The Road Ahead

Will we circle into a drain? Low investments in education and high income tax rates threaten further erosion of personal income levels The U.S. and Oregon economies appear poised for a slow, jobless recovery. Aging of the Baby Boom generation will increase the age 65+ population by 46% during , putting upward pressure on Medicaid spending. High health inflation will continue, which will drive up the costs of Medicaid and public employee compensation. Legacy costs of a poorly managed/conceived public employee pension system have come due.

Slow Economic Recovery No change 2007 State forecast 2001

The number of Oregonians aged 65+ will increase 46% during Or about 60 per day. And, as they retire, they’ll take their diplomas and experience with them.

Fewer workers to pay for an aging population

The incoming workforce is less educated

Legacy costs of a poorly designed and managed public pension system have come due

Costs of an Aging Population will Hit Soon Source: ECONorthwest calculations using data from Mercer, Kaiser Family Foundation, and Health Affairs

Decade of Deficits Revenues (bns.)Expenditures (bns.)

With no sales tax and recent income tax increases, Oregon income and capital gains taxes are among the highest in the nation M 66