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About The independent. (Vernonia, Or.) 1986-current | View Entire Issue (Nov. 15, 2000)
Page 2 The INDEPENDENT, November 15, 2000 Delay in vote count doesn’t hurt U.S.; panic unneeded In spite of all the shouting, the predictions of a crip pled presidency, the accusations and fingerpointing by Dems and Reps, the impatience of the “important” me dia, and the erratic performance of Wall Street, the sky is not falling-honest. Let the count happen. There have been problems in completing the job, this isn’t uncommon, it’s just more exaggerated than usual because the turnout was heavy and the vote is closer than usual. The U.S. Constitution clearly delineates how voting is to be handled. As long as federal requirements have been met, the methodology is left up to the states. Oregon. New Mexico and, especially, Florida hâVS all had legitimate concerns about getting the count right, and they have all worked to do so. Now just let Florida finish the job. We shouldn’t stop them, in fact, no one outside the state should interfere whether we approve of their handling or not. The Electoral College won’t meet until mid December; why must they be forced to either rush the count or stop the count? There is plenty of time. Speaking of the Electoral College, the Constitution also specifies how a President will be chosen if there is no clear majority. Instead of trying to get rid of the Electoral College, we should appreciate that our founding fathers had foresight enough to realize that a deadlock can occur and that they developed a process that allows for stable government even when people’s thought processes are inflamed with partisanship. There have been presidents who did not win the popular vote— at least three. There have been presi dents who were compromises because of a dead locked Electoral College. As a nation, we have been through it before and, guess what? We survived. Be patient. It will be resolved and our government will not fall. ûTfRS y / mpe th e — NOTICE — C&. AUe CORE yfk It- 'tVc “^**K0Cr*^* To " 1 AM BOSH The** History needed to understand taxation Ed. note: Upon seeing an article about the effects of restructuring taxes on timber lands (in the Oct. 4, 2000, issue of The INDEPENDENT), Professor Emer itus Barney Dowdle of the College of Forest Re sources of the University of Washington, offered to explain the history behind the changes. Following is the article written by Professor Dowdle. The article, “Homeowners pay for reduced timber tax,” in the October 4 edition of The In- depndent provided much useful information on the impact of timber tax reform in Oregon. It pro vided little information, howeve, on the justifica tion for HB 3575, the legislation which initiated the reform. The fact that many of the reductions in tax payments benefit large forest land owners has led to widespread belief that a possible property tax inequity has been legislated against home- owners and other non-forest land property own ers. This information is meant to clarify possible misunderstandings on this issue. (In the inter ests of full disclosure, I should note that I devel oped the theoretical argument which underlies Oregon’s forest property tax reform.) Two issues underlie the confusion. First, the timber industry in Oregon and elsewhere in the West, has, in fact, been two distinctly different industries. It began as an extractive (mining) in dustry which was based on large inventories of naturally-endowed “old growth” timber. Subse quently, as old growth timber stands were de A devastating fire on Monday destroyed the home pleted and “second growth” timber stands were and belongings of a Vernonia family. A father, mother established on cut-over lands, the industry was and two little girls lost everything. The family is in need transformed into an agricultural (“tree farming”) of a place to stay, furniture, household items, clothing industry. The appropriate means for taxing property in - just about everything. an extractive industry is to tax income with a The relief effort is presently headquartered at the fire severance tax as income is received: Invento station. For more information about what is needed ries are exempt from taxation. (Analogous con and how to go about making donations, call Synda at cepts are “excise" and “yield” taxes, and Ore 503-429-4600, or 503-429-8252. Both of those lines gon’s “privilege” tax.) Property taxes in agricul ar needed for business so use them as quickly as pos tural industries are levied annually on land, the value of which is determined by the discounted sible. present value of net crop income. Maturing crops are inventories of goods-in-process and exempt from taxation. The second issue is that the reduction (“clear The INDEPENDENT is published on the first and ance sale") of excessively large old growth tim third Wednesdays of each month. There are five ber inventories, which took place throughout Wednesdays in November, so there will three weeks much of the 20th century, was, expectedly, ac companied by an upward trend in timber prices. between this issue and the first issue in December. This upward trend, which began about World Deadlines for the December 6,2000, issue will be War II, was more or less continuous for a period December 1 for news items and display advertising, of approximately 40 years. Timber prices, in cur and December 4 for classified ads. rent dollars, increased about 75-100 times, and Family loses everything in fire that destroys home ? tree farming became an economically viable in dustry. Prior to World War II, timber prices had been low and relatively stable, reflecting the existence of economically excessive timber inventories - cleared land was often worth more than tim bered land - and forest property was inequitably taxed with an annual property tax on both timber inventories and forest land. Tax payments on many forest properties, which were not produc ing income, were paid “out-of-pocket.” The coincidence of low prices and faulty tax policy created bleak expectations for invest ments in growing timber. Incentives existed to liquidate timber inventories and abandon cut over lands to escape inequitable and potentially confiscatory property taxes, and to avoid poor investments in growing timber. Nearly 1.5 million acres of cut-over private timberlands were abandoned in Oregon and Washington for these reasons. The approxi mately 900,000 acres of forest lands managed by the Oregon State Department of Forestry is part of this legacy. Paradoxically, many conclud ed that abandonment of privately-owned cut over lands provided evidence of market failure, and, therefore, justification for public ownership and management of forest lands. In fact, private land owners were reacting rationally to an irra tional and confiscatory forest property tax. The market didn’t fail; policy makers did, guided in part by faulty forest tax theory. When timber prices began their upward trend after World War II, the adverse effects of faulty tax policy were masked. Timber and forest land prices and profits rose even though the industry was paying inequitable and potentially confisca tory property taxes. Understandably, represen tatives of the timber industry were reluctant to lobby for tax reform, because of public percep tions that a profitable industry was merely seek ing a tax break. To open this debate was to risk getting something worse. The general public, which is benumbed by politicized debates over forest management and environmental issues, largely because of exten sive public ownership, is understandably poorly informed about forest taxation. At minimum, readers of The Independent should understand that HB 3575 didn’t give the timber industry a tax break. On the contrary, a tax inequity and a po tential economic land mine were eliminated. The State Legislature wisely invested in a tax reform which is consistent with the long run health and economic viability of one of Oregon’s most im portant industries.
