Lars Larson on How Not to Fix Oregon’s Economic Problems

“Another day older and deeper in debt” is no way to solve Oregon’s job problems. The state has 9.7 billion in bonded debt and a state budget a billion in the red. The so-called stimulus passed by the Legislature in theory creates 3,000 new jobs. That’s ½ of 1% of the number of unemployed Oregons. That won’t even move the needle.

Here’s an idea. Cut taxes on businesses and workers to make Oregon attractive again. Boost logging on state lands. Cut regulations that hold business back. Drill for natural gas. Build some of those safe nuke plants that OSU has developed.

In short, get government out of the way and the economy will fix itself.

FDR’s higher taxes and government spending did not fix the Great Depression. They made it longer. Kulongoski’s borrow and spend threatens to do the very same thing today.

“For more Lars click here”

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Posted by at 09:00 | Posted in Measure 37 | 30 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Jerry

    You are absolutely correct – get out of the way and the economy will do fine. However, what most fail to understand is that the Dems WANT hard times so they can come to the rescue with phony government programs that allow them more control. Dems want misery and victims. Trust me on that.
    Nothing like what you propose will ever happen in Oregon or anywhere else that the Dems control. NEVER.
    They would not know what to do if the economy was fine.
    It is sad, but most definitely true.

  • Reason

    The Oregon state legislature has voted to stymie the Federal stimulus plan. The benefits of this plan will never reach the people who were supposed to get it.

    Is this what they voted for? Did they want Oregon to hijack the funds prior to the people recieving them?

    What good is this stimulus for this state now?

    Please read the following:

    Oregon Legislature Stops Stimulus Package from Helping Unemployed Oregonians and Struggling Small Businesses

    The bill will keep Oregonians from taking advantage of tax relief in the federal stimulus package and in effect increase taxes on small businesses and unemployed Oregonians

    Salem, OR – Democrats in the Oregon Legislature made sure that any tax savings the federal government provides through the $800 billion dollar stimulus package will not end up in the pockets of unemployed Oregonians and Oregon’s small businesses.

    “At a time when unemployed Oregonians need help and Oregon’s small businesses need a break, why Oregon Democrats rushed through legislation that will force Oregon families and businesses to pay $96 million more in taxes is beyond me,” said Bob Tiernan, Chairman of the Oregon Republican Party.

    House Bill 2157, passed yesterday on a 17-13 vote, disconnects the state from the federal tax code, a technical maneuver that eliminates the effect of federal tax relief for businesses and families in Oregon. The bill stops the stimulus package from taking effect in Oregon.

  • Steve Plunk

    Business confidence is getting lower by the day. Without confidence that we can make money why would any business invest in equipment or employees? It becomes a self fulfilling prophecy.

    So the Democrat controlled legislature has proven it’s inability to understand not only economics but how the common man thinks. Higher taxes and fees will continue to distress all of us and delay any recovery.

    The proposed hike in beer taxes illustrates why business fears it’s government. That 1,900% increase could ruin some businesses and certainly endanger many more. Is that the prudent thing to do? Actively undermine the productive class who create jobs and security for all Oregonians? What are the fools in the legislature thinking?

    • eagle eye

      “So the Democrat controlled legislature has proven it’s inability to understand not only economics but how the common man thinks.”

      Who exactly elected this legislature?

      • Steve Plunk

        Eagle,

        The people of Oregon elected them based upon promises made during the campaigns. I doubt a 1,900% tax increase on beer was one of those promises. In fact I doubt a single Democrat promised to raise any taxes if elected. We should never underestimate the ability of politicians to fool the electorate.

        • eagle eye

          If you’re right, I’m sure the Democrats will get cleaned out in the very next election.

      • jim karlock

        Portland’s progressives aided by Bradbury’s redistricting.

        If you think this is bad wait until those nuts pass a cap an trade on energy, where you will have to get government permits to use fossil fuel. The supply of permits will be choked off, to reduce carbon, letting the price rise to whatever price will do the job.
        See SustainableOregon.com

        Thanks
        JK

    • Sybella

      They have also done it with the tobacco tax. I purchase Roll your own tobacco for resale. A 1# bag cost the store $8.60 which includes the current federal tobacco tax of $1.0969. Oregon then taxes that at 65% which comes to an additional $5.59, bringing our cost to $14.19. We then sell for a little over $2.00 profit. April 1 the federal government added an additional $23.53 per pound. that will bring the cost of an $8.60 bag of tobacco to $33.38 which will have an additional $21.70 added to that for the state of Oregon. That will bring the cost of that $8.60 bag of tobacco to $55.08. It doesn’t take a rocket scientist to see that sales will tank. Meaning between the federal government and the state government they will lose $46.48 in revenue. Not only will it cost me and ultimately my employees, because I certainly won’t need as many. I can tell you thought the black market is going to prosper.

