I agree 100% that they need to stop digging. Balance the budget before trying to buy more of our votes with great new pie-in-the-sky.

I also agree in that I think that for our State to copy ANYTHING that Congress does is insanity. I don't care who is in control of the Congress, Dems or GOPs, they spend like drunken sailors and have little or no connection with the problems or their constituents.

Of course, I am totally against the entire bailout bill as I posted on my blog.

Chuck,

How do you bypass the digging of deficit spending and latch onto this worry of yours? Do you not consider spending money you don't have also digging?

Chuck, I will agree with you that "Oregon's current fiscal problem is a revenue problem."

It is also a management problem. Regardless the revenue, if our government does not manage the resources it has, our fiscal problem will not go away. Decisions have to be made by managers to prioritize the uses of our revenue. Instead, it seems we want only to increase revenues to solve our problem.

I will not argue that more revenue is not needed to fund all of the programs we now have so they can operate them in the way they are now operating. I will argue that we have to find better ways to run our programs and that we must decide to reduce or eliminate programs that we cannot afford.

I think it's very progressive to even mention this. Historically, I can think of no case where people have voluntarily made the choice to quit making social comparisons to drive their economic decisions and start making them based on the objective facts of their situation. It's the oldest economic dilemma in history; I want to keep up with the Jones' but I'm out of cash.

Conspiracy theorists talk about the contemporary world monetary system being created out of a few individuals lending money to renaissance princes that wanted to wage wars they couldn't afford, but I've never seen one discuss the human element. Namely, that if you are standing there with a loan, at that critical moment, most people will take it. From there it's "I don't care who makes the laws because I'm issuing the money".

History has shown that the competitive borrowing only stops when that subsystem totally collapses and people are left with no alternative to leverage. I proposed a similar idea back in November, on a little-read blog, with a piece entitled, "This Christmas, Don't Charge It". The idea was to just stay within your means for one day, one important day, to calibrate your expectations that it can really be done. Break the competitive cycle for one day. Every person that responded called it naive and something real people "just can't do".

So where does that leave us with 1901 constructed, 1500 sq ft houses, in inner SE, with no central heat or AC, just blocks off of beauty spots like Powell and 39th, selling for over 1/4 million dollars? What will it take for people to start judging that purchase based on absolute criteria, as opposed to comparing it to other deals and what their buddies are doing? Like I said, it's a great progressive call, but I fear that the populace lacks the character required to understand why it is desirable and necessary. The lawmakers are acting off the same principles that the guy on the street is. There are no better angels in this drama. If they are going to emerge, it will have to be by transforming ordinary people, then electing them to government. We don't have very long, and I'm sure we don't have the motivation.

As responses are already showing, it's beyond not being motivated to do it. We have so long promoted anti-intellectualism and pseudo-science and social posturing that people honestly don't see why you would want to change this. They read for ideas on how to fix what we currently have. It's an addiction. At this point proposing ideas like this will, I fear, only get a lot of threatened addicts up in arms about what they're going to lose. We fear the system collapsing. I think most people fear not being able to keep on in the present mode. If you say, "I have an idea to keep the system from collapsing, but you can't keep on in your current mode", that doesn't qualify as a solution. The addict wants another fix, not a referral to a treatment program, and certainly not one that requires...uggghhh...."lifestyle changes". "I'd rather die than live like 'fill-in-the-blank'". Unfortunately, a lot probably will.

OK; more down to earth. Oregon needs revenue sources that don't vary wildly from year to year. You've heard that a billion times. No one can create a tax package that doesn't meet objections as being "permanent taxes". That's a pretty simple one. Either do that or tell the public that this situation will be a perennial one, get used to it, you chose it and quit tinkering. Someone in Salem needs to say straight out that if you don't want a stable tax base that covers the bills, you won't have stable funding for law enforcement and schools. You can't have two or three programs funded at constant level with the rest of the budget varying wildly based on the direction of the wind. If we can not get consensus on something that simple and demonstrably true, then we can't say that anyone is even willing to sit down at the table. That's the entry condition for a debate, imo. All these debates end with contest over what the stable source should be. That's immaterial. We have to decide that some choice will be made toward that end. It is not an option to "explore the issue" anymore. You can perform exploratory surgery until the patient dies. At some point you either have to decide to choose a treatment from what's on the table, or let nature run its course.

Perhaps I'm totally mis-characterizing the populace. Maybe they've thought this all through and have decided to let nature run its course. It's like therapy. After reading the post I'm just trying to figure out if people are there for treatment because they want to keep doing the same things, but get different results, or if they realize there is a problem that needs to be addressed with their behavior. They would no doubt answer, "you don't understand why I'm digging". I think Chuck's point would be that the system don't care why you're digging. If there's nothing down there, you're just draining yourself toward no end.

