Public officials, elected and otherwise, know that taxes and regulations stifle our economy.
If they didn’t, they wouldn’t have to offer Intel gargantuan tax breaks on its equipment to keep investing in Oregon and help ensure its gargantuan payroll here continues.
They wouldn’t create intergovernmental agreements to disentangle the regulatory nightmare of planning in the Portland area for Nike, specifically in Beaverton and Washington County.
Intel is the largest private employer in Oregon, and its departure would be disastrous for citizens of our state. This is clear to everyone. And because of it, Washington County and Hillsboro have agreed to a tax break of millions of dollars annually – although the bureaucrats and politicians say Intel wasn’t threatening to leave Oregon.
Nike is planning a $150 million expansion, and expects to create 500 new jobs. A small part of that expansion is within Beaverton city limits. The city reasonably has agreed to let the county take over administrative authority for that territory.
What doesn’t ever seem to be clear at the public policy level is why we don’t apply this thinking across the board.
Intel can absorb regulatory and tax costs more easily than smaller businesses, the ones that dot our downtown and strip mall landscapes. But the scope of Intel’s economic impact is certainly more visible than Rock ‘N’ Vape in Albany, Downtown Dog in Lebanon, Periwinkle Provisions in Sweet Home or any of thousands of small mom-and-pop private enterprises.
They don’t get the same kinds of tax breaks for their economic activity.
Nothing is particularly wrong with giving Intel these tax breaks or cutting through regulatory authority to see the Nike project through. In fact, these ideas are so obviously useful that they should be extended to anyone who does business in Oregon. They’re local, county-level issue, but the value of the lessons in them are statewide, nationwide even.
The fact these special favors apply only to large corporations seems in sync with the idea that Washington, D.C., seems to have that some businesses are too big to fail. Perhaps these particular business are just too big to tax or regulate too much. In our state, we’re picking winners based on size.
Many Mid-Valley politicians seem to understand that taxes and regulations are burdens to our economy. They, Republicans especially, campaign on reducing the regulatory burden, although little of any substantiality seems to be done to reduce it.
On the contrary, the regulatory burden on our economy always seems to increase. No one seems to talk about the tax burden much these days except on a case-by-case basis in an attempt to create or retain economic activity.
Nike gets something called “tax certainty,” locking in the state’s current tax policy by contract, for 30 years based on a 2012 bill passed in a one-day special session called by the governor for that purpose in December 2012. And the governor and legislature did it all for Nike.
State Sen. Ginny Burdick, D-Portland, called Nike a special case. We’re left wondering why the thousands of other businesses, which actually employ the majority of Oregon’s workforce, are not special cases.
To our politicians and bureaucrats, we must ask, why not provide the same incentives to everyone doing business in Oregon? All but 24,500 of Oregon’s workforce is employed by someone other than Intel or Nike. Their participation in our economy is critical too – more so since they represent the vast majority of Oregonians; something that Nike and Intel do not.
The same measures statewide would benefit everyone in Oregon for the same reasons that politicians and bureaucrats say cutting through taxes and regulation for Intel and Nike help the state. If it were not so, Hillsboro, Washington County and Intel would be unable to reach an agreement.
Resulting economic prosperity would ultimately benefit Oregon’s economy and its people. It would surely improve the bottom line for public treasuries.
This whole business is a nod to free markets. It is vindication for free-market capitalism.
That’s how the politicians and bureaucrats sell these deals to the public. They argue that it helps those businesses, that it helps the people, that it helps the state and ultimately increases tax revenue.
But when they don’t extend the same logic across the economy, they’re really just trying to pick losers and winners – in this case, based on size. They’re just giving a special nod to someone they deem large and important enough. Apparently, they just don’t believe that everyone should have the opportunity to prosper in such an economic environment.
They should decrease or remove taxes on businesses, and start decreasing the regulatory burden too. Let the resulting salaries and job growth back fill the lost revenue.