East Oregonian : E.O. (Pendleton, OR) 1888-current, September 06, 2018, Page 4, Image 4

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    Page 4A
East Oregonian
Thursday, September 6, 2018
Managing Editor
Founded October 16, 1875
Kicker will land on
Oregon’s backside
The Eugene Register-Guard
he state Office of Economic
Analysis could not have conjured a
better illustration of the perversity
of Oregon’s kicker law: In 2020, the
office’s forecasters predict, Oregon will
return $686 million to individual income
taxpayers — just as the state tips into a
recession. It’s the fiscal-policy equivalent
of spending your savings on a vacation the
week before you need to pay for a kidney
To taxpayers, it looks a little different
— at first. The median Oregon household,
with an income of $36,000, will receive a
state income tax credit of $162 in 2020, a
relatively small but welcome infusion of
cash that will arrive when Oregon’s long
economic expansion comes to an end.
It could even have a modest stimulative
effect on the state’s economy.
But the credit will be tilted steeply
toward those who need it least, with the
top 1 percent of households — those
with incomes higher than $400,000 —
receiving credits of $6,787. Households
in the bottom 20 percent will get $13, and
those in the second quintile, with incomes
between $11,200 and $26,300, will get $75.
These lowest-income households are most
likely to be affected by recession-induced
cuts in state services, cuts that could have
been ameliorated with the $686 million in
refunds triggered by the kicker law.
The kicker law was passed by the
Legislature in 1979 in an effort to head
off a California-style property tax revolt.
The revolt came anyway when voters
passed Measure 5 in 1990, which capped
property tax rates and shifted responsibility
for financing local schools to the state.
In 2000, voters approved a legislatively
referred ballot measure to add the kicker
law to the state Constitution.
The kicker law is unique to Oregon. It
requires that when state revenue exceeds
official forecasts by 2 percent, the entire
amount above the projected figure must
be returned to taxpayers. Before the start
of the 2017-19 biennium, the state’s
economists projected $18.4 billion in
revenue from sources other than the
corporate income tax, mostly the personal
income tax. The latest projection, released
last week, revises that figure upward to
$19.2 billion — a 3.7 percent increase,
well beyond the kicker law’s 2 percent
A separate kicker applies to corporate
income taxes, which are also flowing into
state coffers at a higher-than-expected rate
because of a strong economy and changes
in federal tax law. In 2012, voters amended
the state Constitution’s kicker provision to
divert the corporate kicker funds to school
After nearly 40 years, the personal-
income-tax kicker appears to have become
a permanent fixture of Oregon’s fiscal
policy. An outright repeal would be a tough
sell politically — particularly with the
prospect of another refund on the horizon.
But Oregonians might be willing to modify
AP Photo/Andrew Selsky, File
This Jan. 11, 2018, file photo shows dark clouds over the Capitol in Salem.
the kicker law in a way that makes public
services, particularly education, less
vulnerable during economic downturns.
The vulnerability stems from Oregon’s
heavy reliance on personal income taxes
— the state has no sales tax, and property
taxes are reserved for local governments.
To a greater degree than sales or property
taxes, income tax revenue flows freely
during periods of economic growth, and
slows dramatically during recessions. One
way to dampen this volatility is to build up
a rainy day fund during boom times, and
use these savings to cushion the effects of a
downturn. The kicker is an obstacle to such
a countercyclical practice.
Oregon has two rainy-day reserves
— the Oregon Rainy Day Fund and the
Education Stability Fund — that are fed by
corporate taxes, lottery revenues and other
sources. These reserves will contain $1.2
billion at the end of the 2017-19 biennium,
according to the latest projection. That
would not be enough to carry Oregon
government through a recession that is
deep, long or both.
The kicker law could be amended to
require that all or a portion of refunds be
deposited in the rainy day reserves until
they contain savings equal to, say, 15
percent of the general fund, which would
amount to about $3 billion. After that
threshold of adequacy was reached, kicker
refunds to taxpayers would resume. Such
an adjustment to the kicker law would
ensure that larger-than-expected income
tax receipts aren’t immediately spent, and
provide refunds to taxpayers once a degree
of fiscal stability is achieved.
Such a system would entail some
deferred gratification for Oregon taxpayers.
But it would be more sensible than
providing big tax refunds on the eve of a
Too much secrecy keeps public in dark
ational leaders of all
stripes have complained
for decades that
Washington keeps too many
secrets. Too much of the
government’s information is
classified, the argument goes,
making it nearly impossible for
Americans to know what their
leaders are doing.
“Secrecy is a mode of
regulation,” Sen. Daniel Patrick
Moynihan wrote in 1997, when
the congressionally created board
he headed, the Commission
on Protecting and Reducing
Government Secrecy, released a
report. “In truth, it is the ultimate
mode, for the citizen does not
even know that he or she is being
Moynihan hoped that a “culture
of openness” would develop to
balance the culture of secrecy.
It didn’t happen. A dozen years
later, in 2009, The New York
Times editorialized that the federal
government’s creation of “107
different categories of restricted
information ... seems designed not
to protect legitimate secrets but to
empower bureaucrats.” Still more
recently, when the House held
hearings on secrecy in 2015, the
journalist Terry Anderson testified,
“The Moynihan commission
recommended some changes in
the law, including an office of
Nothing was acted
Today, the
culture of secrecy
is keeping the
public from
learning some
basic facts about
the Trump-
Russia affair,
even as newscasts
and newspapers are filled with
reporting, speculation and
debate about it. When it comes
to allegations that the Trump
campaign conspired with Russia
to fix the 2016 election, the Justice
Department and other agencies
have withheld information
from the public because such
information is classified, or
because it is purportedly critical
to an ongoing investigation, or
because officials just want to keep
the department’s secrets secret.
