be in the minority, but they have been vocal in promoting a balanced budget without raising taxes in these hard financial times. The House and Senate Republicans have uncovered $2.9 billion sitting in state agency accounts. Between $500 million and $1 billion is immediately accessible.

In addition, there are many sensible ways to save. For example, Oregon is the only state whose employees pay nothing toward their health benefits. If we paid only 12 percent like Washington state employees, nearly $200 million would be saved.

In short, Oregon does not have a revenue problem, it has a budgeting and a spending problem. Oregon citizens deserve an open, efficient and economical budgeting process. Our present system does not provide it. It is time for a change in Oregon budgeting practices — a change we all can believe in.

Rep. Dennis Richardson, R-Central Point, represents District 4 in the Oregon House.

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