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July 7, 2007

Republican lawmaker violated election law

The state Elections Division has ruled that State Rep. Donna Nelson, R-McMinnville, violated election laws by failing to accurately report campaign contributions during the 2006 primary and general elections. Nelson could be fined as much as $3,725 in civil penalties for 13 campaign finance violations identified by the Elections Division, said Jennifer Hertel, a division compliance specialist.

Nelson was cleared of criminal violations. Officials ruled she didn't knowingly make false statements on her campaign finance reports.

The investigation stemmed from an elections complaint by Debbie Runciman, a political activist who has worked for House Democratic lawmakers. Runciman's complaint was sparked by Nelson's Oct. 2, 2006, statement stipulating that she wouldn't raise or spend more than $2,000 in the general election. Such filings enable candidates to avoid submitting detailed lists of campaign spending and contributions.

Nelson later reported "receiving" several campaign checks from trade groups, starting a few days after the Oct. 2 filing, that put her above the $2,000 threshold.

The Elections Division found that many of the checks had been written and delivered to Nelson a month or more earlier.

Nelson said Friday that she hadn't opened all her mail because she was busy running a low-budget campaign on her own.

"We get massive mail," Nelson said. "I just didn't pay attention to it. I figured after the campaign I could worry about it."

Nelson said she never solicited any contributions from lobbyists, and thus had little reason to know the mail contained checks for her campaign.

However, she told the Elections Division that the unopened mail included two envelopes hand-delivered to her by prominent Republican lobbyist Larry Campbell and Realtors lobbyist Harlan Levy.

Nelson said she always planned on running a low-budget campaign. But the success of Democratic challenger Sal Peralta's under-the-radar campaign took her by surprise.

House Republicans' elections team, working to retain their House majority in 2006, intervened, warning Nelson to change her strategy to fend off Peralta.

"When it became apparent that my race was targeted, I was told I should get busy and change my plans, and was reminded by leadership to check to see if I had received funds in the mail," Nelson wrote to the Elections Division.

Election Division officials took Nelson at her word, accepting her explanation that she had not checked her mail, Hertel said.

But officials said Nelson violated elections laws by failing to deposit campaign contributions within a week of receiving them, and failing to keep detailed accounts of her contributions and expenditures, which are supposed to be kept current within seven days.

Officials ruled that Nelson should have filed three detailed campaign contribution and expenditure reports. Nelson also should have reported eight campaign checks on an earlier report, Hertel said.

Officials also determined that Nelson shouldn't have filed an April 10, 2006, form saying she wouldn't raise or spend more than $2,000 in the primary. That was invalid, because Nelson had given her campaign $5,000 from her own funds on Oct. 17, 2005, Hertel said.


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Fraud in largest gov't program goes undetected

Employers easily can check whether a job applicant has a valid Social Security number, but it is not required, and many don't. The Internal Revenue Service has the same mismatched information, but federal law protects the privacy of taxpayers - no matter how they earned their money. "We don't care what you do, as long as you put it on a tax return," said Bill Steiner, an IRS spokesman.

"I don't buy the notion that if they pay their taxes, somehow that makes it right," said Jim Ludwick, the president of Oregonians for Immigration Reform. Ludwick said employers should be required to check the validity of Social Security numbers of job applicants. "That would go far toward clearing up the whole thing," he said. "If you're in the country illegally and you can't get a job, then you are likely to self-deport."

By some estimates, illegal immigrants pump as much as $7 billion in taxes into the Social Security trust fund each year.

The Oregon Center for Public Policy, a group that advocates for low-income people, estimates that illegal immigrants in Oregon pay $56 million to $79 million each year in Social Security taxes.

The IRS can fine employers $50 for each inaccurate wage report, but government audits have found no evidence that the fine has ever been imposed.

The IRS offers people who are not eligible for a Social Security number a special tax identification number, so they can pay income taxes owed from money earned on jobs they are not allowed to have. Since 1996, about $50 billion in income taxes has been paid through this system.

The Social Security Administration sends letters each year to employers with significant numbers of mismatched W-2 wage reports. These letters also are not generally shared with immigration officials. Although the letters warn that the mismatch does not reflect a worker's immigration status, employers often use them as a pretext to fire workers.

When federal agents swept into the Fresh Del Monte Produce plant last month, they were armed with information that about 90 percent of the plant's workers had invalid Social Security numbers. But that information alone would not have sparked the raid, officials said.

"If you take a standard case of an unauthorized worker working under someone else's Social Security number, just so they can have the job, as a rule, it's not a great case for us," said Jonathan Lasher, a spokesman for the inspector general's office of the Social Security Administration.

"Workers like that don't stay in one place very long. By the time we begin an investigation, the chances are they're going to be gone," Lasher said. "One worker has a relatively small impact on Social Security."

The agency does get involved if an employer is obtaining bogus Social Security numbers for its workers, which is the allegation in the Fresh Del Monte case.

These issues simmered just below the surface of the more hotly debated points of President Bush's immigration reform package that was recently shot down in the U.S. Senate.

The president's plan would have given the Department of Homeland Security more access to Social Security information. And there were proposals to deny immigrants any chance to claim Social Security benefits from past unauthorized work, and to require employers to verify the status of job applicants.

In recent congressional testimony, James B. Lockhart III, deputy commissioner for the Social Security Administration, defended the agency's philosophy:

"It should be noted that, although non-citizens may be residing and working illegally in the United States, they are contributing their labor, paying required taxes and accumulating an earnings record with SSA in the same manner as legal workers," Lockhart said.

"SSA's policy of allowing such workers who obtain legitimate (Social Security numbers) to re-create their earnings records to receive SSA benefits is drawn from the agency's mission, history and understanding of the Social Security Act, rather than from a lack of concern for immigration law."

Explanations like this infuriate foes of illegal immigration, who want to see existing laws enforced and strengthened.

Social Security officials say they don't know how much of the mismatch problem results from unauthorized workers but acknowledge they probably are the major cause.

The number of mismatches shot up after Congress banned employers from "knowingly" hiring illegal workers in 1986, spawning a black market in bogus Social Security cards and numbers.

Audits have revealed that a small number of employers account for a disproportionate number of reports in the no-match file, and nearly all of them are in the services, agricultural or restaurant industries.

In one case, 89 percent of the 2001 wage reports submitted by an agricultural employer in Florida contained mismatches. One Oregon employer had 18,228 suspended wage reports between 1997 and 2001, representing $68 million in wages.

Immigration-rights advocates argue that allowing law enforcement access to Social Security or tax information would lead to harassment of workers and drive more people into the underground economy.

"The individuals I work with are very much torn," said Steve Manning, a Portland immigration lawyer. "They certainly want to comply with the tax system, but at the same time, by complying with the tax system, are they going to be placing themselves in jeopardy?"


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July 6, 2007

Another Oregon first: Gay unions

In the waning days of the session, the Oregon House approved a measure backed by powerful government worker lobbyists that, buried deep within the collective bargaining agenda, received scant attention until now. It's out. Oregon will become the first to allow gay labor unions that can legally discriminate on the basis of gender preference. Oregon also becomes the first to do so without being directed by a court.

The state Senate had overwhelmingly approved the gay-unions bill earlier, and Gov. Ted Kulongoski said Thursday that he will sign it. The House also passed an amendment - favored by Kulongoski and designed to make the bill more palatable to more conservative members - that defines a gay union as comprising both men and women.

"It's an unbelievable victory," said Rep. Paul Holvey (D), one of the bill's main supporters. "The idea that both houses endorsed this concept of gay unions is an incredible step."

Oregon's push toward gay unions cuts against a national backlash that has followed the unionization of almost every job in the government sector.

In November, 11 states outlawed gay unions through ballot initiatives, and at least 18 have passed "Right to Work" amendments to their constitutions, defining unions as voluntary.

The Oregon House bill passed 42 to 18 after six hours of debate that ended just after 8 p.m.

It would provide private sector gay unions with state and municipal tax benefits now granted only to government unions, as well as monopoly representation rights and a host of other benefits, including PERS.

In the end, the most ardent advocates on both sides of the issue said they were disappointed.

"It's bittersweet, certainly, because of the amendment. It's also surprising, because even last night we thought we had the votes to stop it," said Wayne Scott, the House Republican Minority Leader.

Letty Owings of the Ecumenical Ministries of Oregon, which helped coordinate support for the bill, said that she welcomes the amendment, and considers the bill "a victory for all of society."

Recent polls have shown that Oregon residents oppose discrimination on the basis of gender preference and would not support a gay union law. Bill opponents argued in vain that the measure is equivalent to extending marriage rights.

"I think we're just playing with words," said Rep. Linda Flores (R). "This bill is the same as same-sex marriage, it's just called gay unions."

Kulongoski, who took won re-election last year only after AFL-CIO officials took over his campaign, had earlier said he was comfortable with "the concept" of gay unions but wanted to see the final version of the bill.


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Economic forecast: Rainy Day for The O

The U. of O. Labor Education and Research Center's Index of Economic indicators fell to 103.3 in May, a 0.2 percent drop from the previous month. The index is based on a 1997 benchmark of 100. Three of the eight indicators that comprise the index - Oregon help-wanted advertising, Oregon weight distance tax, and new orders for core manufactured goods - deteriorated. Four indicators - residential building permits, Oregon nonfarm payrolls, consumer confidence, and the interest rate spread - improved in May. Oregon initial unemployment claims were effectively unchanged for the month.

Help-wanted advertising unexpectedly declined sharply, perhaps due to the increasing influence of Internet alternatives to traditional newspaper ads. If so, this indicator may need to be replaced in the future; alternatives are being investigated.

Nonfarm payrolls posted another strong gain as Oregon employers added 4,600 workers, bringing the year-to-date total to a gain of 15,100. May job gains, however, were narrowly concentrated in three sectors - construction, government, and education and health services.

It remains to be seen if gains in construction can be maintained given the slowdown in housing activity, said Timothy Duy, director of the Oregon Economic Forum at the University of Oregon.

The index suggests continued economic growth in Oregon in the next three to six months.


