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Budgeting for Hard Times

AIR DATE: Tuesday, December 2nd 2008
Download the mp3 for this show.
What are your reactions to Governor Kulongoski's proposed budget?

Governor Kulongoski laid out his vision of state spending for the next biennium today. He remains optimistic, but he was clear that Oregonians face some hardships in the coming months. ?We should prepare for worse? With a volatile economy and diminishing federal support, we must change the way we finance and deliver state services,? he stated in a message (pdf) included with his long awaited budget proposal.

The specifics will come when the legislature hammers out a final budget, but in the governor's proposal the state would provide healthcare to 95 percent of Oregon?s children and dedicate 54 percent of the general fund to education. He would also cut back on human services and raise taxes for corporations, hospitals, and smokers.

What do you think Oregon residents must pay for? And what could be cut, even if the cuts might be painful? Are you a schoolteacher who is relieved to hear education spending would not be cut? Or a senior citizen who is concerned about what cuts may mean for services you depend on? What are your priorities for state spending during this recession?

Guests:

Govs Budget: The working poor have already paid. Elimnate the 2nd home mortgage deduction (unique to oregon).

Globalize the income packages for our $70 K teachers and $ 150 k administrators.

The rest of the people in Oregon got Globalized 12 years ago. Thats why income tax revenue is down. We already got a tax cut, AND and Income cut in Oregon.

Its time for the Education Interests to "pay" and become equal.

Bill Clinton said the cut was 48.7 % - so educators have saome cathing up to do.
mark445 —
Mark445: Want do you mean by "globalizing" the income packages for teachers and administrators? It's not a term I've heard before, and google didn't help...
David Miller —
While I can appreciate the difficult position of creating a budget for the next 2 years while living in the middle of an economic recession, the budget from Governor Kulongoski further fractures the safety net for Oregon citizens over 65 as well as those who are disabled. The Governor plans to invest, build, create and support all manner of programs across the spectrum of state government. In the early stages of a recession, we can find the funds to hold education harmless, expand corrections and invest in building a new energy economy, but we must again sacrifice those who live among us and are the most vulnerable of all. Older adults and people with disabilities who need help to live in their own homes, will be forced through program cuts to scramble for the help they need to survive. New income standards for Medicaid if implemented, will leave thousands without a home or support in the community. We have lost our vision and continue to break the social contract with Oregonians who need our help. This is a budget that creates hard times if you happen to be old, diabled or on the verge of falling through the safety net in Oregon.
Scott Bond —
The Governor's budget increases the amount given to Department of Revenue from $163,563,414 to $199,648,806. What will this increase be used for?

In 1990, there were 2.5 million people in Oregon and 1,000 employees at Department of Revenue. In 2007 there were 3.5 million people in Oregon and 1,000 employees at Department of Revenue. Will more employees be hired? Will more law enforcement employees be hired? Will law enforcement policies utilized before 1996 be used again? This would change the current policy of not seizing real or personal assets to secure payment.

What tax expenditure laws will be repealed? Currently, there are about $28 billion in tax expenditure laws on the books. The euphemistic phrase "tax expenditure" is used in place of the phrase "tax discount for special interest group".
Gordon Hillesland —
I am disappointed that the Governor has once again leapt on the "Tax the smokers" bandwagon. This was tried last year. The money brought in by the increase will not cover the cost of the programs being set up and as fewer people smoke, there will be even less money brought in each year. If he really feels that a targeted tax is necessary, he should tax ready to drink coffee. At a nickel per cup sold in Oregon, then I am sure enough money would be brought in to cover the cost of the proposed child healthcare.

On the proposed increase in title and registration fees, this is Oregon, not California. The people who live here do not make enough money to have to pay out $110 per title change and $162 for two years of vehicle registration. Also with the way the law in Oregon is set up, the money collected through DMV fees can only be used on highway projects. I can see an increase in the number of people not bothering to transfer the titles to the cars when they buy them and an increase in the number of cars running around with expired registration. I do support an increase in the gasoline/diesel tax. It has not been raised in quite a few years and a small 2-4 cent increase would be beneficial to maintaining our highways.
MoparCzy —
One of the issues that we need to address in Oregon is how we have tied the hands of our state and local legislators around budgeting and revenue generation. With the passage of Measure 5, we implemented compression, a system in which local citizens can pass local levies, but are unlikely to raise as much as needed because of the $10/$100 cap (In 1990, Oregonians passed Ballot Measure 5, which limited property taxes for local governments to $10 per $1,000 of assessed value. Under Measure 5, when local tax levies exceed the $10 limit, all affected levies are reduced on an aggregate level to bring the total tax collected within the $10 limit. This effect is known as compression). This results in localities that have become increasingly reliant on state funds.

