OPINION:
There will be more to watch on Nov. 5 than just the presidential contest. On the West Coast, Oregonians heading to the ballot box will be asked, “Should I vote to transfer other people’s money into my personal bank account?”
That’s the question posed in Measure 118, which if approved would fulfill leftists’ dream of bringing universal basic income to the state. Antonio Gisbert, the man who spearheaded the effort to collect 122,000 qualifying signatures, explained his motivation in an interview with Willamette Week, an alternative weekly.
“Poverty in Oregon would go way down,” Mr. Gisbert said. “The Oregon Rebate is estimated to reduce child poverty by about 26%. That’s a huge change, right? Like you, like if a family of four gets 3,000 bucks — boom, lump sum — that’s money that family can use to make the situation better.”
It’s the sort of magical thinking that will go over quite well in the Beaver State, where then-candidate Joe Biden enjoyed a 16-point advantage over then-President Donald Trump in 2020. Residents are supposed to assume this money redistribution is funded by someone besides themselves — big, bad corporations that will have to pay an extra 3% tax on sales if they make over $25 million a year.
Corporate fat cats aren’t getting away without paying Oregon’s taxman as it is. The Tax Foundation estimates the typical business pays 14.2% tax on its net income, plus a .57% tax on gross receipts. Only one other state — Delaware — imposes this double whammy on both gross receipts and corporate income.
Figures such as “.57%” and “3%” are deceptively small; they add up. Tax Foundation economists say a business turning an ordinary 7% profit from its gross revenue would be stuck with a combined state and local tax bill of 56% if the initiative passes. The grand total handed to tax collectors would average 77% once Uncle Sam’s cut is included.
Those are the kind of numbers needed to hand out freebies to everyone who in the state — rich and poor alike. Even illegal aliens would be encouraged to sign up for this giveaway. They just need to provide a document proving their identity, such as a passport from their country of origin, as well as “proof to verify the address of an individual claiming a rebate prior to issuance of a rebate.”
Cash distribution will wind up being about as secure as Oregon’s identification-free, all-mail-in voting system — about what you’d expect in a place that hasn’t voted for a Republican president since the 1980s.
Freed from the constraints of rational analysis, the progressives behind the universal income idea realize that big business doesn’t pay corporate tax levies. Every time an Oregonian orders a latte from Starbucks or a bundle of ethically sourced, locally grown arugula from Whole Foods, the price will be increased enough to cover any new expense. The price will have to increase 12% to cover the new business tax, according to the Tax Foundation’s number crunchers.
A radical alternative plan might be to reject Measure 118 and allow those businesses to retain their earnings so they can invest in their operations. With more capital available, entrepreneurs can expand operations and hire people — paying them to work so they don’t need to go on the dole.
That’s how economic growth works in a free society.
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