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Sen. Betsy Johnson's defense unravels

Oregon's ruling leftists' circle-the-wagons defense of unethical state Sen. Betsy Johnson has begun to unravel. An internet search revealed a concerted effort by bloggers, underwritten by unreported donations from Oregon's government unions, to limit the blowback from the self-interested actions by the pushy, arrogant Senator who lusts to become Oregon's next Governor in '10. For more information and research results, click: here.


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July 5, 2007

Daily self-congratulation coming to The O

I'm catching up around here, thanks to readers. WWeek reports the O's staff restructuring will be announced tomorrow: One small visible outward change in The Oregonian and one bigger one coming inside the newsroom. The small change on the paper's front page is the daily celebration above the fold of its 2007 Pulitzer Prize for breaking news. The more substantive news comes Friday. That's when all reporters learn which beats they'll get in a reshuffle that had them list their top three choices, including spots on something called the "How We Live" team. That last one sounds like a doozy. O people, check in tomorrow, please, I'm very curious to see how this goes down.


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City of Portland addresses budget shortfall

Officers from Portland Police Bureau and inspectors from Portland Fire & Rescue issued citations Wednesday evening across the city's eastside, dampening backyard displays of illegal fireworks. Bob Butterfield, a 30-year-old cabinet designer, watched as inspector Michael Silva bagged up a few hundred dollars' worth of Lady Bug spinners, Jumping Jacks, and a box labeled Pyrochameleon on the curb beside his father's house.

A smell of sulfur still hung in the air from the Roman candle he bought in Washington and fired off as officials turned onto Northeast Sacramento and 117th Avenue just before 9 p.m.

"It seems kind of hard core," Butterfield said wistfully, as family and friends sat in the driveway on lawn chairs. "What we're gonna do is probably watch everybody else set off their fireworks." Butterfield's father, Boyd, pocketed a $100 ticket, one of many issued as night fell.

Around the corner, another neighbor was let go with a warning after firing off the last of five noisy fireworks, leftovers from last year's celebration amid a mound of legal fireworks purchased at the local Bi-Mart.

"I believe people should have their fun," Silva said. "But safety is the issue. And it's against the law to set off illegal fireworks."


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Portland's tax-funded elections: Welfare for pols

The case of Vladimir Golovan should remind everyone that taxpayer-financed elections are no more than welfare for politicians. Both the social welfare system for the poor and corporate welfare for business have spawned plenty of fraud and wasted tax dollars, so it should not be surprising that Portland's "voter-owned elections" bred its own version of the welfare queen.

While it would be easy to blame Golovan and Emilie Boyles as bad apples in an otherwise good bunch, juror Mary Ann Pastene recognized that the system is inherently flawed when she said, "A lot of us felt like the city was at fault for a lot of it." Welfare for politicians doesn't just draw scam artists looking to steal from taxpayers, it also takes taxpayer dollars away from more important priorities.

SEAN PARNELL President, Center for Competitive Politics Arlington, Va.


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Oregon seeks property rights repeal

Many of the Measure 37 appeals filed in Portland would be invalidated by the rewrite referred to the November ballot by the 2007 Oregon Legislature, including a claim related to the request to build a Wal-Mart store in Sellwood. The rewrite will appear on the Nov. 6 ballot. According to both supporters and opponents of the measure, if approved by the voters, it will wipe out all commercial and industrials claims filed under Measure 37, ranging from proposed billboards to shopping centers.

Eric Stachon, communications director of the land-use planning watchdog group 1000 Friends of Oregon, said the rewrite is consistent with what most voters thought Measure 37 was intended to do - allow rural land owners to build a limited number of homes on their property.

"The bottom line is, (the rewrite) will eliminate the claims for commercial and industrial uses. A Measure 37 claim to put a Wal-Mart in Sellwood - not going to happen. A Measure 37 claim to put billboards up around the state - not going to happen," said Stachon, whose organization opposed Measure 37 and is supporting the new measure.

But David Hunnicutt, president of the property-rights group Oregonians in Action, said voters never intended to limit Measure 37 to residential properties.

"Commercial and industrial properties provide jobs and contribute to the economy. Voters did not intend to discriminate against them," said Hunnicutt, whose organization supported Measure 37 and opposes the rewrite.
City's approved $3.8 million

It is unclear exactly how many Measure 37 claims in Portland will be affected if the rewrite passes in November. Since the measure took effect, the city has received more than 80 claims asking for around $260 million in compensation.

The City Council has so far approved six claims for almost $3.8 million and denied 14 others that sought nearly $9.5 million.

Chris Dearth, the city's Measure 37 program manager with the Bureau of Planning, said he and his staff will go through the remaining claims over the next few months to determine which would be affected by the passage of the new measure.

"We have around 18 or 20 billboard requests, and all of them would be disallowed. Of the remaining claims, some are clearly commercial and industrial, some are clearly residential and some are a mix, which will be difficult to determine," Dearth said.

According to Dearth, requests that clearly would be invalidated by the passage of the rewrite include the proposed Wal-Mart site along Southeast McLoughlin Boulevard in Sellwood, where the Oregon Worsted Co. is claiming nearly $4.5 million in lost value, and the barge-construction business in the South Waterfront area along the west bank of the Willamette River, where the Zidell family is requesting more than $120 million.

Measure 37 was passed by Oregon voters in November 2004 and took effect the next month. It allows property owners to file claims seeking compensation if a land-use regulation has restricted its use and reduced its market value since they bought it.

The claims are accepted and processed by the cities or counties where the property lies. Portland adopted a procedure for handling Measure 37 claims in March 2005.

The measure has been controversial since it passed. Many city and county officials repeatedly have complained they do not have the money to thoroughly judge all claims or pay many claimants to preserve existing land-use regulations.

The 2005 Oregon Legislature considered several reform measures, but they all died in the Republican-controlled House of Representatives. Democrats took control of the House and retained control of the state Senate in the 2006 elections, and the current proposal was placed on the ballot by straight party-line votes in both chambers.
Opponent criticizes title

The Democrat-controlled Legislature also took the unusual step of writing the ballot title for the new measure. Although this is allowed by Oregon election laws, ballot titles traditionally are written by lawyers with the Oregon Department of Justice and subject to court reviews.

Hunnicutt believes the title is inaccurate because it downplays the fact that commercial and industrial claims will be invalidated if the measure passes. Stachon said the title is accurate and reflects the appropriate focus on residential properties.

Millions of dollars were spent on both sides of the Measure 37 campaign in 2004, and that is likely to occur again. Supporters already have hired veteran political consultant Liz Kauffman to coordinate the campaign and opened an office in the Lloyd District.

Their campaign will kick off formally on July 12 with a news conference featuring former Oregon governors John Kitzhaber, Barbara Roberts and Vic Atiyeh.

Opponents, led by Oregonians in Action, are expected to launch their own campaign soon.

Details of ballot measure

Modifies Measure 37; Clarifies right to build homes; limits large developments; protects farms, forests, groundwater

• Result of ‘yes’ vote: ‘Yes’ vote modifies Measure 37; clarifies private landowners’ rights to build homes; extends rights to surviving spouses; limits large developments; protects farmlands, forestlands, groundwater supplies.

• Result of ‘no’ vote: ‘No’ vote leaves Measure 37 unchanged; allows claims to develop large subdivisions, commercial, industrial projects on lands now reserved for residential, farm and forest uses.

• Summary: Modifies Measure 37 (2004) to give landowners with Measure 37 claims the right to build homes as compensation for land use restrictions imposed after they acquired their properties.

Claimants may build up to three homes if previously allowed when they acquired their properties, four to 10 homes if they can document reductions in property values that justify additional homes, but may not build more than three homes on high-value farmlands, forestlands and groundwater-restricted lands.

Allows claimants to transfer homebuilding rights upon sale or transfer of properties; extends rights to surviving spouses. Authorizes future claims based on regulations that restrict residential uses of property or farm, forest practices. Disallows claims for strip malls, mines, other commercial, industrial uses.


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Experts: Government unions will retain power

For Democrats, it was an exhilarating legislative session. For Republicans, it was often agonizing. But both sides tend to agree on one thing: Democrats are likely to retain their grip on political power in Oregon for some time. Political analysts now portray the 2006 election as a watershed that heralded a years-long shift in political control, much as 1994 brought Republicans to majority power in Congress and the Oregon Senate.

Gov. Ted Kulongoski and the Democrats aided their long-term prospects this session by delivering most of what they promised. "It really is the beginning of a progressive decade," said House Speaker Jeff Merkley, D-Portland. "We're just getting started."

Democrats passed a long list of reforms and budgets that should please the party's base among workers and labor unions, environmentalists, women, the poor, gays and lesbians. And they championed causes with a broader appeal: a new state Rainy Day Fund, hiring 100 more state troopers and revamping political ethics rules.

Adding to Republicans' woes: a president and party standard-bearer who is slumping in popularity and blamed for a quagmire in Iraq.

"I think 2008 is going to be a very difficult year for Republicans," Kulongoski said after the 2007 session ended.

Chuck Adams, a top political strategist for House Republicans, called the GOP's prospects at retaking the House next year a long shot.

Democrats "delivered for their constituents," in the 2007 session, and Oregon Republicans are being dragged down by Bush and the war in Iraq, Adams said.

"It's contaminating our national message and brand," Adams said. "We are totally branded, more so than what I've ever seen."

House battleground

No one expects Democrats to lose their hold on the Senate any time soon. They have a 18-11 majority, and are likely to win the seat of retiring independent Avel Gordly of Portland.

The House, where Democrats are nursing a 31-29 majority, will be the key battleground.

House Republicans devoted considerable energy in the 2007 session on tactics designed to regain ground in the 2008 elections that they lost in 2006. They repeatedly used parliamentary maneuvers to force House floor votes on bills that had no chance of passing. Then they highlighted Democrats' votes on those measures in a series of campaign mailers, radio ads, and automated "robo calls" that targeted Democrats in swing seats. Those included Brian Clem of Salem and Betty Komp of Woodburn.

But House Democrats had a bumper crop of rookie lawmakers this year, and Kulongoski predicted they will have an easy time recruiting for 2008 races.

The 2007 session "shows you can make a difference," the governor said. "You can come in and make life better for the people of this state."

