Careful governor, careless Times

The Seattle Times editorial board urges Gov. Gregoire to be “careful” regarding the state budget…

Its additions were modest, and the $0.015 billion the governor vetoed was helpful in that regard. So was the $0.85 billion ending savings account. But these changes were on the top of a total — $33.7 billion in a two-year cycle — that was not modest. In four years, state spending has risen by 33 percent. […] Some of this spending was necessary. But the across-the-board spending has meant the state was not able to lower taxes in any substantial way.

Yeah, well, there are reasons to be careful regarding the state budget in the face of an antiquated tax system that virtually assures a longterm structural deficit, but not for the reasons the Times suggests. Indeed, every time they trod out Rossi’s intentionally misleading “33 percent” number — without offering readers the appropriate budgetary context — the Times does a great disservice toward the cause of fiscal stability.

Yes, the state budget has grown by about a third over the past four years, and no, that rate is not sustainable when compared to longterm budget forecasts, but our state government’s growth has absolutely been “modest” by any meaningful economic measure. In fact, a January 2007 analysis by the Washington State Budget & Policy Center clearly shows that general fund spending under Gov. Gregoire has merely followed the same trend established during the 1990s.

budgettrend1.gif

The Times would have you believe that it was the spending increase under Gov. Gregoire’s watch that is the anomaly, when in fact it was the slower spending growth during the national recession and tepid recovery that actually fell below historical growth levels. Gov. Gregoire’s budget merely returned the state to the established trend.

Indeed, as a share of the total state economy, Gov. Gregoire’s budget actually represents a reduced investment — a smaller share of state resources than any of the six budgets that directly precede it.

budgettrend2.gif

Anti-government/anti-tax critics can spout all they want about rising spending and per-capita tax increases, but those numbers are entirely meaningless when taken out of context… as they usually are. Read the academic literature and you will find that the most common metric used in comparative studies of government spending, and for analyzing the relative growth of both expenditures and revenues, is spending/taxation as a percentage of personal income.

The reason is twofold. First, the economic metric that most closely tracks long term growth in demand for government services is growth in total personal income. That is because many of the services provided by the government are commodities, and as personal income increases, so does consumption. As our state grows wealthier, demand for government services increases faster than population plus inflation.

The other reason to focus on personal income is that it is the only metric that tracks individual taxpayers’ ability to pay. The state invests in things like transportation and education and law enforcement — investments that provide the infrastructure necessary for our economy to grow and for all our citizens to prosper. Thus a spending increase, even when accompanied by an increase in marginal tax rates, does not increase the real burden on individual taxpayers if it results in a corresponding increase in personal income.

So how does our state stack up in terms of state and local taxes as a percentage of personal income? Again, according to the Budget & Policy Center, Washington currently ranks 36th nationwideand falling.

lowtax.jpg

There is a legitimate debate to be had over the proper size and scope of government, and the priority in which we make public investments, but it is fundamentally dishonest to enter this debate by reinforcing the common misconception that our state government is out of control, when by the most meaningful measure — the government’s total share of our state’s economic resources — even a four-year 33-percent increase represents a decline from historic trends. And it is equally dishonest to profess a concern for fiscal responsibility by focusing solely on budgetary expenditures while refusing to address the revenue side of the equation.

Washington state not only boasts the most regressive tax structure in the nation — one in which the bottom 20% of wage earners pay a whopping 17.6% of income in state and local taxes while the wealthiest pay only 3.1% — our tax system is also based on an antiquated, early 20th century model that over-relies on an ever shrinking portion of our 21st century economy: the manufacture and sale of goods. Economic booms can mask this structural deficit in the short term, but because our economic growth is increasingly occurring in sectors that remain un- or under-taxed, longterm revenue growth simply cannot keep pace with growth in demand for public services… at least not without raising marginal tax rates, shifting an ever greater burden on exactly those families who can least afford it.

The Times and other critics have repeatedly cautioned about unsustainable budget growth while refusing to articulate which programs and services they would see slashed, or displaying an ounce of willingness to discuss the kind of fundamental tax restructuring that might allow state and local government revenues to reliably keep pace with both economic growth, and with the growth in demand for public services. If the Times editorial board wants a smaller state government — if they want to see less per capita real dollars spent on education, transportation, law enforcement, children’s health care, and other essential services — they should just come out and say it; we would all benefit from an honest debate. But the sort of disingenuous budgetary “concern trolling” they display in today’s editorial adds absolutely nothing to the discussion.

