Legislative leaders brushed aside last week's budget proposal by the Republican minority. People around Oregon may end up wishing they had taken it more seriously instead.

The minority insists that its spending blueprint for the next two years, 2009-11, would keep schools and the main functions of state government on an even keel without the need to raise taxes. The Republicans say that the Democrats' answer, which includes program cuts in agencies and layoffs in schools, will likely cause the economic downturn to be deeper and last longer than it otherwise would.

The key difference is that the Democrats start with a ramped-up "current service level," which has been renamed "essential service level," whereas the Republicans would hold spending even with the current biennium instead of ramping it up for expected increases in expenses.

The GOP approach would require pay and expense freezes all over the place. That would hardly be pleasant for the state and school employees affected, but it would be less painful than having your program cut and being laid off. And it would be similar to what's been happening in the private sector, where furloughs and pay cuts have been the norm.

The latest state revenue forecast has not improved the outlook for the Oregon economy, even though it was not as bad as some had feared. It expects job losses to continue through this year, along with declines in revenue from the income tax.

Leaders of the majority in the legislature have proposed a series of tax hikes and spending cuts. Raising the marginal income tax rate from 9 to 11 percent on households making more than $250,000 won't cause any hardships to the taxpayers affected, but it might cause them to spend less in the local economies where they live and work.

By the same token, corporations still in business might be able to stand a one-point boost in the corporate tax, but if they reduce employment to make up for it, what is the gain to the state?

The minority in the legislature has no say. So its budget ideas are dead in the water. That's too bad because its budget approach might cost less and do some good at the same time. (hh)