Never underestimate the power of public employee unions.
That’s the takeaway from Tuesday’s special election in Oregon, where voters approved two measures that will raise taxes on businesses and the wealthy, preserving the jobs, salaries and benefits of government workers at the expense of those in the private sector.
It’s a lesson Nevada’s industry leaders should heed as this state’s lawmakers prepare to address an estimated $900 million revenue shortfall.
Oregon’s Democrat-dominated Legislature passed the tax increases last year, but a referendum backed by business groups succeeded in putting them to a vote of people.
Vote Yes for Oregon, the pro-tax group propped up by public employee unions, spent nearly $7 million spreading the message that cuts to public school and welfare budgets would lead to social collapse. Voters sided with the unions.
Measure 66 raised the state’s top income tax rate on individuals making at least $125,000 per year and households earning $250,000. Measure 67 increased the state’s minimum corporate tax from $10 to $150.
Public employee unions pulled out identical stops in California a few years back. Frightened voters crushed Gov. Arnold Schwarzenegger’s proposals to reform state government and rein in the political power of the bureaucracy. A lot of good that did them — California now sits on the brink of bankruptcy.
As with California, Oregon has merely postponed the tough fiscal decisions that need to be made in tough times. By raising taxes during a recession, Oregon faces an even harder fall than before.