Editorial: No future in state stimulus

Editorial, The Bend Bulletin
March 16, 2010

State officials branded the Oregon Legislature’s Go Oregon stimulus a resounding success. They say the 2009 program “created or retained” 7,500 jobs when the state economy needed it.

But what did Oregon get $93 million later? On Saturday, The Oregonian took a closer look. Here’s how that newspaper summarized its key findings:

– Average length of a Go Oregon job was about two weeks.
– Everyone working on a Go Oregon project was counted as a job, even those who were already employed and in no danger of being laid off.
– One out of four Go Oregon workers was from out of state.
– Counties with high unemployment got a smaller share of the money.”
How are Oregonians supposed to trust politicians that count to 7,500 like that? The Oregonian’s analysis also highlighted some eyebrow-raisers among the Go Oregon projects. Our favorite has to be spending $47,000 on a new roof for a vacant state transportation building in Clackamas County.

That’s really going to propel Oregon’s economy forward.

Of course, there are arguments to be made in favor of state stimulus spending. Recessions are caused in part by a decline in demand. Go Oregon played a role in stimulating demand. It did put paychecks in people’s pockets, however briefly. Remember, Oregon was nearly tops in national unemployment in 2009. Nobody would expect the Legislature to try nothing.

The question is: Was the Go Oregon stimulus the best something?

The Legislature could have chosen to spend the money in ways much more likely to stimulate the economy over the long term. It could have stimulated investment through an investment tax credit on new machinery and equipment. Business investment has been crippled in this recession. Revenues are bad enough and most credit dried up. The amount of the credits could have been capped at the same $176 million the Legislature planned for stimulus spending.

It’s common sense that stimulus based on investment is better for Oregon’s economy than stimulus based on consumption. State government picking which government building gets a new roof or a new coat of paint gets us as far as it did. It doesn’t build for Oregon’s future.

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  • John Fairplay

    But investment tax credits end up stimulating private sector jobs, which is not why the Legislature exists. The projects the Oregonian complains so bitterly about took money from the private sector and funneled it into the pockets of government employee union members and others and wasted it at “prevailing wages.” *That* is why the Legislature exists.

  • valley p

    “Our favorite has to be spending $47,000 on a new roof for a vacant state transportation building in Clackamas County.”

    That vacant building is I believe on the historic register. It is a CCC era stone and timber building. Allowing water to leak in and ruin the wood interior would have caused a huge loss of value to taxpayers. A “conservative” should want to conserve things of value that cannot be replaced. A new roof, regardless of the other merits or demerits of this program, was money well spent.

    • Steve Plunk

      The loss to the taxpayers is that this vacant building hasn’t already been sold. Why should the state be maintaining a building it doesn’t need? Don’t mix up political conservatism with building conservation, two different things. The other question I would have is why $47,000 to put a roof on? Seems a bit high but government jobs always cost more.

      • valley p

        a) its a lot harder to sell or reuse a building with a water damaged interior
        b) Its a pretty large, steep roofed building and may have a shake roof.
        c) government jobs often do cost more, but they also go to the lowest bidder.

        • eagle eye

          Please, such subtleties are unnecessary and anyhow they’re beyond the comprehension of our state’s business sages!

          • Steve Plunk

            Ha ha. State’s business sages. How many people do I employ? How much money do I bring to this state? How about addressing my point? Why is the state keeping a vacant building that’s costing them money? Sell it and let the new owners take care of it. With the financial difficulties the government is facing why is saving money so hard to understand?

            I would say government jobs cost more because of expensive and often unnecessary designs and design standards. Spending other people’s money leads to that.

          • valley p

            “How many people do I employ? How much money do I bring to this state?”

            I don’t know. You tell us. I also don’t know why the state keeps this particular building. Maybe it is presently uninhabitable and needs upgrades for health and safety reasons. Maybe, in the worst real estate recession since the 1930s, it would be dumb to try and sell it given the tanked market. Maybe they just haven’t gotten around to selling it yet. I don’t know and neither do you. But any way you look at it, leaving it with a leaky roof would probably have been the dumbest decision business-wise.

            Expensive design standards? I’ve yet to see a government building with granite counter tops and $500 faucets. But there are a lot of foreclosed on homes with these and other amenities that the private owners or builders apparently could not afford. Spending ones own money to keep up with the Jonses leads to that.