      One of the states back east has added an additional tax on pop because there are too many fat people. Now Oregon wants to add more to the price of beer because there are too many that drink.

      No wonder business if leaving Oregon. I’m just wondering if some of the people will stand up and be heard when they start adding a large tax to your latte’s because it’s also very fattening and also caffeine just isn’t good for you.

      It’s time to get the greed out of our politicians or better yet, get rid of the politicians who certainly don’t really care about us.

  • I can be anonymous 2

    Lars….economics is not your strong suit.

    Cutting taxes would also cut the number of state employees, teachers, and contractors who work on state projects. That would help “move the needle” on unemployment in the wrong direction.

    Boost logging on state lands. In case you have not noticed, there are plenty of trees going unharvested across the state on pulbic and private land ecause there is NO DEMAND because the housing industry sort of died. I’m sure you must have read about this somewhere. Doug fir is at its lowest price per 1000 board feet in nearly 20 years. Alder just plunged from $800 per thousand to $300 almost overnight. We could just give our state trees away I suppose, like the Feds do in Alaska.

    Cut regulations? Sure. Which ones. The ones that prevent air or water pollution? The ones that insure worker or consumer safety? Be specific.

    Drill for natural gas? Um….where?

    Build “safe nuke plants?” Sure. You raise the many billions in capital costs and be my guest. Note that the federal stimulus bill xed out subsidies for new nukes. Note…new nukes need subsidies. Big ones. Especially unproven new technologies.

    • Steve Plunk

      Good questions. I would bet Lars actually has answers to those but he also understands he can’t explain all of the details here.

      I recall the legislature recently passed an increase in registration and title fees to finance what ODOT calls OTIA. A rebuild of bridges throughout Oregon.

      What stimulus did that get us? Little if any. There are half finished projects up and down I-5 and other Oregon highways. These projects employ few and accomplish nothing. There is a specific project in southern Oregon that illustrates the wasteful nature of this and other government programs. A rebuild of a highway bridge that services a small country road with an easy alternate route. This project has been going for over a year and will last longer. This is simply wasted money.

      No one is asking government to anything other than get out of the way. It is an impediment to our progress and prosperity.

      • There is NO ‘E-Verify’ in the Stimulus sooooo……

        I would be absolutely suprised if you DO see those Roads & Bridges being built or refurbished or finished, employing a Single-Unemployed Legal American Citizens.
        Here in Far-Northern California, I have seen, just in the past few days, NEW and FRESH Illegals being dumped off at 5 in the Morning at 7-11 by the Van Load.
        They are RETURNING, after they went “back” to where they were from
        According to Napolitano, just last week. The amount of “Illegal Immigrants” “returning” to their countries of origin, has “Increased” with our “Recession”. And, Napolitano said that “many” have returned to “Mexico”.
        Now, with them SMELLNG OUT that fact that the Democrat Senate EXCLUDED, Eliminated, Removed, and Extracted the ‘E-Verify’ that WAS in the Original House Version, they are Returning.
        And they will take ALL those jobs.
        Leaving the Unemployed out in the cold, of Legal Citizens.
        These Illegals can Underbid all of the Legal Citizens, because they have a 2nd Income, thru Welfare for the Women and Children.
        They have Food Stamps, HUD-Section 8 Housing Choice Vouchers, MediCAL, MediCAID, Low Income Heating & Air Conditioning assistance all being INCREASED I might add via the Stimulus bill being signed into Law on Tuesday.
        That means that if the jobs are paying $15.00 an hour, the Illegal can say, they will work for $10.00, and THEY DO!
        Here in California, they take ALL of the Construction jobs, ALL of them.
        It will come your way as well.
        You will SEE them all working at ALL of the ‘Stimulus’ Construction jobs. ALL of them.
        I have not seen a non-illegal doing Construction at ALL Construction sites for the past 20 years of my life.
        Oh, and I’m half Hispanic and grew up in Los Angeles, so I know why the Hispanic Radio Stations are Celebrating right now, as well as Hispanic Chats and Forums, all celebrating CONSTRUCTION, Goverment jobs.
        They will Legally be allowed to apply and qualify for these ‘Stimulus’ Construction jobs.
        This all came about when Obama’s Economic Advisor, Robert Reich a Professor from Berkley University, said he does not want any “white males” allowed to get any of the ‘Stimulus’ Construction Jobs, and it worked! He got what he wanted!
        Wake up people, your going to get ground into the dirt further and further if you keep on this fantacy land thinking of a wonderful Social ‘Entitlement’ Program Candy Land.
        And, Affirmative Action will boot your Caucasian Booty right out of your Higher Educated positions, mark my word, it happened in California and it’s heading straight up your way as well!
        Just go ahead and keep on keeping on towards your big Mastern Degrees for your Big Jobs, and you will NOT get them, because of your race!
        Remember I tried to warn you!

