The View from Salem, Oregon

William Smaldone

THE MAYORAL VICTORIES of Zohran Mamdani in New York City and Katie Wilson in Seattle, and a sprinkling of other democratic socialist successes in local races around the country provide rays of hope for socialists at an otherwise very grim time.

Indeed, as Trumpism runs amok at home and abroad and as authoritarian movements seem poised to undermine democracies across the world, it seems counterintuitive that it would be the United States — where the socialist movement has long been among the weakest in the western world — that would experience a notable revival.

The Democratic Socialists of America (DSA) have been the main beneficiaries of this opening, and is now by far the largest socialist organization in the country. With only 6000 dues-paying members in 2015, today DSA has almost 100,000 members, over 200 active chapters, and hundreds of office holders, who usually have run as Democrats at the local, state, and even congressional levels.

Few would have said this was possible 10 years ago. High-profile democratic socialists such as Senator Bernie Sanders, and Congresswomen Alexandria Ocasio-Cortez and Rashida Tlaib have drawn most of the media attention during this growth period.

But one might argue that it’s at the local level, especially in big cities, where the DSA’s impact has been most impressive. In Portland, Oregon, Minneapolis and San Antonio, for example, DSA members hold over 30% of city council seats.

Like Mayor Mamdani in New York, these representatives can substantially alter the political discourse by calling for such policies as the provision of free or low-cost transportation, universal childcare, public housing, rent control and affordable access to medical care and nutritious food, demands long considered utopian by mainstream politicians.

Thus, “municipal” or so-called “sewer” socialism, a movement to use city government as a means of meeting the immediate material needs of the people while simultaneously serving as a laboratory for the socialist future, is once again, “in the air.”*

Jacobin, the most widely read U.S. socialist magazine, recently devoted a whole issue to the subject, reminding us of its long history in Europe and the United States until, along with the socialist left as a whole, it became a casualty of the Cold War. At a time when the very survival of the bourgeois republic seems threatened by the far right, the resurgence of socialist ideas and socialist politics at the local level provides grounds for hope.

The success of municipal socialism, or of progressive politics in general, is always fundamentally predicated on its resource base. Even in localities where socialists and their allies might win majorities, these places will always be islands in a capitalist sea.

While they might be able to place certain enterprises, such as local utilities, under public control, local governments alone cannot fundamentally alter the larger economy, and there will be no grand “expropriation of the expropriators.” Thus they have to operate within a system that is not designed to support their basic goals of social and political transformation.

On the contrary, the system generally aims to subvert such goals, a fact of life that any socialist in local government learns from their first day in office. No matter how well conceived local socialist reforms might be, without cash — whether from city, state and/or federal sources — as well as support from those charged with implementing policy, they cannot get very far.

Successfully meeting these challenges is crucial to socialists’ ability to show that their policies can improve the quality of life for average people. Such practical successes will be essential if people are to take socialism seriously as a movement for real change.

Local political conditions in the United States vary widely, and organizing to promote “socialist” or “progressive” change must of course reflect such differences. The analysis that follows looks at this problem in one city: Salem, Oregon.

The Case of Salem, Oregon

The capital city of a blue state, Salem is home to 180,000 people and has a high quality of life. Located in the heart of the Willamette River Valley, the city is surrounded by one of the richest and most beautiful agricultural regions in the country, with Portland, the coast and the high desert all within an hour’s drive.

The state government is its largest employer, but the local economy has also attracted commercial and tourist-oriented investment as old manufacturing industries, especially in lumber and canning, have declined. Thus Salem’s location, generally sound economy and good schools have attracted many newcomers with the population doubling over the last 35 years.

Like many other areas of the country, Salem has also experienced rapid socio-economic changes in recent years that have strained the community. As its older manufacturing base declined, lower-paying jobs in the growing service industries increased economic stress on many families and individuals.

Median annual household income in Salem is $71,000 per year with about 15% of the population in poverty. Far more live close to the edge. Housing has been in a deepening crisis, especially for low but also for middle-income people, and the number of unhoused people has skyrocketed since the recession of 2008.

There are currently over 2100 people without housing in the city, with 950 completely unsheltered, often congregating in encampments in city parks, under highway overpasses, or sleeping on the streets downtown. Polls and public testimony at City Hall indicate that the issue is top of mind for residents, whose attitudes, like those of people all over the country, range from empathy to overt hostility.

