The idea that tax-rises for the rich solve the problems of society, and increase the tax revenues for the state is a commonly held myth. The rich and super-rich have, and always will be, aware of loopholes, tax havens and creative accounting techniques.

What this vote could signify is a changing realisation that more taxes, spread throughout society, are the answer to many problems in the USA, and to a lesser extent here in the UK.

The most important principle, which is unlikely to spread throughout America, although it should, is the realisation that this recession is the fault of the hyper-risky investment banks. The over reliance on the financial sector in both countries has caused huge, long-term problems for so many areas of society. This is crucial, the growing numbers (who never had any interest in economies or financial institutions) are beginning to show disgust, and this is just one way of highlighting that, even if the potential returns from it are minuscule in comparison.

To play devil’s advocate here, they’ll probably explain it in terms of the state being very liberal, the split between the very liberal western Oregon and the very conservative eastern Oregon, the fact that one victory is not defining of an entire political trend, the fact that populist measures aren’t exclusively a liberal preserve even in the US, the fact that as you said this was mainly because Democratic turnout was very high (the criticism levied is that the Democrats are scaring off non-Democratic voters), etc etc etc. Hell, considering the tax bands in question you’d have thought that it would’ve passed by more.

Of course, it can be argued quite fairly that there is the point of past precedent with regards to tax increases. The problems are that 1) this tax is being levied primarily on the really rather wealthy (even taking into account that generally America seems to take a more optimistic view of their own social mobility than we do) and thus has more chance to pass than any other initiative seen as in any way more targeted at a wider range of voters, 2) the state will have shifted politically and demographically over time, although I couldn’t say how dramatically this would effect it.

But I digress. Yes, it’s nice to see, but it’s hardly an ‘up-yours conservatism, looks like you got it all wrong!’ moment, any more than Washington state approving gay marriage sounded the death knell for all anti-progressive social moves.

“53.4% support for higher taxes on corporations.”

Sadly, not true.

53.4% support for the intention of taxing corporations more.

What they’ve actually voted for is to reduce the wages for workers in Oregon.

http://www.voxeu.org/index.php?q=node/4363

“The available evidence suggests that wages fall in response to higher corporate tax rates, implying that business tax burdens are largely shared with workers.”

If you refise to learn the economics of taxation then you’ll end up designing pretty shitty taxation systems.

People of American state make democratic choice to raise taxes in that state (with no context as to whether Oregon has low or high taxes, variable tax rates, a budget defecit of California-type proportions or some particular need for money or not). This is then immediately extrapolated to be some sort of judgement on the narrative of Democrat failure (and by implication, although I admit this may be mine, to support big government in Britain).

Obviously the people of that New England state I can never spell (or look it up – I can’t spell it to look up!) who elected a Republican senator over a Democrat were equally rejecting big government, and were by no means reacting to a local campaign with local issues (such as the Democrat not trying very hard!).

Can’t we put this down to the fact that voters make decisions about issues when consulted not due to party platforms but more due to their own judgements. And a bare majority of the voters who voted in Oregon were inclined to believe these taxes needed to be higher in their state. Good. Nice to see a local area with the ability to make decisions like that – the message if anything is that if you devolve powers (to be fair, not in the US, where the power to raise taxes is technically gifted by the states to the federal government) then people may, surprisingly, actually use them.

“I’ll be interested to hear how the great and the good analysts who have been telling us that the Democrats have been losing because they have been too ‘liberal’ and ‘big government’ explain this results.”

Wow! One state overides everything else going on in America. Thankyou for that compelling evidence.

We’ll ignore that vast number of polls showing American majorities opposed to healthcare reform. We’ll ignore Republican wins in blue states like New Jersey and Mass. We’ll ignore poll findings that shows Obama support amongst liberal democrats still solid whilst support amongst moderate and conservative Democrats is dropping and pretend that Democratic problems are because the left are unhappy.

Yes. Best to ignore all of that because with a majority of 53%, voters in Oregon that went 57% for Obama voted for tax increases on rich people and businesses. A tax increase that Democrats had already put into the budget before the vote and that would have caused the budget to be rewritten with all the confusion that would have entailed, had voters turned it down.