Comments

  1. 2

    ByeByeGOP spews:

    Let’s cut back on victimless crimes – that would save millions – most of these crimes are only crimes because the right wing religious nuts demand that. Funny how they don’t mind spending money on prisons but they don’t want kids getting free health care.

    Also – it’s a good thing you pointed out where Washington sits nationwide. More taxes are collected in 35 other states.

    And if the righties are so worried about spending – why didn’t they stop their own guy in the White House from creating the largest federal budget in US history? I’ll tell you why because they are lying hypocrites.

  2. 4

    spews:

    Goldy,

    Tx .. I enjoyed your analysis.

    Rather than any sort of long term planning, it seems to me that each session is an ad hoc exercise with ecah party and each pol pushing for whatever he or she thinks they can get in the short term.

    It seems to me that the fist step toward state budget reform must be an agreement between the moderate forces on what the budget is. The arithmetic you cite inb suport of a state income tax would, my guess is, be inevitable if the state were required to operate within a longer term budget.

  3. 5

    spews:

    Washington state not only boasts the most regressive tax structure in the nation — one in which the bottom 20% of wage earners pay a whopping 17.6% of income in state and local taxes while the wealthiest pay only 3.1% — our tax system is also based on an antiquated, early 20th century model that over-relies on an ever shrinking portion of our 21st century economy: the manufacture and sale of goods. Economic booms can mask this structural deficit in the short term, but because our economic growth is increasingly occurring in sectors that remain un- or under-taxed, longterm revenue growth simply cannot keep pace with growth in demand for public services… at least not without raising marginal tax rates, shifting an ever greater burden on exactly those families who can least afford it.

    worth repeating

  4. 6

    cmiklich spews:

    It’s not hard to just make up numbers. Reality is different.

    Most truly poor folk don’t own homes/property. So, they’re not paying near the property taxes as homeowners. Many apartment owners are given tax BREAKS to house these miscreants (section 8 or worse).

    Fact is the Fed budget hasn’t increased anywhere NEAR what the commie-demos have done in this State. And my fed taxes haven’t increased while my State burden is increasing at pretty near that 33% !!!

  5. 7

    spews:

    Goldy,

    There is another aspect of the Times’ editorial that bears thought: A government budget is NOT really comparable to a personal budget. States have obligations they can not back away from. Many of those are long term obligations and many are also critical to the long term health of our economy. Finally, many obligations are constitutional. Bankruptcy literally can detroy the structure of state government!

    My pet peeve in all this is the way we fund education. For example, during the last term the legislature and the governor did a a much better job than usual of meeting its goals .. some of them constitutional goals. However, they met these needs out of current dollars for current costs. This sort of ad hoc financing of a constitional obligation is terrible expensive. One can not, for example, hire faculty for a new area in 2009 and then fire faculty on 2010 wihtout making the UW into a basket case. Moreover, while the UW does try to even out its budgets, the result is inevitably misuse of funds that would be better used if long term planning was possible ..ask any bureaucrat what happens to funds that are “left over” at the end of a year.

    It seems to me that a “Responsible PLan for Fiscal Responsibility in Washington” is badly needed.

  6. 8

    George spews:

    The State, Counties, and Cities have open Demo’s Credit Card its call Tax All if you don’t like it vote us out of office.

  7. 9

    spews:

    I hopr this is not too much of chgange in topic but Hillary has just announced that she wants Bush to boycott the Beijing Games!

    FOUR BIG STARTS to the lady from NY and I hope BHO and John McC join her asap,

  8. 10

    Commentator spews:

    To close the budget gap, would the Times advocate giving back the tax break they and other newspapers just got? Would they like to keep the estate tax, or implement an income tax?

    Income taxes have been very bumpy recently in some states, notably California and Oregon, where income tax receipts are largely driven by the stock market. It is not necessarily a panacea.

  9. 11

    Hannah spews:

    I am confused on tax brackets. Can someone help me understand what SJ is saying: “one in which the bottom 20% of wage earners pay a whopping 17.6% of income in state and local taxes while the wealthiest pay only 3.1%”

    When I look at federal tax tables, it looks like the more you make, the more you pay, but I keep hearing everyone say the federal tax is less the more you make? I am confused! Is it a state thing as to why the lower earners pay so much more in tax? Here is the tax tables for federal taxes…
    http://www.moneychimp.com/feat.....ackets.htm

    Is there such a thing for State and Local taxes?

  10. 12

    busdrivermike spews:

    So Hillary wants Bush to boycott the Olympic Games. Why isn’t she calling for a boycott of the games by the US Olympic team? Please, someone post that it would rob athletes the chance to compete, and the Olympics should not be politicized. Like Beijing hasn’t been politicizing the Olympics since they got them.

