Taxing the Rich and Restoring Services for the Public Good: A Victory in Oregon

BUZZFLASH GUEST COMMENTARY
by Lawrence S. Wittner

       Decades ago, rightwingers began championing cuts in income taxes for
the rich and -- when that lowered government revenue -- turned around
and claimed that government could no longer "afford" to maintain vital
public services like education and healthcare.  Unfortunately, in an
effort to curry favor with the wealthy and their corporations, many
state and national office-holders began to adopt the rightwing's
tax-cutting model.  In New York State, the tax rate for top income
earners was reduced from over 15 percent to less than half that
amount.  On the federal level, it plummeted from 91 percent (in the
early 1960s) to 35 percent (today).  As a result of such policies --
and of rising expenditures on the military -- there was a lot less
government revenue left for public services, and they were slashed
accordingly.

       Of course, in these circumstances, there was plenty of money -- in
fact, more than ever before -- in the pockets and vast bank accounts
of the wealthy and their corporations.  Furthermore, unlike most of
the population, the wealthy generally didn't regret the decline of
public schools, public hospitals, public law enforcement, or public
parks.  After all, they sent their children to expensive private
schools and colleges, utilized private healthcare, resided in secure,
wealthy neighborhoods, and vacationed in exclusive hotels and resorts.
Why worry about the adequacy of the government's stamp program if the
only time they experienced hunger was when the service was slow in
their favorite French restaurant?

       To help reverse the erosion of public services, unions and other
social justice organizations have turned increasingly to a
tax-the-rich approach.  A good example of this occurred in Oregon on
January 26, when voters passed two ballot measures that raised taxes
on the wealthiest 3 percent of that state's residents and on the most
lucrative businesses in the state.

       These ballot measures developed in the context of a severe state
budgetary crisis, which left Oregon on the verge of freezing salaries
for public employees, making deep cuts in spending on education, and
ending forest protection rules.  Taking the offensive, public employee
unions, community groups, and progressive businesses developed a
grassroots campaign to pass the two ballot measures, which were
designed to safeguard $1 billion in public services while not raising
taxes on the vast majority of the population or, for that matter, on
93 percent of small business owners.  They pointed out that the rich
had grown much richer thanks to conservative policies and that the
state's minimum tax paid by most corporations stood at only $10 a
year!

       Not surprisingly, corporate leaders and their supporters fought back
ferociously.  A coalition of business organizations spent millions of
dollars, donated by the banking industry and wealthy entrepreneurs
such as Nike's Phil Knight, to inundate the airwaves with ads
proclaiming that a tax raise for the wealthiest individuals and
businesses would destroy jobs and the state's economy.  Although polls
found that the ballot measures were popular, it seemed quite possible
that business groups and the wealthy would prevail.  For years, the
state's voters had rejected propositions for tax increases, and they
had not supported raising income taxes since the 1930s.

       Nevertheless, in the end, Oregon's voters backed both tax-the-rich
ballot propositions by roughly 54 to 46 percent.

       Doug Hall, the director of the Economic Analysis and Research Network
at the Economic Policy Institute, declared:  "The people had an
opportunity to weigh the relative merits of draconian budget cuts
versus strategic revenue increases, and they have decided to support
the revenue increases.  I think that sends a powerful message to the
rest of the country."

       It certainly should.  The passage of the Oregon ballot propositions
is one more indication that -- despite the televised ranting of
rightwing demagogues -- most people believe that the vast wealth in
the hands of individuals and corporations should be drawn upon to
promote the public welfare.

*     *     *

Lawrence Wittner is Professor of History at the State University of
New York/Albany.  His latest book is Confronting the Bomb: A Short
History of the World Nuclear Disarmament Movement (Stanford University
Press).

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