These views are reflected in local politics, which are polarized between those who seek to mitigate the conditions people experiencing homelessness live under and those who would prefer to lock them up.

Over the past two decades, Salem has also experienced substantial demographic changes. While home to many different immigrant groups, the Latino population in particular has boomed and now constitutes about 24% of the population.

Although Salem has no racial or ethnic ghettos, Latinos tend to be poorer and concentrated in the northeastern and southeastern parts of the city, which are relatively low-income areas, while wealthier, whiter populations live in the south and west.

With over half of the school district’s 30,000 children of Latino heritage, a major issue for the city’s future will be the degree to which this group, historically underrepresented, engages in politics.

The Political Structure

Salem is governed by a Council-City Manager system. There are eight volunteer city councilors, each of whom serves for a term of four years and represents a ward consisting of about 22,000 constituents. The mayor is elected city wide and serves a two-year term.

The council is the policy-making body for the city, but the city manager, appointed by the council, runs the city from day to day and manages the staff. A city councilor’s job can be extremely stressful, consuming at least 20-30 hours per week and requiring one to develop a wide range of expertise to make good decisions.

Since it is an unpaid position, most councilors are either retired or have a job with substantial flexibility (e.g., realtors, independent businesspeople, lawyers, academics, and so on). Few workers can stand for election to these positions, thus eliminating most people from the competition.

Officially the members of the city council are elected on a “non-partisan” basis, but the reality is that the Democratic and Republican Parties play key behind-the-scenes roles in recruiting candidates and mobilizing resources and voters.

On the right, the most important political organization in Salem is the neoliberal Chamber of Commerce, which uses its paid staff to operate essentially as a full-time political party by recruiting candidates, raising funds, and helping them manage their campaigns.

The Chamber’s candidates generally oppose tax increases of all kinds, aim to privatize as many city services as possible, remove restrictions on “development,” and stress private solutions to such problems as poverty and homelessness.

Until recently, the left has had no organization nearly as effective to organize its campaigns, and for this reason the Chamber dominated Salem politics from 2002, when the last “progressive” council was defeated, until 2018.

The right eventually lost its majority because Salem’s progressives finally set up an organization of their own. Founded in 2014, Progressive Salem (PS) is a volunteer activist group whose main task has been to win majorities in the city council and to change that body’s priorities.

PS has no explicit program, but, in general, its candidates support policies that include the creation of a climate action plan to combat global warming, the limitation of urban sprawl, the use of public resources to shelter the homeless and help them find permanent housing, and the protection and enhancement of the city’s parks, library and senior services.

PS cannot match the Chamber’s ability to raise money. In a recent race for an open seat, for example, the Chamber candidate was able to raise $75,000 (for an unpaid post!) which was triple the amount raised by PS’s candidate. The latter won, however, by mobilizing more volunteers (generally drawn from allied groups like 350.org, The Friends of the Salem Public Library, and the DP), carefully targeting its voter base, and effectively driving turnout.

Over the last six years, Salem’s progressive majority has accomplished much. It implemented a climate action plan, promoted the construction of hundreds of new apartments, including some for low-income residents and veterans in a city center that was a virtually devoid of housing just a few years ago, created hundreds of new shelter beds and tiny-house units, and directed a modest amount of public safety funds to provide social services for unhoused people.

These were important policy victories, but it is essential to recognize that they were bandaids covering over much larger problems. Indeed, 30 years of fiscal crisis have caused a steady decline in the level of city services, so that Salem not only had to permanently close all four of its public pools, but it has also reduced police, fire, park, library and community services.

Councilors find themselves constantly performing triage to keep the ship afloat, and, due to the lack of operating funds, it is virtually impossible to actually complete many city master plans. Thus, the city’s longterm fiscal decline makes the pursuit of progressive goals, to say nothing of “municipal socialism,” exceedingly difficult.

The Crisis and Fiscal Struggles

Figure 1. Measure 50 was one of several ballot measures passed by Oregon voters in the early 1990s to limit the growth of property taxes. As a result, city revenues are unable to keep up with rising costs.

Salem’s financial woes are not unusual in Oregon. While most cities have adequately funded water and sewer systems because rates can be raised to cover costs, general fund expenses (e.g. public safety, parks, library and senior services), which have traditionally been covered largely by property taxes, can no longer keep up with rising costs.

The reason can be traced back to the early 1980s Reagan administration’s decision to end revenue sharing, which had distributed substantial federal tax dollars back to states and cities. When that money disappeared, Oregon cities filled the funding gap by raising property taxes, which precipitated a tax revolt.