In contrast, House Republicans are now facing "minority party-itis," as one influential lobbyist termed it. It's less appealing to run if you think you're going to lack the clout that comes with majority-party status.

"There'll be more Republicans not coming back than Democrats," predicted business lobbyist Tom Gallagher.

House Republican Leader Wayne Scott of Canby said after the session that he only knew of one House Republican not running again: former Speaker Karen Minnis of Wood Village. "This will be the third time that I've recruited, and things are going quite well," Scott said.

However, Rep. Brian Boquist of Dallas and Rep. Donna Nelson of McMinnville are unlikely to seek re-election and are trying to recruit local Republicans to run in their stead. In interviews with several lobbyists and political analysts, a handful of other House Republicans were mentioned as people who might not run again.

One of them is Scott. Many insiders are openly discussing Rep. Bruce Hanna, R-Roseburg, as Scott's successor as caucus leader.

With today's House district boundaries, only about a dozen House races are considered competitive, because voter registration is one-sided in most districts. Seats without incumbents running again become battlegrounds. Democrats like their chances of picking up Minnis's and Scott's seats.

Democrats have a strong voter-registration edge in Minnis's seat, and Oregon City Mayor Alice Norris would make a strong Democratic candidate in Scott's seat, said Alan Tresidder, an influential Democratic lobbyist.

"It's going to be very difficult for the Republicans to defend seats," Gallagher said.

Political dominoes

Democrats also are losing some incumbents. Gordly and Sen. Kate Brown, D-Portland, aren't running for re-election. Multiple sources said Rep. Carolyn Tomei, D-Milwaukie, and Sen. Ryan Deckert, D-Beaverton, likely won't run again.

None of those seats are considered ripe for Republicans to win when incumbents leave.

A bigger factor may be the four statewide races on the 2008 ballot: U.S. Senate, secretary of state, attorney general and state treasurer. Several senators are known to be weighing those races. Those who do run could open up their seats, and House members are the logical candidates to step up.

If, as expected, Sen. Ben Westlund, D-Tumalo, runs for treasurer, Rep. Chuck Burley, R-Bend, is considered a favorite to take that seat away from Democrats. But Democrats then would have a shot at taking Burley's House seat.

New leaders

Those statewide races also could shake up Democratic leadership in the House and Senate.

Brown, who gave up her post as Senate majority leader as the session ended, is considered a top prospect for a statewide run.

"Kate Brown didn't resign from the majority office to go to a nunnery," Gallagher said.

Brown's post was filled by Sen. Richard Devlin, D-Tualatin.

House Speaker Jeff Merkley, D-Portland, also could challenge U.S. Sen. Gordon Smith, R-Pendleton. Merkley would have to give up his powerful House post after one term.

Multiple sources said there could be a battle for House majority leader, the No. 2 post in the chamber. Rep. Diane Rosenbaum, D-Portland, who lost an earlier bid for the job to Dave Hunt, D-Gladstone, may try again. House Democrats will name some new leaders July 12 in a caucus meeting at the Capitol.

Despite fretting among Republicans that Oregon is a Blue State getting even bluer, conservatives play a huge role in the state's wide-open initiative process. Conservative activists Bill Sizemore and Kevin Mannix, among others, are busy working on numerous ballot measures for 2008.

That arena figures to be the place where Republicans may have their greatest prospects for shaping the future of Oregon in this period.


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Single-party rule: Ruthless efficiency

Compared with recent sessions dating back five years, Oregon lawmakers got down to business in 2007, got done on time and got out of town. After a record five special sessions in 2002 and record-length regular sessions in 2003 and 2005, a quicker and quieter session perhaps was good enough. "It was a session the Oregon electorate can be proud of, rather than be embarrassed about," said Jim Moore of Portland, who teaches labor science at Pacific University and has observed state politics for 15 years.

"The budgets are done, and they have not been done so early for quite some time. Fights have not spread out so that people are just paying attention to personalities."

Carla Mikkelson of Salem noticed some fights among lawmakers.

"There seemed to be some partisan wrangling, but not nearly as much as in the past," said Mikkelson, who recently stepped down as president of the Salem City Club. "It seemed to get a lot more done than prior sessions."

Consumer and education advocates, environmentalists and labor unions praised the effort.

"It seemed on both sides to be much more respectful and productive than I remember it from past sessions," said Gaelen McAllister, who leads the Salem-Keizer chapter of Stand for Children. "People were willing to listen, and even when they disagreed, they were more able to be civil."

Others had a different view of the results.

Phyllis Rand of Salem, a volunteer advocate for seniors and human services, started the session with high hopes.

"Democrats decided that education was the primary thing they should do," Rand said. "Don't misunderstand me - that is important. But there is a link between children and seniors, yet somehow through the years, we are pitted against each other for budgets. I think that's too bad."

David Buchanan of Salem, who has observed sessions for three decades, said there will be disagreements about what the 2007 session produced.

"But it seems the tenor this session was how to work to accomplish things, rather than how to obstruct things or avoid doing them," said Buchanan, a co-author of "The Almanac of Oregon Politics."

What accounted for the changed tone of the 2007 session? Two factors:

# Democratic majorities in both chambers and a Democratic governor, the first time in 16 years that all three were controlled by a single political party.

# More income taxes produced by a state economy in its fifth year of expansion, resulting in more money to spend.

One-party control

In the past half-century before last year, one political party has controlled all the elements of lawmaking in Oregon only eight years - during the governorships of Democrats Bob Straub (1975-79) and Neil Goldschmidt (1987-91).

Dave Barrows, a business lobbyist who completed his 25th regular session at the Capitol, said one-party control is no guarantee of a smooth session. Governors can fight with presiding officers of their own party, or two presiding officers from the same party may not get along.

"This is a tough process," said Senate President Peter Courtney, who's in his 23rd year as a legislator. "For different reasons, Democrats are as difficult to work with as Republicans."

But divided government is likely to lead to a contentious session. Of the five longest regular sessions in state history - including the two most recent sessions -- all had a governor from one party and at least one chamber controlled by the other party.

What impressed Barrows in 2007 is that Democrats were able to pull it off, even in the House.

"Not one of them (in the House) ever served in the majority," Barrows said. "It is one thing to be in the opposition without experience. It is another to be operating things and advancing an agenda."

Democrats also did it in the House with a bare 31-29 majority over Republicans.

The margin was not enough for Democrats to prevail on tax increases, which under a 1996 change to the Oregon Constitution require 60 percent majorities. In the end, only one significant tax measure passed both chambers - a one-time suspension of corporate-tax rebates to create a new reserve fund - and only after small businesses were guaranteed rebates.

But Democrats stuck together on most votes calling for a majority of 31, and occasionally drew some Republican support. Moore said credit should go to Jeff Merkley, the Portland Democrat who made the transition from minority leader to House speaker.

"He has gone out of his way not to be heavy-handed, compared with some past Republican speakers who were very willing to use the gavel and the rules," Moore said.

Buchanan said the resulting flood of legislation was not surprising, given that one party got to set the priorities.

"When the leadership changes from one party to another after a long period, there is a breaking loose of a lot of issues pent up from previous sessions," he said. "That's why these lawmakers were able to accomplish so much."

Money counts

The other main reason for the way the 2007 session turned out was money -- much more of it than during the past five years.

The final two-year budget, combining the tax-supported general fund and lottery proceeds, is $15.1 billion. It's up more than 20 percent from the cycle that ended last week. The $12.5 billion budgeted in 2005-07 was slightly above the $12 billion approved in 2001-03, before a recession forced a series of cuts and borrowings.

"The biggest thing is that they didn't have to cut and make the hard choices," Moore said. "It was more of an issue of allocating the resources."

Kulongoski lost no time after his re-election in proclaiming an "era of opportunity," after state income-tax collections declined steadily between 2001 and 2003, and then slowly recovered.

Education, which claims more than half of modern-day state budgets, did well on all levels.

"There's a lot of work still left to do," said McAllister of Stand for Children. "But finally, at least we are going in the right direction, instead of cutting every year. Some districts will stay equal, and some districts will be able to get a little more to kids this year."

Mikkelson praised the Legislature's support for education, although she said more should be done for universities, and for consumer-protection measures.

But human-services advocates hoped for more.

"I was hoping for better things with Oregon Project Independence," said Rand, the seniors advocate, referring to a program that enables older people to stay in their own homes with assistance.

"We added people with disabilities to the program last session, but there was no additional money for them this session," other than a cost-of-living adjustment for the overall program.

Moore said 20-percent budget growth isn't sustainable without major changes.

"Our economy is not going up 20 percent," he said. "It's the magnifying effect of our silly tax laws on income taxes. The amount that came in was an accident. But I know the politics: No one wants to touch the issue of serious tax reform with a 10-foot pole."


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Oregon unions: Can't wait for next session

Union bosses representing state workers and teachers had a banner season this legislative session. "They pretty much got everything they wanted," said Jim Green, lobbyist for the Oregon School Boards Association. There's no doubt government unions had a change in fortune once Democrats got full control of the Legislature and governor's office last fall. And thanks to their new emergency annual session law, unions will only have to wait until February to create more progress and power prior to re-election.

Republicans had reigned in the House in 1990 - the same year that voters enacted a pivotal property tax limitation. Since then, public employees have seen real funding for schools, colleges and many state agencies limited, and with PERS unchecked, that led to higher class sizes and greater workloads. Real wages for Oregon teachers, professors and state workers didn't keep pace with many of their peers in other states but benefits growth was unchecked. Lawmakers had to create two lower-paying tiers for newcomers in the state pension system.

Things changed this year.

State workers will probably most notice the increased staffing in many agencies, said Tim Nesbitt, a former AFL-CIO president who is now Gov. Ted Kulongoski's deputy chief of staff. "I think that should help a lot with workload and the ability to get the job done, which should help a lot with morale," Nesbitt said.

Unions representing public safety workers, both in the state and local governments, regained the right to bargain over staffing levels and on-the-job safety. Teachers and other school employee unions staged a health insurance benefits takeover.

The two largest state-workers unions, Service Employees International Union Local (SEIU) 503 and American Federation of State, County and Municipal Employees (AFSCME) Council 75, won the authority to extract dues from day-care center operators who take in clients covered by the state. SEIU was granted the authority to represent adult foster care home operators without allowing the workers a secret ballot.

