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Home arrow Opinion arrow Editorials arrow Tax deal: Where should the trickle start?

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Tax deal: Where should the trickle start?


We used to believe that Congressman Peter DeFazio, who represents Oregon’s 4th District, west of the Cascades, had a greater immunity than most politicians to the peculiar effects of long-term exposure to Washington, D.C.

Although we sometimes disagree with DeFazio’s positions, we admire his independence and his knack for slipping out of the powerful grip of dogmatic partisanship.

Then we read his recent op-ed in The Oregonian.

The subject was the tax deal that President Obama negotiated with Republicans earlier this month.

Actually we read DeFazio’s column a few times to make sure we hadn’t misunderstood him the first go-round.

But his message, as is his custom, is admirably clear.

Not so admirable, though, are DeFazio’s reliance on tired platitudes about the unfairness of America’s progressive federal income tax system, and his inconsistent stance on the efficacy of using public dollars to roust the slumbering economy.

DeFazio describes the tax deal, which prevents federal income tax rates from increasing for all brackets on Jan. 1, as a “financial disaster for 98 percent of the American people.”

He also accuses Republicans of “hold(ing) the middle class and unemployed Americans hostage until the millionaires and billionaires get their ransom.”

Now we understand that exaggeration is a favorite arrow in most politicians’ quivers.

But we’re confident that the vast majority of those 98 percent of Americans to whom DeFazio referred, on learning that, thanks to the tax deal, their paychecks will not get smaller when 2011 debuts, would not call the situation a “financial disaster.”

Nor will they think of themselves as hostages.

The plight of the 98 percent is not the crux of this matter, of course.

It’s the 2 percent — those millionaires and billionaires — that DeFazio is so worked up about.

Continuing the Bush tax cuts for that tiny minority, by DeFazio’s reckoning, constitutes “needless generosity.”

(Why it’s not also a financial disaster, considering the 2 percent is getting the same basic deal as the 98 percent, the congressman does not say.)

Although we’re troubled that DeFazio thinks the government’s setting of income tax rates is a form of generosity, we also concede his point.

The wealthiest 2 percent of Americans don’t “need” their tax rate to stay steady, in the conventional sense of that word. They can afford to pay more.

The salient question, though, is whether the 98 percent will fare better or worse as a result of Obama’s and the GOP’s “needless generosity.”

“Worse” is DeFazio’s answer.

But the case he lays out in his op-ed is flimsy at best.

He raises the specter that the tax deal will render Social Security vulnerable to “the attacks of privatization advocates,” yet his evidence consists largely of his own predictions about what Republicans will do a year from now.

DeFazio larded his column with a few predictable cliches as well, claiming, for instance, that Obama was “outmaneuvered by Republican devotees of the trickle-down-at-all-cost economic theory.

But here’s the thing: DeFazio’s proposal relies just as much on the notion of money trickling downhill.

The key difference is that DeFazio thinks the trickling should start, as it were, from the top of the Capitol dome.

The way to revive the flagging economy, he writes, is to make “significant investments in our crumbling infrastructure (which) will create tens of thousands of living-wage American jobs and produce tangible benefits for future generations.”

Another federal stimulus, in other words.

Trouble is, Congressman, we already tried that, $730 billion worth, and it has proved not to be anything like the tonic we were led to expect.

Besides which, you voted against that stimulus bill in February 2009. What part of its failure convinced you to reverse your position?

By contrast, Obama, along with a majority of DeFazio’s colleagues in the capital, has concluded that the better option now is to leave more money in the private sector.

Lacking DeFazio’s claimed prescience, we can’t say whether this strategy will benefit the economy any more than siphoning more dollars to the federal government would, or passing the stimulus package did.

We do know, thanks to the U.S. Census Bureau, that just 19 percent of Baker County’s workforce is employed by a government agency (including state and local levels as well as the feds).

Which means most workers in this county draw a paycheck from private rather than public accounts.

Given those statistics, we’d rather that local private employers continue to keep more of their earnings. This includes small businesses whose owners’ incomes put them in the 98 percent category — DeFazio’s purported “hostages” — as well as big companies such as Ash Grove Cement, Behlen and Marvin Wood Products, whose management teams no doubt include some who belong to that 2 percent club.

Let’s ensure that these employers, the heart of our local economy, are healthy before tackling the ticklish matter of whether they’re also being “generous” enough to the federal government.

Returning to DeFazio’s castigation of GOP trickle-down theory, think of it this way:

When it comes to trickles of money, we think we’re more likely around here to catch a refreshing shower if the dollars flow into private rather than public channels.

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