In the early 1990s, Oregon voters passed a series of ballot measures limiting cities’ ability to raise property taxes on the assessed, rather than the market, value of a person’s home to three percent per year. In addition, voters imposed a cap of $10 per thousand on assessed value that property owners may pay to all local governments.

This means that cities, school districts, and counties must all compete for a share of that $10. When a homeowner’s tax bill hits that mark, local governments have hit a wall.

Thus, even though the market value of people’s homes has skyrocketed in recent years, cities cannot raise property taxes commensurately to keep up with rising costs. Since cities are required to balance their budgets every year, for decades Salem has dealt with repeated shortfalls by seeking new sources of cash and by cutting services.

New, easily accessible sources of revenue are scarce. Oregonians pay income taxes to fund the state budget. Voters have routinely rejected state and local sales taxes, and the state government has limited the kinds of local taxes that can be imposed. For example, after intense lobbying from the real estate industry, the state forbids local governments from levying a real estate transfer tax.

While the property tax is a declining means of financing the general fund, city councils and city staff generally like it because it is less volatile than sales or income taxes, and they hesitate to break with it. Instead, many have implemented a variety of “fees” on homeowners and businesses that can raise substantial sums.

In Salem, for example, all residential homeowners pay a city “operating fee” and a “streetlight fee,” which together cost each homeowner about $20 per month and are tacked onto the water bill.

These regressive fees are like sales taxes, which hit the poorest people the hardest. While they help plug the revenue gap, they are too small to solve the problem, and over time the city has had to cut service levels by about 20%. As of 1997 Salem employed 5.2 workers per thousand residents, but in 2024 that number was 4.3.

Concretely, that means that the city has had to scale back investments in infrastructure that it cannot staff and maintain. It means slower police and fire response times, fewer parks, and fewer community and senior services. To restore service levels to those of 1997 would require a staff of 1100 workers, 300 more than are currently employed.

Counting on Growth?

The Chamber of Commerce has long made two arguments against any substantial tax increases. First, it has insisted that the city has had plenty of “fat” to cut and, second, that the way out of the revenue impasse is to increase property tax revenue by building more houses and attracting more businesses to the city.

In reality, however, repeated audits have shown that the city is efficiently run and indeed, is understaffed. Also, if growth was the way out, Salem should be swimming in cash since its population and commerce have grown steadily since 1990. It is thus clear that simply counting on growth to resolve the issue is chimerical.

Figure 2. As a result of voter-pased property tax measures, service levels have been gradually declining for decades.

The Covid pandemic brought substantial infusions of federal money into the city’s coffers that allowed it to stave off financial disaster for a time but was quickly used up.

With Salem’s $190-million general fund facing a $14-million shortfall and draconian cuts in the offing, including the closing of a new 100-bed facility for unhoused people, in the spring of 2023 the City Council enacted a 0.8% payroll tax on all employees and self-employed workers in Salem, while exempting those earning the minimum wage.

This action triggered immediate broad opposition, backed by the Chamber, and the tax was referred to the voters, 82% of whom said “no.” The council’s decision to back this regressive tax had major implications for Progressive Salem, which had strongly supported Mayor Chris Hoy, a key figure in its coalition.

In the May 2024 election Hoy lost his post to an anti-tax candidate, Julie Hoy (no relation), a restaurant owner backed by massive sums from the real estate and builders’ lobby. During the campaign, Julie Hoy had argued that the city had plenty of money but the wrong priorities.

She also asserted, despite having occupied a council seat for two years before becoming mayor, that the budget was too complex for her to read — but she had smart friends who, over coffee, had found a million dollars in savings.

Once in the mayor’s chair, however, she quickly changed her tune.

Addressing the Crisis

Before he left office after the defeat of the payroll tax, Chris Hoy’s council appointed a Revenue Task Force (RTF) of 25 Salemites, drawn from various sectors of the community, including the Chamber. In the spring of 2024, this group examined 41 different tax options and heard testimony from residents at several town hall meetings.

In the end, after considerable debate, it put forward a recommendation with three main components. The first was to go to the voters immediately with a legally permissible, special “Livability Levy” that would raise property taxes for five years to pay for general fund services.

The second was to approach the state for a substantial payment in lieu of taxes that the state does not pay on its large properties in Salem. The third recommendation was to consider a fundamental reform of the tax system, which would abolish all the regressive fees now propping it up and replace them with a progressive income tax.

