Andrew Garber has done an excellent job in today’s Seattle Times, of explaining in layman’s terms why it is the state government faces cutting services, even as existing taxes are producing an estimated $1 billion in additional revenues over next two year budget: “State budget writers tangle with high cost of just standing still.” I hope the Times doesn’t mind if borrow one of their graphics, to help explain:
What we have is a “structural deficit,” where the costs of maintaining existing services at current levels are rising faster than tax revenues. The economic figure that most close tracks growth in demand for public services, is growth in personal income, yet because our tax structure is so heavily dependent on sales and excise taxes (only New Hampshire is more dependent on a single tax) government revenues simply cannot keep up with demand.
Excise taxes, like those on gasoline, alcohol and tobacco, are taxes on volume, not price, and as such rise slower than consumption over time, as inflation raises the price of the product and eats away at the value of the dollar. For example, while the Legislature added a nickel a gallon to the gas tax last year, the gas tax is now half what it was a couple years ago as a percentage of the retail price. While that is a dramatic example, it illustrates the impact of inflation on excise taxes in general.
The general sales tax, which is by far our largest source of revenue, also becomes less adequate over time, for a number of reasons, not the least of which being that we only tax goods… an ever decreasing portion of our post-industrial service economy. At the same time, inflation, particularly in health care, is hitting the state budget much harder than it is the private sector.
Nowhere is the state’s inflation problem better illustrated than in health care, which has been described as the “Pac-Man eating the state budget.”
For example, a single dose of Avinza, a prescription pain-relief medication, jumped $72 in the past year to $208 a dose. The cost of an electric hospital bed went up $101, to $1,407. And the cost of a wheelchair increased by $98, to $2,366.
Add cost and caseload increases to expected cuts in federal Medicaid spending, and the state suddenly finds it needs about $695 million in additional funds over the next two years to maintain existing health-care services for the poor.
Some would argue the solution is to simply cut health-care services for the poor. But even if one were to follow such a Hobbesian policy, it would end up costing our economy more, not less. Poor people will continue to get sick, showing up at emergency rooms at more advance stages of illness, when treatment is more expensive, and shifting the costs to the rest of us. Whatever savings we might see in lower taxes will more than be eaten up in higher insurance premiums.
And the inflationary pressures aren’t just limited to health-care:
To maintain existing levels of service, the state needs to come up with an additional $90 million to pay for prisons over the next two years, $164 million to run colleges and universities, $383 million for public-employee pensions and $444 million for public schools. That doesn’t include pay raises or benefits increases.
Of course, Republicans argue that the solution is simply to reign-in spending, but their usual metaphors fall flat. Running a government is not like running a business, or balancing your household budget. Increasing class size does not make teachers more productive, and we just can’t cut federally mandated “No Child Left Behind” requirements, like a family might cancel cable TV.
Indeed, the whole anti-tax movement that is partially responsible for our perpetual budget crises, has government finances exactly ass-backwards.
After all, people want the services, said Senate Majority Leader Lisa Brown, D-Spokane. Perhaps the true question is, “how much [money] do we need, to do what we want to do?”
Exactly!
We levy taxes to provide the services voters want; we don’t provide services simply to spend the tax dollars we have. What’s missing from the debate is the real debate… the debate over the proper size and scope of government. Republicans don’t want to have this debate because they know they’ll lose, and because they know that without the debate, we’ll just continue continue hobbling along with the status quo, gradually defunding and eliminating government programs, until their dream of a libertarian dystopia is achieved by default.
In the end, Washington state will be faced with the choice between implementing an income tax… or becoming Mississippi. There are many in the Republican leadership who would greatly prefer the latter.
So exactly what is so bad about becoming another Mississippi? It would be an improvement in a lot of ways.
Mississippi has a state income tax and its state and local tax structure is a lot less regressive than Washington’s. Please refer to Who Pays? A Distributional Analysis of the Tax Systems in All 50 States, 2nd Edition, published in January 2003 by The Institution on Taxation and Economic Policy:
http://www.itepnet.org/wp2kst.htm
In Washington, the wealthiest 1% pay only 3.3% of their income in state and local taxes. At the same time, the poorest 20% pay 17.6% of their income in state and local taxes. Ours is by far the most regressive state and local tax structure in the nation.
In Mississippi, the wealthiest 1% pay 6.9% of their income in state and local taxes. At the same time, the poorest 20% pay 10.0% of their income in state and local taxes. That ain’t exactly fair, but it is a helluva better then Washington.
In an interview I did with Sen. Finkbeiner he states the biggest thing eating the budget is definately the health care costs. When I asked about reducing the number of state employees he was pretty frank about the state employees union having too much power to do that.
So instead of reducing the size of state government, we are forced to reduce services to cut costs. That aint right.
By the way Goldy, if we increased the average tax rate of the top 1% of our population to what the top 1% pays in Mississippi, I bet there would be more than enough money to meet the $2 billion so-called “shortfall” in the 2005-07 biennum that would be needed for the “wish list” spending set forth in the Seattle Times article you quoted.
Furthermore, I would venture to speculate that, if we increased the average tax rate of the top 5% of our population to what the top 5% pays in Mississippi, not only could we meet all the “wish list” spending demands for the coming biennum, but we could also reduce the 17.6% tax rate paid by the poorest 20% of our population down to the 10.0% paid by the poorest 20% in Mississippi — or even less.
So maybe the best solution would be to adopt Mississippi’s tax structure. Since Washington is wealthier than Mississippi, we could support a lot more government spending with the same rate of taxation. We could also reduce the tax burden for lower income people to even less than that imposed in Mississippi.
there are two fundamental things to keep in mind about taxation and government expenditures:
First and foremost, is that a huge proportion of all that money goes to corporations in terms of what is bought and consumed. For example, healthcare for the poor is not for the poor. The $$ cycle through from Govt accounts to medical and pharmaceutical corporations and insurance racketeers, in the name of the poor. Even the labor costs, union and non-union(think teachers here for example) end up going to banks, mortgage companies, auto sales and service, food corporations, services, and as above large chunks moved directly to the healthcare apparatus. So too do costs for roads and infrastructure and so forth. To cut taxes is to cut paying these financial interests. It is the smoke and mirrors of the anti-tax movement to convince the public that to cut taxes cuts costs. It is simply not true: cutting taxes moves the costs to higher priced options, products, and services, thus increasing profits.
Second, not accounting for MIssissippi’s educational failures across the board, their tax structure is not the best of models to consider. In this dawn of the so-called ownership society what always seems to be left out of the discussion is the realization that not everyone can be owners. There must be workers, and sub contractors and labor to exploit in order to increase the profitability of the fewer and fewer owners concentrating their ownership. Someone at somepoint has to consider what to do with the increasing impoverished population–other than describing them as character flawed lousy owners of whatever. Taxes have always been a mechanism for sharing wealth, even in that they provide security apparatus for protecting wealth from those that might want to take a share. Thus, do we let the population of the poor increase exponentially, offering no programs for their health and welfare, while offsetting tax cuts by encouraging private security apparatus to develop(one of mississippi’s models at the moment actually) ? Or do we recraft a new tax structure that is fundamentally and necessarily more progressive that will insure that opportunities for safer and healthier communities across all the population demographics?? It really comes down to that choice.
Goldy, I’d like to add 3 significant factors impacting state revenues that you didn’t mention:
1. People are buying more untaxed goods online or from out-of-state mail order houses;
2. Many services remain untaxed while a growing percentage of the economy continues to shift from good to services; and
3. Per-gallon gas tax increases are offset (and then some) by higher fuel efficiency of new vehicles.
Spyder @ 4
I didn’t say that Mississippi’s tax structure is the best model to consider. I only said that it was a lot fairer than Washington’s. Since Washington’s tax structure is by far the most regressive of any state in the country, I could have easily made sport of Goldy’s comments, no matter what backwards “red” state he wanted to raise as a scare tactic for Washington’s future direction. (That is, assuming those evil Republicans have their way, and don’t let the Democrats increase our regressive state taxes.)
