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Kick-start Oregon

The Oregon Legislature is chockablock with people of good intentions determined to create jobs and stimulate Oregon’s economy.

The Democratic brand of good intentions has been: the government borrowing money for government-decided spending. The Legislature passed Senate Bill 338, the “Go Oregon” state stimulus. It authorized $175 million in borrowing for repairs at schools, colleges, in transportation and to address deferred maintenance across the state. Gov. Ted Kulongoski has signed it into law.

We hope it works.

The Republican brand of good intentions is about cutting taxes. The idea is that a good jolt to the economy comes from Oregonians getting more money in their pockets and spending it how they want.

State Sen. Brian Boquist, R-Dallas, has proposed to cut the amount of state income tax withheld from Oregonians’ paychecks. Senate Bill 704 would cut by 4.2 percent the amount of tax to be deducted in each payroll period until July 2010. That would put about $100 million back in Oregonians’ paychecks over the time of the reduction. Every month, Oregon workers could decide what to do with their little extra.

It’s not without complications. The decrease in withholding could mean some Oregonians won’t get an expected tax refund or might have to send a bigger check to the Department of Revenue at tax time.

Republicans also advertise that the cost to the state of the withholding change is zero. They say that it would simply change the timing of when the state received its income tax revenue. But because the state would lose whatever interest it would have gained on withheld dollars, it would seem to cost the state something.

If you already started planning what to do with the little extra in your paycheck, strike that. In the Oregon House and Senate, Democrats have what state Sen. Ted Ferrioli, R-John Day, calls “a stomping majority.” What Republicans want doesn’t matter much. Despite all the cooing in campaigns about bipartisanship and working across the aisle, we can’t see Democrats doing anything with the Republican idea. The comfortable Democratic majority means they need not spare SB 704 a disapproving cluck, let alone a determined look at its merits.

That’s too bad.

Even President Barack Obama is trying something similar at the federal level with his Making Work Pay tax credit. Eligible workers will start seeing it in the form of lower federal withholding beginning April 1. It will provide $400 to individual workers or $800 to couples. The credit begins phasing out for those with incomes above $75,000 a year and for couples with incomes of more than $150,000.

Oregonians don't so much care about the brand of intentions. They want ideas that work. And unlike the “We Decide For You” state stimulus, the withholding change would mean all Oregon wage earners decide what’s best to do with their money.

— Wescom News Service


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