    • Jerry

      The best possible thing for Oregon would be fewer teachers and fewer state workers.

      • eagle eye

        Yes, Jerry, with no teachers, all the kids could grow up to be like you!

      • Teacher

        So, making me unemployed would help the economy? Explain that to me and my students when you aren’t sitting on the sidelines making snide assertions and complaining about things you know nothing about.

  • mac mccown

    hey lars when you state “FDR’s higher taxes and government spending did not fix the Great Depression. ” you are disagreeing with the nobel winning economist Paul Krugman. whom am i to believe? a not ready for prime time bloviator or a world renown economist? ah lars, the revisionism of the gop and the right about the great depression sounds so pathetic and whiney … give it up.

    • jim karlock

      I suspect he agrees more with, Nobel prize winner, Milton Freedman.

      Thanks
      JK

    • Don’t matter no more what some Paul Krugman said…….

      What really matters NOW is what will work and what will NOT!
      Not what some dude said with a big butt award!
      Understant Dim Sum-Dim Dumb?
      The proof will be in the puddin’ Dim Dumb!

    • Fred Thompson

      Krugman never said higher taxes fixed the depression. What he said is that higher federal spending helped fix the depression. But as Historian observes below, “economists generally agree that the Great Depression did not end until 1939, when the country began preparing for World War II. Unemployment rates, which reached as high as 25%, took several years to recover and did not get below 9% until 1940.” Most, economist also believe the major failure of the New Deal was that it didn’t increase deficits fast enough, soon enough, spending went up too slowly and taxes went up too fast.

  • eagle eye

    With all these great ideas, Lars should be running for Governor! Or better yet, get an experienced hand like Bill Sizemore to do it. A winning formula for sure!

    • eagle eye

      mac — Nobody but the diehard right any longer believes stuff like

      “get government out of the way and the economy will fix itself.”

      And you’re right about FDR and the depression — the diehard right has been running against FDR since last year, before the financial crisis. They must have had a bizarre ability to foresee the future i.e. that their guys were going to bring us to the brink of the economic abyss. That they’re still running against FDR shows that they are intent on political suicide.

      You don’t have to think that everything about the New Deal was great to see that being obsessed with it now is a formula for political death.

      • jim karlock

        You seem to forget that DEMOCRATS Barny Frank and others IGNORED Greenspan’s warnings against loosening mortgage lending rules.

        The Ds won and we lost.

        Thanks
        JK

        • I remember that Video Jim!

          Oh yes in deedy I remember that You Tube video of the Republicans going to Barney Frank, Maxine Waters and I believe it was Raines, telling and warning of the extreme need for investigation and oversight into the fact that millions upon millions of dollars were being “extracted” from Fannie and Freddie, as well as the implosive Bad Mortgage Loans being handed out like Candygrams!
          It’s still available on You Tube, that video!
          It’s still evidence that the DemoGRANTS are to blame for the 2 years they were robbing the Fannie and Freddie and gripped about it being “racist” to try and say that the “funds were disappearing” from Fannie and Freddie.
          The Video also is on ‘hotair.com’ with all the Transcript of the conversations.
          The ‘Pig Book’ that’s put out every single year shows how much each DemoGRANT recieved in Fannie And Freddie FUNDS, and number one was Chris Dodd, then John Kerry and then Barack Obama, along with Barney Frank and you can read it for yourselves, there’s no denying it!
          So don’t anyone play Baby Games like the Republicans did not go and that there’s no record of the warning, it’s all there Dim-Dum Dim-Sums!

        • eagle eye

          You are right about Frank, there is a good deal of blame to go around.

          On the other hand, Greenspan seems pretty chastened in his belief in the unfettered market.

