Saturday, December 7, 2013 at 10:06AM
Why is Governor Kitzhaber, who claims to be an environmentalist, giving tax dollars and brakes to a corporation that emits greenhouse gases and lies for 30 years about fluoride emissions?
Governor John Kitzhaber just signed a deal with Intel granting them a 30 year reprieve from higher taxes following the Nike deal precedent in the November 2012 special session.
Like the Nike deal it was done behind closed doors although enabled by legislation passed in the last days of the 2013 session which prevented any serious debate. So much for Oregon's tradition of open government!
Kitzhaber has decided to run for a 4th term. Now whom do you think he'll go to first to build his campaign war chest. As they say - "follow the money." Knock knock, who's there - Nike and Intel?
We now know how Kitz defines tax reform - "give aways" to corporate Oregon on the dubious promise of job creation.
Now that Nike and Intel have been given a "30 year no new tax" pledge who's next, Tektronics, Columbia Sportswear, Precision Cast Parts? This is classic corporate liberalism in the Puzzle Palace in Salem. This line of thinking began with Bill Clinton back in '92 when he veered to the right as a so-called "centrist" New Dem. The theory is that we grow the economy by stimulating the private sector with government incentives.
Clinton also de-regulated Wall Street - boy did that work out for us all!
In the 1950s personal and corporate income was taxed on a steep graduated basis. We had the largest and broadest economic expansion in US history with a robust middle class. Government also primed the pump with the GI bill and building the federal highway system. Ever since Reaganomics became the fashion, thanks to Oregon's own Bob Packwood, the idea of tax fairness has gone out the window to be replaced by "trickle down" economics.
According to the unOregonian article - "Intel already receives tax breaks well in excess of what any other Oregon business enjoys. Its current SIP [Strategic Investment Program] tax breaks exempt up to $25 billion in Intel equipment from the property taxes that other businesses pay. SIP tax breaks have saved Intel more than $500 million since 2001, according to Washington County officials."
With $500 million in local taxes over the past 11 years at $45 million per year - how many more teachers could have been hired, how many homeless families could have been saved from the streets?
Greed has replaced fairness. The theory of "trickle down" economics presumes that lowered tax burdens stimulate growth in the private sector and with that tax revenue. If we've learned anything from the Great Recession we know this is a totally bogus theory. But corporate Ds like Kitzhaber have embraced a version of the theory as long as it's tied to questionable promises of job creation.
Intel's claim that they will create 500 jobs with this deal is also bogus since that promise was made under a previous SIP deal which is helping fund the DIX project in Orenco. They are double counting aka "statistics, lies and damn lies."
As Obama noted last week, in the '90s the US has seen the largest transfer of wealth from the middle class to the top 1% largely because of this theory.
In Intel's and Nike's cases, they are already heavily invested in Oregon - they are going nowhere fast. Unlike Boeing in Seattle this "shake down" of Kitz is minus any serious threat they will leave Oregon. Boeing's headquarters are in Chicago not Seattle. They've had major plants in other states for years. However stupid, walking away from Seattle is not walking away from billions in new investments.
But Nike and Intel have shown corporate Oregon how they can play their "Al Capone" card. Just hint at leaving and Kitz will play Guv "step and fetch it"...
This is especially outrageous because Intel is also a "major source" polluter and as noted above is a recipient of millions of taxpayer assistance through the state's SIP program which shelters their income and property tax burden. Of course this "tax shifting" means you and I will pay more in local property taxes to support schools and other local government entities which provide services to business and residents.
The next time you get your property tax bill ask yourself how much does Intel or Nike contribute to funding local roads, schools, libraries and vital infrastructure. Answer virtually NOTHING thanks to "Honest John" Kitzhaber.
Last but not least - in my testimony against the Nike deal I said this was a bad precedent and that other corporations would expect a similar deal. Sadly I was clairvoyant. And the Oregon taxpayer gets the short end of the stick again!