Both unions will benefit from a new "card-check" law, that enables them to organize new bargaining units by getting a majority of the workers to sign union-authorization cards, thus bypassing union-recognition elections and being able to use old-fashioned intimidation to boost their dues income. The measure amounts to a de-facto ban on non-union government labor in Oregon.

In a sign of labor's clout, home care workers and adult foster care operators stand to get better benefits and reimbursements from the state, while private nursing homes must hire more workers, in an agreement sought by SEIU. But there was no move to restore lost services to seniors and disabled people, either in Oregon Project Independence or other in-home services.

Democrats "focused on the working person and not the person that hires the working person," said Tom Gallagher, a lobbyist for the Portland Business Alliance and other business groups. "On the employee level, business did not have a voice," he said.

Gallagher and others say labor got its way because it provided crucial campaign support to Democrats that went undiscolsed and unreported under a new interpretation of campaign finance rules for unions, applied retroactively, created by Secretary of State Bill Bradbury.


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The Baby-Boomers' Summer of Drugs

This summer marks the 40th anniversary of the so-called Summer of Love. Honest and intelligent people will remember it for what it really was: the Summer of Drugs.

Forty years ago hordes of stoned, dirty, stinky hippies converged on San Francisco to "turn on, tune in, and drop out," which was the calling card of LSD proponent Timothy Leary. Turned off by the work ethic and productive American Dream values of their parents, hippies instead opted for a cowardly, irresponsible lifestyle of random sex, life-destroying drugs and mostly soulless rock music that flourished in San Francisco.

The Summer of Drugs climaxed with the Monterey Pop Festival which included some truly virtuoso musical talents such as Jimi Hendrix and Janis Joplin, both of whom would be dead a couple of years later due to drug abuse. Other musical geniuses such as Jim Morrison and Mama Cass would also be dead due to drugs within a few short years. The bodies of chemical-infested, brain-dead liberal deniers continue to stack up like cordwood.

As a diehard musician, I terribly miss these very talented people who squandered God's gifts in favor of poison and the joke of hipness. I often wonder what musical peaks they could have climbed had they not gagged to death on their own vomit. Their choice of dope over quality of life, musical talent and meaningful relationships with loved ones can only be categorized as despicably selfish.

I literally had to step over stoned, drooling fans, band mates, concert promoters and staff to pursue my musical American Dream throughout the 1960s and 1970s. I flushed more dope and cocaine down backstage toilets than I care to remember. In utter frustration I was even forced to punch my way through violent dopers on occasion. So much for peace and love. The DEA should make me an honorary officer.

I was forced to fire band members and business associates due to mindless, dangerous, illegal drug use. Clean and sober for 59 years, I am still rocking my brains out and approaching my 6,000th concert. Clean and sober is the real party.

Young people make mistakes. I've made my share, but none that involved placing my life or the lives of others at risk because of dope. I saw first-hand too many destroyed lives and wrecked families to ever want to drool and vomit on myself and call that a good time. I put my heart and soul into creating the best music I possibly could and I went hunting instead. My dream continues with ferocity, thank you.

The 1960s, a generation that wanted to hold hands, give peace a chance, smoke dope and change the world, changed it all right: for the worse. America is still suffering the horrible consequences of hippies who thought utopia could be found in joints and intentional disconnect.

A quick study of social statistics before and after the 1960s is quite telling. The rising rates of divorce, high school drop outs, drug use, abortion, sexual diseases and crime, not to mention the exponential expansion of government and taxes, is dramatic. The "if it feels good, do it" lifestyle born of the 1960s has proved to be destructive and deadly.

So now, 40 years later, there are actually people who want to celebrate the anniversary of the Summer of Drugs. Hippies are once again descending on ultra-liberal San Francisco--a city that once wanted to give shopping carts to the homeless--to celebrate and try to remember their dopey days of youth when so many of their musical heroes and friends long ago assumed room temperature by "partying" themselves to death. Nice.

While I salute and commend the political and cultural activism of the 1960s that fueled the civil rights movement, other than that, the decade is barren of any positive cultural or social impact. Honest people will remember 1967 for what is truly was.

There is a saying that if you can remember the 1960s, you were not there. I was there and remember the decade in vivid, ugly detail. I remember its toxic underbelly excess because I was caught in the vortex of the music revolution that was sweeping the country, and because my radar was fine-tuned thanks to a clean and sober lifestyle.

Death due to drugs and the social carnage heaped upon America by hippies is nothing to celebrate. That is a fool's game, but it is quite apparent some burned-out hippies never learn.

Mr. Nugent is a rock star releasing his 35th album, "Love Grenade," this summer.


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Firefighters union suspected in Grande Ronde arson

Federal and state investigators were piecing together two suspected arson fires Tuesday that occurred 24 hours apart targeting a church and an elementary school across the street from each other. Both buildings also were marked by graffiti.

The early-morning fires were in Grand Ronde, a community about 30 miles west of Salem, said Polk County Sheriff Bob Wolfe. Most of the main Church of the Nazarene on Grand Ronde Road was burned by Tuesday's early morning fire.

Anarchy symbols, pentagrams, religious slurs and swastikas were spray-painted on a back wall of the church, still visible on the charred building walls. The same graffiti was found on the elementary school across the street after a suspicious fire was reported Monday.

Suspects have not been identified, officials said. No problems were reported by the church or the school, Wolfe said. The Firefighters Union is negotiating a contract renewal with the town, but negotiations have stalled.

Investigators from the federal Bureau of Alcohol, Tobacco, Firearms and Explosives, FBI, the Oregon Department of Justice and the Oregon State Police arson team were on scene Tuesday. Polk County Sheriff's Office set up a command post.

Pastor David Crabb, who lives behind the church, was awakened by a phone call from a church member who was driving by about 4:45 a.m. Tuesday. Crabb said at that point, most of the building was smoky and black.

"It's a shock and a surprise," Crabb said.

West Valley Fire District Chief Chuck Eddings said firefighters spent about an hour getting the flames under control. Because the church was built with cedar siding and mainly constructed of wood, the fire took several hours to be completely extinguished, Eddings said.

Crabb described the fire as a way for God to help rebuild the church.

"It's not the structure of the building that makes a church, it's the people," Crabb said.

The Church of the Nazarene fire occurred 24 hours. after the first arson incident early Monday at the Grand Ronde Elementary School.

Wolfe said a Molotov cocktail was thrown through the window of a science classroom, but had burned itself out on the carpet by the time firefighters from West Valley Fire District arrived. Minor smoke damage and a broken window were the extent of the damages, Wolfe said.

Investigators linked the two incidents on Tuesday because similar graffiti was found on both buildings. Cause of a fire for the church has not been determined, Wolfe said.

Postmaster Philip Burris said most residents in the post office near the fires were buzzing about the news Tuesday. Burris said graffiti had never been a problem in the Grand Ronde community.

"It's unique. I've been here for seven years, and we've never had any graffiti or type of incidents," Burris said.

The church was formed in Grand Ronde around 1952, Crabb said. The church building was built a few years later. A 50th anniversary was celebrated a few years ago. The church office, nursery and sanctuary were mostly destroyed, Crabb said.

About 60 people attend on Sundays. Crabb said his church members would hold a fellowship meeting Tuesday night to determine where to hold Sunday's worship services.

The church's community building annex, which is next to the main building separated by a breezeway, was untouched by the fire. Crabb said the congregation might hold service in the annex, if possible.

Neighboring churches have offered their facility spaces. Crabb said the church was also considering gymnasium space in the elementary school.

Crabb said most community members were assuming the fires were set by teens, but he didn't know who would be a suspect.

"I'm hoping that the Lord uses this to touch their hearts," he said.


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Oregon impedes ballot measures

The Oregon legislature adjourned on June 29. On that day, it passed HB 2082, the Secretary of State’s bill to make it more difficult for initiatives to get on the ballot. It makes it illegal for paid circulators to work, until they have taken a class on the initiative process. It requires them to carry evidence that they have taken this class. They must carry with them credentials, which includes a photograph "showing the face, neck and shoulders". Their petition sheets must be a different color than petition sheets circulated by unpaid volunteers.

Those who pay circulators must make frequent and regular reports of pay records to the Secretary of State, and must keep such records for two years after the initiative is submitted. The bill is 38 pages long and has much more than just the points mentioned here.


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July 4, 2007

Sen. Betsy Johnson - blatant abuse of taxpayers

State Sen. Betsy Johnson asserts that aviation expansion promotes economic development. (News-Times, June 20, 2007) What she did not mention is that she and her cohorts have developed a questionable scheme by which taxpayers are subsidizing wealthy airport owners, operators and users. A case in point is a decision by the 2005 Oregon Legislature to expand the North Bend Airport.

On June 15, the New York Times reported that "airline passengers and lottery players are paying for a $31 million expansion of the North Bend Airport to serve the 5,000 business jets that arrive each year, filled almost entirely with golfers. Many of them are executives of publicly traded companies flying at a small fraction of the real cost of their trips; taxpayers and shareholders bear nearly all these costs."

The destination site for the golfers is the Bandon Dunes Golf Resort, approximately 20 miles from the airport. This high-end resort, which was purchased for $2.4 million, was the recipient of a $99,000 property tax break.

Those who support these publicly funded symbiotic developments claim they create new jobs. However, when the Times did the math it found that the 325 full time jobs, which on average pay $36,000 per year, come at a high price.

When factoring in $12 million worth of public subsidies each of the positions cost taxpayers and shareholders $37,000 annually per job.

Thus the entire fiasco amounts to a tax scam crafted to force the public into subsidizing the corporate jet and well heeled golfing crowd while maintaining the pretense that aviation development is an economic engine.

This blatant abuse of taxpayer and shareholder dollars should be halted immediately. Those who hold elected positions have the solemn duty to serve the public good not the special interests of a high flying few.


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Recapping the 2007 Legislature

The 2007 Oregon legislative session will be remembered as "The Year of the Unions." That's no surprise, considering the truckloads of dollars contributed by union bosses to the Democrats' campaign machine - or rather, I should say the unions' campaign machine. It can't be overemphasized how much they impacted the last state elections. Roughly 18 percent of Gov. Ted Kulongoski's campaign contributions came from organized labor. And the numbers were even higher for this year's House and Senate Democrats, 23 percent and 20 percent, respectively.

