Guest Opinion

Tough times call for smart spending

By Eric Fruits

, Nov 27, 2008, Updated Oct 30, 2009

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On the other hand, if new road and rail projects truly are needed, then roadway users and rail passengers should be willing to pay for such improvements. Properly implemented mileage-based user fees can fund construction, reduce congestion and diminish emissions. Transportation revenue would rise in line with road use, ensuring adequate funds for road maintenance and expansion. Because better roads boost economic productivity, the benefits to all Oregonians would exceed the individual costs of user fees, an important principle of Smart Spending.

Another principle asks whether more money will produce better outcomes: How much bang will Oregonians get for taxpayer bucks?

In a series of studies for Cascade Policy Institute, Randall Pozdena and I found that after accounting for differences in income and demographics, Oregon’s state and local government spending is among the highest in the country. Spending on K-12 education and on police and corrections are especially high relative to comparable states.

In the wake of a record high K-12 budget last legislative session, the Chalkboard Project observed that “money alone is not the answer” and that legislators need to “connect the dots” between spending and achievement. A smart spending approach connects the dots between expenditures and results.

Looking forward for the next biennium, the Legislature will be faced with the age-old challenge of satisfying unlimited demands with limited resources. Smart spending, rather than new taxes, will be one step on the path out of our current crisis.

(Soapboxes are guest opinions from our readers, and anyone is welcome to write one. Eric Fruits is a Portland-based economist. He is president of Economics International Corp. and an adjunct professor at Portland State University, where he teaches state and local public finance. He is the co-author of “The Ranking of Oregon State and Local Spending,” published in June 2008 by Cascade Policy Institute.)

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