    Another “I smoked, but did not inhale” moment from the Clinton Machine.

  11. 13

    George W. Bush spews:

    Goldy,

    Excellent post.

    Assuming all these scary numbers are in nominal terms, a 3% per year inflation rate would explain a third of the spending increase in and of itself. Throw in population growth and income growth….and the increase is readily seen for what it is: At or near trend.

    @6 abv.

    1. Property taxes to not go into the state’s General Fund. They are local. Renters pay property tax, just like owners.

    2. Using 2005 as a baseline, federal spending has increased nearly 30% per Bush’s 2009 proposed budget.

    Yes, wingnuts deliberately lie.

  12. 14

    Hannah spews:

    @13 – “1. Property taxes to not go into the state’s General Fund. They are local. Renters pay property tax, just like owners”

    Property taxes are not just local and county, part of our property tax goes into the state fund.

  13. 15

    Roger Rabbit spews:

    I have several discrete points to make about the state budget.

    1) It’s misleading to compare Washington’s overall state budget to spending by other state governments, because about half of Washington’s nominal state budget is actually local school spending. Under our unique system, local school taxes are counted as part of the Office of Superintendent of Public Instruction’s budget, but all that agency does is distribute school revenues to local school districts. The 48% or so of the state budget spent on K-12 education really isn’t part of state government in any meaningful way.

    2) Gov. Gregoire inherited the 2005 – 2007 budget from the previous administration, so even though she was elected in 2004 and took office in 2005, her the current biennium (i.e., the 2007 – 2009 budget( represents the first budget she actually controlled. So, she’s only responsible for the last two years, not the last four years as the Times states.

    3) Spending increases in the 2007 – 2009 cycle were inevitable because Gov. Gregoire took office against a backdrop of accumulated deferred spending caused in part by economic recession and in part by 10 years of GOP obstructionism (Republicans controlled the state senate from 1994 through 2004). The major increases were in education (partly to implement voter-passed initiatives, and partly because of rapid population growth) and transportation (where deferred expenses piled up because Republicans refused to pay for even basic road maintenance).

    4) As Goldy pointed out, Republican critics of state spending have failed to identify any waste, profligacy, or potential cuts. Whenever they do get specific about spending increases, their arguments don’t hold water. For example, some conservatives criticized the pay raises Gov. Gregoire’s budget gave to state workers, but at that point state employees had gone 6 years without a COLA. That’s effectively a pay cut, and given that public salaries are low to begin with, when you keep cutting workers’ pay they leave and you incur greater costs because of expenses attributable to recruiting, training, and the higher error rates typical of inexperienced employees. Therefore, the pay raises were actually a cost-cutting measure, as well as an investment in the quality of state services that our citizens depend on.

    5) Gov. Gregoire’s spending increases also occurred against a backdrop of federal disinvestment in everything from medical care to law enforcement, plus imposition of new unfunded federal mandates on state and local governments for homeland security, etc. These state spending increases are the fault of the White House and Republican-controlled Congress during the first years of Gregoire’s term as governor.

    Goldy’s main point is accurate: Republican posturing about state spending is either empty grandstanding — i.e., demagoguery — or masks a hidden agenda to slash public services most voters want, and which the majority of voters would not knowingly vote for.

    For example, many conservatives are hostile to public education — some might even eliminate public schools if they could. So how can voters trust a Gov. Rossi to not wreck public education in this state if they give him the chance to run our state government? Other areas in which a Rossi administration would certainly disinvest (as well as make policy and regulatory changes) are environmental protection, consumer protection, and business regulation. On the other hand, a Rossi government could be expected to increase spending on subsidies and tax breaks for businesses.

    In fact, in all probability, total spending under a Rossi budget probably wouldn’t look much different. That’s because most state budget items are locked in, and aren’t easily changed. Although there are over 200 state agencies and a much larger number of programs, most state spending occurs in three areas — education, transportation, and social services — and the remaining state government functions amount to only a tiny fraction of the overall budget. Consequently, you can’t realize noticeable savings or make meaningful budget reductions by slashing those programs or eliminating small agencies.

    Let’s take social services as a potential target for budget cuts. The biggest spending item here by far is medical services, and the biggest item within that category is nursing care for indigent elderly. Vendor rates are tightly controlled and you can’t cut nursing home spending without degrading quality of care or reducing patient count — as in other states, Medicaid patients are a loss leader for Washington’s nursing homes, and vendors are already forced by low reimbursement rates to provide these services on a shoestring. If you cut nursing home expenditures, what are you going to do with the aged residents who have no one to take care of them? Put them on the curb and let them sit there until they die?