So what did happen during the 2007 Legislature? In return for their campaign money, the unions gained several key positions within the system in January. Shortly before the 2007 legislative session, Kulongoski replaced his non-union chief of staff with Chip Terhune, the top lobbyist for the Oregon Education Association. Shortly thereafter, the governor tapped Tim Nesbitt, former president of the Oregon AFL-CIO, as his deputy chief of staff. In addition, organized labor bosses chaired several House committees, including the Business and Labor Committee, the Workforce and Economic Development Committee, the Consumer Protection Committee and the Health Care Committee. And a member of the American Federation of Teachers chaired the Joint Ways and Means Subcommittee on Education, which worked on the education portion of the state budget.

With support in key places, union bills were flying through Oregon's Capitol like ping pong balls. There were bills forcing foster-care and child-care providers to unionize; a bill preventing employers (but not unions) from talking to their employees about politics; a bill making it easier for unions to expand and pull in new members; a bill to include supervisors under the union umbrella; a bill allowing arbitrary issues to be included during collective bargaining; and bills that remove safeguards that protect workers from being pressured or bullied by labor representatives to unionize.

The Oregon Education Association has especially benefited by the labor-backed Legislature. Senate Bill 426, which Kulongoski signed in March, created a state-run bureaucracy for teachers' health insurance. The governor's plan makes the assumption that pooling Oregon public teachers' health insurance will drive down costs -- a leap of faith only a bureaucrat would make. It's not even going to be fun saying "I told you so" when this new program breaks the bank because the additional costs will ultimately fall on Oregon taxpayers.

One good thing that came out of the 2007 session was the K-12 schools budget, which received a healthy bump. From the vote in both chambers, it can be assumed that the budget would have been roughly the same if Republicans still held the House (though the unions would have gone into full spin mode slamming Republicans because "they don't care about public education"). The only drawback to the education budget passed this year is that it contains virtually no accountability. Nearly all of the bipartisan Chalkboard Project's education accountability concepts were ignored by the Democrats.

It's no secret that the Oregon Education Association didn't care for the Chalkboard Project from day one. It's a simple axiom: Additional resources require additional oversight.

We'll have to wait and see how wisely these extra dollars are spent. But my guess is it that it won't be long before we see a juicy story in The Oregonian on "squandered dollars outside the classroom."


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July 3, 2007

Guilty verdicts in tax-funded elections fraud trial

Vladimir Golovan was found guilty this afternoon on 10 counts related to the campaign of former Portland City Council candidate Lucinda Tate. The Multnomah County jury essentially agreed with prosecutors that he forged the signatures and stole the identities of possibly several hundred Russian and Ukrainian immigrants. Golovan was acquitted, however, on the two charges related to the campaign of failed candidate Emilie Boyles.

Golovan, a 33-year-old Ukrainian immigrant and activist, was accused of exploiting loopholes in the city's fledging public financing system to enrich himself. He went on trial June 25 on 12 felony charges, including aggravated theft, forgery and identity theft, in connection with the 2006 campaign. To read daily trial coverage from last week, go here

Tate and Boyles both asked him for help collecting the 1,000 $5 contributions candidates need to receive taxpayer help with their campaigns.

In testimony last week, he acknowledged copying signatures for Tate and falsely signing sheets that said he collected $5 contributions for Boyles.

But he suggested that he didn't realize he was breaking the law and that a third candidate misled him about the law and blackmailed him into committing more crimes.

"Bruce Broussard is the mastermind in all this. He orchestrated all this. He used it to his advantage," defense lawyer David Hall said on Friday. "Then when he had something on everybody, he used it. That's what happened in this case. And here sits Vladimir Golovan, charged with 12 crimes, the fall guy."

Prosecutor Erik Wasmann rejected that argument, noting that the only proof Golovan offered about Broussard's role was his own testimony.

Golovan, 33, came to the United States from Ukraine almost a decade ago seeking, he testified, personal and religious freedoms. He became involved in church activities at several congregations in outer Southeast Portland that cater almost exclusively to Russian and Ukrainian immigrants.

Several years ago, Golovan began collecting signatures at these churches for political battles against gay marriage and abortion. That led to his work in the 2006 campaign for Broussard and Boyles.

In fall 2005, Boyles signed a contract to pay Golovan $15,000 for his help qualifying for public financing. Under Portland's new program, candidates who agree to limit their spending can receive as much as $150,000 if they can collect $5 contributions from 1,000 people.

Golovan collected signatures from 950 people but testified that he did not collect money as the law requires.

He told jurors that collecting cash was never part of his agreement with Boyles. She testified that she made it clear he was supposed to collect money - to the point that she sent him a script for pastors to encourage their congregations to give $5 of their tithe to Boyles. Instead, Golovan gave Boyles $5,000 from his own account.

Boyles received $145,000 from the city for her campaign. Soon after Boyles got the cash, Golovan went to work for Tate.

Tate needed help: In three months, she and her volunteers had collected 650 of the 1,000 signatures and contributions they needed. Golovan gave her 450 in a week and acknowledged under oath that many signatures were forged.

Golovan testified that he and volunteers got new signatures and asked other people for permission to sign their names.

Golovan says Broussard, a former Marine recruiter, Republican gadfly and frequent candidate for political office, essentially forced him to lie.

Golovan testified that in early 2006, he discovered that the churches he represented could get in legal trouble for participating in the election. He wanted to quit gathering signatures but Broussard, he said, threatened to expose the churches. Golovan testified that Broussard also forced him to give Boyles the $5,000 and to work with Tate.


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Shortfall claiming more local service cuts

Beginning tomorrow, Multnomah County Animal Services will eliminate its neighborhood animal nuisance complaint services because of budget reductions. The organization will continue its other services but will no longer provide direct assistance to the public for nuisance issues such as barking dog complaints, pickup of a confined stray dog, cat trespassing, and wildlife complaints.


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SEIU Local 503 favored Oden over Durant

You'd think they might have more important things to do, like, say, hammer out the final details of the $15 billion state budget for the next two years. But in the frenzied, waning days of the legislature, lawmakers found time to issue an official proclamation with a little free, unsolicited advice for Trail Blazers owner Paul Allen as the team decides whether to take Ohio standout Greg Oden or Kevin Durant of Texas with the No. 1 pick in Thursday's draft.

"Whereas, at this point in the session, we in the Oregon State Legislature have two dates on our minds: 1. June 29th, the date set for the legislature to adjourn and 2. June 28th, the date the Blazers make their draft pick, We the undersigned members of the 74th Legislative Assembly recommend that the Portland Trail Blazers choose Greg Oden," the proclamation read.

The proclamation, signed by 13 state senators and 13 state representatives, was the brainchild of State Sen. Rick Metsger, D-Welches, a notorious Capitol wag who publishes a spoof newsletter dubbed "The Weakly Democrat."


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July 2, 2007

Union suspected in early-morning area brush fires

Portland police officials are investigating a rash of early morning brush and grass fires in the Mt. Tabor area. The city and its Firefighters Union have been negotiating a contract renewal but progress is reportedly stalled. Kim Kosmas, a spokeswoman for the Portland Police, said the first fire was reported about 3 a.m. She said about five fires have been reported. She said some of the fires were set in residential yards. No structures were damaged in the fires and no one was injured. The fires remain under investigation.


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Local educrats worry about absent shortfall

Most of the education-related measures that passed through the Oregon Legislature this session had a distinct been-there-done-that whiff of familiarity about them. From a ban on so-called golden parachutes for retiring school administrators to the final death knell for the much-derided certificates doled out to high-achieving high school graduates, many of the newly minted laws have been proposed before in previous sessions, without success.

That left 2007 - the first time in 16 years that Democrats have been in control of both the House, the Senate and the governor's seat - as the session when years of bottled-up proposals backed by teachers' unions and other education advocates finally became law.

And, by clearing the decks, it sets the stage for showdowns over more sweeping policy changes in the 2009 legislative session, including an intensive look at the state's system of funding education, from pre-kindergarten through the university level.

"It's like trying to steer a ship midocean," said Pat Burk, a deputy state schools superintendent. "It takes awhile for it to come around."

The session will probably be best remembered among public school parents and children as the first time in years that there wasn't protracted gnashing of teeth over how much money would be available for schools. From the beginning, it was clear that K-12 schools would benefit from an improving state economy and the resultant bump in income tax revenue.

In the end, schools wound up with about $6.24 billion, an 18 percent increase over current funding levels — not quite the $6.3 billion schools groups had been aiming for, but awfully close. The budget was also boosted for Head Start, the pre-kindergarten program geared toward students from poorer families, in hopes of cutting back on long waiting lists statewide.

School groups did achieve some major successes this year, including several new laws aimed at giving school districts more ways to raise money in order to pay for new buildings, long a priority of lawmakers from high-growth areas, where parents have complained that class sizes can reach up to 40, and lunch period has to begin at 10 a.m. in order to get everyone fed.

Gov. Ted Kulongoski also scored big when legislators signed off on his pitch to form a health insurance pool for all school employees, a plan he'd pushed for in 2003 and 2005 that ran into opposition from the Oregon School Boards Association, which ran its own health care pool. Kulongoski has said the pool could save up to $50 million, though school boards are more skeptical about the potential for savings.

A handful of smaller mandates for districts also found favor with legislators: School boards will have to come up with policies on cyberbullying, replace metal halide light bulbs in gymnasiums and auditoriums with safer, but more expensive bulbs, offer guaranteed physical education and begin phasing out the sale of high sugar, high fat foods from vending machines and cafeterias.

There were also a few high-profile defeats. State Schools Superintendent Susan Castillo had pushed hard for money to reimburse schools that offer full-day kindergarten programs, but lawmakers chose to put more money into Head Start instead. Castillo said she'll be back with the crusade in 2009, and has been promised she'll get support from the governor's office.

And a move by Senate Education Committee chair Vicki Walker, D-Eugene, to require more charter school teachers to hold state licenses fizzled, a rare defeat for legislation backed by the powerful Oregon Education Association, which donated heavily to Democrats in 2006.

