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To tax or not to tax is not the question

Post by Kim Bradford on Nov. 21, 2009 at 7:33 pm with 3 Comments »
December 2, 2009 5:35 pm

This editorial will appear in Sunday’s print edition.

State lawmakers who thought they’d never live to see a session as ugly as this year’s may well be proved wrong.

Washingtonians aren’t in a spending mood, and that has led to what Arun Raha, the state’s chief economist, calls a “revenue-less recovery” from the recession. An additional $760 million has evaporated from projected revenue collections, and the state now expects to be $2.6 billion in the red.

That might seem like next to nothing compared to the $9 billion gap the Legislature stared down earlier this year, but this is one of those cases when appearances are deceiving.

Lawmakers have less time, fewer options and a much smaller shot at getting federal bailout dollars to plug this hole. The last infusion of federal aid is actually part of the current problem: It helped balance the budget, but it also prevents budget writers from cutting some key programs.

What to do, except buy Raha a new crystal ball and pray Washingtonians suddenly become shopaholics?

For starters, don’t buy into the notion that the debate is as simple as whether to tax or not to tax. Raha’s revenue forecast on Thursday seems to have been greeted in Olympia like a declaration of war, with everyone from politicians to pundits to people on the street swearing allegiance to one camp or the other.

Some Democrats say the state can’t cut its way out of this problem without inviting disaster. Really? Have they tried – and we mean really tried with the kind of no-holds-barred approach that the governor called for last January?

As painful as balancing the budget was this year, there were still hard choices deferred and sacred cows protected. State government, by and large, doesn’t look drastically different than it did a year ago. Many businesses and families can’t say the same.

Meanwhile, Republicans are leading the campaign to declare taxes verboten. It doesn’t seem to matter what kind of tax it is or where the burden would fall – if the state doesn’t make do with what it’s already got, it’s inviting economic ruin and fiscal imprudence.

Such polarization is healthy so far as it checks the reflexes of either side. But responsible, thoughtful governing lives in the messy intersection of ideas, not in either-or propositions.

Gov. Chris Gregoire will give the state a taste of what a $2.6 billion deficit looks like in December when she releases a budget that relies on existing revenue only. Here’s hoping she uses the opportunity to offer something more than a worst-case scenario designed to prime the state for tax hikes, something that gets at the real fundamental changes she seemed to signal earlier this year.

Once it has that baseline, then the state can begin in earnest the debate over how to patch the budget deficit while inflicting the least amount of harm. The test of any proposal should be how well it positions the state and its citizens to recover. Beyond that, all bets should be off.

Leave a comment Comments → 3
  1. derekyoung says:

    Discretionary spending is about $9.3 billion from which they must cut $2.6.

    To put this in perpsective, here are the programs that can be legally cut.

    Mental health and developmental disabilities services: $1.6 billion.
    Corrections: $1.6 billion
    Elderly care: $1.3 billion
    Assistance for low-income families: $1.1 billion
    Class size $635 million
    Higher Ed: $500 million
    Juvenile correction $198 million.

    That’s it folks. We could quite literally end all assistance for the poor and throw children and old people onto the streets and still need to cut financial aid to students in order to balance this budget without new revenue.

    It’s time for Washington to take a hard look in the mirror and decide what its core values are.

  2. “That’s it folks. We could quite literally end all assistance for the poor and throw children and old people onto the streets and still need to cut financial aid to students in order to balance this budget without new revenue.”

    Wow, really?!?!

    Are you telling me that there’s no waste to be cut or efficiencies to be gained? I ask as I’ve read and been told many times of areas where waste occurs.

    Perhaps your associates in your political party and elected friends should have taken more care before burning through the budget surplus. Why didn’t you list the possibility of renegotiating the increased salaries given to the Democratic union supporters? I realize this is politically undesirable but it’s certainly possible.

    I’m certain there are a few initiatives you could take before tossing those old folks and kids “into the street”. You see part of my core values is not to give any more of my money to the state where a significant portion of it is wasted.

  3. derekyoung says:

    Where is this waste? How many billions do you suppose we could save? Speak up now because nobody in state government from either party seems to know where it is.

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