We’ll ignore that vast number of polls showing American majorities opposed to healthcare reform

Let’s be clear – vast majorities also supported it earlier. Now, the polls are mostly against it because they also incorporate Democrats who think it doesn’t go far enough

Funny you don’t mention that…

and pretend that Democratic problems are because the left are unhappy

Just look at the polls:
http://www.themonkeycage.org/2009/12/three_myths_about_political_in.html

Sunny, from that link:

Obama’s declining approval rating is more a story about losing the Republicans who are unlikely to vote for him anyway than it is a story about losing independents.

The Democrats lost the Union vote to the Republicans in Massachusetts – not by a lot, but they lost the absolute core Dem vote in the absolute core Dem seat to the Republicans. Is it your argument that if Obama tacked hard to the left, those voters would have voted Democrat? That voting Republican is a protest at how right wing the Democrats are? That just seems entirely counter-intuitive.

As a general rule, political parties that concentrate on stroking their base are ones that are losing. Cf Tories 1997-2005.

Is it your argument that if Obama tacked hard to the left, those voters would have voted Democrat? That voting Republican is a protest at how right wing the Democrats are? That just seems entirely counter-intuitive.

Again – that’s because you guys don’t study the polls. The Democrats lost Mass. because the demoralised Democrats didn’t turn out and support Coaxley in the way they supported Obama? Why because she’s a centrist and because Obama hasn’t done enough on healthcare. Mass. healthcare actually mirrors what Obama was proposing.

Given that nationally registered Democrats outnumber Republicans by 10%, its more an issue of getting the Democrat vote out than tacking centrist in hoping to get right-leaning independents to support you.

Sunny,

You can’t have it both ways – if you are trying to get out now disillusioned left-wing democrats, then you are not able to attract right-leaning independents (I suspect the majority of independents are in this category, although I am not sure why this fact has sprung into my mind). The problem here is that what you are advocating is pure number politics – appealing to one group, then gathering in another whilst frantically trying to hold onto the first – whilst what President Obama did was offer a message and a platform that was not based primarily on political calculations (and thus overcame Senator McCain, whose campaign was based on such things). Once politics becomes about the numbers, not the message, it slowly dies until a new message shines bright. And the great danger is that if the relatively centralist and sane messages (and I would include libertarians and socialists in this broad reach) are muted by playing numbers, the anger and fury of the extremists wins through.

Excellent news. Why on earth are Labour so scared of putting up taxes on the rich, particularly bankerscum? It might be a long time until the public hates the rich this much. Just tax them till the pips squeak – it will cover up the deficit and win back working and middle class voters.

John,

I trust you did read the post yesterday about ‘Britain becomes more liberal’. It did mention support for higher taxes for the rich was falling. I presume the Labour party has spotted this one at some point. For all their current failings, they have not yet gone in for electoral suicide, and backing a policy with declining support (most of whom will probably vote for Labour anyway) is hardly the way forward for them.

The Democrats lost Mass. because the demoralised Democrats didn’t turn out and support Coaxley in the way they supported Obama? Why because she’s a centrist and because Obama hasn’t done enough on healthcare. Mass. healthcare actually mirrors what Obama was proposing.

In the same way that the Tories lost in 1997 because the demoralised Tories didn’t turn out and support Major in 1997 in the way they did in 1992. Obvious solution for the Tories – head to the right to secure that base of disaffected Tories to capitalise when Labour’s popularity wanes. Remind me how that worked out?

Diehard supporters of every party pull this line: our supporters didn’t turn out because we’re aren’t right/left-wing enough. Tony Benn even said that in 1983. I remember Ken Livingstone saying it in 1992. Tebbit, IDS and lots of other Tories were saying that from 97 on. Simon Heffer’s still saying it. Hey, they might be right now, even though they’ve been wrong on it for 30 years.

It’s largely just a smell test thing though isn’t it? The Democrats lost Mass because they weren’t left wing enough. So the Republicans won it. Nah. The link you have is from a month before the Mass election in any case – from a time, in other words, when the Democrats polling lead in Mass was 30 points.

Sunny

“Just look at the polls:”

Perhaps you should take your ow advice. From PPP (a Democratic pollster who got the Massachusetts result spot on:

“You wouldn’t know it from reading the blogosphere but liberal Democrats are actually pretty happy with the direction of their party right now. On our most recent national poll 76% expressed that sentiment.

