Wednesday, March 07, 2007

Sen. Morse gets it, House Republicans don't

Word is that Sen. Morse, in the Republican caucus meeting, railed on the House Republicans for their "compromise" plan that raised corporate taxes by a couple hundred million dollars more than the Democrats wanted.

The problem for Morse, as I understand it, is not so much keeping the corporate kicker. Rather, Morse's problem is the new corporate minimum tax proposal, a tax based on gross proceeds rather than profit. The proposed tax is so screwed up that a company with negative net income could find itself with a $50,000 tax liability.

This is a devastating piece of public policy for job growth and capital formation. Start-up companies regularly lose money in the scale-up years. To burden them with this kind of tax liability during their start-up years will simply make many new companies decide to base the business somewhere other than Portland.

Sen. Morse understands this because he is a businessman. I have no idea why Wayne Scott, who is also a businessman, supports it. But the real damage is that Rep. Scott is strongarming the House Republican caucus to go along with the plan, which is putting them in a horrible spot.

This plan is a disaster not just for the economy, but also for the Republican party. Where is Vance Day and the party structure? Are they doing anything to oppose it?

It doesn't look like it. I'm told the Republican Party legislative update circulated recently didn't even mention the kicker deal! Looks like the party is taking a pass on this issue.

Here's the question: will the Senate Republicans stay united and defeat this dog? Democrats need only a single Republican vote to meet the 2/3 supermajority. Will Senator Morse succeed in keeping his caucus united, or will the D's succeed in culling a wobbly Republican senator from the herd?

Stay tuned. If the Republicans allow this to go forward, we will be the minority party for a long long time.


Anonymous said...

You have got to be kidding me. Wayne Scott? That fat ass. Why would he do this? Why is Reinhard cheerleading him? This is so stupid.


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