Now is the perfect time for Seattle to pass a “millionaires tax.” With the minimum wage battle coming toward a peaceable end (or so the mayor promises), city council member Kshama Sawant will be free to turn toward the next item on her socialist agenda: taxing the income of millionaires. And with the city in need of finding new revenue to adequately fund human services (not to mention universal preschool, transit, and parks), who better to turn to for a little extra cash than Seattle’s untaxed rich?
But more importantly, there may never come another time when the Washington State Supreme Court is more predisposed toward revisiting the controversial constitutional question that has long threatened our state’s prosperity: Is income property?
That was the 5-4 ruling of the court in 1933 after voters overwhelmingly passed a graduated income tax initiative, and it has hampered our state government’s ability to fund our basic needs ever since. Even in its day it was a controversial ruling, based on scarce and tenuous precedent—precedent that has since been rejected by every other state and federal court in the land. Everywhere else in the United States of America the courts have determined that income is a transaction that is taxable as such. Only in Washington State do we cling to this arbitrarily contrary definition, backed by not a single word of our state constitution. Go ahead, read it. It’s not mentioned once.
Normally, our elected justices are loath to tackle issues that might anger voters—for example, the decade and a half of legal wrangling it took to force the court to issue its equally inescapable and unpopular ruling on the now-dead two-thirds supermajority requirement for tax increases. But the shameless contempt our legislators have shown toward the court’s McCleary decision may put justices in a different frame of mind.
Under McCleary, the court ordered legislators to increase K-12 spending by an additional $4 billion to $7 billion by 2017 in order to meet our constitutional “paramount duty … to make ample provision for the education of all children.” But that is a legally binding order that legislators aren’t even close to fulfilling. Sure, they’ve restored a little bit of funding to public schools as the post-Great Recession recovery continues. But anybody who knows anything about the state budget, and who discusses it with integrity (that rules out you, Seattle Times editorial board), understands that it is mathematically impossible to comply with McCleary without raising new revenue. And legislators have made zero progress toward that end.
So what are the justices to do? They can’t very well pass tax legislation themselves—that is beyond the power of the judicial branch—and even if they could seize control of the budget writing process, they couldn’t do much better given the insufficient resources available. And as much as I’d love to see some legislators tossed in jail on contempt charges, I’m not sure that would be either legal or constructive.
But what the court could do, given the opportunity presented by a Seattle millionaires tax and the inevitable lawsuit it would provoke, is overturn the 1933 decision, tossing a political hornets nest into house and senate chambers by dramatically multiplying the revenue options available to lawmakers.
That might send a message.
Again, under normal circumstances, the justices would avoid this issue like the plague. Any opportunity to defer due to some procedural or preemptory issue would likely be seized upon. But desperate times call for desperate measures, and with a constitutional crisis looming, the court may welcome any opportunity to give the legislature a kick in the pants.