    The only budget Rossi had a hand in writing gave us a clear indication of where he would look for budget economies: He kicked 40,000 poor kids off Medicaid. Is that really a public policy we want in a time when our state economy is doing relatively well? Do we want to deprive children of basic health care so affluent taxpayers can buy another big-screen TV? In fact, Rossi’s Medicaid cuts probably saved our state’s citizens nothing; in all probability, those kids ended up in emergency rooms, and the cost of their ER treatment got passed along to Washington’s insurance premium payers (businesses and individuals) and paying patients. Hospitals and clinics don’t eat the costs of free care; they’re doing just fine, thank you, and these costs get passed along to their paying customers. So, Rossi’s budget philosophy is merely a prescription for yet more medical socialism on top of the socialism that already pervades our private health insurance system.

    The bottom line is there’s simply nothing in the GOP/Rossi bleating about the state budget to vote for. They haven’t given us any specifics, which is suspicious by itself. They probably can’t implement any meaningful cuts. If they do cut, in all likelihood the cuts will harm our economy (transportation) or result in higher costs elsewhere (medical care). Their bleating is one of two things (or perhaps a combination): Smoke and mirrors, or a hidden agenda to make cuts in basic public services that voters would never support if they knew.

    In short, the charges against Gov. Gregoire of runaway spending are unfounded, and there’s no “there” there in GOP promises of a spending-cut windfall to taxpayers. It’s nothing more than partisan gamesmanship, totally lacking in substance or real change.

  14. 16

    Roger Rabbit spews:

    It should also be pointed out that Gov. Gregoire kept her promise not to raise general taxes. She never promised there would be no increases in fees or the gas tax, although it should be pointed out that under her administration one highly visible fee — the $5 day use fee at state parks — was rescinded. That was a financial break for our state’s recreation users. The gas tax isn’t indexed to inflation, and given both population growth (i.e. more cars on the road) and rapid inflation in construction materials, a gas tax increase was inevitable. Also, as I’ve frequently pointed out in these threads previously, the gas tax increase actually costs motorists nothing because the pump price is set by supply and demand, and if the market supports $3.30 a gallon that’s what drivers will pay regardless of whether 10 cents or $1 of it is taxes. If the 9 1/2 cent gas tax increase passed by the Gregoire administration and Democratic legislature had been repealed by the failed voter initiative, that money wouldn’t have stayed in motorists’ pockets, it would have gone to oil companies as additional profit. A solid majority of Washington voters were smart enough to figure this out, at least intuitively, and recognized I-912 for the turkey it was.

    Which brings up another point. Mark the Redneck, publicly in these threads, bet Goldy $100 that I-912 would win by 10 points or more. MTR not only was pathetically wrong, he even more pathetically refused to pay up. That debt is now 2 1/2 years past due, and it’s time to pay your gambling debt, you dishonorable lying piece of shit! Meanwhile, MTR has continued to freeload on Goldy’s blog, clogging the comment threads with repetitive tripe at will. If he isn’t going to pay his moral debts, then Goldy should charge him by the word for the privilege of posting here, payment to be made in advance in U.S. funds only, no certified checks drawn on Nigerian banks! Otherwise, ban the fucker until he pays his gambling debt!

  15. 17

    spews:

    Hannah

    The simplistic (righty) view of taxes as a portion of waht we all earn is way out of date at the federal and local level because

    a. all “income” in the US is in dollars created by the Fed. W/o the fed the US would be bankrupt is a few months.

    b. Of we view income as all benefits from all sources, in our society it is impossible to disentangle benefits from the state vs. benefits from personal income. Bill Gates, for example, escapes paying any taxes by giving money from capital gains to his foundation. In effect you and I subsidize his philanthropy.

    In my opinion we need to change the concept of taxes all together. Taxes should be seen as the portion of our national (or state) economy we want the state to control and spend. THEN the question comes .. what is the most efficient way of allocating that money?

    I suppose the nuttiest idea would be to have no taxes but just let the Fed allocate a part of its creation of dollars to the state. The obvious problem her eis that this should account for growth but NOT for fixed expenditures.

    Another nutty idea is the national sales tax .. aka the flat tax. There is no way of doing this that is nit regressive.

    My favorite is a wealth tax. Surely the biggest benefit any of us can get (vs. all other citizens) is personal wealth. The holding of this benefit by a few has never been in the interest of any society. Indeed wealth hording may be common factor in the downfall of regimes as different as the monetarists, the Monarchists, the imperialists, etc. In contrast, one could argue that the greatest success of capitalism grows form the ideas of Ricardo, Schumpeter and others that capitalism depends on the welfare of the consumer.