          And look what you wrote, about Greenspan’s “warmings against loosening mortgage lending RULES”. That does not sound like a call to “get government out of the way” so “the economy will fix itself”.

          For myself, I think the unregulated or badly regulated financial instruments (cdo’s and cds’s), the lousy work by the rating agencies are at least as much to blame.

          I believe there are instabilities in the economy that are very poorly understood. I don’t believe that the “invisible hand” will take care of everything, that is just an 18th century hypothesis.

          I don’t believe that ANY economists really understand economics — not Milton Friedman, not Hayek, not Krugman, not Keynes.

          For one thing, if they really knew what they were talking about, they wouldn’t disagree so violently.

          For another thing, if they really understood the state of their “science”, they would admit that there is a great deal of vital stuff that they don’t understand at all.

          It was true back in the great depression, and it’s still true.

  • Historian

    Krugman is only making a best guess, just as anyone can do.

    But today’s liberals (Democrats) are completely disconnected from everything but massive spending and government growth.
    https://money.cnn.com/2009/02/10/news/economy/yang_newdeal.fortune/?postversion=2009021106

    “Roosevelt’s programs were first passed in 1933 but economists generally agree that the Great Depression did not end until 1939, when the country began preparing for World War II. Unemployment rates, which reached as high as 25%, took several years to recover and did not get below 9% until 1940.

    Critics say the New Deal failed because some of the government’s actions suppressed competition, slowing the economy’s ability to rebound. A central culprit was the National Recovery Administration (NRA), from 1933. The goal of the NRA was to lift wages for workers. But to do this, it encouraged industry leaders to meet and establish minimum prices and wages, effectively creating cartels. The result was wholesale prices rising 23 percent in two years.

    It’s hard to find anyone now who will defend the NRA, which academics agree was a bad program because it stifled competition. It was obvious to people even then that the NRA was seriously flawed; in 1935, the Supreme Court ruled the program unconstitutional.
    The biggest thing we have in common, perhaps, is that like Roosevelt, we can only take our best guess at what will work. And hopefully, the cure this time will take hold faster.”

  • Rick Hickey

    Mr. Milton Friedman is also the expert who said you cannot have massive immigration of unskilled peoples who qualify for welfare and other social services and a capitolistic state at the same time, it’s never been done and it won’t work, hello?

    I’ve been whining about this for years and here we are X Trillion more in debt and blindly ignoring the Proof California is providing in that this is not cheap labor and it is making us a Socialist nation.

    Economic Experts – Milton Friedman, Harvard Prof. Howard Borjas and former Grace commission leader Edwin Rubenstein, have all been saying this for years.

    Yet our Borders are still wide open on top of the 138,000 Legal immigrants coming here every month that will work for less than you and tax free.

    Too many of you ignore this fact at our own peril.

    • eagle eye

      I think some people on the right e.g. the Wall St. Journal types have been hoping that unrestricted immigration would make the welfare state unviable, hastening its destruction by the will of the citizenry.

      Whereas what is happening is that the citizenry is being transformed, with the result that it may be capitalism that is going to be jettisoned.

  • anonymous 2

    The “New Deal did not work” meme is going strong amongst the crazy right. Only reality is as usual different. After Roosevelt took office and initiated his New Deal, the national GDP grew at an average of 9% per year his first term. He then erred by balancing the budget and the nation had a short recession in 37-38. he went back into spending mode and the economy grew by 11% a year until WW2.

    Unemployment stayed high. But it was 253 when Roosevelt took office, declined to 16.5% at the end of his first term, then went back up to 19% during the 37-38 recession, then declined to 14.6% in 1940. By 42 it had dropped to 4.7%, due to ramped up war spending and military recruitment.

    Roosevelt did not “end’ the depression” with the New Deal. But he did re-start economic growth and reduced unemployment a lot, even before the war.

    • anonymous 2

      253 was supposed to be 23%.

  • Nuls illigitmus carborundum

    The issue should be AIRED simultaneously in prime time on the ALPHABET NETWORKS, PUBLIC TV and NPR…who’res, alas, bent on propagandizing US to the enth decree from what’s Left of America vaunting $ocialism in a way that’s fi$cally unacceptable…’sides being secular New World Order balderdash.

  • Anonymous

    Reagan cut taxes for rich folks in 1981. What happened to the economy? Unemployment went up, and was higher in all of Reagan’s first term than during Carter’s term.

    Bush cut taxes for rich folks in 2001, and, again, unemployment went up.

    Clinton raised taxes for rich people in 1993, and unemployment declined every year he was in office.

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