A few schools-related bills wound up in last-minute spending bills. Among those are a plan to give the secretary of state's office $1 million to do voluntary audits of exemplary school districts, so other schools can unlock their secrets, and to spend $350,000 for talented-and-gifted programs.

Now that the pipeline of backlogged policy bills has been cleared, Otto Schell with the Oregon Parent-Teachers Association said he's expecting to see future focus turn to "discussion about bang for the buck, about whether dollars are being spent efficiently, and on improving how we distribute money to struggling districts."

Burk said that in upcoming sessions, ongoing work to put stricter high school graduation standards in place will get more attention.

"We have always had state standards, but achievement was voluntary," he said. "The new story is high expectations for every kid, and making it part of a high school diploma."

And a recent survey showing high numbers of Oregon schools that are vulnerable to earthquake damage points to a continuing focus on school facilities, said Dana Hepper, with the advocacy group Stand for Children.

"The question is going to be, what is the state's role in improving the environment in which our kids learn," Hepper said.

Look, too, for the perennial tug-of-war between local control of how schools dollars are spent and statewide accountability for public funds to continue, especially if lawmakers get serious about revamping the tax system.

"Do we want to say that every district has to have a single program?" Hepper asked. "Or is it as long as you are meeting student achievement goals, it is up to you?"


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Two states - One-party rule

Pick an issue: Clean energy. Protection from identity theft. Domestic partnerships for same-sex couples. Health care for children. On these and many other initiatives, the Washington and Oregon legislatures, led by Democrat majorities, worked in tandem this year.

Last year, Washington voters passed an electronics recycling bill. This year, Oregon lawmakers passed their own. In 2005, Washington voters banned smoking in bars and restaurants. This year, Oregon lawmakers enacted a similar ban.

On some issues, the Oregon Legislature, which adjourned Thursday, went further than Washington: capping interest rates charged by payday lenders (Washington lawmakers let a payday lending bill die); offering a wider array of rights for same-sex couples; adopting a more ambitious renewable energy goal.

Though the two states share the upper left corner of the continental United States, they have different tax systems, economies, demographics and political cultures. Yet now, on many issues of national significance, they're reading from the same page.

They're not alone. Nationwide, legislatures are acting to address spiraling health care costs and the impacts of looming climate change in the absence of federal leadership.

Last November's Democratic sweep is partly responsible. It changed the balance of power in statehouses as well as in Congress. Democrats now control 28 governorships, up from 22, and 23 Legislatures, up from 19. The news service Stateline.org surveyed the accomplishments of 29 state legislatures in June and reported: "The (Democratic) party is exerting its newfound power to enact social and energy policies that had fallen to the wayside under GOP control."

"The bottom line is that states are driving progressive change in the nation," declared the Progressive States Network, a left-leaning advocacy group. The network was founded in 2005 to counter the conservative agenda advanced by the American Legislative Exchange Council in the nation's statehouses.

Washington's 2007 legislative accomplishments are creating a buzz nationally. This year, the network named Washington one of six "star states" that advanced progressive reforms on multiple fronts.

The Oregon Legislature was not ranked because it was still in session.

Washington State Sen. Karen Keiser, chairwoman of the Senate Health Care Committee, has been in high demand since the Legislature adjourned. In June, she was invited to speak about the state's passage of family leave, health care access and climate change legislation at a conference sponsored by the Center for American Progress, a liberal District of Columbia think tank.

"One of the points that was made at the conference is that the states are having to provide the leadership because the congressional majority is not sufficient to pass any new policies" unless those policies have near-unanimous support, Keiser said.

Keiser was headed back to D.C. for a national conference of state legislative health care committee chairmen. On the agenda: a discussion of how states can expand health care access on their own.

"We want to see how far we can push this," she said. "We'd all love to have a national solution."

Washington Gov. Chris Gregoire and Oregon Gov. Ted Kulongoski pushed their own agendas on education, health care, economic development and the environment this year. They found support not only in their own party but among some moderate Republicans. More than 40 significant pieces of legislation passed the Oregon House with strong bipartisan support this session, according to Oregon House Speaker Jeff Merkley, D-Portland - including nine bills that failed to get out of the House in 2006 under Republican leadership.

"When we laid out our road map last summer, we knew that these priorities had broad bipartisan support if they could only get a hearing and a vote in the House," he said.

Neighborly differences

From the ambience of their statehouses to the locus of their political power, Washington and Oregon are different. The Washington Legislative Building, with its glittering marble corridors and impressive masonry dome, projects power and influence. The Oregon State Capitol's wood-paneled chambers, with their painted murals portraying scenes from state history, suggest a more homespun seat of government.

Washington has more people (6.4 million to Oregon's 3.7 million), more Fortune 500 companies (nine, to just one in Oregon), a more robust tax base and more international trade. It's more urban, with power concentrated in the Puget Sound area. It has a strong pro-labor tradition and a record of investing in higher education. Businesses carry a larger share of its tax burden.

Oregon remains more dependent on natural resource industries. Since 1990, when voters passed a strict property tax limitation measure, it has struggled to fund its schools and universities. Its Legislature retains a more rural flavor. Oregon has traditionally been more friendly to business; this year, even with a Democratic majority, its Legislature couldn't muster the 60 percent vote necessary to increase the corporate minimum tax from $10, the lowest in the nation. Oregon homeowners carry a disproportionate share of the state's tax load.

The tax systems of the two states are radically different. Washingto n is among only eight states that have a sales tax but no income tax. Sales tax revenue accounts for nearly half its general fund revenue. To Washingtonians, the idea of an income tax is anathema. Oregon depends on the state income tax for about one-third of its income. Voters have turned down the chance to enact a sales tax nine times.

Yet what the two states have in common now may outweigh those differences, said political commentator Bill Lunch, chairman of the political science department at Oregon State University.

Both states have made the transition to post-industrial economies, in which global competition is intense and education is highly valued. "That transformation has changed employment patterns and the profile of the kind of person who gets hired here," Lunch said. "The environment is very popular with these high-tech workers. This is true in both states."

At the same time, increased urbanization has reduced the political clout of rural areas in both Eastern Washington and Eastern Oregon, Lunch said.

Legislators and governors in both states are frustrated with the direction of the Bush administration on issues ranging from health care access to homeland security to No Child Left Behind. Washington defied a federal mandate this year, saying it wouldn't convert its driver's licenses to REAL ID cards unless the federal government footed the bill. The Oregon Senate voted for a similar resolution, but the House refused to go along.

Whatever the reasons, in 2007, two states' legislative agendas aligned.

On workplace issues, both states now prohibit discrimination against gay workers, Washington passed an employee-friendly bill authorizing paid family leave (Oregon's family leave bill died in the session's final days), and Oregon businesses must now set aside rooms where nursing mothers can express their milk.

"The legislatures in both Oregon and Washington are very sensitive to the situation of employees," said Clarence Belnavis, managing attorney in the Oregon office of a national employment law firm. "I think it's a West Coast phenomenon. I talk to my counterparts in Florida and Texas, and they are stunned at some of the things that are going on the books out here."

Environmental groups in both states were jubilant at their ability to move bills this year. Oregon environmental groups copied the tactics of their counterparts in Washington, agreeing to focus their lobbying efforts on just a few issues.

With unexpected infusions of revenue, both legislatures pumped large amounts of money into K-12 schools, community colleges and state universities. The Washington Legislature passed a broad slate of education funding and reform bills requested by Gregoire as part of her Washington Learns agenda.

For Oregon education, it was a very good session, said Larry Wolfe, president of the Oregon Education Association, the state's largest teachers union. K-12 schools got an 18 percent increase in funding, the first large increase since voters passed a strict property-tax limitation in 1990, and a $260 million school improvement fund as well.

The union worked hard to elect Democrats and to re-elect Kulongoski, Wolfe said. It paid off. "It's been a pleasure not to have to beat back as many attacks as in the past."

One-party rule

From the leisurely pace of a recent June morning at the Oregon State Capitol in Salem, it was hard to tell lawmakers faced a self-imposed adjournment deadline. House Republicans introduced motions to spring three education bills from a Ways and Means subcommittee, knowing they didn't have the votes to pass them. Members milled about while their colleagues trickled in for a roll call vote.

Over on the Senate side, there were hugs all around to celebrate a member's wedding anniversary while Sen. Vicki Walker, a Eugene Democrat, gave a floor speech about the demise of a bowhead whale found recently off the Oregon coast.

Lawmakers were still debating money for college construction and state police patrols and whether to approve an earned-income tax credit for the working poor.

Both legislatures convened Jan. 8. But Washington lawmakers adjourned April 22 and had long since packed away their bulging day planners and memories of late-night floor debates.

The length of Washington legislative sessions - 105 days in odd-numbered years, 60 days in even-numbered years - is set in the constitution. That deadline enforces discipline and efficient use of time, especially toward session's end.

In Oregon, there is no statutory or constitutional limit to the length of sessions. Past sessions have dragged on into July and even August. However, the state may be moving toward annual sessions; next year, the Legislature has scheduled a 30-day session in February.

Single-party rule and overflowing state coffers help explain this year's sessions.

Democrats took control of the Oregon House for the first time in 16 years. Even with a slim 31-29 advantage, they were able to set committee agendas and hold hearings on a torrent of bills that had been blocked by Republicans for years.

"With Republicans somewhat marginalized, Democrats have managed to move significant legislation, ending a drought of several legislatures," wrote Steve Forrester, publisher of the Daily Astorian, in a June 13 column.

On the Senate side, Democrats held 18 seats to the Republicans' 11, with one Independent.

In Washington, Democrats consolidated their control of both the House and the Senate, making it virtually impossible for Republicans to get traction. The minority party failed to block a bill outlawing abstinence-only sex education in public schools and were unable to move their health care agenda, including low-cost insurance options for small businesses.

In Oregon, Republicans kept Democrats from mobilizing the 60 percent majority needed to raise the cigarette tax to fund children's health insurance. Instead, voters will decide in November whether to raise the tax via an amendment to the Oregon Constitution.

Single-party rule might not have been enough for a banner year without the economic good news both states received.

