Oregon Unions Save Services, Tapping Voter Anger to Tax Wealthy

Faced with yet more blood-letting of public services, Oregon voters chose a different treatment: Tax those most able to pay.

By 54 percent, they passed new taxes on the wealthiest 3 percent of the state’s residents and on corporations in a special election in late January.

The vote preserved funding levels for schools, critical human services, and public safety statewide.
It’s also given union activists nationwide hope that relentless organizing can turn the media fascination with the anti-tax Tea Party on its head and settle bulging state deficits by taking money from recipients of the bubble economy’s billions instead of public services and public workers.

The tax boosts should cover a $727 million hole in the state budget—although the latest revenue estimates forecast deeper shortfalls.

Oregon’s budget situation has been critical for many years. One of five states without a sales tax, Oregon has relied on an essentially flat personal income tax and limited property taxes. Lacking the ability to create a “rainy day” fund, Oregon has been hit by the recession especially hard. Unemployment hovers above 12 percent.

After cutting $2 billion from services last year, Democrats, who had enough of a majority to pass revenue measures, enacted two measures to plug the remaining budget gap.

But most business groups opposed the tax increases, so business sent out paid signature gatherers, who collected enough to refer both measures to the voters.

The Yes for Oregon campaign was based in many organizations that have worked together over the years, most recently in the 2008 election to fight off anti-union, anti-tax, and anti-immigrant ballot measures. Key funders and strategists included the Service Employees (SEIU), the Oregon Education Association, AFSCME, AARP, Our Oregon, Stand for Children, and the Oregon Health Care Association. The state AFL-CIO was an important source of volunteers and funds. Staff from many coalition partners were loaned to the campaign and provided its leadership. The campaign built a coalition of 250 groups statewide, including all five Jobs with Justice chapters.

“There was an amazing willingness from the average citizen to say, ‘I’ve got skin in this game and I’ve got to get involved,’” said Timothy Welp, a 15-year member of SEIU Local 503 now organizing for the local.

Beginning in the summer, all the coalition partners signed their members up on a “vote yes” pledge and started to focus their persuasion on undecided voters. Polling showed that we began the campaign with a solid majority of the voters. The challenge was to keep them in the face of what the Yes campaigners knew would be a well-funded, slick, and dishonest “vote no” drive.

The state’s minimum corporate tax had been $10 since 1931, making the need to increase corporate taxes an easy sell that appealed to voter anger at corporate greed and corruption and the federal bailout. Business groups reported raising $4.6 million for their group, Oregonians Against Job-Killing Taxes, but the Yes campaign, largely bankrolled by public employee unions, raised $6.9 million.

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Most newspapers editorialized against the measures. Portland’s influential Oregonian sold the No campaign wrapper advertising, so in the days before the election the front of the paper advertised its “vote no” position. TV ads from the no side were misleading but effective, implying that the taxes would affect middle-class Oregonians.

Oregon votes only by mail, stretching the get-out-the-vote push for weeks. We thought as we went into the last two weeks that it was very close and knew that turnout would determine the outcome. Thousands of people phone-banked and canvassed during the final push. Volunteers at SEIU Local 503 made so many calls that phone service crashed throughout the neighborhood.

In total, Yes campaigners made more than a million phone calls at locations around the state. We knocked on 300,000 doors—nearly one-fifth of registered voters in the state.

Jobs with Justice had a small piece: recruiting volunteers, getting faith leaders on board, creating our own JwJ voters pamphlet statement, and helping pull together a rally in the campaign’s closing days. The backbone of the volunteer base was the public employee unions.

ANGER AT BUSINESS

It was very clear as we went door to door that the business message was not resonating with working people this time. People are angry about corporations and the $10 minimum tax struck most people as ludicrous.

“Oregon has had decades of anti-tax rhetoric, but at some point people are pushed to the wall,” Welp said. “Working folk have been squeezed so hard here. They’re tired of getting squeezed.”

The “vote no” message combined the two ballot measures and hit several themes, many of them false: a bad recession was the wrong time to raise taxes; 70,000 Oregon jobs would be lost; businesses would close or raise prices; public employees got a big raise.

Oregonians Against Job Killing Taxes argued that many of the households making over $250,000 were really single proprietorships who filed taxes as individuals. Their message was complicated: for some corporations, the tax would be on sales, not profits.

We said that both taxes were modest and affordable and that enacting them would save critical services we all depend upon. No polling has surfaced, but it seems clear that majorities of people voted their class interest. The keys to victory were the smart strategy, the broad coalition, the incredible number of volunteers, and the breadth of the field campaign.

There is much more to do to stabilize the state’s finances, even with the new taxes. Their passage, the first tax increase in Oregon since the 1930s, was a historic step toward fairness—although many Oregonians agree that our tax structure needs more change to make it stable and fair.

Margaret Butler is the director of Portland Jobs with Justice.