Reading the article on the budget and cost rises what comes to mind is this is no surprise package to those who control it or us who hear about it. Balanced budget is becoming an extinct species. 2 Billion shortfall in the budget may not be a drop in their big bucket. Everyone is feeling the squeeze in their little bucket. Larger the figures, the more mind-boggling to pull apart their massive coded budget and decode the process. Beyond my ability and mosts. Seemingly, living within your means means less and less in more ways than one.
I may just not be smart enough to comprehend the downside of this, but, why cant the income tax, be a flat rate system, where every “net” dollar, is taxed equally?
Make some allowances for business expenditures, deductions, but remove some ability to hide personal incomes behind the corporate curtain, and everyone, no matter who, pay in the same rate?
Wouldnt this be the most fair way to tax?
How high would the tax rate have to be?
Don @ 5
While the three things you state are true, it isn’t clear what you’re suggesting. Do you think we need to remove taxes from goods and apply taxes to services?
Washington has the most oppressive B&O/sales tax combo in the entire country. Does anyone wonder why people buy items in Oregon, by mail order or the Internet? Now, there is supposed to be a great equalizer in the form of the Use Tax, but the public isn’t educated about it and the state is naive if it thinks that people are just going to self-report. It is only when the state puts the screws to companies like Dell that they recoup some of the lost revenue.
I would have no problem with switching to a state income tax (NOT a VAT tax) if we could trust both the state and local governments to wipe out the non-competitive sales tax.
Let’s see–
Economic concerns-
Pay raises-
Benefit costs rising-
Need to cut the number of FTE’s….quickly.
Many local government’s face the same circumstances.
“Diamond” benefit packages in government….we cannot afford it.
The State Employees Union is too powerful.
Need to get that “RIGHT TO WORK” Initiative on the ballot ASAP!!
Richard @ 1
Interesting info @ that website. It was particularly fascinating that the least regressive states are Delaware, Montana, Vermont, and California according to the study.
However, if we were to examine the lowest burden, there is good info here.
”The five states with the lowest tax burden as a percent of income are: Alaska (6.3%) 50th, New Hampshire (7.5%) 49th, Delaware (8.2%) 48th, Tennessee (8.5%) 47th, and Texas (8.7%) 46th.”
Washington ranks 21st according to these guys. I suppose the familiar maxim “There are lies, damn lies, and statistics” comes into play here.
Vince @ 2
Sen. Finkbeiner can’t claim ignorance, so he is being disingenuous by blaming unions for the state’s inability to reduce payroll. The state unions are toothless, and have never gone on strike (except for a protest walkout a couple years ago that involved few workers and lasted only 1 day). The governor and legislature can easily reduce agency payrolls any time they want to simply by writing them out of the budget.
The real reason the state doesn’t reduce its payroll is because the state’s population is growing, and public demand for state services is growing commensurately. Do you really want to release prisoners in order to reduce the Department of Corrections payroll by laying off guards? Or make the prisons more dangerous by further diluting the already strained guard-prisoner ratios within the walls?
In DSHS, by far the state’s largest agency, caseworkers are overworked to the point where they can’t effectively perform their jobs. DSHS’s licensing, inspection, and intervention systems routinely break down because of understaffing. How is a day care licensor supposed to inspect the facilities when she is responsible for hundreds of facilities? The reality is she spends most of her time processing licensing paperwork and never visits the facilities until a complaint is filed because a kid got hurt or killed. (Yes, fatal accidents have happened in day care facilities.) Caseworkers in the child support division are assigned over 600 cases but can actively work only a few dozen of them at a time. The same pattern exists through all of DSHS’s programs, including welfare fraud prevention, vocational rehabilitation, foster care, child and adult protective services, and so on. Several years ago, the federal government threatened sanctions against our state because of quality control problems in the food stamp program that resulted from no staff being available to do the quality control work. All the staff had been shifted to other mandated work necessary to comply with court orders, legislative directives, or whatever.
There are only three big spending areas in state government: Education, transportation, and social services. Nearly all of the state education budget is passed through to local school districts. The Department of Transportation implemented deep budget cuts and staff reductions several budget cycles ago, and there’s not much left to cut without eliminating the agency and its functions altogether. Even in DSHS, budget cutting opportunities are limited because some of the programs are federally mandated and/or federally funded. Two examples of large DSHS programs that are mandated by federal law and paid for almost entirely with federal dollars are vocational rehabiliation and child support enforcement. A smorgasbord of DSHS programs collectively add up to a lot of dollars and caseworkers, but do we really want to scrap Child Protective Services, foster care for abused and neglected kids, juvenile detention facilities for youthful offenders, and licensing of hospitals, nursing homes, day cares, and group homes? Unless you do, the only place you can save enough state money in DSHS to make a dent in the overall state budget is by slashing medical assistance spending — nearly all of which goes to elderly people in nursing homes and basic care for a limited number of poor children (by no means all of our state’s poor kids). By the way, teachers tell us sick kids can’t learn, and social workers tell us kids who fail in school cost taxpayers money later on by populating our adult prisons and juvenile jails.
Cutting in other areas does not produce meaningful savings for a variety of reasons including (a) the programs are too small to make a dent in the overall budget, (b) the programs are federally funded or are self-supporting through fees and/or revenue generation, so no General Fund money would be saved by cutting them, or (c) the programs are revenue-producing, and cutting them would produce a net financial loss to the state.
For example, the Horse Racing Commission and Gambling Commission are funded entirely by user fees and receive no General Fund money. Liquor, Revenue, and Lottery all produce net income for the state, and cutting these agencies will cost the state more money than is saved. The Department of Natural Resources brings in hundreds of millions of dollars annually through state timber sales, and laying off the staff involved in selling state timber would mean losing this revenue; a large portion of that agency’s remaining budget pays seasonal and temporary employees involved in fighting forest fires (should we just let the state’s timber lands burn unchecked? that’s the only alternative to employing these people).
Those who glibly claim that state payrolls are bloated and the solution to state financing woes is to cut FTEs should be forced to come up with specific cuts. In fact, the Republican legislators who, year after year, demand budget cuts have been challenged to do just that — and have never once delivered. How many opportunities should we give them before concluding they’re just blowing political hot air? I personally feel they’ve used up their allotment and then some.
Since Republicans love to rant about “20 years of Democratic rule,” let’s now look at what the Democrats have actually done in the last 20 years.
1. Customer service has improved greatly. Agencies have demanded that their employees treat the public courteously, and to make sure it happens have provided training, adopted rules and procedures, and where necessary taken corrective or disciplinary action. Although budget realities necessitate use of automated phone answering in many agencies, the state has adopted a “pick up the phone” policy. It also has emphasized prompt response to inquiries and applications — once again, subject to budget and staffing realities. Overall, state government has become much more user-friendly than it was 20 years ago.
2. Democratic administrations, especially the Locke administration, have developed and implemented an official state web site that now embraces nearly all of the state’s agencies, boards, and commissions and contains an enormous amount of information. In addition some licensing, permitting, filing, and payment functions can now be done online.
3. The Locke administration adopted a “Priorities of Governing” (POG) budgeting process that strives to maximum the productivity of limited tax resources by initially setting each agency’s or program’s budget at zero. The idea is to make sure that managers examine and justify every spending item, so that outdated or inefficient programs don’t continue in existence through inertia or lack of attention. Early results indicate this approach is producing incremental savings and efficiency gains.