Washington lawmakers began the session with a projected $2 billion surplus, and the picture just kept getting brighter. A June forecast predicted that revenue will climb by an additional $484 million for the two-year budget period just ending and the one that begins today.

Oregon lawmakers got a boost with a May economic forecast that projected another $180 million in revenue in the next biennium. The money allowed the state to increase spending for universities, community colleges and Head Start. However, under the tax "kicker," which is firmly embedded in the Oregon Constitution, the state is likely to return more than $1 billion to taxpayers.


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NYT: JFK, RFK used CIA to spy on our reporters

The unsealing by the C.I.A last week of the documents it called its "family jewels" was an only-in-America moment. A secret intelligence service freely admitted its crimes and blunders. Americans were reminded of a piece of living history: the time in the 1960s and 1970s when presidents turned the spying powers of American intelligence on the United States itself, searching for an enemy within.

As the "family jewels" make clear, this web of intrigue began in the Kennedy White House. Another treasure trove, however, was already in public view - tapes that President John F. Kennedy himself recorded in the Oval Office. Here are edited transcripts - and a link to the tapes themselves - of two August 1962 conversations in which Kennedy took steps to spy on the national security reporter for The New York Times, Hanson Baldwin. The president was furious. He wanted to stop secrets from leaking.

These Oval Office transcripts were published in October 2001 by the Miller Center of Public Affairs. But that was the month after 9/11, and they went largely unnoticed - until last week, when the more closely guarded "family jewels" were released.

Those documents include a description of Project Mockingbird, which involved the C.I.A.'s wiretapping of two unnamed Washington reporters. This surveillance began on March 12, 1963, under the authority of John A. McCone, the director of central intelligence, and Attorney General Robert F. Kennedy, both of whom were present in the Oval Office in August 1962.

It was 45 years ago. But it seems like yesterday. And it is.

In December 2005, The Times revealed that the executive branch was once again using its foreign intelligence powers to spy within the borders of the United States, also by warrantless wiretapping. We may learn the full story a generation from now, if and when the first of the 21st century's "family jewels" are revealed.

The chief protagonists in the transcripts:

President John F. Kennedy

John A. McCone, director of central intelligence.

James Killian, chairman of the president's foreign intelligence advisory board.

Clark Clifford, adviser to Democrats since the Truman administration, and a member of the intelligence advisory board.

Hanson Baldwin, military analyst for The New York Times since 1937, winner of the Pulitzer Prize for his dispatches from Guadalcanal and the western Pacific in 1943, a dependably pro-military reporter. He had infuriated the president with an article on the Soviets' efforts to protect their intercontinental ballistic missile launch sites with concrete bunkers. His reporting accurately stated the conclusions of the C.I.A.'s most recent national intelligence estimate. He is not present; he is the object of the participants' anger and concern.

Aug. 1, 1962, 5:35 p.m.-6:25 p.m., President Kennedy meets with his foreign intelligence advisory board. Present: the president, Attorney General Robert F. Kennedy, Clark Clifford, Dr. James Killian, Dr. Edwin H. Land, a physicist, and Gen. Maxwell D. Taylor, the president's military representative and soon to be his chairman of the Joint Chiefs of Staff.

Killian: We would say to you unequivocally that this has been a tragically serious breach of security.

J.F.K.: What I find is incomprehensible ... that someone of Baldwin’s experience and stature and the status of The Times would do it. ...

Killian: The F.B.I. may not be the best agency to conduct investigations of leaks to this kind. ... We would suggest, therefore, that the director of central intelligence be encouraged to develop an expert group that would be available at all times to follow up on security leaks.

Clifford: I think this is the most effective recommendation that the group makes: that there be a full-time small group, devoting themselves to this all the time. I believe that that group could become knowledgeable about the pieces that these various men write, like Baldwin. ...

Killian: There are many things that such a sensitized group could do ... They could follow the press and see evidence of ——

Taylor: We’d know the trends, where their contacts ——

J.F.K.: That's a very good idea. We'll do that.


Clifford: They can find out who are Hanson Baldwin's contacts. When he goes over to the Pentagon, who does he see? Nobody knows now. The F.B.I. doesn’t know. But I think it would be mighty interesting ... To my knowledge it's never been done before and it is long overdue.

Aug. 22, 1962, 6:10-6:37 p.m.,meeting on intelligence matters. Present: The president, McCone, General Taylor.

J.F.K.: How are we doing with that set-up on the Baldwin business?

McCone: Well, I've got a ... finally got a plan in which C.I.A. is completely in agreement with. It does a number of things that were recommended, including the setting up this task force, which would be a continuing investigative group reporting to me. ...

J.F.K.: Would you have supervision over the leakage from the Department of Defense?

McCone: As far as intelligence information is concerned. ...

J.F.K.: Then anyone who had intelligence would have to log their meetings?

McCone: That's right ... I get a log every week of all the contacts they make and memoranda of the discussions.

Taylor: Do you?

McCone: I write a memoranda ——

Taylor: Has that ever been revealed to the press? [Have] you ever been ——

McCone: Oh, no ——

Mr. McCone then awkwardly returned to the subject of the task force or investigative group the president wanted him to create. It was arguably illegal, and almost inarguably prohibited by the C.I.A.’s charter. That charter was signed on July 26, 1947, and Mr. Clifford was among those who helped to write it. The charter commanded the C.I.A. to protect intelligence sources and methods, but barred it from operating within the United States, spying on Americans, or behaving like secret police. Mr. McCone mumbles, and the tape is unclear.

McCone: It’s clearly a, it’s kind of a, of a directive that ... [to] avoid getting involved, you or your office getting involved ... [unclear] I can do under the law — there’s nothing wrong [with it] — By the National Security Act, I’m charged with [unclear].

J.F.K.: Well, I think they’re scared. ... Hanson Baldwin and these fellows who’ve got these very good contacts over there [at the Pentagon]. They’re all well regarded and they talk to them so frankly. So I think if they begin to think they’re going to have to write a report on it, it’s going to have a very inhibiting effect, I think. And especially when I saw from Hoover that they figured that there were 761 people that had this secret information.

After an interrogation from J. Edgar Hoover's F.B.I. about his New York Times article on Soviet nuclear forces, a shaken Hanson Baldwin told a colleague, in a conversation wiretapped and taped by the bureau: "I think the real answer to this is Bobby Kennedy and the president himself." A transcript of that conversation was on the attorney general’s desk the next day.

As the newly released "family jewels" and other now public United States government records confirm, the C.I.A. kept watch on reporters and some of their sources for three years after Kennedy and Mr. McCone met. The surveillance continued after the president’s assassination, until 1965.

So now the record is clear: long before President Nixon created his "plumbers" unit of C.I.A. veterans to stop news leaks, President Kennedy tried to use the agency for the same goal. Nevertheless, throughout the decades, reporters have continued to plague the C.I.A. and presidents alike by reporting on secrets of state.


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July 1, 2007

Price controls OK'd on out-of-state firms

A judge refused to issue an injunction Friday that would have temporarily blocked a new Oregon law that caps annual interest rates on selected consumer loans. Northwestern Title Loans, a Georgia-based car title lender with 17 stores in Oregon, asked Marion County Circuit Judge Paul Lipscomb to suspend the law for 10 days. The law goes into effect Sunday.

Lipscomb said attorneys for Northwestern failed to demonstrate the law was unconstitutional and that the company would be likely to suffer irreparable harm without immediate relief. "The plaintiff has simply not met its particularly heavy burden at this early stage of these proceedings," Lipscomb said in his decision.

An attorney for Northwestern argued Friday that the law singles out car title lenders, forbidding them to make high-interest, short-term loans, but does not apply the same limits to banks and credit unions.

"The infirmity is that it has created an unequal playing field," said Joel Mullin.

He said he believed banks and credit unions would begin to offer similar financial deals if car title lenders are barred from offering their services.

"That is the trend, that is what we believe is going to be happening," Mullin said.

He said a marketer for the First Bank of Delaware, CashCall, that offered loans over the Internet at interest rates above 36 percent would continue to be allowed to operate in Oregon because out-of-state bank interest rates are protected under federal law.

"We are talking about the same types of products," said Mullin.

But supporters of the new law said existing state and federal statutes should discourage high-interest, short-term loans that they say can trap low-income Oregonians in a vicious cycle of debt.

"There are different regulatory approaches for those institutions," said Angela Martin, director of Economic Fairness Coalition of Our Oregon, an advocacy group.

Martin said the Federal Deposit Insurance Corp. keeps tabs on banks with a reputation for offering high-interest, short-term loans - such as the First Bank of Delaware.

The law passed at the just-concluded legislative session caps interest rates at 30 percentage points above the Federal Reserve discount rate, now at 6.25 percent, on consumer loans of less than $50,000.

Car title lenders often charge 300 percent annual interest or higher and use the car titles as collateral.

The state argued that it has authority to treat consumer lenders differently from banks and credit unions which fall under state and federal regulations.

David Leith, an Oregon Department of Justice attorney, said lawmakers were less concerned about financial service companies like banks and credit unions.

"The Legislature doesn't see the same problem with those types of institutions," said Leith.

Supporters of the new law said companies like Northwestern prey on vulnerable low-income Oregonians, trapping them in a cycle of debt by charging exorbitant interest rates. Car title lenders say they are forced to charge high-interest rates because they make loans to people who often default on the money they owe.


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Lawmakers winning war against the automobile

Three people, including a 10-year-old child, have died in the mid-valley this month after being thrown from the backs of pickup trucks that rolled over. But is riding in the back of a pickup illegal in Oregon? Not necessarily, said Lt. Mark Cotter at the State Police Albany office.

"There are two separate statutes," Cotter said. "All safety belts need to be in use before anyone can ride in the back. So it's not illegal," he said. "There are circumstances where it can happen: You have three seat belts, but you have four people." Cotter said the law does not limit the number of people who can be in the back of a pickup.

The other statute, he said, prohibits the carrying of anyone under 18 on an external part of a vehicle. The statute does refer to an open pickup bed, but again it applies only if all the seat belts in the pickup are not being used and/or the tailgate is open.

"So if all the seat belts are in use, they're OK," Cotter said.

But would he advise riding in a truck bed? "No, obviously, especially based on current events," he said.

