Will disparate interests lead to some type of legislative Grand Bargain in Oklahoma this year that includes an irresponsible tax cut, a reduction in workers’ compensation benefits for injured workers and a plan to codify delays in state infrastructure improvements?
Maybe so or maybe not, but conflating these different GOP initiatives seems not only like a recipe for political infighting but also just plain poor governance and lawmaking. Trading, say, a reduction in benefits for people losing their limbs on the job for a delayed but larger tax cut is a grim business. It’s also illogical and ego-based politicking unrelated to the specific consequences of legislation.
Struggling to find an agreement on a tax cut and what Republicans call workers’ compensation “reform,” the GOP bigwigs have essentially announced they plan to announce a deal next week that includes majority agreement on the two issues, along with the support of an eight-year, “pay-as-you-go” agreement to renovate some state buildings and infrastructure.
House Speaker T.W. Shannon, a Lawton Republican, said, “We just thought it made sense to make it an announcement altogether." Of course, there’s been no actual announcement yet. This is sort of an announcement about a pending announcement, which makes very little sense.
The principal players include Shannon, who wants to take the slow path to infrastructure improvement, Senate President Pro Tempore Brian Bingman, a Sapulpa Republican, who wants big changes in the state workers’ compensation system and Gov. Mary Fallin, who wants a tax cut, any tax cut it seems, to seal her GOP bonafides. The vested interests come complete, no doubt, with big and easily-bruised egos, or is that too much of an assumption?
Currently, on the tax-cut front, the Senate is negotiating House Bill 2032, a Fallin-supported measure that initially cut the top income tax rate from 5.25 percent to 5 percent next year without any offsets. The Senate, which had its own plan rejected by the House, then rewrote the bill. The new plan is to cut the rate to 4.95 percent, but not until 2015, and to sunset some tax credits.
A Senate plan to “reform” the state’s workers’ compensation system, contained in Senate Bill 1062, is now undergoing negotiations in the House, which is rewriting the measure. The bill is ostensibly about changing the system from a judicial process to an administrative process, but it also reduces benefits for those who get injured on the job. I wrote about it here.
So the Senate is rewriting the House’s tax bill and the House is rewriting the Senate’s workers’ compensation bill.
Meanwhile, Shannon’s infrastructure plan, House Bill 1910, which centralizes state property oversight and creates a long-term plan to renovate buildings, flies under the radar given the fact that the state Capitol building is crumbling to pieces before everyone’s eyes as Republicans announce their plan to make an announcement.
All these initiatives should be considered on their own merits without political tradeoffs unrelated to their purposes and consequences.
So here’s my own announcement of some common sense ideas: The tax cut should be put on hold because of the future loss in state revenue until the economy completely recovers from the Great Recession or until lawmakers get serious about overhauling the entire tax code. Any workers’ compensation bill that under the guise of “reform” severely reduces benefits for injured employees deserves to be defeated just for that reason alone, especially in Oklahoma. Why even implement a long-term, infrastructure renovation plan until the state Capitol building is repaired?
I wonder how many Oklahoma workers injured on the job don’t file workers’ compensation claims because they feel their employer would retaliate against them by either firing them outright or limiting their career advancement?
This is a question virtually impossible to answer because of its built-in paradox—suppression equals invisibility—but any reasonable person would have to concede that it happens, especially among long-term workers with chronic injuries that have developed over many years because of repetitive physical tasks or repetitive body positioning.
Here are some questions that might go through injured workers’ minds: Will I lose my job if I file a claim? Will I be reassigned to a position that pays less money? Will I become known as someone who complains too much and thus not given raises or promoted?
But these aren’t the type of questions getting much attention in this year’s GOP legislative quest to “reform” the workers’ compensation system, which pays people injured on their jobs for lost work time and medical expenses.
What workers' compensation reform seems to mean to many Oklahoma GOP legislators is reducing the financial amount of awarded claims for on-the-job injuries and reducing an employee’s ability to file an injury claim. This, goes the logic, will reduce the amount of money any given company will have to pay for workers’ compensation insurance. Reform, under this definition, means human pain and suffering is secondary to corporate interests.
Before the right-wing co-opted the language of the progressive movement, using terms like “reform” to promote the power of the few over the many, huge strides were made in developing and protecting worker rights. The idea of workers’ compensation due to injuries dates back to the nineteenth century, and developing and sustaining workers’ rights from the beginning of the twentieth century until the 1980s was most often associated with the language of progressive reform. The labor movement has since its inception pushed consistently for workplace safety. It was even a Republican, former President Richard Nixon, who signed into law the bill creating the Occupational Safety and Health Administration in 1970.
In Oklahoma and other conservative states, the word “reform” now means rolling back rights and advances for workers in order to promote the interests of corporations.
A workers’ compensation measure, Senate Bill 1062, is now under negotiation in the House. Its principal purpose is to change the current workers’ compensation system from a judicial process to an administrative process, but legislators have also pushed for reducing award amounts and limiting the time period for claims.
One of the provisions, according to media reports, would reduce disability wage benefits by 30 percent. This is based on the premise that wage benefits aren’t taxed, and thus the state should only pay 70 percent of its average weekly wage rate. Other provisions, since removed from the bill, would have reduced benefits to amputees and spouses of workers killed on the job, and reduced the amount of time in which a claim could be made from 30 days to three days. There is a potential that these provisions could be restored in some form as the bill makes its way through the legislature where disagreements on it remain between the House and Senate.
Legislators are also discussing whether some companies should be allowed to opt-out of the system entirely if they provided compensation benefits on their own.