Measure 47/50 created a double majority that has further hamstrung the ability to raise taxes, even if so desired by the citizens (In May , 2002, Portland Parks & Registration put a levy on the ballot which passed by over 70% of the visiting electorate--but because less than 50% of registered voters turned out to vote, the levy did not pass. Not only did the citizens not get the services they were willing to pay for, but they also incurred the cost of a second election on the same issue). Fortunately the supermajority rule was overturned in the November 2008 election.

Finally, the kicker penalizes our state legislature for sound budgeting practices. We want our government to budget expenses high and our revenue low. That greatly reduces the chances that we will be put into the situation we are now in, where there is a need for mid-year budget cuts. But instead, we return the overbudgeted revenue to both citizens and corporations.

This trifecta of restrictions make it virtually impossible for our state legislature to support the services we as citizens want and need, or have the flexibility to continue to be the innovative and trend-setting state that we have been historically. Yes, we need to address the current budget situation we are faced with. But, we also need to look forward and remove the constraints we have put on ourselves and our legislatures.

EvaCatHerder —
Someone commented below about their disapointment regarding tobacco taxes. The great thing about tobacco and other "sin" taxes, is that in terms of policy, one can get a good "two for one" - extra money is raised, AND use is discouraged.

For both tobacco and alcohol, there's good research to show that when the prices are raised, the two populations that cut down on their use are adolescents and pregnant women (populations that shouldn't be using anyway). I'm happy to hear about the proposal to increase tobacco taxes, but I think the Governor gets too nervous about wine and beer industry pushback - he should also be advocating for an increase there, as well. Oregon has the lowest alcohol taxes in the nation, the last time those taxes were raised was, I believe, in the '60's. I would be more than happy to pay an extra 50 cents for a six-pack or bottle of wine.
Lesadg —
I heard something about budget cuts in mental health? I could not think of a worse idea right now while we are considering ways to bring our troops home. These things go hand in hand. It is estimated that 1/3 of our returning Iraqi veterans are facing mental health issues and the VA hospitals are already severely understaffed.
I know everyone will be feeling the pinch of our failing economy, but have our troops not felt enough fighting a relentless and meaningless war?

I can think of other places to find excess money. Why not do a little more background searching before handing out food stamps or welfare money, I know many people personally who abuse our welfare system and never get caught. That's just one idea, I am sure there is more money being wasted out there.
meggibrit —
While I agree that cuts in mental health are not good, given the very tough budget choices that need to be made, I agree with Kulongowski's priorities. We will never have enough money to adequately fund our mental health system. It is just not enough of a priority for Americans. So any money that goes into mental health is simply a band-aid.

However, putting money into education and infrastructure allows us to put money into a place where it will make a systemic difference. Otherwise we will be hamstringing future generations with ever more difficult decisions, as if the huge defivit is not enough.
EvaCatHerder —
If you are aware of people cheating on welfare and food stamps, why aren't you reporting them? You can help identify where the excess money is that way.
howdy.do —
If, as the Governor says, "this storm will pass," why turn it into Hurricane Katrina by targeting Oregon's least affluent and most vulnerable residents for such a disproportionate share of the burden?

And why eliminate any programs that come with matching federal dollars? Isn't that actually exacerbating the shortfall by forcing working parents denied child care and ailing seniors denied home care into more expensive services often funded exclusively by the state?
Mt. Tabor Maven —
The governor should propose that the federal government drop all the requirements when federal funds are co-mingled with state funds. We'd save a lot of money. Parents of disabled adults get a pittance to be their adult children's care givers but foster homes usually are paid five times as much to do the same thing, minus the love and better knowledge of who the disabled adult is from the ones who raised him. It is because of all the useless hoops the state has to jump through to get federal funds.
I was told that when co-mingling funds for infrastructure, they have to jump through similar very expensive meaningless hoops.
RebeccaB —
I'm with Bill Sizemore: I hate all taxes.

I prefer to pray for money to fall from the sky instead.
Chad Balcom —
I support a higher auto/truck registeration. The current fee barely covers the cost of processing the paper work.

Steve B.
spbimages —
Alcohol taxes need to be raised NOW. The tax hasn't been raised since 1976. Alcohol costs society much more than tobacco and claims many more innocent victims, from auto accidents, domestic violence & raises health care costs for everyone. The Beer & Wine Lobby have been taking legislators on several Hawaiian golf vacations with the understanding that taxes wouldn't be raised, we voted for change and this type of politicing needs to end now. I would rather raise the alcohol tax than cut necessary services the government provides.
Jeff Bernards
ytamer —
Let's eliminate the department of revenue by revamping the tax code to a simpler and fairer system for everyone.