    Sweden has recently begun trying a wealth tax.

  16. 18

    Roger Rabbit spews:

    @3 Fuck you. I like art. It doesn’t come out of general taxes anyway, it’s paid for out of the bond funding for capital projects.

  17. 19

    Roger Rabbit spews:

    Even the Romans and Popes — neither of which were noted for their generous employee salaries or lavish charity programs — invested in art. The European fascists prized art, too, but they preferred to steal it.

  18. 20

    correctnotright spews:

    cmiklich: Once again the right wing “idiot” opinion (and opinion is a very liberal term for cmiklich’s garbage) surfaces:

    Cmiklich says:
    “Fact is the Fed budget hasn’t increased anywhere NEAR what the commie-demos have done in this State”

    Umm – I haven’t noticed a nine TRILLION dollar record deficit in this state – but I have noticed the largest budget deficit in history proposed by that well-known “commie” GWB (republican, from spend-it-all on Iraq).

    Maybe your federal taxes have not gone up much – but that is because GWB is borrowing ALL that money. And have your taxes in Washington State gone up 33% – do you have the data to back up that false claim too?

  19. 21

    ByeByeGOP spews:

    The GOP really wants to cut school funding for one simple reason. The more educated you are, the more likely you are to vote Dem. That’s been at the core of their thinking for decades. And if Rossi wins – you can bet that’s what will happen – and the money will be transferred directly into the BIAW bank account as a kickback for all the election money they’re funneling to him.

    Too bad for him it won’t work. Washington is a Democratic state – no GOP need apply.

  20. 22

    Roger Rabbit spews:

    @4 “Rather than any sort of long term planning, it seems to me that each session is an ad hoc exercise with ecah party and each pol pushing for whatever he or she thinks they can get in the short term.”

    That’s not really true, SJ. It’s virtually impossible for an individual legislator to get spending items inserted into the budget. There is no state-level equivalent of congressional earmarks. Over a long period of time, some programs get dropped and others get added because society is constantly changing and technology is evolving. Today’s state budget doesn’t have the same spending priorities as the 1920 state budget. But these changes invariably come about after extensive and prolonged public discussion, and are a product of a political process that offers many opportunities for public input and is generally responsive to what the public wants.

  21. 23

    spews:

    Hannah @11,

    My post is referring only to state and local taxes, and since there is no income tax in WA state, there are no graduated brackets. The primary reason WA’s tax structure is so regressive is because lower income families spend a higher portion of their total income on taxable items.

    As for the federal income tax, it is not nearly as progressive as it looks because FICA (Social Security) is a flat tax on the first $100,000 of income. Being self-employed, that means I pay 15.3% (in addition to my income tax) on the first $100,000 of income, whereas Bill Gates pays no FICA on anything over $100,000. So you can see pretty quickly how this on its counteracts much of the progressivity in the federal tax.

  22. 24

    correctnotright spews:

    @11: Hannah

    What Goldy (not SJ) is saying is that Washington state (not the Federal taxes) has a regressive sales tax and that people in the bottom 20% pay 17.6% of their incomne in sales tax while the richest quintile (top 20%) pay a mere 3.1% of their income in sales tax. That is the definition of regressive: where the poorest pay a much greater proportion of their income than the richest.

  23. 26

    drool spews:

    Roger @ 18,

    Fuck you back. It makes no difference what pot it comes from the pots are filled from our wallets.

  24. 27

    Roger Rabbit spews:

    @6 “Most truly poor folk don’t own homes/property. So, they’re not paying near the property taxes as homeowners. Many apartment owners are given tax BREAKS to house these miscreants (section 8 or worse).”

    Typical wingnut bullshit/tripe. Only in Wingnut World does being poor make someone a “miscreant.” In the real world, people are poor for various reasons, including:

    1) Unemployment beyond their control
    2) Financially ruined by medical expenses
    3) Being born into a family that couldn’t leave them an inheritance
    4) Lack of educational and employment opportunities (which are not evenly or fairly distributed among the population)
    5) Limited economic opportunities because of race, age, and gender discrimination by employers
    6) Etc.

    In Wingnut World, but nowhere else, being disadvantaged by one or more of these factors makes you a “miscreant.” To which I say, BOOOOOOOLSHIIIIIIT!!!