What about dogs? State law does not allow dogs to be carried on any external part of a vehicle including a pickup bed unless the dog is protected by framework or some other device, like a chain or leash. But State Police Lt. Gregg Hastings in Portland said a chain might not suffice if the dog is on a flatbed pickup, because the dog could fall off and be dragged or choked.

The state police investigated a fatal truck rollover June 3 on Highway 226 east of Scio. Jonathan Elliott, 18, of Albany, and four other teens were thrown from the truck when it rolled. Elliott died last week at a Portland hospital.

Elliott's mother, Wanda, said she doesn't think minors should be allowed in a truck bed at all. She acknowledged that her son was 18 and he made his own choice.

"If they're underage and riding in back, I'm completely against it," she said. "People need to be more conscious of the choices and decisions they make. They can alter the events of more than one person's life."

The driver, Justin Clement-Romey, 17, also of Albany, has been charged with driving under the influence of intoxicants and other charges related to the crash.

On Monday, 10-year-old Katelyne Dugan of Sweet Home and 21-year-old Brian Gilbert were killed when they were thrown from a pickup that rolled on a gravel road near Foster Reservoir. The Linn County Sheriff's Office is investigating that crash.

Katelyne's father, Patrick Dugan, 34, lost control of the truck in the sharp curves of the road, according to the sheriff's office. He is in serious condition at Sacred Heart Medical Center in Eugene.


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The New Deal: Progressives' house of cards

The late Arthur Schlesinger Jr. was a true liberal - a man who welcomed debate. Just before he died this winter, he wrote, quoting someone else, that history is an argument without end. That, Schlesinger added, "is why we love it so." Yet concerning Schlesinger's own period of study, the 1930s, there has been curiously little argument.

The American consensus is Schlesinger's consensus: that FDR saved democracy from fascism by co-opting the left and far right with his alphabet programs. Certainly, an observer might criticize various aspects of the period, but scrutiny of the New Deal edifice in its entirety is something that ought to be postponed for another era - or so we learned long ago. Indeed, to take a skeptical look at the New Deal as a whole has been considered downright immoral.

The real question about the 1930s is not whether it is wrong to scrutinize the New Deal. Rather, the question is why it has taken us all so long. Roosevelt did famously well by one measure, the political poll. He flunked by two other meters that we today know are critically important: the unemployment rate and the Dow Jones Industrial Average. In his first inaugural address, Roosevelt spoke of a primary goal: "to put people to work." Unemployment stood at 20% in 1937, five years into the New Deal. As for the Dow, it did not come back to its 1929 level until the 1950s. International factors and monetary errors cannot entirely account for these abysmal showings.

When I went back to study those years for a book, I realized two things. The first was that the picture we received growing up was distorted in a number of important regards. The second was that the old argument about the immorality of scrutinizing the New Deal was counterproductive.

The premier line in the standard history is that Herbert Hoover was a right-winger whose laissez-faire politics helped convert the 1929 Crash into the Great Depression. But a review of the new president's actions reveals him to be a control freak, an interventionist in spite of himself. Hoover signed the Smoot-Hawley Tariff Act, which worsened a global downturn, even though he had long lived in London and understood better than almost anyone the interconnectedness of markets. He also bullied companies into maintaining high wages and keeping employees on their payrolls when they could ill afford to do so. Perhaps worst of all, he berated the stock market as a speculative sinner even though he knew better. For example, Hoover opposed shorting as a practice, a policy that frightened markets at an especially vulnerable time.

The second standard understanding is that the Brain Trusters were moderate people who drew from American history when they wrote the New Deal. If their philosophies were left wing, then that aspect ought to be treated parenthetically, the attitude was. But the leftishness of the Brain Trust was not parenthetical. It was central.

In the summer of 1927, a group of future New Dealers, mostly junior professors or minor union officials, were received by Stalin for a full six hours when they traveled on a junket to the Soviet Union. Both Stalin's Russia and Mussolini's Italy influenced the New Deal enormously. The Brain Trusters were not, for the most part, fascists or communists. They were thoughtful people who wrote in the New Republic. But their ideas were wrong. Their intense romanticization of the concept of the economy of scale ignored the small man. One of the New Dealers from the old Soviet trip, Rex Tugwell, even created his very own version of Animal Farm in Casa Grande, Ariz. As in the Orwell book, the farmers revolted.

The third familiar story line in the received wisdom about the New Deal is that, while it may not have been perfect, it did inspire the American people and tide them over. Here the emphasis is wrong. Roosevelt's radio voice may have inspired - yes. But the New Deal hurt the economy, and that mattered more. At some points Roosevelt seemed to understand the need to counter deflation. But his method for doing so generated a whole new set of uncertainties. Roosevelt personally experimented with the currency - one day, in bed, he raised the gold price by 21 cents. When Henry Morgenthau, who would shortly become Treasury Secretary, asked him why, Roosevelt said that "it's a lucky number, because it's three times seven." Morgenthau wrote later: "If anybody ever knew how we set the gold price through a combination of lucky numbers, etc., I think they would be frightened."

The centerpiece of the New Deal, the National Recovery Administration (NRA), was perverse. The premises of its codes were ones anyone would reject outright today - the concept that price cutting caused deflation, for example. Everyone, even Roosevelt's own agonized advisers, understood this. The poet Ogden Nash wrote a poem that captured the inanity - its title was "One from One Leaves Two":

Mumblety-pumbledy my red cow
She's cooperating now
At first she didn't understand
That milk production must be planned
She didn't understand at first
She had to either plan or burst

A think tank produced a report of 900 pages in 1935 concluding the NRA "on the whole retarded recovery" (that think tank was the Brookings Institution). Some of the great heroes of the period were the Schechter brothers, kosher butchers who fought the NRA all the way to the Supreme Court and won. Their case was not only jurisprudential but also based on common sense - management from above was killing recovery. The Schechter case is as important to history, as, say, the Gideon case that Anthony Lewis wrote about in his great book about the right to counsel, "Gideon's Trumpet." Where is the "Gideon's Trumpet" for free marketeers?

The fourth rule we learned is that Roosevelt's call to "bold, persistent experimentation" was, on balance, good. But this conviction ignores the cost of uncertainty, as the economic historian Robert Higgs first pointed out. Today we know that unknown unknowns are inherently destabilizing. Roosevelt, a man of impulses, changed policies routinely. He moved from supporting big business to attacking it to supporting it again, many times in his presidency.

On some days, as Anne O'Hare McCormick, a Maureen Dowd of her time, wrote during FDR's second term, Roosevelt was the personification of "the Dutch householder who carefully totes up his accounts every month and who is really annoyed, now that he is bent on balancing the budget, when Congress can't stop spending." Other days he was a big spender.

Uncertainty caused markets to freeze in fear; so did investment - the old New Yorker cartoons of the plutocrats in the salon were true. Yet Roosevelt counterattacked by compiling lists of the wealthy to prosecute - his administration prosecuted the Alan Greenspan of the day, Andrew Mellon, until Mellon died. Roosevelt's administration pushed a plan for an undistributed profits tax to eat the essence out of companies. Policies like this caused the most unnecessary part of the Depression: the Depression within the Depression of the late 1930s.

The final line in the traditional story is that Roosevelt's government offices were somehow better than their private sector counterparts--when it came to utilities, for example, we learned that only the federal government could electrify backward rural areas. This is a false memory, for there was a company that already planned to light up the South, Commonwealth and Southern. David Lilienthal of the Tennessee Valley Authority set out to gut it, and succeeded. But the battle over electric power was also, literally, a power struggle between coequals, not a contest between a good policeman and a sinning company.

The most useful economic philosophy for understanding what went on is not Keynesianism. It is the public choice theory of James Buchanan and others, which says that government is a competitor that will annihilate what comes in its path.

So why has it taken so long to revisit this period? The first reason is that the Great Depression was a disaster. From the Crash to the Dust Bowl and the floods, it all felt like a permanent Katrina, and Americans suspended disbelief. But the reality was that the depression did not mean permanent Katrina - indeed, we see now that that downturn was the exception in the century, not the rule.

The next reason we hesitate is World War II. War always trumps economics. New Deal critics were right on the economy, but they were wrong in their estimations of Hitler. To write sympathetically about the Liberty Leaguers is seen, even today, as siding with the appeasers. The incredible rightness of FDR's war policy obscures the flaws in his prior actions.

The Cold War also played a role in delaying examination of the 1930s. Nearly all writers today--whether they write policy or history - make a point to avoid being classed with Sen. Joseph McCarthy and the House Un-American Activities Committee. But that fear of being labeled as a red-baiter prevented the necessary discussion of the counterproductive policy of the 1930s.

In the Cold War, there was also the assumption that Europe certainly, or even the U.S., might conceivably go communist. The premise therefore was that safety nets - from Social Security in the U.S. to codetermination in German boardrooms - were necessary to prevent such an event. Bismarck's social democracy and Roosevelt's New Deal were therefore glorified as justified.

In the past half-century, we have learned that much of our capital comes from the private sector, not the public sector, and that most of our growth inheres in the private sector. After the 1980s and 1990s we know that markets can do much of the work that Roosevelt believed only government capital could do.

My own sense is that there is a final reason we have all paused at the New Deal - a generational one. To insult the New Deal is to insult the Social Security that we, our parents, or grandparents receive. The Baby Boomers have a reputation as being selfish. But their reverence in regard to Social Security, not to mention Medicare Part D, is overly unselfish, and comes out of misplaced filial piety. Younger Baby Boomers and the generations after them will doubtless pay higher taxes because of our current unwillingness to criticize entitlements. Americans owe them as much as we owe senior citizens.

After all, the argument of markets has its own powerful morality. It is immoral to cause unemployment by pretending that a big government policy is morally necessary. When Andrew Mellon and Calvin Coolidge put through their tax cuts in the 1920s, they made the efficiency argument that supply-siders make today: lower rates could yield, they posited, higher revenues. But they also had a moral argument: high taxes were wrong, confiscatory and illiberal, in the classical sense. You can acknowledge this without being a Roosevelt-hater.

Schlesinger, who so often contributed to these pages, has already issued the invitation. It is more than time that the rest of us took him up on his offer.


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