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Editorials: A recovery package on the edge The Oregonian Jan 8 The first thing worth noting about the economic stimulus package proposed by President Bush Tuesday is that the most expensive part of it may not stimulate the economy anytime soon. Which is not to say that the president's main idea, repealing the double-taxation of stock dividends, is a bad one. It isn't. Republicans have been arguing, correctly, for many years that taxing dividends amounts to double taxation of corporate profits. And the president believes that eliminating this unfair disincentive is best for the economy in the long run. Since its "cost" - $364 billion in forgone tax revenue over 10 years - amounts to most of the $674 billion stimulus package, the president is placing a bet on the supply side economic theory that lower taxes, in the long run, will lead to greater government revenues through increased economic activity. The case for not taxing dividends is straightforward. It is unfair and discourages proper investing. Beyond that, removing the double taxes on dividends creates incentives for publicly traded businesses to operate with longer-term goals in mind. One of the side effects of the stock-market explosion during the 1990s was to create a belief that the best way to make money in business was to trade equities in the stock market rather than invest in well-run companies. This created incentives for corporate managers to operate more with quarterly earnings in mind than long-term stability. The president's proposal wouldn't eliminate short-sighted or dishonest management. But it would create incentives for investors interested in longer-term values. Is it economic stimulus? Not in the way we have come to know the term. The reform would be good for the economy and good for investors - a category that includes, directly or indirectly, well over half the adult population of the country. But it wouldn't put dollars in consumers' pockets right away. Some of the other things in the president's package would do that, of course. He proposed accelerating the cuts in the 2001 tax bill, making them effective now, instead of phased in next year and in 2006. He proposed moving the dependent income-tax deduction from $600 per dependent to $1,000. And he proposed allowing small businesses to write off $75,000 a year in capital investments instead of the current $25,000. Whether these things will put enough money in enough pockets to be effective is anyone's guess, although the president's critics are pretty sure that they won't be. We're more confident than that, although the package could be stronger. It could, for example, do more to help the states through their nearly universal fiscal crises. But much of what seems to ail the economy right now has to do with business spending and business confidence in the future. The president's measures address those problems head-on. If the lack of confidence among business decision-makers hasn't spread to consumers, the president's program has a chance of working. If consumers finally start believing the gloom-and-doom view of the economy, though, no recovery package is likely to help much. Guest forum - Mountain Meadows: It's a good place to live By Gideon Wizansky, Ashland The story "Mountain Meadows: One newsworthy story" which appeared in The Tidings on Dec. 23 is an ugly, hate filled, vindictive and scurrilous article. It includes vicious personal attacks and makes libelous statements about management personnel and operations at the Mountain Meadows community without proof or supporting information. To start with, the writer's name, "Richard Baarsma," is phony. No such person ever worked for MM. One can't really comment on accusations that offer no specific facts or backup information. So I will discuss one issue raised in the article which actually mentions a specific "fact." The statement that "Seniors who live there (in MM) now pay five times the original monthly association fees." This statement is bogus and misleading. Here are the facts. The CC&R (the governing document distributed to prospective residents) stated that when the clubhouse was built and dining room started operations, the monthly operating assessment would be $220 per household and the monthly dining room assessment $73 per person. These were the baseline fees. We are now faced with the need for an increase in assessments because of budget deficits. There are a number of reasons for these deficits. In my opinion, the primary reason is that the developer underestimated the cost of running operations and dining room services. As an example, the original price of dinner, including soup, salad, entree, dessert and beverage, was $9. This is obviously unrealistically low. The choice we faced was to severely reduce services and amenities or to raise assessments. Cutting services and amenities would drastically change the character of our community. The board of directors opted for assessment increase and residents will vote on this in January 2003. The proposed increase is approximately 50 percent. The new budget is realistic, covers actual expenses and includes building up a reserve fund. It puts operation of MM on a sound financial basis and will maintain the character and amenities currently available to residents. The amenities provided include the clubhouse; dining room; fitness center and trainer; heated indoor pool; water aerobic classes; Tai Chi classes; social services; landscaping; vegetable garden plots; library; bus trips; exterior window washing; specified residence maintenance services; woodworking shop; and park areas. Finally, I would like to address the attack on the management of MM. MM is governed by a board of directors elected by the residents assisted by resident composed finance and other committees. The board of directors has a contract with a management company to operate MM. The company CEO, David Rothstein, reports to the board of directors. He participates in bi-weekly finance committee and board of directors meetings. He provides financial and operating data and his performance is monitored by these committees. To say as the writer of the article states "that the entire place is running on a shoestring budget, which is elaborately engineered by the current CEO, David Rothstein, to his own ends" is therefore patently absurd and libelous. I cannot speak for all residents of MM but I can speak for myself. MM is a good, vibrant community. It provides numerous amenities for the well being of residents. It provides a compassionate environment in which intimate and caring relationships can develop and flourish. It has interesting and stimulating residents. It's a fun place to live. My final word is that I do not understand how The Tidings can publish the subject article which is so full of hate and vindictive personal attacks, offered under a false name. Expressing opinions and disagreements is one thing, but this is ridiculous and shameful. ( Editor's note: The submission referenced in this Guest Forum was not an "article" or "story" by The Tidings. It appeared as a Letter to the Editor.) LINKS: DAILY TIDINGS: Main | News | Sports | Business | Obituaries | Opinion | Columnists | AP News | Subscribe | Archives | Weather | Classifieds | Contact Us | Privacy REVELS: Main | Calendar | Dining | Movies | T.V. OTHER: Road Cams Copyright 2003 Ashland Daily Tidings 541.482.3456. 1661 Siskiyou Blvd., Ashland, OR 97520. Ottaway Newspapers, Inc. - Advertisers -