Z, If I understand what you are saying, we agree. The debate should not be about the revenue sources to pay for government services. It needs to be about what services are needed, how they are provided, and the priority each service should receive. Until we clearly determine what we NEED, distinguish that from what we WANT, and set up a system to properly provide what we need, discussing how to finance these things is wasted energy.

Thank goodness Intel won't benefit in Oregon from the bonus depreciation.

I've had an epiphany.

Why don't we just ramp up all stimulus spending to cover everything? That way we don't need to argue about priorities and worry about insufficient stimulation.

I'm good with this.

Democrats have all of the power they need to do the right thing. Make it an even $5 trillion. There's no more argument against $5 trillion than there is the $1 Trillion. So why not?

Federally, Democrats should pass the $1 Trillion plan but add $4 more Trillion to be distributed to the 50 states on a per capita basis.

State legislatures, such as Oregon's Democratic legislature could then easily cover the costs of everything needing funding.

I don't mind that Democrats only would be passing this expanded stimulus. And they'll deserve full credit. Although I think McCain should also vote for it and get some credit too.

I'm good, you're good, we're all good.

Finally

Chuck when you say that the Oregon Legislature can't spend money they don't have I have to question - Then why/how can they decide to borrow money to pay for state stimuli packages that the state hasn't the money for?

I can't argue your excellent points about the evil bonus depreciation issue for business. However I would give your ideas more credence if you turned those same effective intellectual powers to inclusion of routine maintenance issues (the moss on the roof, doors for university buildings, etc) for public infrastructure as you do against evil bidness.

I think the criticism of bonus depreciation is missing some important points. We are at a time when getting business to invest in anything is difficult, due to the economic uncertainty and tight credit, so that shortening the timeframe for a tax-based return has special importance.

The key area I'm concerned with is green investments in renewable energy and energy efficiency. Bonus depreciation had a significant impact on the attractiveness of solar projects last year, and will help with these projects this year. I am a contractor specializing in efficiency and renewable projects, and these are a tough sell when the economic return is dependent on continued tax liability over the next several years. Promoting these projects will benefit our economy both by reducing the money we export for energy and by providing jobs.

The flip side of this is to look at the cost of bonus depreciation. Bonus depreciation does not increase the total amount to be deducted by a business, but rather changes the timing so it is more front-loaded. Higher deductions now mean lower deductions over the next four or more years, depending on the project. This doesn't alleviate a very real short term problem, but is still worth considering. Given the way the credit markets are currently structured, the benefits of shortening the timeframe for business are very much higher than the cost to the state. There is also the increased cost of managing a system with different state and federal rules to consider, both for the state and for business.

I strongly concur with the real need for sustainable revenue solutions, but we need to be aware of the potential unintended consequences of simply backing away from everything that has a cost, without considering the real potential benefits.

Chuck, It is not my intent to start a fight or to make anyone with whom I disagree look bad. It is my intent to express my opinion. Though I may disagree with your opinion, I read blogs like BlueOregon and others on both sides of the aisle to learn from many perspectives. I take the time to keep an open mind, as I am sure you do to. I will comment below about your most recent comment with the intent of showing where I disagree, not to belittle you or your thought process:

You stated: "Why do you think we haven't already figured out what we need and a system to provide that? The Legislative Assembly -- your and mine -- "our" representatives -- goes through that exercise every two years."

I think we "...haven't figured out....a system..." because I read constantly that we are failing to provide the services we need and we haven't the money to fix the problems. When any enterprise is pricing its products and services properly, those who are served continue to use the services and complain rarely. I take the high level of dissatisfaction with many government services and taxes to be an indicator that we haven't figured it out yet. Improvements can be made and therefore it makes sense to debate the issues and find improvements.

You stated: "The suggestion that spending is done without priorities or assessment is silly talk."

In my opinion, it is silly to spend time defending failed policies and failed systems rather than exploring places where improvement can be made. To me, your statement, "Why do you think we haven't already figured out what we need and a system to provide that?" flies in the face of reality and is IMO wrong, not silly.

You stated: "You and I may not agree with the priorities and assessment of what Oregonians need, and that's something we all can take up with our legislators and while voting. But to suggest that spending today is without that assessment begs the question "what the heck you think the legislature does in the Ways and Means process?"

I am sure that you are right and that I underestimate the level of effort and the amount of time taken in assessing our needs and our best ways to meet those needs. I am also sure that the "system" and all that effort is not resulting in a successful fulfillment of the needs of the public served by the government. For that reason, I go back to your original blog post. I, like you, think the Congress is on the wrong track and would not like to see Oregon tied to mistakes made by the Congress. However, when I made that point, if poorly in my first comment, you replied that "Oregon's current fiscal problem is a revenue problem." This is my big disagreement with you. When a business has a "revenue problem" they must change pricing, products, delivery, services, or whatever is needed to bring revenues in line with expenses. I don't hear you saying we have any problem with the expense side. That is where you and I disagree.

<h2>I'll make this my last comment on this post. I appreciate you taking both the time to post your thoughts and to reply to comments.</h2>