Only the latter could bring in the requisite revenues in an equitable way that could return City service levels to those of 1997 and even expand them.

Before moving forward with the Livability Levy, the Chamber, with Mayor Julie Hoy as its mouthpiece, insisted that the city government subject itself to one more “efficiency audit” dominated by representatives of the “business community.”

When even this group reported that the city was truly a skeletal operation, Hoy changed her mind, and she and the Chamber then supported a community effort to pass a levy that would raise an additional $76 million over five years. In the spring of 2025, after an energetic community campaign, 57% of the voters approved the levy.

That gives the city breathing room to lobby the state for regular infusions of cash (for which the prospects are poor) and to consider longer-term solutions like the income tax. If Salem does not come up with new revenue during that time, it will again have to deal with even larger structural deficits when the levy expires.

Challenge for Progressive Salem

The great challenge ahead for Progressive Salem is to mobilize public support to scrap the current funding model and to replace it with one based on the income tax.

According to available public information, Salem taxpayers earn at least $7.5 billion in adjusted gross income each year. Much of that is concentrated at the very top of the income ladder among people who have grown steadily richer as inequality has deepened.

A subcommittee of the RTF working with other community members has developed a series of tax schedules showing that Salem could easily raise the requisite sums to fund city operations at a much higher service level by targeting the wealthy.

Depending on the rates and policy goals, the bottom 40-50% of the population could be excluded altogether from the tax, and the tax burden on middle income residents could be reduced. This is not rocket science.

The main problem in carrying out the reform, of course, is ideological. Decades of anti-tax and anti-government propaganda have had lasting effects on voters, and many see the income tax as an exaction by the state rather than as a means of facilitating the public good. This attitude is supplemented by a lack of trust in government institutions at all levels.

In my view, however, the problem is not unsurmountable. As the Livability Levy showed, in addition to police and fire services, people generally want high quality library, park, community and senior services. They want good social services; they want housing to be plentiful; they want the homeless to be housed.

They also want taxation to be equitable and rightly identified the payroll tax as regressive. Over the next several years, Progressive Salem and its allies must make the case that a progressive income tax can deliver the resources the city needs. Otherwise, we will return to triage as a way of governing.

Municipal Socialism as a Way Forward

It is at the local level that most people encounter their government. Going to the library or park, taking the bus, dealing with a fire or burglary, turning on the tap, flushing the toilet, or driving on a residential street, are the places where people “meet” the state on a day-to-day basis.

For a long time, such public services were taken for granted by many Americans, especially in the middle and upper classes. For the last 40 years they have been under steady attack by the right wing, which has sought to shrink the state, privatize its services, and to deny access to formerly public goods to those without money.

The success of the right in driving our growing inequality has been supported by both mainstream parties and has fueled mass support for Trump as well as furious criticism of mainstream Democrats by the left.

Local struggles to resist the right and to expand democratic control over an enlarged array of public goods and services — what one might call “municipal socialism” — are central to building a broader movement that can push for systemic change.

The U.S. is experiencing a major upheaval in which the forces of authoritarianism, indeed of fascism, have seized control of the levers of power at the federal and, in many places, the state level. At the same time, political and economic conditions have also mobilized forces aiming to protect the democratic republic and, what’s more, to address many of the contradictions of contemporary capitalism. In some places, such as New York and Seattle, the intensity of the problems arising from these contradictions has led to calls for “socialist” solutions. These would, of course, not overthrow the system, but they can legitimize a socialist discourse essential to building a movement for change on a much larger scale. Thus, cities can be laboratories to demonstrate how socialist policies can improve people’s lives.

Calls for “socialist” reforms have not yet come to Salem, where, as in most places in the United States, the socialist left remains small. There is an active DSA chapter in town, but its members remain largely aloof from city electoral politics and have focused on labor education and protests against ICE.

In Salem, the language of the “left” is largely still that of “progressivism,” but that may change as political struggles unfold in the state and country. In the meantime, it is important for socialists to build broad support to fight for changes that will make expansive socialist reforms possible.

In Salem and cities like it, struggles for progressive taxation, long at the center of the labor movement’s agenda, should take center stage.

*For this definition see Patrizia Dogliani, “European Municipalism in the First Half of the Twentieth Century,” Contemporary European History 11,4 (2002): 576.

March-April 2026, ATC 241