Let's make sure tax dollars are spent effectively as possible. I'm not impressed that we pay 54% for an education system that produces half-educated children or worse. It's not the education system's fault though.

Our society is in decline or failure.

Our society would require fewer "safety nets" if resources were more equitably distributed. Virtually all the money is in the hands of the rich while the unwashed mass fights for rotting scraps.

Provide people jobs that pay wages that allow them to effectively live here.

It's hard to pay your mortgage when you are made redundant several times in a row.

If you look at the balance sheets of many corporations you can see they're hoarding cash. At the first hints of trouble corporations lay off people.

People have become disposable as trash and I don't think that bodes well for our society over the long term.

Have fun talking about your special interest pork and your budget cuts. In my opinion you're spitting into the wind and not solving society's unresolved base problems.

Militarism and the military industrial complex must be retired. It is a system that leads to failure, totalitarianism and suffering.

Fundamentalist [religiousity] must give way to compassion and intelligence.

Television and mass media must be allowed to go out of business. Stop watching and listening to sources that charge you for advertising. Don't buy advertised stuff that is bogus.

When are we going to stop being stupid? We enthusiastically accelerate our demise.
trurl9 —
Legalize marijuana and tax the heck out of it. Might save a lot of money.
RebeccaB —
Yes, this sounds obnoxious, but in the spirit of brainstorming:

Budget problems solved: State of Oregon recoups revenue by sales from state-regulated marijuana. Also from fines on population tested at work and on highways.

Jobs created: Part-time Monitors stationed at public places (work, gas stations, etc.) who test their peers' inebriation levels---

*Reframe: We aren't unemployed--we are On Sabbatical and in the process of re-applying our imagination to "nonobvious solutions."

Perhaps more plausible:

*A computer to every homeless adult.

*A user-friendly, elegant-and-efficient database (I'm thinking of www.LotsaHelpingHands.com)--created by the talented computer people at the local Job Clubs--that help serve as barter/match-up services.

*Lots of brainstorming meetups throughout Oregon, like Appreciative Inquiry conferences

Thanks for indulging me here.
SusanE —
First, I don't envy the governor at all.
After that I have two issues/comments/questions:

Everybody talks about lower taxes and smaller government ... except for the things that matter to them and then they are outraged at any cuts. If you want it it needs to be paid for. Maybe we need to ignore the budget at first and rank our states priorities and fund them from the top down. Once we run out of money, everything below that doesn't get funded. If we want it? we need more money.

Finally, people have been saying that taxing hurts the economy for so long that it is just excepted as a given. Why? Where is the evidence? Can you show me two comparable societies where the one with lower taxes is better off? Public services are a vital part of a thriving economy and they need to be paid for.
katied —
Considering that the traditional Conservative Republican strategy has been to run the government so far into debt that a following Democratic administration cannot afford to do socially responsible programs and considering that our current financial crisis is due to Conservative Republicans de-regulating the financial sector; I propose that the Democrats carefully go through all of the budgets and cut back and/or eliminate everything that benefits Conservative Republicans and let them feel the pain that they traditionally put upon all of the non-Conservatives.

De-Fund Conservative Republican priorities and Re-Fund Progressive social programs.

Lets invest in our people, and disinvest in parasitic Conservative programs!

Tom D Ford —
I applaud the Governor for his initiatives to make Oregon a green energy mecca. But for so many press releases on the subject, his proposal to raise the gasoline tax by only 2 cents/gallon strikes me as laughably anemic. Everyone breathed a sigh of relief when gas fell back to $2.98 a couple months ago. Now it is $1.98 and headed lower. Why not raise the tax by 10 cents (or more)? That would make a real green energy statement, raise badly needed state revenue and our gasoline will still be far cheaper than it has been in years.
cfitzpat —
There was NOTHING in this discussion about doing what we have to do with greater efficiency. When our personal budgets are stretched, we made do and figure out how to stretch our dollars. Why not look at the waste in government and not just idealogue handwaving but real life experience at seeing waste and listening to how to do better with less?
RebeccaB —
I am in my seventies and do not like nor support an increase in vehicle registration fees. Can be very difficult for low income people. I do however support an increase in the gas tax.
Paul J Daniels —
Attached contents as REPLY to Rebecca's.
SusanE —

Comments are now closed.

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