4. Governor Locke has not been successful in combining or eliminating agencies. His attempts to do were rebuffed by the legislature. Although a few state agencies have been eliminated in the past (e.g., the state energy department, which no longer exists), the state today pretty much has the same agencies it had 10 years ago. This was by the legislature’s choice, not the governor’s, and throughout that time one house of the legislature was controlled by the GOP so Finkbeiner can’t blame this entirely on the Democrats. The legislature supposedly is responsive to the people, and the agencies in question supposedly continue to exist because that’s what the public wants, so there really is no blame at all to be assigned here unless you’re willing to assign it to the public.
I suspect most people reading this blog know very little about what state agencies exist or what they do. You would have to spend quite a few hours of research to get a feel for it, and most people don’t do that. Nor is it necessary. There is a simple answer to Finkbeiner’s rhetoric: If there is fat in state government why haven’t the Republicans found it? Lord knows they’ve been looking long enough. But whenever you ask them to come up with specifics they can’t. Why? Because there is no fat. Every agency, every program, fills a need and serves a constituency; and not only Democratic legislators but Republican legislators as well have been unwilling to eliminate those agencies and programs because their constituents want them. That’s the answer.
I am going off and later when all you whiz kids work this over see what cooks. :-) Have a good one!
DON…What a manifesto to swallow. Do I take that with or without water. :-) Good job as always!
Mark @ 9
A couple years ago the legislature established a commission to study and report back on the state’s tax system. This commission, as you know, was headed by Bill Gates Sr. Apart from being the father of his famous son, Gates had a successful career as a corporate attorney, and his late wife served on the University of Washington Board of Regents. In other words, the Gateses were no slouches in the public policy arena, and Gates didn’t get this position because of his son’s wealth, he got it because of his own knowledge, competence, and accomplishments.
The other commission members were recognized experts from government, academia, and the business community. They spent about two years collecting information, synthesizing it, and coming up with recommendations.
These folks, individually or collectively, are smarter than me (happy now, Cynical?) and put far more time and effort into this study than I ever could on my own, and in addition had access to information, officials, and agencies that I don’t. So I figure their opinion is a lot better than mine, and I go with theirs.
The Gates Commission found that business pays about 41% of state and local taxes in Washington compared to an average of 30% in the other western states. Because big companies like Boeing and Microsoft have the political clout to get lucrative exemptions, what we are really talking about here is mostly small business, in terms of who bears this inordinate tax burden.
The Gates Commission also found that low-income households pay four times the percentage of their income to state and local taxes that affluent households do.
So the two major findings of the Gates Commission were that small business is overtaxed and affluent households are undertaxed. The solution is obvious: Shift some of the tax burden from small business to upper middle class and upper class households.
The Gates Commission recommended doing that by enacting a state income tax, eliminating or reducing the B&O tax, and reducing the sales tax. I don’t recall whether they mentioned extending our highly selective sales tax to services and other currently exempted transactions, but that’s another possible way to reduce B&O taxes and/or the sales tax rate, even if we don’t enact an income tax.
To answer your specific question, I don’t really have a suggestion of my own. Rather, I have chosen to endorse the Gates Commission recommendations, because they’re smarter and more knowledgeable on the subject than me and their recommendations make sense.
Wow, Don! 1300 words in order to say you need a tax increase? ;)
Don @ 12
Excellent essay. Again, you should guest blog somewhere, here at HA or pacific views or even blather watch.
Now to return to the endless search for the smoking vans and conspiracies of mass deception …
Cynical @ 10
DSHS caseworkers are required to have a college degree and are generally accepted to have a master’s degree in social work or another field related to their job, but the typical DSHS professional position starts at around $2000 a month and tops out in the 40K’s. State workers have not had a cost of living increase in 4 years, while their employee contribution to health insurance has continued to go up, so their actual take-home pay is going down. PERS 1 closed its doors to new enrollees in 1977; everyone hired by the state in the last 28 years is in PERS 2 or 3, which are far less generous than 1. (But then, PERS 1 employees paid commensurately more into the retirement system, too.)
So you think the state employees union is the problem? How so? Only a small percentage of the state’s employees belong to the union. Why? Because (1) membership is voluntary, and (2) the union historically has been ineffectual at getting improved pay, benefits, or working conditions for state employees. All the union could do was lobby the legislature, but in the end they had to take whatever the legislature felt like giving them, which wasn’t very much. What has actually happened over the years is the legislature has punished state employees for not striking by taking money from them to give to teachers as a reward for striking.
You want to abolish the union and institute right-to-work in our state? Okay, let’s see what would happen. Actually, not much would change, because state pay is already set by what the market will bear, because state employees can’t and don’t strike and their union is ineffective. The legislature, facing with intense competition for inadequate resources, pays state workers as little as it can get away with. When raises are given, it’s not from kindness or generosity, but to keep state government’s recruitment and retention problems from getting even worse. Underpaying your employees leads to higher turnover, more errors, worse service, and higher training costs. If you think the solution is paying state workers minimum wage (as some GOP legislators have actually suggested in the past) and staffing agencies with Labor Ready personnel, well, you’ll get what you’re paying for. If you want your driver’s license or business license issued by a day laborer, don’t come crying to me if you have to wait six months to get it and the paperwork is all screwed up when it finally arrives.
marks @ 11
Washington would be in that list too, if we had Alaska’s oil revenue. With a population of a few hundred thousand (compared to Washington’s 6 million) and oil revenues in the billions, neither our state nor any other state can possibly duplicate Alaska’s tax structure, although a couple of relatively lightly populated and resource-rich states come sort of close. In the last budget cycle, only two states didn’t have deficits: Wyoming and Oklahoma; and the reason they didn’t was because they both are major natural gas producers and there has been a giant spike in natural gas prices that filled their state treasuries with royalty income.
Goldy,
“We levy taxes to provide the services voters want; we don’t provide services simply to spend the tax dollars we have.”
This statement is a crock of sh-t. We all know that both Republicans and more so Democrats are addicted to spending like crack. It’s all about raising taxes and then raising the bar each year as recipients know that they must either use it or lose it with tax dollars.
What we need is massive cuts in services across the board. There’s so much wasteful junk in government that we don’t need, particularly in education where much of the money goes to overpaid union teachers and administrators.
Until we grow up and learn to practice fiscal responsibility where we don’t borrow against the credit card like huge public bonds, and we rein in all of the ridiculous government programs like mandating that a significant percentage of each public project be spent on art, etc. the only solution is what we have today. The Democrats controlling the legislature and whining that we must raise taxed to fill our wanton spending desires.
I think it’s a bipartisan issue, but since you Dems are in the driver seat right now, it’s your problem to fix.
Good luck, I’d say you’ve got a much better chance of getting struck by lightning than getting a Democrat controlled legislature to stop spending.
marks @ 16
We don’t need a tax increase. We need a tax system capable of keeping up with inflation and population growth. Under the current system we’re not even staying even.
If we continue to muddle along with the status quo, we are looking at fewer college slots, less K-12 funding per student, fewer prison and nursing home beds, and less government services across the board, per capita.
If this is what the people of our state want, fine, they should get it. That’s how democracy works. But let’s not delude ourselves into thinking we can get something for nothing. If we refuse to pay for colleges, then our kids won’t go to college. If we refuse to pay for prisons, then we’ll have more criminals on the streets. If we refuse to pay for roads, then we’ll have more traffic congestion, potholes, and unsafe bridges. If you think buying a big-screen TV or a $70,000 SUV is higher priority in your life than those things, then vote Republican.
Diggin @ 8
No one is pushing a progressive state income tax. All of the proposals under discussion ARE flat-rate.
Jeff @ 20
“This statement is a crock of sh-t. We all know that both Republicans and more so Democrats are addicted to spending like crack. It’s all about raising taxes and then raising the bar each year as recipients know that they must either use it or lose it with tax dollars.”
