Governor John Kitzhaber

In Each Other We Trust

Even though Oregon lawmakers are laboring to approve a grand bargain budget deal, legislative leaders such as House GOP Leader Mike McLane and House Speaker Tina Kotek are seeking common ground based on mutual trust, a sharp contrast to gridlock in the nation's capital that has shut down part of the federal government.With the federal government on furlough and Congress in dysfunction, the Oregon legislature is trying to enact a grand bargain in what some hoped would be a one-day special session. That one day came and went without any action, but legislative leaders were meeting to hold together a deal they reached last week.

What's happening in Salem is a sharp contrast to what's not happening in Washington, DC.

As erratic as Oregon’s political process can be from time to time, we are, by comparison, an exemplar of the political process done right. One of the key reasons for Oregon’s success is the ability of Oregon’s leaders to avoid sharing all of their thoughts with the press.

All for One, One for All

One of the under-reported features of the Grand Bargain is the "everything must pass or nothing passes" part of the agreement.

That was always the implicit understanding when the grand bargain involved public employee retirement reductions and tax increases to generate more money for K-12 schools. 

But the deal has expanded to include small business tax cuts and a local pre-emption on genetically modified crops. That expansion has altered the political math. 

First, a quick lesson about Oregon legislative procedure, which doesn't allow multi-subject omnibus bills. Congress can stuff Brussels sprouts and brownies into the same legislative stew so there is something to like for almost everybody. In Oregon, lawmakers pretty much have to vote on each major provision separately.

Now back to the grand bargain. It appears to require five bills — two to trim PERS benefits, one to raise taxes and provide for a small business tax cut, one for the GMO pre-emption and one to appropriate money for K-12 schools, other educational institutions and community mental health. 

For legislative Republicans, all of those are sweet votes. For legislative Democrats, three of the five cut against key constituencies — public employees and environmental groups opposed to pre-empting local bans on GMO crops. 

Much has already been written about the give-and-take on PERS cuts and tax hikes. A deal was close during the 2013 regular session, but didn't quite make it over the finish line, in part because it failed to include small business tax cuts pushed by GOP Senators Larry George and Brian Boquist.

Surprise Decision Strains Reform Support

The decision caught almost everyone by surprise last week. The Governor's Office and the Oregon Health Authority said they would not make any of the $2 billion in new federal money obtained by the Administration available for the first year of health care reform in Oregon.

"Members of the new groups (Coordinated Care Organizations, CCOs) are crying foul," reported The Oregonian, "after a directive Thursday that they'll receive no new funds for the additional responsibilities they've agreed to take on — mental health care, prevention efforts, quality measurements and new patient-care staff, among others."

In fact, managers of the new, still-not-yet-approved CCOs have been told they will have to live with last year's rates, which themselves represented an 11 percent cut. Leaders of the new groups say their success relates directly to the new money to fund them. They say it takes money to revamp care for more than 600,000 Oregonians covered by Medicaid, the joint federal-state program that provides care for low-income citizens.

In touting health care reforms such as CCOs and the Health Insurance Exchange, Kitzhaber has stressed the need to control costs through competition and innovation.

For many in the health care reform orbit, all of this conjures up images of the original Oregon Health Plan more than 15 years ago, also designed by Governor Kitzhaber in his earlier service as Oregon Senate President and as governor in his first term. A key tenet of the plan then was that providers would be paid close to their costs for delivering services. The clear objective was to limit the cost shift onto the backs of private health insurance payers.

Well, that tenet apparently has been lost in the intervening years.

Today, those with private health insurance pay about 20 per cent more in premiums as they bear the "hidden tax" of paying for Medicaid underfunding. In a 2008 study, the Milliman Group estimated underfunding of Medicaid and Medicare amounted to more than $90 billion annually.  Though four years old, the study is still applicable today.

Assessing Wisconsin's Recall Vote

Assessing the impact of Wisconsin's foiled recall effort this week of GOP Governor Scott Walker can be tricky for a state such as Oregon. First off, we haven't had a Republican governor here since Vic Atiyeh a quarter century ago. But we have had, at both the state and local level, encouraging examples of collaboration between political parties and between political leaders and organized labor.

