On Monday, members of Portland DSA, along with members of three other branches across the state, gathered on the steps of the Capitol to protest Governor Kate Brown’s special session. She called this special session to push through another set of tax breaks that will largely benefit richer Oregonians and decrease the available funds needed for the state’s already underfunded social services. Partnering with the Poor People’s Campaign as part of their “Tax the Rich” efforts, the Democratic Socialists hoped to draw attention to the crushing austerity and neoliberal tax policy that enriches the already wealthy at the expense of the poor and struggling.
Despite the almost supermajority of Democrats in the Oregon legislature, the bill, touted as a win for “small businesses”, passed easily 51–8 in the House and 18–12 in the Senate, with many Democrats voting for it despite substantial criticisms from left, right, and center. The tax break heavily favors the wealthy, with 75% going to earners making over $250,000 a year, and will cost the state between $10 million and $15 million in revenue. Governor Kate Brown and proponents of the bill have not addressed how they intend to pay for the difference, if at all. They point out that state revenues have never been higher, ignoring the fact that this level of revenue is still inadequate in meeting the needs of those suffering under Oregon’s massive wealth disparity. Their thinking also highlights how out of touch the state leadership is with the experiences of average working class people.
The tax break expands the 2013 pass-through income tax loophole, which was passed in 2013 but excluded about 90% of small businesses. The expansion allows sole proprietors to also be taxed at a lower rate. This loophole already costs the state around $100 million a year, according to the Oregon Center for Public Policy, and this expansion for small businesses adds $11.3 million to that shortfall. Though the Governor is arguing this expansion makes the pass-through loophole more fair, the expansion will still largely benefit sole proprietors making substantially more than the median wage in Oregon, which has barely budged in recent decades at $34,000 a year. No real justification was given for why small business owners deserve to be taxed at a lower rate than wage earners, an idea that seems to be taken for granted by Democrats and Republicans alike.
The Democratic Socialists of America and the Poor People’s Campaign object not only to the tax breaks in question, but also to even calling a special session for this purpose. Despite suffering from decades of neglect and neoliberal deprivation, no special session has been called to address the crisis facing education, housing, wages, or any other social services. No special session has been called to discuss protecting vulnerable immigrants or combating the rise in racism and white supremacist groups. Though state governments often receive criticism for being slow to take action, when they do act, they move quickly to reward the wealthy with additional benefits.
Though disappointed by the outcome of Monday’s vote, DSA’s Tax the Rich Campaign will continue to draw attention to and challenge policies like these. As with the recent Tax the Rich Rally in Portland, which challenged the city budget, this action aims to highlight where Governor Brown’s priorities lie and put pressure on Democrats that would like to claim the progressive label. The idea that Democrats have to be the party of ‘fiscal responsibility’ or grand bargains must be challenged — Oregonians demand both a party and politicians that will put the needs of the working class first. We are done with austerity. It’s time for a government that is responsive to the needs of working people, not the wealthy. The fight is just beginning.
Written by Portland DSA member Rob Guthrie