No, you’re the one who is full of shit. Your silly statement would not withstand the slightest scrutiny.
Don @21
I knew what you meant, I was just poking fun at the length in which you went to explain it.
Don @ 22
A totally flat rate state income tax for Washington? Same rate for everyone (i.e. no different bracket percentages) and no exemptions of the first so-many-thousand of income?
Even Mississippi has a somewhat progressive state income tax, although it ain’t all that progressive:
http://www.mstc.state.ms.us/ta.....ldfile.htm
In Mississippi, there is an exemption of $6,000 for a single person, or $12,000 for a married couple. You get $1,500 for each child, plus an additional $2,000 if you are a single parent. The first $5,000 is taxed at 3%, the next $5,000 at 4%, and anything above that at 5%. The exemption and bracket amounts are not adjusted automatically for inflation, and Mississippi has not changed these amounts in at least 20 years.
So if we have a flat rate state income tax with no personal exemptions, then it won’t be progressive. Most likely, any state income tax bill the Democrats pass will result in all wages being taxed, while allowing certain exempt categories of income earned by wealthy people not to be taxed at all, and also allowing lots of deductions to be taken against non-exempt income earned by wealthy people.
Here’s the answer: (Rolling) Zero-Based Budgeting combined with GMAP (Giuliani’s system that I have to give Gregoire credit for implementing)
Under (R)ZBB, agencies wouldn’t have to justify themselves EVERY budget cycle, but would have to do so perhaps every other or third cycle (4 or 6 years).
Government (like many big corporations) often has a “we’ve always done it this way” mentality because it is a monopoly. They don’t have to really think creatively because there isn’t a competing government ready to take market share. Right now, as long as they do a passable job (and can puff it up with good PR), they get to keep their jobs. And even if legislators lose jobs, the rank-and-file (who are rut-prone) remain.
Don @ 21
Did you know that Washington’s Crime Victims’ Compensation program recently had a $3.6 million emergency appropriation (SB5993/HB2137) because of the increase in health care expenditures?
Did you know, however, that there are MILLIONS of dollars in uncollected fines and restitution out there?
Yet liberals (maybe or maybe not including you) want to restore the voting rights of these guys who have done their time, but not paid their fines and restitution??!!
Most likely, any state income tax bill the Democrats pass will result in all wages being taxed, while allowing certain exempt categories of income earned by wealthy people not to be taxed at all, and also allowing lots of deductions to be taken against non-exempt income earned by wealthy people.
Sounds like the AMT (which was invented to prevent the rich from avoiding all income taxes, but has instead allowed that to continue, while ensaring a greater and greater portion of the middle class).
While I’m in favor of progressive tax structures, exemptions that encourage savings and property ownership, our (US) tax structure is so byzantine that I doubt that any exemption accomplishes (overall) what it sets out to do – even the much vaunted mortgage interest deductions.
It seems to me, after reading the article, that there are two good points:
1) If we (WA state) have a tax structure that doesn’t allow tax revenue to keep up with population growth, that’s a recipe for continual (if periodic) service cuts. The alternatives are continually cutting vital services until there’s nothing left or increasing the regressivity of our tax structure by increasing gas taxes, sales taxes, B&O taxes, etc.
2) While there many be more efficient ways to run various government programs, you can’t simply “run them like a business”. The example given in the article is a good one – you can’t just have each teacher teach 100 kids/class (an efficient use of resources). I’m not arguing there isn’t room for improvement, but the constantly cited “government waste” turns out to be more elusive to eliminate than it always appears. It’s probably distributed in tiny amounts across all government services, much like it often is in businesses. They call this the “death of 1000 papercuts” (or “pecked to death by ducks”) and fixing it isn’t as simple as hiring an efficiency expert or doing some audits.
Look at California (and Arnold). He got elected on a promise to “trim the bloat and eliminate the waste” from government. And in the last year he hasn’t even offered a single example of “fat”. Instead he’s focused on mass layoffs, program elimination and reducing wages/benefits. Simply saying “if we lay off 10,000 employees, we’ll save money” is not the same as trimming actual fat.
Many “dot-com” companies proved this during the recession. Some good companies have found that all the wage cuts, benefit elimination and layoffs result in is a demoralized workplace that’s even less efficient as the work piles on.
(add this sentence in after “during the recession”) – These dot-coms trimmed all their “supposed fat” and as a resut found themselves unable to offer anything useful (no employees to build anything).
I also wanted to add that I know that some of the companies deserved to go under, but a lot simply found themselves in a cash crunch. And because the government has a different mission, I hope no one is as callous as to really think that saying “the poor will just have to go hungry and without healthcare” is a reasonable long-term solution for the government’s problems.
Some Republicans on this board have suggested that the B&O Tax is a fair tax – it is the unemployment and workers comp programs that are in serious need of reform. Thoughts on that?
That being said, if a progressive income tax is adopted then a reduction of the B&O tax burden along with a 1/3 reduction of the sales tax is justified. I don’t favor eliminating the sales tax. Americans are spendy creatures and we desperately need to save more.
Richard @ 25
There may be an exemption of the first $X of income in the various proposals floating around, I don’t really recall. But no one is proposing a graduated-rate system.
Mark @ 27
I don’t know any Democrats who oppose criminals paying fines and restitutions, do you? The court system (and not a few plaintiff’s lawyers) are open to suggestions on how to get money from people who don’t work, aren’t motivated to work, don’t have job skills, can’t get credit, and spend every cent on drugs as soon as they get it. Got any ideas?
Now that we’ve concluded it’s unlikely felons will pay up, should we restore their voting rights anyway? The American Corrections Association thinks so because their studies indicate it reduces recidivism. Which do you prefer, less voting rights, or less crime?
If you don’t want ineligible felons voting, then you should be in favor of simplifying our currently confusing system under which some ex-felons can vote and some can’t, and nobody can figure out which ones. Can’t-vote-if-you’re-in, can-vote-if-you’re-out, is as close to foolproof as you can get. But I do understand the point of view of those who believe we should disqualify felons permanently, torture enemy prisoners, and bomb civilian populations if we don’t like what their dictator is doing. I just don’t agree with it, that’s all.
John @ 30
“Some Republicans on this board have suggested that the B&O Tax is a fair tax”
WHO here said that??!! Lemme know so I can have their GOP membership card revoked. ;)
“[I]f a progressive income tax is adopted then a reduction of the B&O tax burden along with a 1/3 reduction of the sales tax is justified. I don’t favor eliminating the sales tax. Americans are spendy creatures and we desperately need to save more.”
You gotta be a Democrat. Not only are you trusting that the Legislature won’t raise income, sales AND B&O taxes at will, but you’re dabbling in social engineering from the “stick” side of the equation.
John @30
It is fair to say I hate taxes. That said, taxes are a necessary part of a functioning government (okay, I had to focus really hard in order to write that)…
“I don’t favor eliminating the sales tax. Americans are spendy creatures and we desperately need to save more.”
I don’t generally ascribe to the theory that people must be forced to employ good behavior. Your idea is keeping a sales tax in place (reduced by 1/3) simply to discourage spending. So why not make the sales tax really outrageous so it does what you intend? A simple example is tobacco taxes:
When they were at 5 cents a pack, nobody thought much about it. Now, taxing them at $1.50 or more is getting people to quit. So let’s just double or triple the sales tax and really discourage spending money. It will help accomplish your goal…
Don @ 32
“I don’t know any Democrats who oppose criminals paying fines and restitutions, do you?”
Yes. Based on your defeatist (or is it criminal-coddling) attitude, it seems like you just want to throw up your hands and say, “Oh, well. What can we do? We asked nicely and they didn’t comply.”
“Now that we’ve concluded it’s unlikely felons will pay up”
Who is this we, Kemosabe?
