Washblog

I don't really think Gov. Gregoire wants to have as her legacy that she stubbornly refused to propose new taxes even as state services collapsed and Washington had some of the worst unemployment numbers in the country. Can you imagine? Washington has had one of the stronger economies in the country. To go from that to one of the worst would be on the head of this governor--and her allies in the legislature.

New taxes I take it will be proposed by the legislature in a series of referenda put to the voters. Let us hope these referenda are not too little, too late.

Talk about denial. Nationwide we've lost about 600k jobs each month for the last three months. Krugman has suggested that unemployment could rise into 2011--yes, 2011. Economist Joseph Stiglitz long ago proposed raising taxes as part of a recovery package. Voice crying in the wilderness.

Restructuring Washington's tax structure was long ago proposed. Because we have a regressive tax system that relies on the sales tax, we now have one of the worst deficits, per capita, in the country--approaching the mess in California.

I'm beginning to think that Olympia has its own kind of bubble. Let's hope reality breaks through soon.

Of course we need new taxes, but we need them as a structural revenue and reform plan so we can pay back the $10 billion we need to borrow to get through this crisis. Dems need to start pushing things like this "good bank" proposal. All across the modern world countries have - at one time or another - created state banks and "good banks" could be state banks. We need to get financially smart. Simply raising taxes will not, at this point, close these gaps.

Debate of an income tax cannot be conducted in a workable timeframe and establishing an income tax as a means to increase overall revenue is a nonstarter.

So the legislature must look at every budget reduction that they can find and then propose raises in taxes and fees and tuition in order to bridge the projected deficit. In the end, a detailed tax and program funding measure will be sent to the voters and with any luck the measure will be passed.

She, and our out-of-touch legislators, have failed to do their jobs when it comes to education. They proposed education finance bills that didn't actually contain any plan for putting education on a stable platform.

First there was Washington Learns, which, as part of its enabling legislation, was supposed to tackle the funding issue. Gregoire and her crew kicked the issue down the road 2 years to the Basic Education Finance task force, which did everything but come up with a revenue plan. So now here we are. Education is about to get gutted, and there really is no one to blame but the legislature and the governor. It was their responsibility; they didn't deal with it.

If you think education funding doesn't matter, please visit my classroom. I see it every day. If legislators and the governor and the task force had seen what I'd seen the last three years, they would have been down in Olympia screaming their heads off. Instead, they've been dilly-dallying. Out. Of. Touch.

As a political matter, I am starting to reluctantly agree with the fiscal responsibility message the President is putting forward. The private sector, the previous administration and their radical-right fantasy world have put us in this predicament, but they've also succesfully destroyed the credibility of the left.

However stupid and counter-productive it may be, we have to be seen as putting our own house in order first. It's monstrously stupid. Now is absolutely NOT the time. But we'll be asking for such a large, structural adjustment and we need credibility. We need to make sure that Dems can run on everything they are going to ask the people to change their lives so much to fund.

Right now there's patching problems with lots of money and belt-tightening. The patching slows down the speed of the drop and the speed of the drop is what gets everyone doing the same (wrong) thing at the same time. Belt-tightening is that wrong thing. People think the belt-tightening makes things better, but it makes them much worse.

We want to spend efficiently, but consider this: World War II was the most insane waste of human effort in history and yet it got us out of the Depression. It only did that because it got everyone going the same direction, but against fear not in reaction to it.

Cutting spending is belt-tightening. Taxes are belt-tightening. They're both counter-productive in this circumstances because they stress and atomize society. But if cutting spending will get people believing in government, I guess it's necessary to appear to be doing it - temporarily - while actually doing as little as possible of it as possible. Its all about uniting people to spend and go in the same direction.

And how about a Basebasll tax? Taxpayers paid for Safeco Field. A buck a seat for M's game would raise about $20 million. I know that is a drop in the bucket, but $20 million here, and $20 million there, pretty soon it adds up to real money.

The system of funding our public sector in Washington fails the test on the most critical measures.

Most of the developed world has a Value Added Tax.

The B&O tax is really not far from a VAT.  It can be reformed into a VAT.  Business will support it, since they will be able to deduct costs from the taxable income.  The public seems hardly aware of the B&O tax and is not deeply indoctrinated to hate it, as they are an income tax.  

We need a beefy public sector.  Let's build the doctrines and message towards a reform of the B&O tax.  FIRST you must clean up all the arbitrary and unequal treatments, THEN implement deductions from the taxable gross THEN, raise the rate to get more revenue.