This is a “told you so” story about Measures 66 & 67 …
by Steve Buckstein
In December 2009, Cascade Policy Institute published a research report by Randall Pozdena, Ph.D. and Eric Fruits, Ph.D. forecasting the impacts of tax increase Measures 66 and 67 on Oregon employment.
The study was based on thorough research of peer-reviewed literature and a quantitative analysis of taxes and economic growth across the U.S. and over a long period of time. They concluded that the tax measures would have a significant negative impact on Oregon’s employment picture, as shown in Exhibit 1 on page 7 of their report.
On Saturday, September 12, Cascade Policy Institute founder and Senior Policy Analyst Steve Buckstein [center photo] spoke to an enthusiastic crowd of about 80 people from the courthouse steps in Astoria. The event was one of hundreds of such “9-12” events around the country, including a massive rally in Washington, D.C.
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Contact Steve Buckstein
(503) 242-0900 email@example.com
The state recently announced that its $175 million “stimulus package” has created or saved 3,236 jobs.1,2
What the state hasn’t yet told citizens is that Oregon risks losing ten to twenty times or more as many jobs if two “anti-stimulus” tax bills take effect.
I estimate that raising the maximum tax rates on personal income, including capital gains, to eleven percent will cost the Oregon economy 36,000 jobs by 2015. The job losses will continue to accumulate beyond that year. This analysis does not incorporate job losses due to higher corporate income taxes.
The estimate is based on a model of state employment growth that incorporates data for all 50 states for 26 years. It exploits tremendous variation in tax practices from one state to another, and within individual states across time. The model was developed for my 2005 analysis of Oregon’s capital gains tax. (See “Generating Jobs and Income Through a Capital Gains Tax Reduction,” Appendix 1, Equation 3, available at http://www.conerlyconsulting.com/pdf/Capital_Gains_Report.pdf.)
The opinions expressed herein are those of the author and
should not be attributed to any other individual or to any other organization
with which the author is affiliated.
The State of Oregon faces State budget deficits due to the sharp decline in employment and economic activity in the state. In an attempt to fend off this fiscal problem, the Oregon House just passed, and the Oregon Senate will decide shortly, on two major tax measures:
• HB 3405 would increase tax rates on corporate profits, from 6.6 to 7.9 percent for two years, dropping to 7.6 percent thereafter.
• HB 2649 would increase, for three years, personal income and capital gains tax rates from the current 9 percent to 10.8 percent and 11 percent for those earning more than $125,000 and $250,000, respectively. A 9.9 percent rate would be imposed thereafter.