Remember the Comey memos?
Starting in the transition, then-FBI
director James Comey wrote notes
on each of his encounters with
President Trump. Later, he leaked
some of them to the press in hopes
of setting off a firestorm that
would result in the appointment of
a Trump-Russia special counsel.
His plan worked.
But even after that, the Justice
Department kept the Comey
memos tightly under wraps, as
if they were one of the nation’s
highest-level secrets. When
members of Congress of both
parties demanded to see the
memos, the Department would
allow only a few lawmakers a
glimpse -- and then only with
an FBI minder present, and no
copying or note-taking allowed.
The situation changed only
when Comey began a book tour,
with much of his presentation
clearly based on the memos.
After that, even the Justice
Department couldn’t come up
with a reason to keep them secret.
The public finally got to see the
memos, and the country -- and the
investigation -- survived.
This year, House Intelligence
Committee Chairman Rep. Devin
Nunes wrote a memo, based on
classified information, about the
FBI’s rationale for wiretapping
the Trump campaign’s volunteer
foreign policy adviser Carter Page.
The FBI and Justice Department
protested that releasing the memo
would endanger both lives and
national security. President Trump
ordered it released, and the public
finally learned that the FBI had
used the opposition research
known as the Trump dossier as
part of its wiretap application. The
country -- and the investigation
-- survived.
Then there are the Michael
Flynn papers. On Jan. 24, 2017,
just four days into the Trump
administration, the FBI went to
the White House to interview
Flynn, ostensibly on the suspicion
that during the transition he might
have violated a never-enforced
law on U.S. contacts with foreign
officials. It was that interview
that led Flynn to plead guilty
to lying to the FBI. But Comey
told Congress the agents who
interviewed Flynn did not think
he lied to them. The public has no
idea what happened -- a situation
that could be remedied by release
of the write-up, known as a 302,
that the agents did immediately
after the interview. But the
Justice Department, along with
the special counsel, is steadfastly
There are also the Sally Yates
emails. Congress has asked for
emails to and from Yates, an
Obama appointee who played a
role in sending the FBI to question
Flynn. Even though Congress
limited its request to just 10 days
of emails, the Justice Department
said no.
Finally, there are the remaining
parts of the Carter Page wiretap
application. Some, but not all, of
it was released in the wake of the
Nunes memo. Now, Republicans
claim some critical information
is still being withheld. The public
has no way of knowing.
The need for the government
to stop reflexively classifying and
keeping secrets is especially acute
in a case like Trump-Russia, when
there is endless public debate over
every aspect of the case, and some
of the president’s adversaries
hope to use the affair to remove
him from office. Nothing could
be of greater public interest and
benefit than the release of more
But for the moment, too many
people are too set in their ways
to bring a culture of openness
to this politically charged affair.
That group can even include
journalists. Back in 1997, when
the Moynihan commission report
was released, The Washington
Post’s E.J. Dionne wrote: “A
journalist can win acclaim by
publishing a ‘secret report’ leaked
by a government official who
also benefits from the transaction.
But other citizens robbed by
secrecy of any knowledge beyond
what was leaked have no way
of judging what the published
account means.”
That was true in 1997. And it is
true today.
Byron York is chief political
correspondent for The Washington
Democrat McLeod-Skinner
sanitizing her message to voters
I have a number of friends who are far to the
left of left. At the behest of some of them I took
a look at Jamie McLeod-Skinner, Democratic
candidate for U.S. representative in the second
district of Oregon.
Under her gun safety values tab of her
website the candidate spelled out what she
would do if she could in regard to what she
described as military-grade weapons. She
would, if she could, require the confiscation of
millions of guns she or her language committee
deem military grade. She would, of course,
somehow compensate owners with our money.
She did hold out possibility of ownership if
stored at a gun range and the gun nuts pay
I pointed out I could not support this
Unsigned editorials are the opinion of the
East Oregonian editorial board. Other
columns, letters and cartoons on this page
express the opinions of the authors and
not necessarily that of the East Oregonian.
candidate, although it was refreshing to see
honesty as to her intentions. Soon after that the
tab was sanitized to a more “can’t we just all
get along and work together” message.
This says a few things to me. The candidate
has not a clue about 75 percent of the
constituents she hopes to represent. She is
no different than Greg Walden in that regard,
only she represents the left side of the state
and political spectrum. She is willing to make
criminals out of good law-abiding citizens for
exercising their constitutional rights. She is
willing to sacrifice important things like health
care for all to pander to her core support group.
And she covered up her deeply held belief in
the hope of winning.
I don’t tell anyone how to vote but I will
hold my nose and vote Walden on November 6.
Bruce Staley
The East Oregonian welcomes original letters of 400 words or less on public issues and public policies for publication in the
newspaper and on our website. The newspaper reserves the right to withhold letters that address concerns about individual
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Send letters to managing editor Daniel Wattenburger, 211 S.E. Byers Ave. Pendleton, OR 97801 or email editor@eastoregonian.com.