Like all good politicians, the late Ronald Reagan understood that the best way to drive a message home to people was not with dry statistics but with stories – anecdotes about ordinary folks like themselves. (Some of Reagan’s stories were true and others were not, but that wasn’t the point; the point was they were effective.)
Taking a page from the Reagan playbook, opponents of Measures 66 and 67 tried to tell Oregonians a story. The story was told in the first person by Carol Leuthold, who with her husband owns a dairy farm in Tillamook, in a letter mass-mailed to voters.It was a touching story of a small, struggling family business that will be devastated if Measures 66 and 67 pass and modest tax increases on some businesses and high-income individuals are allowed to stand.
“Measure 67 would tax businesses up to $100,000 a year even if they didn’t make a profit,” the letter said. “Public employee unions say the sky will fall if the new taxes do not pass. I’m here to tell you that the sky is already falling on Oregon small businesses like mine.”
When reporters and bloggers started checking around, however, the story started looking kind of hinky.
The Oregonian’s Jeff Mapes called Leuthold and found out that the only effect of M67 on her business would be to increase its minimum tax payment from the present absurd $10 (unchanged since 1931) to $150 – hardly a back-breaker. Leuthold told Mapes she and her husband would pay more in personal taxes because their income is over $250,000, and since they plow money from other (unspecified) sources back into the farm their business would be negatively affected.
But a little more digging revealed that the Leutholds are not exactly hard up. A profile on the Tillamook Cheese Fan Club website (subsequently removed) described them as having “a serious case of the travel bug. The couple has roamed around the world, including stops in Brazil, Italy, Germany and Alaska.” Last year Carol went to Italy and France to take cooking classes and Dan went on safari in Africa.
If Oregonians Against Job-Killing Taxes, the deep-pocketed group behind the Leuthold mailing, wanted to tell a story about a struggling mom-and-pop business that will be devastated by Measure 67, why didn’t they use a real one instead of a couple of globetrotters with a quarter-million-dollar (at least) income?
Probably because they couldn’t find one. Under Measure 67, 88% of Oregon small businesses will have to pay only the $150 minimum. The top $100,000 figure Leuthold’s letter cited would apply only to corporations with more than $100 million in sales in Oregon. That’s why the Oregon Bankers Association, representing the likes of Wells Fargo and Bank of America, has kicked in $100,000 to defeat 66 and 67.
The tax opponents should have realized it’s harder to sell bogus stories in the age of the Internet and Google than it was in Reagan’s day. For trying to peddle this fairy tale to Oregonians, we’re giving them THE BOOT.
This article appears in Dec 10-16, 2009.
MAKE LOCAL JOURNALISM HAPPEN
Republish our articles for free, online or in print, under a Creative Commons license.
Just a quick comment. There are small businesses here in Central Oregon that will be impacted significantly. I personally know of a business that is owned by a family that employs around 20 employees that will see an effective Oregon tax go from 6.6% to around 45%. This business sells products on very low margins with a high volume of sales. The products the business sells is commodity based. They don’t have a lot of control on their margins, because it is a commodity. The minimum tax based up gross sales would result in this higher tax rate. Don’t tell the public that this tax only hits big businesses. And by the way, those big business do provide jobs and given the choice to pay this rediculously high tax in Oregon or move their operations to another state, companies will choose to move to another state. The result is job losses. Take a look at the situation in the state of Washington where Boeing could not come to an agreement with one of the labor unions and relocated that segment of the business to North Carolina. The result – 34,000 people lost their job in the Seattle area.
Chris, you might want to check your facts on Boeing. The company actually won large concessions from the employee union, which agreed to them in understanding that it would allow the company to expand in Seattle. Boeing however chose to bolt anyway in pursuit of the almighty dollar.
Chris is partially right on Boeing. They are opening a second 787 production line in South Carolina when they could not negotiate a deal with the IAM to expand production in the Seattle area. They chose not to expand production in an area where the IAM has crippled them with strikes. Seems rational to me.
Again that might make sense if it were true. But it isn’t.
But don’t take my word.
http://www.seattlepi.com/business/411636_workersreax29.html
Chris, someone is telling you a boogeyman story.
“will see an effective Oregon tax go from 6.6% to around 45%” based on what? Certainly not on what 66 and 67 will actually do.
Here are the facts:
If this company is a C-corporations and is reporting a profit, they’re currently paying 6.6% on their profits. Under M67, they’ll be paying 7.9% on their profits above $250,000, but only for the next couple of years. It drops to 7.6% and then back down to 6.6%. (Profits above $10 million will still be taxed at 7.6%.) This applies only if they’re a C-Corp. If they’re an S-corp or partnership, they’ll pay just $150 in business taxes no matter how much they make in profits.
If this company isn’t reporting a profit, they’ll either be paying one-tenth of one percent of their sales or $150. (That’s a lot less than “40%”.) Are you sure someone hasn’t just lied to them and now you’re repeating the same scare tactics?
I don’t. Try this source which is not union spin.
http://seattletimes.nwsource.com/html/editorials/2010456664_edit09boeing.html
Scott, your link was to an editorial page and the owner of the Seattle Times DEFINITELY pushes his opinion, especially when it comes to taxes. If you are interested, just google his name…Blethen. Also try to google Blethen and estate taxes. Talk about spin…
“Take a look at the situation in the state of Washington where Boeing could not come to an agreement with one of the labor unions and relocated that segment of the business to North Carolina. The result – 34,000 people lost their job in the Seattle area.”
You’re claiming a small tax increase will drive businesses out of Oregon, and you try to prove it with the example of a company that left Washington because of union problems? Am I missing something?