    As is typical of Wingnut Diatribes, this one is factually flawed. Most apartment dwellers are working class and middle class renters who aren’t subsidized by section 8 or anything else — they pay full-bore retail rents out of their own pockets. The owners of most apartment units do not get property tax breaks. Property taxes on rental property ultimately are passed through to, and borne by, renters who, on a valuation basis, pay the same property tax rates as homeowners. So again I say — BOOOOOOLSHIIIIT!!!

    It’s instructive that wingnuts are unable to make their points without lying about basic facts.

  25. 28

    Hannah spews:

    @17 – SJ I agree that the wealthy tax tables haven’t changed in years. But I am confused by all this talk of Bush giving tax cuts to the wealthy…what is considered “wealthy”. Didn’t we all get “tax cuts” so to speak? And in the state income brackets, yes the poor pay more in tax because everything is taxed except food. How about a state “tax cut” to the lower and middle classes and an change in property tax dependant of individuals income levels?

  26. 29

    Roger Rabbit spews:

    @7 “There is another aspect of the Times’ editorial that bears thought: A government budget is NOT really comparable to a personal budget. States have obligations they can not back away from. Many of those are long term obligations and many are also critical to the long term health of our economy. Finally, many obligations are constitutional. Bankruptcy literally can detroy the structure of state government!”

    Sounds like a pretty good description of the average household budget, as well, except for the constitutional part.

    Now let’s examine your constitutional argument in more detail, SJ — but not too much detail. I don’t want to get bogged down here. Let’s take the most prominent example of constitutionally-mandated spending — school spending — for illustration purposes. The court decisions have generally gone in favor of the school districts in terms of saying, yes, the state is constitutionally obligated to pay the full costs of basic education. But the amount of additional state revenue that has produced for school districts is zilch. The courts recognized that neither the state constitution nor judicial interpretation/enforcement thereof can force the legislature to spend Nickel Number One on schools or anything else. Taxation, appropriation, and revenue allocation effectively remain within the purview of unbridled legislative discretion, guided and constrained only by the ability of voters to elect, or not elect, their legislators (and would-be legislators). What this adds up to is that such spending mandates as exist in our state constitution are paper tigers that, de facto, don’t exist at all but are mere words on paper.

    Where that leaves us is that the state budget really is comparable to household budgets, with one important exception: The various interest groups (e.g., light rail bppsters) who drive the political process that drive public budgets often act as though there is no limit to what they can demand household contribute to public spending. As much pressure as the state budget is under, personal budgets often are under even more pressure. They, too, have contractual, legal, and moral obligations making claims on their financial resources. For example, if you have a dog, you’re supposed to get a $20 annual pet license and you’re subject to being fined if you don’t (not to mnetion what you’ll pay to bail Fido out of the pound). Mortgages and car payments — these are contractual obligations households can’t back away from without painful consequences, typically are long-term obligations, and meeting them is critical to the household’s economic viability and ability to function (if your car is repossessed, you may be unable to work). And bankruptcy certainly can destroy the structure of a household if it results in divorce.

    The main difference between the state budget and a household budget is the state’s ability to force you to meet their needs first. The state doesn’t really care how, or whether, the household meets its own needs. This, of course, is what drives tax rebellion and anti-government attitudes. But the problem here is not the absolute size of the state budget — on the whole, our state’s citizens can afford the current level of state spending — but rather the distribution of the state tax burden; and that, in turn, is not the fault of liberals but of the same retrograde troglodytes who bleat the loudest about tax burdens while paying the least share who insist on maintaining the current system that makes our state citizens pay state and local tax in inverse proportion to their incomes. It is the tax freeloaders, not the tax payers, who are complaining that we spend too much on the public services that, generally speaking, benefit them more than anyone else.

  27. 30

    Roger Rabbit spews:

    @26 Fuck you back again. I pay taxes for stuff you want (e.g., your recreational war in Iraq), so you can damn well pay taxes for stuff I want (e.g., art that uplifts my spirit and enriches my life). That’s how the system works.

  28. 31

    Roger Rabbit spews:

    @17 “I suppose the nuttiest idea would be to have no taxes but just let the Fed allocate a part of its creation of dollars to the state.”

    That tax has been around forever. It’s called the Inflation Tax, and we’ve always had it, and always will.

  29. 32

    Roger Rabbit spews:

    @31 For example, you pay for Bush’s Iraq military misadventure every time you fill up at the gas pump or go through a checkout line in a grocery store, in the form of higher prices for those commodities. Actually, in a real sense, the prices aren’t really higher; your dollars are simply worth less. (Caveat: Monetary devaluation doesn’t account for all the inflation of recent years, of course; there are other factors at work, too.)