          • Steve Plunk

            valley p, Eagle insulted me without knowledge and deserved a retort. It seems to be his stock in trade these days.

            You’re kind of doing something similar, speaking about what ifs and maybe’s regarding this building. Basing your argument on speculation is risky. My point is the editorial was not off base questioning (the job of journalists) this expenditure. If the roof leaks it should have been scheduled for repair under the maintenance budget.

            $500 faucets? No, but aren’t those people who buy those using their own money? The state is using other people’s money to buy without consequence. I recall our library here in Jackson county was built with bronze doors and expensive stone work only to be closed for lack of operating funds. Bureaucrats just don’t think right.

          • eagle eye

            Sorry, but anyone who doesn’t understand that different buildings have roofs that might cost different amounts is a prime target for a little mockery. Especially someone who is as nasty to a lot of different people as you. For instance, you couldn’t resist your little dig about government jobs, could you?

            The roof on my own modest-size (but for Oregon, high quality) house is a good example, by the way. It cost $17,000 in today’s money. I got the best possible roofing materials, but because of the need for scaffolding, it cost way more than I was expecting. I gagged, but had no choice but to pay. Maybe it’s all the lousy private contractors we have in Lane County — a lot of great business sages here, too.

          • Steve Plunk

            I understand that different roofs cost different amounts and wondered aloud if $47,000 was too high. That was deserving of an insult? You know nothing about me and what criticism I give I give in a area reserved for public policy debate. You know, the appropriate place for such criticism. Criticism of the government is fair game while criticism of individuals unknown seems misplaced. It’s not the first time you’ve gotten personal with but I expect that’s my fault for being brave enough to post in my own name. Nasty? That is completely wrong, I’m quite nice and respectful. If you don’t believe that let me buy you a beer next time you’re in Medford.

          • valley p

            You are correct I am assuming some what ifs. I’m pretty sure I know which building is in question because I used to live near it, have done consulting work for ODOT, and a number of years ago had a meeting in that building. It is a visual landmark, like a mini Timberline Lodge. But it is in a bad location off of a semi freeway with indirect access. It is set amidst used car lots and tacky motels. I can see where this building would be difficult to unload. Economically the state is probably better off demolishing it, but it is an architectural gem so they probably can’t bring themselves to that. If it were in Silver Falls State Park it would be treasured.

            I think it used to be the regional headquarters for ODOT, but when they moved to downtown Portland they vacated it.

            Here is our philosophical difference. You say that when the state spends money on a facility, like a roof for a building owned by the state, they are spending “other people’s money.” I disagree. When we send them our money as taxes, it becomes State money It isn’t ours any more. If you doubt that, try and write a check on your account after you have paid your taxes. (And if you think you own the building, not the state, then try moving in and see what happens).

            When the state spends the money it receives in the form of taxes, we probably agree that it ought to be spent as wisely and well as possible. I may be a liberal, but I’m not naive. I used to work for government (still do when I teach at state universities) and I know there is waste and spending that is worth questioning. State workers are human, they sometimes goof up, sometimes are indifferent or sloppy. In this particular case, if it is the building I think it is, putting a new roof on at a cost of $47,000 seems like a most reasonable expenditure. That was the only point I was really trying to make in my initial post. Just because some (public) money may be spent badly does not mean all money is spent badly. Don’t always assume the worst.

  • retired UO science prof

    So much fun here, and the weekend’s just starting. The plunk, the eye, and the person, battling wits as usual. So many great ideas here! I wish I was up to that level. Me just the old perfesser spending some of the money formerly known as the taxpayers’ until it went into my 401k, to the consternation of many. Hey, I’m on my way to Grants Pass, maybe I’ll run into the “sage” of Medford — that’s for you, eagle — and find out why roofs are so much cheaper in southern Oregon!

    • valley

      Because it rains less down there. Most of the year you wouldn’t even need a roof. Have a great trip.

  • retired UO science prof

    Do they at least have outdoor pluming? Some places in Lane County don’t.

    • valley p

      There are definitely some back woods places that lack plumbing. I was once on the board of directors of a former S, Oregon commune. Very primitive but unarmed people.

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