Please cite the statistics relating to uncollected criminal penalties in Washington. Please tell me what efforts have been made to collect said penalties. Please tell me what incentive there is for these criminals to ever pay their fines if we don’t withhold something from them.
As for ease of figuring out who can and can’t vote, the SoS has at least PROPOSED running the courts’ database(s) against the voter rolls. And, if you’re a criminal, you should assume that you do NOT have voting rights UNLESS you’ve explicitly had them given to you.
Mark @35
Don’t want to get too far OT here, but if a felon is on probation, he/she must be living by the terms of his release, including paying what he/she can in fines. I can envision the court setting a fine that an ex-felon simply would not be able to repay during the course of probation. Those cases would again be something that the probation officer and the court would need to make a judgment on for final disposition.
If probation terms are met, voting rights should be restored. If a felon is on probation, the felon has not fulfilled the required terms for restoration of suffrage.
Don @ 32
“Now that we’ve concluded it’s unlikely felons will pay up, should we restore their voting rights anyway? The American Correction[al] Association thinks so because their studies indicate it reduces recidivism.”
I looked up the ACA’s position on this and they say that rights should be restored upon completion of sentence (including community supervision, etc.). Since the fine(s) and/or restitution are part of the sentence, that seems to be contrary to your selective quotation of their position. Unless, of course, you can cite an ACA statement that says that fines & restitution don’t need to be paid.
marks @ 36
The probation officers are SUPPOSED to work out a payment plan for fines and restitution, but they often don’t. Remember what restitution is — the compensation of actual damages inflicted upon the victim by the criminal. Right now, you and I (as taxpayers) are usually paying for that victim’s care, not the person that committed the crime.
Also, some aspects of restitution are not subject to a judge’s discretion. If a victim has medical bills, the criminal owes the state reimbursement.
So Goldy….are you becoming the newest version of Ross Perot??
I mean pie-charts, tables….and lots of words that all boil down to TAX INCREASE! I guess you figure we all need some of Goldy’s finest vaseline to lube up before we take it, huh?
The ONLY way to force changes in government is to TAKE THE MONEY AWAY until bureaucracy’s are eliminated and trimmed. Just like tuning a lawnmower…adjust the carburator until it chortles and chokes and almost dies….then ratchet it up a WEEEEEE bit.
Don-
People don’t really DEMAND government services…they become addicted to them and want more and more for less and less. I strongly believe in FEES FOR SERVICE and outsourcing as many government services as practical. Annual bidding. Accountability. Bureaucrats get diamond benefit packages that most working people in Washington can’t come close to affording. The gap is growing.
Eliminate 15% of the State and local government work force and let’s talk.
HINT–No one will EVER really miss the 15%!!
Mark @38
An interesting component of crime data statistics is the violent to non-violent crime data. Violent crime in 2003 was 1/4 of total crime, and non-violent offenses were the remainder. Murder and rape was 2.4%DOJ Statistics
”Twenty-five percent of defendants had an active criminal justice status at the time of the current charged offense, including 14% who were on probation, 13% on pretrial release, and 6% on parole.”
Interesting how much recidivism there is. And those are only currently active members of the club. I did not search for anything on graduate program participants…
”Besides being sentenced to incarceration or probation, 36% or more of convicted felons also were ordered to pay a fine, pay victim restitution, receive treatment, perform community service, or comply with some other additional penalty. A fine was imposed on at least 25% of convicted felons.”
I would conclude that 25% to 36% of felons had fines and/or restitution levied against them. Now, probation officers are required to work out a payment plan, yet you say they often don’t. I do not doubt you are correct, but do you have data/links on that?
jrcricket @ 28
Any time you try to talk about “waste” in government, you run into a discussion-killing problem right at the starting gate, because so many people abuse the definition of “waste.” To partisans with an ideological axe to grind (and there are many of those) “waste” is anything they disagree with. For example, a single person with no kids who hates property taxes may see every cent spent on schools as “wasted” and if you are a parent with kids in school, there is no way you can have a constructive discussion with this person about financing education.
The fact we have so many partisans running around labeling as “waste” anything that doesn’t benefit them personally or that they disagree with has greatly muddied the waters and led many people in the general public to falsely believe government is inefficient.
The gut reaction of most of us to the term “waste” is they’re talking about what business refers to as inefficiency. In business it’s easy to define and measure efficiency — you can figure out the exact cost and profit margin on each widget that an assembly line produces or each 2×4 that a lumber yard sells to a retail customer. By contrast, trying to measure the effectiveness of public money spent on crime reduction, education, or other typical governmental activities is far hardr to do and much less exact. A business can gauge the viability of a product or activity by counting the sales revenues and profits that come in; government agencies can only count the dollars that are going out and then try to figure out from various kinds of statistics or anecdotal evidence whether those dollars are producing anything of value. Running a public agency or non-profit organization is very different from, and in some ways more complicated than, running a for-profit business.
Am I saying waste doesn’t exist in government? No, not at all. But before you can find and eliminate “waste,” you have to define and identify it, which requires getting past the biases, ideologies, and emotions of a bunch of people who don’t agree with each other. Not infrequently, this first step is an insurmountable and unsolvable obstacle.
As for Arnold, he is doing exactly what the voters fired his predecessor for: Borrowing money ($15 billion to be exact) instead of balancing the budget. Why? Because he doesn’t know how to balance the budget. He doesn’t know how to define, much less identify and eliminate, “waste.” He doesn’t know how to persuade competing constituents to give up part of their piece of the pie. In short, he doesn’t know how to get out in front of the curve and provide that thing called leadership. There’s nothing more to be said about Arnold.
Don,
“In short, he doesn’t know how to get out in front of the curve and provide that thing called leadership.”
You are wise, indeed. That said, I don’t think you give the Governator credit. He will take the issues he has with the legislature to the voters via the initiative. If the legislature wants to win that fight, they need leadership as well…
John @ 30
Some ultra-conservatives think injured and unemployed workers should get nothing. Their thinking is the same as the single-person-with-no-kids I used as an example in my post above. With these people, there’s nothing to negotiate. Either they win, or they don’t. I used to vote Republican about 25% of the time, but not anymore. The we-don’t-compromise, take-no-prisoners, style of the New Republicans has cost the GOP my occasional votes for their candidates. If Republicans ever decide to rejoin human society and negotiate compromises, then yes let’s hear what they have to say about the unemployment insurance and workers comp systems can be improved to work better for everyone — businesses and workers alike. But, like I said, if their position is business pays no taxes and workers get no benefits, there’s nothing to negotiate and we’ll settle this at the polls one way or the other.
Mr. Cynical @ 10
We have a good example right in our backyard of what a government agency looks like when you get rid of the union and civil service rights, management can do whatever it wants, and the workers be damned. It’s called the TSA and a Seattle Times series found that the TSA baggage screening operations at Seatac airports are rife with cronyism, favoritism, worker abuse, high turnover, low morale, corruption, and poor effectiveness.
Here’s the article. Read it. This is the kind of government you’re advocating, Mr. Cynical. I say you’re full of shit.
http://seattletimes.nwsource.c.....tsa11.html
Mark @ 33
Jim King. I haven’t seen him comment here in a while. Too bad. He had a good quote from a businessman he knows about the fairness of the B&O Tax. A little googling might dig it up.
I am a Democrat and like Richard Pope (not a Democrat), I believe the current tax structure in this state is a scandal. There is no substitute for an engaged electorate. In ’92 the Dems raised taxes to defend programs and in ’93 they suffered for it. Now just about everything is put out for a vote. Also I don’t think a 5 to 6 percent sales tax is too onerous of a “stick” – just obnoxious enough to make some folks think twice before they impulse spend. Ideally if they think about what they spend in sales taxes and compare it to what they might gain by saving and investing – they might choose to do more of the latter over the former.
