Wednesday, January 27, 2010

Reporter's Notebook

Paul Leonard can be reached at

On 66 and 67: Here comes the flood?

A clear majority of Oregon voters approved Measures 66 and 67 yesterday, passing for the first time in about 80 years a tax increase on themselves – or in this case, some of the themselves, with those individuals making over $125,000 a year, along with corporations throughout the state, taking the hit.

Now comes the obvious question for any Vancouver-based publication: what effect, if any, will this tax increase have on Southwest Washington’s battered economic landscape?

First and foremost, there’s no doubt amongst the majority of business owners that the approval of two substantial tax increases on the so-called rich and corporations sets a dangerous regional precedent.

Oregon, with its double-digit unemployment rate and moribund job-creating industries, should be the first state to realize that no economy has successfully taxed their way out of recession.

Instead, one of the most burdensome income tax structures in the country for individuals, families and small business owners has only become more so.

Though the passage of both measures is clearly bad news for most Oregon business owners, what is less clear is the prospect of any benefits for the Clark County economy.

Contrary to the wisdom of some in our business community, the flood of companies fleeing Oregon for Washington state may not materialize anytime soon.

For one, regional economic development execs like Bart Phillips of the Columbia River Economic Development Council, told an audience at last week’s Economic Forecast event in Vancouver that he believed the time of Clark County’s explosive population growth – much of it courtesy of the Portland area – had passed.

Another barrier to the hoped-for flood is continued economic weakness on both sides of the Columbia River, with businesses in Portland and in Vancouver equally wary of expanding or hiring new employees.

Business leaders from Vancouver to Washougal to Battle Ground should instead turn their attention to Olympia – a place where the debate over the growing disconnect between increased government services and our increased inability to pay for them rages on.

In a statement today, Gov. Christine Gregoire reacted to the Oregon “yes” vote with a keen eye on the tug-of-war currently underway in the Washington state capitol: “Oregon voters met the challenge of these difficult times and clearly said that schools, healthcare, public safety and other essential services cannot be forsaken.”