Oregonians have historic opportunity to save for a Rainy Day
(Soapboxes are guest opinions from our readers, and anyone is welcome to write one. Matt Evans is the spokes,am for the Rainy Day Amendment Committee, which is trying to pass Measure 48. He is a former executive director of Oregon Tax Research, and has 20
This year, Oregonians have a historic opportunity to put their government on firm financial footing - and keep it from growing too big. With the Rainy Day Amendment, we can control spending, save for the future and make sure that government doesn't squeeze out the strong and vital private sector of our economy.
What is the Rainy Day Amendment? It's a simple proposal to limit growth in state government spending to the rate of inflation plus the rate of population growth. That means government spending would continue to increase to match the needs of Oregonians - but it wouldn't grow so fast that it would outstrip taxpayers' ability to shoulder government expenses.
What the Rainy Day Amendment does not do is cut spending - ever. The measure not only permits spending for essential public services; it allows such spending to increase year after year, consistent with the growth of population and inflation.
But the Rainy Day Amendment won't let the government spend every dollar that comes through the door during boom times. Revenues above the limit are left in the state treasury and will be available to fund government when the economy takes one of its periodic downturns. That's money available to maintain sustainable levels of expenditure during lean years. Just as our families save for hard times, so the Rainy Day Amendment will make the state government do a little basic financial planning.
The truth is, when government spending balloons during strong economic times it rises to levels that can't be maintained when the economy goes bust. People become dependent on services that won't be there for the long term. During tough times in the past, programs have had to be cut in painful ways and the future mortgaged as trust funds were raided. As we've discovered over the years, it's no kindness to spend temporary riches and make promises the state can't keep.
It's better to keep government spending at sustainable levels and put money away during the good times to keep us going when things turn bad.
But what happens if an emergency comes along that requires spending more than the limit permits?
The Rainy Day Amendment allows for that, too. If, despite steady growth in spending and a rainy day fund for tough times, legislators believe that higher state expenditures are desirable, they can ask voters to go to the polls and make it happen. That's right, the power to spend over the limit rests in the hands of the voters.
Aside from smart budgeting, there's good reason to support a spending limit. At present, Oregon's state government can grow at a faster rate than our economy as a whole. That means that government is at risk of displacing the private sector and devouring an ever-larger share of our finances.
By limiting the growth of state spending to inflation plus population growth, the Rainy Day Amendment will hold government to a stable share of Oregon's economy. Controlled spending, along with strengthened reserves, will ensure the state government is always able to meet its obligations without becoming overpowering.
Overall, the Rainy Day Amendment looks like an exercise in common sense. Smart individuals and businesses have long understood they have to live within their means and save money to see them through tough times. The same financial realities apply - or should apply - to governments. And we neither want nor need government to grow without end.
With the Rainy Day Amendment, Oregonians at last have the tool they need to bring fiscal responsibility to Salem - and to give themselves a little peace of mind.