Marks @ 34
I favor reducing the sales tax insomuch as it reduces the unfair burden on the poor and the middle class (they have to consume something) and partially corrects the regressivity of the current system. I think eliminating it is to overdo it just like jacking it up too high.
John @ 44
No, they’ll just spend the money through mail order or the Internet. If people want to spend, they’ll spend. The problem is that they won’t spend locally if the cost of shipping (which is sometimes zero) is less than the sales tax they’d pay. And, as I’ve said before, the Use Tax with voluntary reporting is a joke.
You’re also VERY naive to think that we can trust the Legislature with and income tax AND a B&O tax AND sales tax. Instead of trying to raise the sales tax one percent and getting clobbered for it, they’ll pretend to “spread the pain” and raise each of the three by “only 1/3 of one penny for each dollar spent.”
John @44
“I favor reducing the sales tax insomuch as it reduces the unfair burden on the poor and the middle class (they have to consume something) and partially corrects the regressivity of the current system. I think eliminating it is to overdo it just like jacking it up too high.”
I honestly have no idea how a low sales tax will do what you want. If it is under 10% there is little incentive to worry about the added cost for the consumer. When a person has been conditioned to accept such a tax burden, they will view it as they always have, whether it rises or falls by a small margin (‘cept for me, I notice any tax increase)…
Goldy –
S’up to you, G-man…
John @ 44
I looked up Jim King’s comments on the B&O Tax and they’re not quite how you portray them. On one hand, he mentions the fact that two car dealers of equal sales and unequal profitability still use the same state resources, so they should pay the same taxes. In the same thread, he also says, “If I, as a lobbyist, did $2 million gross, I’d be the richest lobbyist in Washington; but the little corner grocery store doing $2 million gross isn’t hardly staying afloat.”
The latter is a great example of why the B&O tax can be grossly unfair. If you’re a jewelry store with high margins, you can afford a B&O tax on gross more readily than a grocery store or gas station with razor-thin margins.
Mark @38
I have a response stuck in SpamBlocker hell. Anyway, I think I need to get a cable modem, and if I did, we would coincide perfectly, as opposed to my 4 minute delay…
On Meet The Press, an economist said that Japan was considering no longer going to buy U.S. Dollars to hold the U.S. dollar up. This was due to the U.S. showing irresponsible spending, poor fiscal management and Iraq war. I am told this could be a fatal blow if it comes to pass.
Cynical @ 39
Fees are appropriate for some government services, but not for others. Should charge kids to attend public schools? Perhaps yes for extracurricular activities like sports, but not for basic education.
Outsourcing is a complicated issue prone to be oversimplified by fans of the Kneejerk Party. (1) Much is already outsourced including construction and repair, leased office space and equipment, printing, data processing services, and many services (e.g., nursing home care). (2) Outsourcing doesn’t always save money, and sometimes costs more, because private businesses unlike government must make a profit. Conservative advocacy of privatization is based on the assumption that government employees are overpaid and businesses can hire labor for less. This is rarely if ever the case. The big incomes are in the private sector, not public service. (3) When government outsources, it loses control over how the work is done, which has led to such problems as prisoner abuse in privately-run jails. The Bush administration’s attempt to outsource battlefield intelligence-gathering functions to private contractors is a prime illustration of what can go wrong. (4) Some government jobs can’t be outsourced because they involve exercising governmental authority that can’t legally be delegated to private contractors, or shouldn’t be. The power to arrest, for example. Or the performance of prosecutorial, legislative, or judicial functions. Many state agencies have quasi-prosecutorial, quasia-legislative, and quasi-judicial functions such as issuing citations, revoking licenses, conducting hearings, and adopting regulations.
Cynical @ 39
I don’t think depriving public agencies of the funds they need to do the job we asked them to do makes any sense whatsoever.
Your attitude seems based on an assumption that bureaucracies simply waste money in defiance of the public’s will. That’s utter nonsense. Agencies and programs are created and funded by elected legislators who are highly responsive to what the public wants. It’s the height of absurdity to tell our legislators what we want from government, then take away the money so government can’t provide it.
Hey, if you hate your foot that much, shoot the damn thing off!
Chee @ 49
The Bush administration is printing money like crazy, which results in more dollars chasing the same goods and services, so dollars are worth less. Consequently, oil producers must demand more dollars per barrel just to get paid the same, and the Japanese need more dollars for their goods or they’re taking a pay cut. There simply is no free ride in this universe. When government finances its spending by borrowing, you get inflation. Inflation is a tax.
Mark @ 45
Depends on what they buy. You still have to pay WA State Sales tax on a Dell Computer. In very few cases is shipping zero cost. Maybe at Christmas at a few big websites. Lower the sales tax and they’ll be more likely to buy locally. Eliminate it and they may make too many consumption choices over savings/investment choices.
Re: naivete. No substitute for an engaged electorate. If they over-reach they pay the price. Your favorite approach appears to put as few supports under government as possible and then knock them out when they over-reach (in your reckoning) thus hobbling the government and causing crises. This is the approach of Eymanism. I say be engaged and throw the bastards out if they don’t do their jobs. Besides, they put just about everything out to a vote anyways. Deers in the headlights instead of leaders.
Marks @ 46
Any economist would just about agree that the more you tax something, the less you get of it in the aggregate. A poor person is especially price sensitive. If you lower the sales tax they might buy something, yes, but they also may choose buying something over gambling their money away which is another bad can of worms in this state.
Mark @ 47
I quote Jim King on 1/21/05:
Business- especially small business- has consistently indicated that the b&o tax runs a very poor third (if that high) in comparison to worker comp and unemployment insurance taxes.
Doesn’t sound like small business hates this tax all that much in comparison to other things. For the benefit of those that do, I favor lowering it but not eliminating it in exchange for a progressive individual income tax.
Don @ 51
“Agencies and programs are created and funded by elected legislators who are highly responsive to what the public wants.”
More properly, legislators are highly responsive to their major donors and vocal core of voters.
“I don’t think depriving public agencies of the funds they need to do the job we asked them to do makes any sense whatsoever.”
The questions to ask are:
1. Is there still a need for the service we originally asked for? Is the service still of the same priority as it was when originally implemented?
2. Is the service being implemented completely according to plan? Are those that manage and/or implement the service today fully aware of what the public’s intent was/is?
3. Are there redundancies between local, state and/or federal programs or agencies that could be eliminated or at least made more efficient?
4. #2 aside, are the programs being managed and implemented in the best way possible? Is it possible that the same goals can be achieved in a different, more effective and/or cost-effective manner than was outlined originally?
As I said before, I think it is great that Gregoire is implementing Giuliani’s GMAP system. Let’s just hope that it is more than window dressing.
Also, I seriously think that Rolling Zero-Based Budgeting must be considered. It would mesh well with the GMAP program and force legislators, the public and programs to face the needs, desires and resources out there.
John @ 53
I mentioned Dell earlier. The only reason they charge sales tax is that WA put the screws to them. $100 in tax on every transaction adds up quickly.
What I’m talking about are places like clothing, gift, electronics, etc. dealers by catalog or on the Internet. They DON’T have a WA tax agent at their doorstep each month. But they do sell things like a $500 camera or $400 batch of clothes in a single order. And there are a great number of companies that will give you free shipping if you are a “member” or use their house credit card (even if you pay it off every month with no interest).
“Re: naivete. No substitute for an engaged electorate. If they over-reach they pay the price.”
If wishes were horses… Politicians know that the electorate is not sufficiently savvy to understand what is really going on. That is how they can tell the public that they have “cut spending” when, in fact, they have merely cut the increase in spending that they were going to do anyway.