The bottom line is that no one is discussing statistics like these: In 2010, 91 workers were killed on the job in Oklahoma. In 2011, there were more than 49,000 recorded on-the-job injuries. The discussion among Republicans is mostly limited to how to help companies pay less in insurance while reducing benefits for workers.
To return to my first question, no one seems, as well, to be discussing how many on-the-job injuries go unreported, especially in a weak job market in which workers might feel fearful of losing their jobs.
It’s clear the intent of SB 1062 is to erode workers’ benefits and rights. Let’s hope it dies in a storm of legislative bickering this session.
The Oklahoman editorial board has attempted to philosophically defend the GOP push for a tax cut this year despite the cut’s future impact on revenue in a state that has faced budget reductions in recent years.
Unlike Gov. Mary Fallin and to an extent House Speaker T.W. Shannon, a Lawton Republican, who mostly engage in sweeping, Republican generalizations when it comes to cutting taxes, a recent commentary in the newspaper actually tried to parse the issue and offer specific counter arguments to those people who oppose an income tax cut right now.
The newspaper should be commended for actually trying to construct a logical argument, but ultimately the overall argument fails because of misguided assumptions, lack of empirical evidence and over reliance on unproven conservative dogma. It would be nice if state leaders, including editorial writers at Oklahoma’s corporate media, could have a rational discussion about taxes, but it can’t happen if we must begin with prevailing conservative presumptions that simply aren’t true.
The editorial, “High-tax states wouldn’t mind an economy like Oklahoma’s” (April 12, 2013), essentially offers counter arguments to the Oklahoma Policy Institute, which has opposed any income tax cut this year, primarily because of its future effect on state revenues and in light of recent budget cuts. The latest proposal under consideration, which came out of the state Senate, would drop the top tax rate from 5.25 percent to 4.95 percent starting in 2015, sunset some tax credits and would cost the state $169 million a year. That proposal is now under negotiation. Fallin and Shannon have pushed for a cut from 5.25 percent to 5 percent starting in 2014. It would cost the state more than $100 million a year.
I have outlined my argument against a tax cut at this time here, but in this post I want to address some of arguments put forth by The Oklahoman in its response to OK Policy and others opposed to a cut.
The commentary, for example argues that a “tax cut is hardly going to make the poor poorer” because the top income tax rate starts at $8,700 for a single filer. This argument supposedly addresses concerns OK Policy has about the relationship between taxes and poverty in the state. But the editorial doesn’t address the fact that any flat cut that doesn’t take into account income brackets is always regressive and shifts the most money to the wealthiest in our society. Also, declining government revenues eventually lead to budget cuts or stagnation, which could mean fewer dollars for safety-net programs that help the poor.
The Oklahoman dismisses OK Policy’s concerns that state workers haven’t had a cost-of-living raise since 2006, arguing in italics that it’s a political sales pitch that comes off like this: “You need to accept less take-home pay so a bureaucrat can get more.” Not every state worker is a bureaucrat, of course, and under Fallin’s original plan 43 percent of Oklahomans wouldn’t even receive a tax cut. I’m unsure the sales pitch for stopping a tax cut right now comes off to a majority of people as described by The Oklahoman. Here’s the real sales pitch: You will receive no tax cut at all or a token amount of money and it will take money away from schools.
Higher education funding from the state has declined in recent years because of lower state revenues, prompting tuition hikes, but that’s okay, according to the commentary, because colleges will raise tuition no matter what. This type of argument dismisses any real discussion of just how much tuition has skyrocketed or of the increasing cost of college, which is saddling many students with crippling debt. It also makes a presumption that colleges will always raise tuition each year, which isn’t necessarily true. A few years ago, for example, many state colleges came together and gave students a year without any increase. It also implies that colleges would have raised tuition that same amount with more state support. I don’t think that’s true, either.
The editorial goes on to argue that “no amount of taxation is ever so great that government boosters won't claim poverty,” which is a misguided, conservative assumption. On the philosophical level, so-called “government boosters” are usually people who want a fairer, progressive tax system. They actually favor tax cuts for the less fortunate in our culture. They want to adequately fund education and safety-net programs and call attention to the growing income inequality between the richest people in our culture and everyone else. Specifically, they recognize the state’s historical and well-documented lack of decent funding for education and the state’s historical and well-documented poverty levels. How can we not “claim poverty” when it stares us in the face?
Many of us opposed to the tax cut have argued that the median cut is only $39 a year, a trivial amount, at the same time it collectively takes a large chunk of money away from overall state revenues. The answer from The Oklahoman is more Republican dogma and presumption. The editorial claims, even though the cut is small the private sector “allocates money far better than any government agency.” That’s certainly true if you’re a billionaire, like the newspaper’s owner, Philip Anschutz, but it’s not so true if you’re working at a minimum wage job and don’t even receive the extra $39 annually. The free market enforces poverty as much as it makes people rich. The newspaper is making an assumption certainly not held by everyone and probably not even a majority of voters in this country.
Finally, the newspaper claims tax collections actually went up after recent tax cuts, but it completely ignores the impact of the Great Recession on Oklahoma and the steep decline in revenues after 2008. I’m trying hard not to engage in hyperbole here, but this claim borders on rewriting not just history but extremely recent history. A strong argument could be and has been made that the tax cuts sent state revenues into a devastating downward spiral once the economy tanked.
Still, I’ll give The Oklahoman some credit here for the attempt to argue ideas and also for its rather subdued approach to the tax-cut proposals presented by lawmakers so far this year. The editorial seems okay with the idea that lawmakers “may favor state spending over tax cuts this year, and consider tax cuts again in future years.” I’m okay with that idea, too.