  30. 33

    drool spews:

    #30

    Who the hell says I want a war in Iraq?

    I just want government involved in infrastructure and things of that ilk…….not fluff. Art is fluff. Putting art at a transfer station is insanity.

  31. 34

    Roger Rabbit spews:

    @14 Part of our property taxes do go into the state revenue stream, but that doesn’t necessarily mean they go into the general fund; as noted in one of my comments above, most local school spending is funneled through the Office of Superintendent of Public Instruction, and that state essentially acts merely as a processing agent for the funds that ultimately are spent by local school districts.

  32. 35

    Roger Rabbit spews:

    @20 It’s worth noting, in response to cmiklich’s Wingnut Drivel, that federal spending increased three times as fast under chimpface as it did under Clinton — roughly, 12% a year versus 4% a year, or somewhere around there. Federal spending under Bush43, as a percentage of overall spending, has increased as fast or faster than state spending under Gregoire.

  33. 36

    Roger Rabbit spews:

    @21 They also want to keep you barefoot and ignorant so they can force you to work for less pay.

  34. 37

    spyder spews:

    One point i like to keep making about tax revenue expenditures: Nearly every single penny of government expenditures eventually goes into the hands of corporations. Governments essentially pay for labor and contract for services. The dollars expended on labor go to various corporations through purchases of food, energy, commodities, consumer junk, homes, etc.; the dollars for all contracted services go immediately and directly into the coffers of corporations. Essentially government is an economic distribution system that takes taxpayer money and gives it to fewer and fewer corporate entities. The more these corporate entities remove the funds from the state (think WalMart for example), the less the state’s citizens have to spend on local businesses and corporations. The spiral gets tighter and tighter, until eventually many agencies and entities are broke and can no longer provide for the commonweal.

  35. 38

    spews:

    @28 All taxes are relative. The fed creates a money supply that hopefully reflects the flow of capital. From that flow, the government, among other big forces, diverts funds to various tasks.

    If the govt decides to divert its share of income FROM the rich to the poor, all other things being equal, the poor’s share of the goodies goes down. The devout Bushies claim one can actually create a bigger pie by rearranging the flow to the rich who, supposedly, will invest more in the economy. The “all ships” will rise because the Fed will have to create b$$ to account for society’s increase in productivity.

    BUT .. in Bush’s case he cut taxes in a way that diverted a lot more oney to the rich. Their relative share of all wealth has gone way UP. Is that OK? Maybe if the poor also went up .. even though at a lower rate. BUT, that did not happen. Ine ffect Bushg has taxed the poor to pay the rich. some call him the Hooh Nibor of modern times. (Read Hood Nibor in mirror).

    The bottom line is thast the right is fill of shit. This IS a socialist economy .. the only issue is which pigs should get fed.

  36. 39

    ArtFart spews:

    You can bet your butt that this same debate is going on in every state in the union, regardless of its particular funding structure.

    Can you say “inflation”? I KNEW you could! Eight years of profligate spending backed by nothing more than regular greasing of the printing presses, combined with the systematic destruction of America’s industrial base and the resulting horrendous trade imbalance, are driving the cost of doing everything up faster than anyone or anything can keep up. Combine that with an “energy policy” designed to elevate the cost of fuel and maximize the profits of our “leaders'” friends, and the breakdown of the social contract that comes from the balkanization of ninety percent of the population. Even responsible politicians have been forced into delay and denial, because they know if they tell their constituents how bad it’s really going to get, they risk getting voted out at best, and ripped to pieces by an angry mob at worst.

    It’s also a pretty safe bet that in every state there’s a Tim Eyman and/or a Dino Rossi pushing the something-for-nothing fantasy that it’s all “someone else’s fault” and passing out the white sheets and ax handles.

  37. 40

    Hannah spews:

    @38 – Thank you for the explanation of the wealthy tax cuts.

    So here’s a question, we are all so sick of taxation, why not band together to come up with a more progressive structure in this state? What is holding back our state government from fixing the problem?

    Would it be wise to have property taxes based on one’s income level, just like fed taxes are? So if you make say 50k a year, your prop tax can only be say 5% but if you make 200k a year your prop tax can be 20%. Would that be the fair way to tax?

    And what is considered “wealthy” or “rich”? At what dollar amount do you become classified as “rich”?

