I know it is cliche to say that with every crisis comes opportunity, but cliches have a habit of ringing true, as with our worst ever budget crisis facing Olympia, now in its second year of a three to four year run. Unfortunately, while Republicans are prepared to take advantage of this opportunity, Democrats apparently are not.
The all-cuts approach of last year’s budget, and the mostly cuts, plus more federal bailout, plus maybe a hundred million or so in odd revenue increases the governor is pushing in this year’s supplemental, is nothing if not a recipe for permanently shrinking the size and scope of state government. We’re not talking about merely squeezing out waste or cutting the fat or reprioritizing, although we’ll get a little of that too; we’re talking about redefining the role of government in Washington state… ensuring that not only does state government come out of this recession smaller as a percentage of the total economy, but that it will continue to shrink in such regards for perhaps decades to come.
This is, of course the Republican agenda, an agenda that they have been unable to win with at the polls, but which they will inevitably achieve nonetheless as long as our highly regressive and inadequate tax structure remains at status quo. And faced with an opportunity to at least move the debate forward, if not immediately enact substantial reforms, the Democrats have opted to cede the debate to the opposition, pretty much accepting their terms unchallenged.
Republicans and their surrogates in the legacy press (you know who I’m talking about, Seattle Times editorial board) have insisted that a down economy is the exact worst time to raise taxes, an assertion that many economists would challenge, but which our state Democratic leadership will not. So… um… when is the right time to raise taxes? When the economy is good? Does anybody really believe that there will be political support in the Legislature to raise taxes once state revenue starts to recover?
Of course not. But the problem is, barring another unsustainable economic bubble, state revenue will never recover to pre-recession levels compared to growth in demand for public services, and will certainly never grow as fast as the overall economy. Without substantial tax restructuring — without a shift away from our over-reliance on regressively taxing the sale of goods, a tax base that has been steadily shrinking for the past half century as a percentage of the total economy — our government can never grow fast enough to keep up with the economic, infrastructure and human investment and services our state needs to prosper in the 21st century.
Without substantial tax restructuring, our state government, the investments it makes and the services it provides, will be gradually dismantled, piece by piece by piece.
This was our inevitable future before the Great Recession, and it will be our inevitable future after. Which is a shame, because with their large majorities in both houses of the Legislature, and their control of the governor’s mansion, the Democratic leadership had an opportunity to use this crisis to guide us down the road toward the reforms necessary to at least sustain our current quality of life, if not enact a truly progressive agenda.
Unfortunately, it looks like we’ve had the wrong Democrats in leadership.