After reaching a 30-30 tie in the 2010 election, Republicans and Democrats in the Oregon House agreed to share power. Co-Speakers Bruce Hanna, R-Roseburg, and Arnie Roblan, D-Coos Bay, avoided most partisan flare-ups during the 2011 and 2012 sessions and instead made a round of statewide joint appearances to discuss key policy decisions. (Two former House speakers from different parties in Pennsylvania are serving time in the same state prison and may become bunkmates.)

Multnomah County Chair Jeff Cogen found a way to work with the American Federation of State, County and Municipal Employees, which agreed for the second time in three years to forego cost-of-living increases in return for leaving employee health benefits unchanged

Governor Kitzhaber counseled Oregon labor leaders to put aside potentially divisive ballot measures dealing with corporate taxation and higher taxes on the wealthy and focus instead on a measure to direct corporate kicker refunds to education. Kitzhaber said he would pursue another attempt to revamp Oregon's tax system, which is heavily reliant on personal income tax revenues, including capital gains.

These are stark contrasts to the bitterness that has gripped Wisconsin since Walker's election and his survival of a politically motivated recall drive.

Many pundits have drawn their own conclusions from the Wisconsin election. Republicans say it is a harbinger of GOP success in the November general election. Unions and Democrats blame their loss on being hugely outspent. Exit polls showed as many as 60 percent of voters in what was a relatively small turnout said they disagreed with using the power of recall for political reasons.

Words Matter as Much as Policies

Will Oregon Governor John Kitzhaber convince the federal government to give money back to the state because of progress here on health care reform?As a person who likes and uses words, I have noticed that the health care debate — both heading toward the U.S. Supreme Court and the 2012 Oregon Legislative session — has been marked by words apparently designed to get the attention of those involved.

Consider these examples:

  • Regarding the "you-have-to-buy-health-insurance mandate" that is heading to the U.S. Supreme Court, a health economist at the Massachusetts Institute of Technology, put it this way:  "Health reform without an individual requirement is the spinach you need to get the chocolate you want."
  • On the same issue, a former health care policy advisor to President Bill Clinton was quoted last week as saying that "health reform without an individual mandate is like driving a train without tracks; you can still move, but you can't get to your destination and it will be a tougher and far more costly trip."
  • Or, consider this quote used last week in an update for Oregon legislators on the Health Insurance Exchange: "Our assumption is that the exchange is being born in a political battlefield. Half of Oregon never wanted you to exist and other half wanted much more than what you are. It seems your biggest challenge will be to gain the trust from both sides that you are an honest broker of information and opportunity — not the purveyor of a political agenda."

The Public Policy Cauldron: What's Intractable and What's not


No less an important public figure than former State Senator Ryan Deckert, now president of the Oregon Business Association (OBA), used that term last week as he introduced Governor John Kitzhaber at the annual OBA Statesman dinner.

He said Kitzhaber, now in his third term as governor, has defied conventional political wisdom by taking on seemingly "intractable" problems such as education and health care reform.

Deckert's words contained a bit of irony because, at approximately the same time, police forces in Portland and Salem were removing so-called "Occupy Wall Street" demonstrators from overstaying their welcome in public parks and roads in the two cities. That group, like the right wing Tea Party, does not appear to be interested in solving intractable problems; they appear to want "their way or the highway."

Speaking of the Tea Party movement, in a column last week in the Oregonian, columnist George Will contended that, "in scale, Occupy Wall Street demonstrations-cum-encapments are to Tea Party event as Pittsburg, KA is to Pittsburgh, PA. So far, probably fewer people have participated in all of them combined than attended just one Tea Party rally, than of September 12, 2009, on the Washington Mall. In comportment, OWS is to the Tea Party as Lady Gaga is to Lord Chesterfield: Blocking the Brooklyn Bridge (or streets in Portland) was not persuasion modeled on Tea Party tactics."