  38. 41

    Roger Rabbit spews:

    11, 23 – “I am confused on tax brackets. Can someone help me understand what SJ is saying: ‘one in which the bottom 20% of wage earners pay a whopping 17.6% of income in state and local taxes while the wealthiest pay only 3.1%’

    SJ was referring to the Gates Commission findings. The Gates Commission was commissioned by Gov. Gary Locke to study Washington’s state and local tax structure, and make recommendations for changes. That’s not the commission’s official name; it’s popularly known as the “Gates” commission because it was chaired by Bill Gates Sr., a prominent attorney and Seattle community figure (and incidentally the father of Bill Gates Jr.).

    The Gates Commission was made up of representatives from business, labor, academia, and government. Among its findings, the Commission divided the state into five income quintiles, i.e., the 20% of households with the highest income, the 20% of households with the lowest income, and the three 20% groupings in-between. Its report found that the richest 20% of households pay only about 3% to 4% of their income in state and local taxes, while the poorest 20% of households pay over 17% of their income to state and local taxes, giving statistical affirmation to what has long been known, that Washington’s state/local tax structure is highly regressive and takes proportionately more money from household budgets the farther down the income scale you go.

    The Gates Commission evaluated a number of tax reform ideas, all of them premised as “revenue neutral,” i.e. that these proposals would not increase overall taxes but only redistribute the existing tax burden. There wasn’t really a consensus behind a single reform proposal among the commission members, but the proposal that received the most support (and the most public attention) is the one that suggested eliminating the state B & O tax and the state portion of the sales tax, and replacing these taxes with a state income tax. Most of the state income tax proposals call for a flat-rate tax, and the idea of a progressive state income tax (within different tax rates for different income brackets) really hasn’t been discussed very much or gotten much traction. If we get a state income tax, it’ll probably be a flat rate tax with a simple and fairly modest exemption (as opposed to the complex system of federal exemptions and deductions), like most other states have.

    In other words, the most-discussed Gates Commission tax reform option bears a very close resemblance to the state tax system that has been adopted by approximately 45 other states. This system is used because it’s time-tested, meets states’ revenue needs, is perceived as fair, and is supported by a wide spectrum of voters on a nationwide basis. Washington is one of the handful of states still using a homegrown state tax system that departs significantly from the model that has been worked out over time and adopted by most other states. Ours is especially ad hoc and regressive in nature; in fact, it’s unique. Our Rube Goldberg, jury-rigged, chewing-gum-and-baling-wire state tax system richly deserves the appellations it has earned as the worst in the nation.

    It’s time we scrapped it and adopted the tax model that works, and has been almost universally adopted elsewhere.

  39. 42

    Roger Rabbit spews:

    @40 “What is holding back our state government from fixing the problem?”

    A combination of propaganda that misleads the public and governmental structure that makes possible minority rule. In our state system of government, as in the federal government, a legislative minority can block tax reform or other legislation.

  40. 43

    spews:

    @40,42

    I would add leadership to what the rabbit has ot say.

    The Radical Repricans use taxes as a wedge issue even more successfully than they use gays, terrorists and gods. For example Hannah says we are all fed up with taxes. Speaking as one person, I am not fed up because I realize we are very undertaxed AND underserved by our government.

    Unfortunately, the Liberal Demos have lacked the cohones to show the Repricam mythology for what ti is AND to promote real reform. This is my big gripe with both Gregoire and Locke. When things are good, they want to take credit and not shale the boat. When things are bad, the libdems are too frightened of the Reprican ogre to suggest reform.

    Tsongas and Rudman tried to found an independent group directed at fiscal responsibility .. the Concord Caoliton. My impression is that has not made a lot of political progress.

    Let me give you one example of liberals behaving badly … Clinton’s version of health care. You hear a lot about its being universal. What the good folks following herself do nto say is how this is to be paid for. They would use an increase in the social security tax to cover the part of Hillary’s Universal Care for the Healthy (HUCH) not paid in premiums. In effect we would be using tax money to subsidize healthcare. Worse, the SSC tax is the most regressive tax we have.

    So, unless we have tax reform Hillary would be taxing the poor ot pay for the healthcare of the righ. Hopefully, this will nto happen but it illustrates the lack of commitment on the eldt to true reform.

  41. 44

    spews:

    @23 Goldy

    As for the federal income tax, it is not nearly as progressive as it looks because FICA (Social Security) is a flat tax on the first $100,000 of income. Being self-employed, that means I pay 15.3% (in addition to my income tax) on the first $100,

    EXACTLY why Hillary care makes no sense. It taxes the poor to pay for the health needs of the rich.

  42. 45

    Chris Stefan spews:

    @42

    One real issue is implementing a state income tax would require amending the state constitution. This has failed every time it has been tried. The combination of a 3/4 vote of the state legislature and a public vote is a hard hurdle to overcome.