“Your favorite approach appears to put as few supports under government as possible and then knock them out when they over-reach”
No. Read my comments to Don @ 54. I am strongly in favor of GMAP & also think that zero-based budgeting should be considered — at least on an alternate- or every-third-budget-cycle basis.
Joh @ 53
“Doesn’t sound like small business hates this tax all that much in comparison to other things.”
So, if I were to give you the choice of:
A. A poke in the eye from a low-hanging tree limb.
B. Being run over by a speeding truck
or
C. Twisting an ankle on broken pavement
you’d tell me that you’re actually fine with not fixing broken pavement because it is a lesser injury??
Mark @ 55
Well now that you mention it I just bought a Soekris net4801 and they ship free UPS ground but on the other hand lately when I buy computer gear from Newegg.com I pay enough shipping to make me curse out loud :(.
I don’t know anything about the ZBB or GMAP but Gregoire seemed impressed enough by reading Giuliani’s book to give it a go and the people of New York seem to like it well enough. I’ll indeed give them the benefit of the doubt.
I think Missisippi has better SAT scores than Washington students…
John @ 57
“Well now that you mention it I just bought a Soekris net4801 and they ship free UPS ground”
So, John, you’re going to fill out that WA State Use Tax return and send in the check for what would have been the sales tax. Right??
For your convenience, I’ve included the link to the form:
http://dor.wa.gov/Docs/forms/U.....TxRtrn.pdf
I mean, you wouldn’t want to be not only a tax cheat, but part of the reason that those social programs are underfunded, would you?? ;)
Chuck @ 59
Mississippi high school seniors who take the SAT test do score significantly higher than Washington high school seniors who take the SAT test. In fact, these Mississippi high school seniors are among the highest in the nation when it comes to the SAT test.
However, only a small percentage of Mississippi high school seniors take the SAT test. Most of them take the ACT test instead (or in addition to the ACT). Every college and university in Mississippi, public and private, will accept the ACT test for admissions. Many of them don’t even accept the SAT test — especially the public institutions.
So, most of the (relatively few) Mississippi high school seniors who choose to take the SAT test are interested in being considered for admission to colleges and universities outside of Mississippi. These folks tend to be quite a bit smarter, motivated and prepared than the average Mississippi high school senior.
It was the same way 27 years ago when I graduated from high school in Mississippi, and it is the same way today.
By the way, I think Mississippi has a significantly higher number of students enrolled in public colleges and universities than is the case in Washington.
As for that last paragraph, I meant on a per capita basis. Obviously, Washington would have more public college and university students in terms of total numbers, since Washington has more than twice the population of Mississippi.
Wow — 27 years ago does seems like a very long time :(
Mark @ 57
Boy you do hate paying taxes don’t you? A dollar out of your pocket for police, fire, snowplow, national guard, etc gets compared to the most interesting of things. Again, if you didn’t hear me the first two times or so I favor easing the burden of the b&o tax on small/medium business as well as reforming those things that appear at least to Jim King to be much worse.
Mark @ 60
Only if I use what I bought and yes, it does help the overworked dshs caseworker who gets slammed every other week on the Mike Siegel Show if a citizen pays the use tax.
John @ 63
Your line was, “Doesn’t sound like small business hates this tax all that much in comparison”
Maybe in comparison, but ONLY in comparison. My point was that just because something is the lesser of three “evils,” doesn’t mean you somehow like that thing (or “not hate it all that much”). SOME businesses may feel that worker comp or unemployment tax are worse than B&O, but their business is more likely to be labor-intensive.
I also have no problem paying taxes, but I want to know that my tax dollar is being spent wisely. Olympia is finally talking about performance audits and showing some respect for taxpayers’ millions and millions of dollars. It is the LEAST they could do.
I really am curious how you will resolve the Use Tax issue. As a believer in the goodness and righteousness of the Wise Democrats in Olympia, how can you not pay?
Will you not pay, but lie and tell us you did? Will you brazenly admit to defrauding the state? Or will you actually take the time to fill out the form and send in your $20 or $50 or whatever? Even if you give it away as a gift, Use Tax still has to be paid.
[P.S. I haven’t bought anything non-taxed from out-of-state in a LONG time, so my conscience is clear.]
Mark@56.
Oregonians shop in Washington tax free and Washingtonians shop in Oregon tax free. I know it is a resident based theory but seems tourists could be taxed in WA. May not be a good idea or even legal to do so.
Chee @ 65
Washingtonians who shop in Oregon and use the items here in WA are REQUIRED BY LAW to submit a Use Tax return and remit what would have been the sales tax they’d pay in their area. If a Washingtonian shops in a different state that does have a sales tax, they can deduct that amount from the Use Tax owing to WA.
Oregonians (and Alaskans? and others with no sales tax) don’t have to pay sales tax here if they present proper ID.
So… all you Democrats that vote for those incremental sales tax increases “for the public good” but then shop online or in Oregon should be dutifully filling out that Use Tax return and voluntarily sending in those checks. You wouldn’t want some state prisoner to lose his or her cable TV, would you?
Mark @ 64
If P-Audits are the least they could do and I agree that is the least they can do – I’m curious what you’d think is the MOST they could do or what is even half-way reasonable.
Re: Wise Democrats. I’ll quote Ronald Reagan: “trust but verify”.
Re: Use tax for my purchase. Again, if I decide to actually use the device, I’ll pay the tax. I’ll think of it as the “stick it to Mike Siegel” fee.
Mark @ 66
“You wouldn’t want some state prisoner to lose his or her cable TV, would you?”
Let’s analyze this all-too-typical winger comment.
1. The delegitimizing factor — the tactic is to pick an example of government spending that almost no one would agree with, in order to portray all government spending as illegitimate.
2. The lie factor — it doesn’t matter if the example is true or not, as long as it accomplishes its function of delegitimizing all government spending.
3. The red herring factor — even if true, it’s irrelevant, because cable TV for prisoners wouldn’t make a dent in the prison budget let alone the state budget.
4. The omission factor — the example distracts attention from real issues and problems such as inadequate funding for critical programs.
5. The demagoguery factor — make sure to pick an example that provokes the maximum amount of emotion in order to minimize opportunities for rational debate.
A good way to summarize the comment is: BULLSHIT.
Actually, if you really look at the numbers people who shop on line don’t do it to avoid the sales tax. They buy online because the price is cheaper.
The people buying the items online are avoiding the high B&O tax, the inventory tax, and the state sales tax.
Washington state has a lot of problems with a tax system that depends on an economic model from the 1950’s. Times have changed but we haven’t. And since we just elected (sort of) a governor that is more status quo than not…..we’re screwed.
Don @ 68
Don you are a treasure. Goldy should have a section of solid-gold comments like that one preserved for easy-reference.
Don, Don, Don…
You are SUCH a typical, Big Government apologist. Let’s analyze your analysis:
“1. The delegitimizing factor – the tactic is to pick an example of government spending that almost no one would agree with, in order to portray all government spending as illegitimate.
Now, if almost no one would agree with this and the government is a servant of the people, why do expenses like this happen? Arrogance on the part of the government? And it isn’t to portray ALL government spending as illegitimate, but to point out that there ARE tax dollars being wasted while Olympia pleads poverty.
“2. The lie factor – it doesn’t matter if the example is true or not, as long as it accomplishes its function of delegitimizing all government spending.”
Are you saying that prisoners do NOT have cable TV? (and saying “nyah, nyah… they have DirecTV” doesn’t count)
“3. The red herring factor – even if true, it’s irrelevant, because cable TV for prisoners wouldn’t make a dent in the prison budget let alone the state budget.”
So your #2 isn’t really a factor because it actually could be true. SO, what you do is deflect the point by minimizing it. To use your logic, I should (and perhaps am entitled) to avoid paying my taxes because they constitute such a small portion of the overall budget. Right? Think “death by a thousand
paper cutstiny expenses.”“4. The omission factor – the example distracts attention from real issues and problems such as inadequate funding for critical programs.”
