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Did they forget about the Great Recession?

TWO VIEWS • Let's have a candid conversation about Oregon's budget crisis

Maybe they don't know the meaning of the word 'candid.' State Rep. Dennis Richardson (R-Central Point) and Allen Alley write that fixing Oregon's fiscal problems requires 'candid conversation,' yet their discussion of the issue piles obfuscation on top of deception.

Start with the fact that they never once mention the word 'recession' when writing about Oregon's fiscal woes, even as the waves of pain from the Great Recession continue. That's like writing about flooding in New Orleans in 2005 and not mentioning Hurricane Katrina.

It's no secret why Oregon and 45 other states in the nation face fiscal crises: the worst recession in more than 70 years wreaked havoc on state revenue. With unemployment up and business activity down, revenue collections have fallen sharply.

At the same time, demand for state services that protect people when the economy fails them has skyrocketed. Because of the recession, more Oregonians are looking to the state for help with unemployment, food assistance and other emergency needs.

But rather than acknowledge the truth of the recession, Richardson and Alley use data deceptively to claim that state spending has risen sharply.

As noted by both the Oregon Center for Public Policy and the Oregon Business Council, as a share of personal income, state and local spending in Oregon has remained fairly constant over the past 30 years.

Stated differently, relative to the income earned by Oregonians, the public sector is no more expensive today than it was three decades ago.

In the current budget cycle, the Legislature has in fact cut and cut deeply. The 2009 Legislature slashed $2 billion from the state budget, followed by two across-the-board cuts ordered by the governor after the recession proved deeper and longer than anticipated. Thus, it's clear that cuts - not increased spending - have dominated the budget picture.

So how are Richardson and Alley misleading Oregonians in claiming that state spending has increased? They deceptively cite the 'All Funds' budget, rather than the general fund and lottery budget.

The general fund and lottery budget is what most people mean when they talk about the state budget. More than 90 percent of that budget goes to just three things: education, public safety and health and human services. And they are paid for mostly out of the state's principal source of revenue, the personal income tax.

The 'All Funds' budget, by contrast, simply shows how much money - including large amounts of federal money - flows through the state coffers.

Although the 'All Funds' budget has grown substantially in recent years, that doesn't mean that the size of state government has grown. As the Legislative Fiscal Office has explained, 'The majority of the increases (in the total funds budget) are directly related to the federal stimulus package provided by Congress and the increases in unemployment insurance payments.'

These federal Recovery Act dollars have protected Oregonians from the worst ravages of the recession.

If Richardson and Alley truly want candid conversation of Oregon's fiscal situation, they should not mislead Oregonians by trying to portray increased emergency federal spending - funds that have protected many Oregonians - as increased spending by the state of Oregon.

A candid conversation also would recognize that more than nine out of 10 dollars that Oregonians pay in income taxes go to educate kids, keep cops on the beat, keep courthouses open, provide health care to the vulnerable and protect foster kids and seniors.

A candid conversation would disclose that former Gov. Vic Atiyeh - on whom Richardson and Alley shower praise - pushed through the biggest tax increase in Oregon history, relative to the size of the general fund, in order to balance a budget hammered by a recession.

Finally, a candid conversation would acknowledge that Oregonians value public services. That's the takeaway from Oregonians' overwhelming 'yes' vote on Measures 66 and 67 in January.

That's why the real heart of the discussion surrounding Oregon's fiscal woes must be around the need for adequate revenue to best protect and improve the public services that matter to Oregonians.

Charles Sheketoff is the executive director of the Oregon Center for Public Policy in Silverton.