Betsy Hammond responds

Betsy Hammond, author of the front-page story on the lessons Oregon should learn from Colorado's experience with Tabor which ran yesterday, and which I critiqued, sent me the e-mail below objecting to my post. I post it here with her permission:

Rob:

Today's article is fully and factually reported. I talked to all three budget directors who have implemented Tabor in Colorado at length. and I am confidence the piece is correct about what happened in Colorado and, when taking into account the Q and A, is correct about how Oregon's spending limit would be the same and different.

As my article says, there is no requirement under Measure 48 that the Legislature save any revenues that come in over the limit, rather than rebate them or lower tax rates or create tax breaks so the money doesn't come in in the first place.

To say that money would always be there to patch up spending in a downturn is simply unsupported by the facts, Rob.

To say that the article did not give the positives of Tabor.... come on. It says it delivers government that costs less. It points out that Coloradoans got more than $3 billion in rebates. It says the typical household got $400 a year for four straight years. It quotes Owens about reining in spending during a boom. It quotes Hopkins about reasonable vs. inordinate growth of spending. It quotes Caldara about thinking outside the box. It says most people in Colorado aren't even aware there is a spending limit. It says community colleges managed to patch together some excellent programs and instruction on low budgets. It says that flagship universities remained strong. It shoulds that private sector development is thriving at Lowry.

The fact of it is, however, that the business community and most seasoned Republican budget writers have turned over-the-top negative on this thing. In fact I toned down what Brad Young, Bill Kaufman, Tom Clark, Rocky Scott, etc., had to say about a state spending limit. And these guys aren't sideline nutcakes. They're respected conservative and centrist leaders in Colorado.

Who exactly did you want me to quote that I did not as far as talking up the positive aspects of Tabor? A majority of the people I quoted are Republicans who like Bill Owens.... did you want me to interview a bunch of angry lefties or something?

I am copying reader [name deleted] on this email, because he just sent me an email that picked up much of the language and critique from your blog, Rob, and I think he should have this same info/perspective (rant?) that I am sharing with you.

Both of you guys can quibble with some of the headline, photography, packaging, etc., if you want. I didn't do that part. I will own up to the fact that we try here at The Oregonian to make things look vaguely interesting. But the content of the article and the charts and graphics is mine and it is complete and fair and accurate.

The spending limit promises less government, lower government costs and less services in some sectors of state government and that is what it delivers. It puts the decisions about what will grow and what will be cut in the hands of legislators, whose decisions we cannot predict (not precisely anyway) but whom we know will be constrained by voter mandates, federal rules and political reality.

The article does not say or imply that life would come to an end in Oregon under Measure 48. But it does imply we would notice, and that certain areas would really feel it. Whether the trade offs are worth it are up to readers/voters/citizens/researchers/whoever to decide.

Finally, regarding the ratchet, let me quote from an email I sent earlier to another reader on this subject: (The "you" and "yours" refer to that reader, not to you, Rob; I am just trying to save myself the time of rewriting the same content.)

Beginning to quote myself here:
The key error you make is to assert that Oregon's spending limit would not have a "ratchet" effect. In fact, Oregon's constitutional spending limit would do what Colorado voters now have fixed: Tie each of the state's budgets to the previous one.

(Reading directly from the text of the measure: "Any increase in total spending by the state from one biennium to the next shall be no greater than... population plus inflation....") That means that, if one Oregon budget happens to plunge (due to recession, Legislators' discretion, tax cuts or whatever) the limit for the next and subsequent budgets is reset at the new, lower limit. (Colorado last year fixed that problem, by tying the limit henceforth to whichever of the five years of revenue collections during this period of unlimited spending is the highest.)

You are correct that, to the extent our Legislature opts to create a state savings account, the odds are reduced that spending will plunge as sharply as Colorado's revenue did in 2001-02, because our lawmakers could use the savings account to prop up spending in a downturn. But creating a state savings account is optional under Measure 48, and our Legislature doesn't exactly have a track record of saving up big bucks.

It would be wildly inaccurate to say Oregon would always manage to spend up to the "popuflation" limit, even in a recession. And, if the Legislature does not come up with enough money to spend to the limit, the new limit would be "ratcheted" down to rise from that lower starting point.

You assert repeatedly that spending "can't" go down under Measure 48, which is patently false. The law would prevent spending from being greater than a certain figure each biennium, unless two-thirds of the Legislature and a majority of Oregon voters agree, but it would not prohibit spending from falling below any certain level.

Also, briefly:
- My article is correct when it asserts that the central premise of both limits, restraining the rate of government growth to population plus inflation, is identical.
- My article does point out that under Measure 48, Oregon is likely to sock money into a state savings account.
Ending my quoting of myself there.

If there are particulars of the article you take issue with, I am happy to address them.

Rob, your assertion that Colorado did not have a budget crisis in
2001-02 like every other state is so laughable that I won't even get into it. Hello????? If I hadn't spent two hours talking to the state budget director from that period maybe I wouldn't be so snide.... but believe me, it was ugly --- more so than in many states because they had to pay out $1 billion in Tabor refunds the same year their revenues plunged (order of magnitude here) 18 percent.

My article was rigorously reported. Your slam against me does not appear to be so. I have covered state tax policy and spending full time for a year now, and had analyzed PERS and state education spending in detail before that. ("new" to the beat?) My bias is toward math that adds up, evidence over rhetoric, facts and clear-headed analysis.

As you can probably tell, I feel your blog posting is extremely unfair and not supported by the facts.

-Betsy Hammond