Hmmm… Seems that you’re out of the loop, Don. Even Olympia seems to admit that there needs to be review of inefficient spending of tax dollars. Are you from the “just throw money at it” school of government?
“5. The demagoguery factor – make sure to pick an example that provokes the maximum amount of emotion in order to minimize opportunities for rational debate.”
This is somewhat of a repeat of your #1, but… you should think about why such examples are raised. If the public would be easily outraged over this, then it is clearly a problem. Instead, you attack the messenger.
Don, if you really think that $20 or $50 in waste is irrelevant, why don’t you volunteer to pay the Use Tax on his purchase. I mean, as a former lawyer, government employee and judge you DID pay all your Use Taxes, right???
Mark @ 71
“there ARE tax dollars being wasted while Olympia pleads poverty … Are you saying that prisoners do NOT have cable TV?”
Actually, I didn’t know — and neither did you (as will becomeious momentarily) — so I called DOC to find out.
I called the Olympia main number, 1-360-753-1573, and got an operator.
In a marvelous demonstration of wise use of tax money, I was put on hold while she fielded three call in queue ahead of mine. (No idle operators sitting around picking their noses in this agency — nosiree!)
She didn’t know the answer my question, but in another amazing demonstration of efficiency, connected me to someone who DID know! Not a bit of the “I don’t know, that’s not my department, I’ll switch you to another department that might know …” runaround — DOC’s efficiency puts most businesses to shame!
And now … (drum roll) …
Yes, the prisoners do have cable TV. Not just any cable TV, though. DOC controls the programs inmates can watch — no porn is allowed.
DOC’s cable TV policy is part of its “population management” strategy, which is their fancy way of saying entertaining prisoners is cheaper than controlling riots, especially since the state is paying NOTHING for the inmates’ cable TV access.
You see, the inmates pay for it themselves. The money comes from the Inmate Betterment Fund which gets its income from vending machines, pay phones, etc. patronized by inmates and visitors.
Bottom Line: Not ONE RED CENT of state money is being spent on cable TV in our prisons.
Too bad you didn’t make that phone call yourself before making an ass u me.
Of course I paid the Use Tax.
MArk@66.
I was not aware of that. I had an inkling that it did not seem right from what I surmised. Not having any reason to search the issue I appreciate you filling me in. Thanks Mark.
Mark @ 71
Where do you get off asking Don to pay my use taxes? You think that’s funny?
John @ 75
I said that because Don was pooh-poohing the amount as a drop in the bucket AND the fact that it could be wasted money. If he’s so cavalier about throwing that money away, perhaps he should pay it.
John @ 75
Hmmm I read Mark’s post rather quickly & didn’t realize he was asking me to pay YOUR Use Tax. My first impression was he wanted to know if I paid MY Use Tax, the answer to which is yes. But I sure don’t know where he gets off asking me to pay YOUR Use Tax, especially when he doesn’t even know if you paid it. Next he might even ask me to pay HIS Use Tax. I’ll bet he knows if he paid HIS Use Tax or not!
Mark @ 76
What’s your point, Mark? If, arguendo, it is humanly impossible for the state to spend $26 billion a year without wasting at least $20 — or, lordy, $50 — does that mean the state is ripping you off every time you pay a state tax?
Should we spend $100,000 on additional management, oversight, and accounting to make sure the Department of Pissinbucket doesn’t spent fifty bucks more on copy paper than it really needed?
Are you saying that your complaint about wasteful and inefficient government amounts to a stinkin’ fifty bucks???
You have too much time on your hands. Get a job, or something.
Don
“You have too much time on your hands. Get a job, or something.”
I have a job. As for you, I’m glad you DON’T have a job any more. It is clear that you must have been a lousy judge because you are one of the most vitriolic, argumentative, opinionated, one-sided SOB’s on this board. You can pretend all you want that you were impartial on the bench, but a leopard can’t change its spots.
Don @ 78
As for my original point… You attacked a single tongue-in-cheek phrase from my post @ 66 where I merely pointed out a perceived area of government waste to illustrate a point. Did you address the point specifically? No. Instead, you tried to paint any conservative criticism of the government as illegitimate BS. Only later did you address the point.
When will you get it through your head that the government is the SERVANT OF THE PEOPLE? It DOES have to answer to the public for EVERY decision it makes and EVERY tax dollar it spends. I’m not saying you appoint a nine-member blue-ribbon panel on staple waste (though I’m sure the Dems would love to put nine more people on the payroll). However, if a member of the public questions an area of perceived waste, it is the OBLIGATION of the government to either answer why the waste is legitimate or unavoidable or to stop the waste.
Don@72
So the same machines that made Mitchell Rupe too fat to hang pay for his cable?
Mark @ 79
Mark, let me explain it to you this way.
A man who spent days crawling across a barren desert under a hot sun without a drop of water comes to a water hole and takes a big drink of water.
Mark @ 80
The “perceived area of government waste” you mentioned was spending taxpayer money to buy cable TV for prison inmates. I researched this by calling the Department of Corrections and found out no taxpayer money is spent on cable TV for prisoners. Gong!
But don’t let this minor embarrassment discourage you from your efforts. Governor Gregoire needs to plug a $2.2 billion budget hole and needs all the help she can get. Every dollar that can be saved through operational efficiencies is a dollar of taxes we don’t have to pay. That benefits us all! So don’t give up. There’s always room for improvement somewhere, and sometimes it takes alert citizens to spot it.
However, as you go about this endeavor, please be intellectually honest about it. What is needed are objective facts and analysis, not partisan polemics that are long on hot air but short of specifics or factual accuracy.
Chuck @ 81
That’s right.
They shoulda hung ‘im anyway.
Don @ 82
I presume the time crawling in the desert represents when you were a judge. So, what does the thirst represent? Did you lack sufficient knowledge of the world around you? Do you feel that you should have been more partisan on the bench? And what does the water represent? Is that supposed to be Democratic talking points or ???
Don @ 83
For one, the cable TV was a minor, tongue-in-cheek sentence to illustrate a point. Had you merely addressed the point and corrected the mistake, we wouldn’t be having this chat. Instead, you dismissed the overall idea of the point. At least in this post, you acknowledge the existence of government waste.
And, as a final comment, I realize CG has a massive job ahead of her to try and carve off the bloat of the last administrations. From what I’ve seen and heard so far, I gotta give her credit.
Don @ 83
Now that it is public, I can link:
http://www.governor.wa.gov/new.....newsType=1
More power to her if she really means it.
I am delighted that you have chosen to respond at last to one of the people posting comments on your blog. While the subject of the sex/slave trade is indeed horrendous, I am sure I am not alone in wishing that you would engage and debate with those of us posing hard and difficult questions about the impending EU Constitutioncrisis that is likely to result from a rejection by French and Dutch voters. Surely this is a paramount subject for you – Commissioner for Institutional Relations and Communication – to be addressing. It wont go away, you know.
I am delighted that you have chosen to respond at last to one of the people posting comments on your blog. While the subject of the sex/slave trade is indeed horrendous, I am sure I am not alone in wishing that you would engage and debate with those of us posing hard and difficult questions about the impending EU Constitutioncrisis that is likely to result from a rejection by French and Dutch voters. Surely this is a paramount subject for you – Commissioner for Institutional Relations and Communication – to be addressing. It wont go away, you know.
I love your site and find it to be a wonderful resource. Thank you for taking the time to put it all together.
Ive just been letting everything wash over me recently. Pretty much nothing seems worth bothering with. I cant be bothered with anything recently, but I guess it doesnt bother me. I havent gotten anything done for a while. Ive just been staying at home waiting for something to happen. Not that it matters.