For months, Oregon Gov. Tina Kotek’s prosperity council has made headlines with a key focus: How best to jumpstart Oregon’s economy and what practices from other states may make that possible.
The governor’s top economic advisers answered that question in late June with a litany of recommendations including cutting taxes, replacing a key state climate program and allocating a quarter of a billion state dollars for business infrastructure needs every two years. The findings are based on what the council describes as practices from other states that could deliver results for Oregonians as well, according to council leaders.
“Every single one of these recommendations is in the context of ‘What do other people do? How are we different? Are we better? Are we worse?’” Renée James, founder of semiconductor company Ampere Computing and council co-chair, previously told the Capital Chronicle.
But new questions in the debate over Oregon’s economic future are emerging over whether the Beaver State should instead have a unique vision of success and whom policy changes for economic development should most benefit.
The dispute has taken on urgency following the release of the prosperity council’s wide-ranging recommendations that could reduce significant revenue streams for the state, which is staring down hundreds of millions of dollars in cuts due to cuts and federal tax changes from the GOP’s 2025 tax and spending law. It’s a preview of the pressure on lawmakers and Kotek that could be forthcoming in the Legislature should she win reelection.
“When politicians, academic journals, and business leaders talk about ‘the economy,’ they usually mean (gross domestic product) numbers and business rankings,” a coalition of progressive advocates and union groups wrote to Kotek in a May letter first reported by the Oregonian/OregonLive. “We think the real question is simpler: Can a person working in Oregon pay their rent? Do they have health insurance? Can they retire with some dignity?”
The prosperity council’s recommendations referred to states such as Arizona, Indiana, Virginia, North Carolina and Pennsylvania. In a scathing recent analysis, however, the left-leaning Oregon economic observer Joe Cortright noted that those states lag behind Oregon’s performance for measures such as median household wealth, per capita income, GDP growth and the percentage of self-employed people.
“The way businesses flourish, they figure out what they’re good at, they try to be as innovative as they can, they try to develop new and better projects. They try to offer what business folks call a unique value proposition, something that somebody can’t duplicate,” he told the Capital Chronicle. “They don’t simply say, ‘I’m going to cut prices as much as I can and hope good things happen.’”
Kotek, meanwhile, has already acknowledged differences among some of the state’s top political forces. In a response letter to progressive advocates, she wrote that she is committed to “protecting working families, defending essential services, advancing basic freedoms, strengthening public education and ensuring Oregon remains a place where everyone can build a stable and dignified life.”
“The choice before us is very straightforward,” she said at a press conference in June. “We can allow economic uncertainty and external pressures to define Oregon’s future, or we can take deliberate action to shape that future ourselves.”
Differences among economic observers
At a Friday Portland City Club event where some of the state’s top economic observers offered their insights on the prosperity council’s report, differences in views over whom Oregon’s economic recommendations should serve were on full display.
Panelists represented perspectives from progressive economic analysts to traditional business groups and corporations. They acknowledged that there was a clash between two economic narratives in Oregon politics: One view arguing that Oregon-specific policies have contributed to state statistics such as higher-than-average unemployment rates and another suggesting that federal headwinds such as trade wars and tax cuts have contributed to cost of living and affordability struggles in the state.
“The notion that this has stopped being a state or a country where you can start a business and build a business and benefit from that, and then be able to share that with the community, and that somehow that’s to be something that you’re ashamed of, I guess I’m confused by that notion,” said Richelle Luther, a chief administrative officer and general counsel for the Portland-based Columbia Sportswear and a member of the prosperity council.
John Tapogna, president of the nonpartisan Oregon Business Council, agreed that Oregon economic development has been hampered by federal trade policies. But he said Oregon’s economy could be more reliant on consumption-based taxes such as a sales tax in a manner that mitigates impacts on low-income households.
He pointed to a statistic showing Oregon was 49th in job growth nationwide from May 2025 to May 2026, a figure cited in the prosperity council’s final report. He rejected a common talking point from economic observers such as Cortright who say that most of Oregon’s job losses over the last year are from large companies such as Intel and Nike which have ordered layoffs.
“Year after year after year, we had a higher, growing share of U.S. manufacturing that stopped in 2021, 2022, and it started to decline,” he said. “Intel’s part of that story, but it is not all of that story.”
Alejandro Queral, executive director at the Oregon Center for Public Policy, said the prosperity council missed a chance to combat income inequality. He said lawmakers should invest in access to universal pre-school and reform the state’s kicker law, which returns excess state revenue to taxpayers whenever incom tax payments are at least 2% higher than forecasted in a two-year budget period.
The state has paid out kickers every two years for more than a decade, including a record-setting $5.6 billion in 2024. Because it is based on the amount of taxes paid, wealthier Oregonians with a higher tax liability receive bigger refunds.
Colorado is the only other state with a similar tax refund program, and at least four states as well as the District of Columbia have universal pre-Kindergarten programs.
“We’re thinking about the solutions to these economic challenges, as if they could be resolved by just focusing on providing the best environment for businesses and corporations to thrive,” Queral told attendees. “But hey, they’re doing pretty well. So the question is, how can we expand that vision of prosperity so that we can have really shared growth, economic growth for all Oregonians?”
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