The other wings of the party are not that content- 58% of moderates say they like where the party’s headed but only 39% of conservatives do.”

http://publicpolicypolling.blogspot.com/2010/01/looking-at-democrats.html

Funny you don’t mention that…

Probably because it’s part of the liberal mythology that they’re using to convince themselves that Americans really really want this sort of reform. In the latest NBC poll, 49% consider the reforms to be a step backward, 44% a step forward. Even dissatisfied advocates aren’t going to think this reform as a “step backward”.

And PPP again. 76% of liberals support the healthcare plan, only 11% oppose. Whereas only 53% of moderates support the plan and 12% of conservatives. So remind me again how that means that healthcare is unpopular because it’s the left that don’t like it.

The truth is, what is happening in America isn’t about left v right or Republican v Democrat. It’s about populist vs technocrat and about the people vs Washington. At the moment the Democrats represent the elite. When the tea-parties started, rather than understand a genuine sentiment that was growing nationwide, the Dems tried to dismiss the people as un-american and as extremists. They’re still doing it today. They are demonstrating that they are out of touch.

Obama has potentially seen this, thus his pivot towards more populist measures, but the liberalati still don’t get it. They think a pivot to the left is what’s needed. I hope that sentiment continues.

“In the same way that the Tories lost in 1997 because the demoralised Tories didn’t turn out and support Major in 1997 in the way they did in 1992. Obvious solution for the Tories – head to the right to secure that base of disaffected Tories to capitalise when Labour’s popularity wanes. Remind me how that worked out?”

OTOH, this strategy worked for Bush in 2002 and 2004 – they went hard to the right and concentrated on driving turnout amongst their base, with great success.

The left/right scale can lack explanatory power, as well. Taxing the rich is normally portrayed as an example of lurching to the left, yet in the case of Oregon, it achieved stronger than expected conservative support. In contrast, lefties are divided about both process and outcome of healthcare reform, and conservatives are united and fired up against it.

One way in which this result is similar to Massachusetts is that the populist, anti-elite side won unexpectedly, thanks to greater voter enthusiasm and turnout amongst supporters than opponents. So rather than the Americans necessarily swinging left or right, they are supporting anti-incumbent and anti-establishment policies and candidates, whether from the right, left or centre.

Conservative Cabbie – would you agree that the tax campaigns in Oregon were populist?

“Tuesday’s strong support also validated a strategy by Democratic lawmakers to single out the rich and corporations for targeted tax increases.

Campaign ads by supporters highlighted banks and credit card companies and showed images of well-dressed people stepping off private jets. They also hammered on the $10 minimum tax that most corporations have paid since its inception in 1931.”

It’s not just the Democrats who represent the elite.

Don

would you agree that the tax campaigns in Oregon were populist?

Yes I would. But it is not evidence that being “too liberal” or “big government” is a good thing in the current political climate. Most polls I’ve seen have a majority saying that government should be doing less not more.

It’s not just the Democrats who represent the elite.

True again. But Republicans have been able to find a populist message that so far is resonating. See Scott Brown or Bob McDonnell. But note that in both those cases, the voters ignored their right-winginess that supposedly puts voters off according to lefty pundits and voted for them anyway. The left made a big deal out of McDonnell’s socially conservative thesis, but the electorate ignored that and supported his pragmatic messaging. Scott Brown campaigned on lower taxes, lower spending, and military trials for terrorists and far from putting people off, it worked for him. In both cases, the Democrats tried to position McDonnell and Brown as extremists and crackpots. In both cases, that strategy failed.

So rather than the Americans necessarily swinging left or right, they are supporting anti-incumbent and anti-establishment policies and candidates, whether from the right, left or centre.

There is some truth in this. But an inescapable truth is that in almost all cases, Republicans are polling better than Democrats. Whether it is fair or not, Democrats are being tied to DC and the elites.

OTOH, this strategy worked for Bush in 2002 and 2004 – they went hard to the right and concentrated on driving turnout amongst their base, with great success.

True, but a war President running on national security… He tried the same trick in 2006 with much less success.

Tim,

I presume Bush in 2002 was turning out base on the Florida Supreme Court? I seem to remember that was a pretty close election.

Well, it ought to be interesting to come back to this one next year. They’ve voted for higher taxes, but will they take more taxes in?

From what I see, the trackers would be

- total tax revenue compared to forecasts
- income tax revenue – if Tim W is right and corporation tax increases lower workers wages then we ought to see a fall in income tax compared to forecasts.

I do congratulate Oregon on making this decision. It must be fantastic living in a country that allows the people to set the level of taxation.