Time ran out yesterday for state lawmakers to come to an agreement and pass a budget during special session. Lawmakers must now keep running up the taxpayer tab for a second special session, with the major sticking point between state Senate Republicans and state House Democrats being whether the state should raise taxes on working families.
Last week, state economists released the latest revenue forecast and told lawmakers they could “count on another $400 million without raising taxes a dime”. That means lawmakers have $3.2 billion (a whopping 9.2% increase) more in tax revenue than they had last time they wrote the state budget. The $3.2 billion does not include “things like money that comes in before June 30,” which allow the state to build a larger reserve fund.
Given that reality, one would think Democrats would drop their every-session tax demands and accept that they do not need to raise taxes on working families in order to meet the state’s spending needs (notably, fully funding public schools). Unfortunately, that hasn’t happened yet. GOP state Senator Jan Angel recently explained the reason behind Democrats’ puzzling insistence on tax hikes. Angel wrote,
“So if we don’t actually need the money, why in the world are we arguing about a tax increase? I think it has to do with a notion that has taken hold of a certain wing of the Democratic Party – that tax increases are a social good. Some say we should redo our tax system so that it captures a greater share of personal income, and so that tax revenue rises even faster from year to year than it already does. This argument is always presented as a matter of “fairness.” If we had this money, of course we would spend it wisely – we’d still make tough choices, none of it would disappear into the black hole of state government bureaucracy, and surely it wouldn’t be used to reward special interest groups that favor a particular political party.
“You can sense my skepticism. The thing is, these special interests are more influential than ever. They were frustrated during the recession, when no sensible lawmaker was willing to raise taxes on a struggling populace. Now that times are a little better, we see a burst of creativity when it comes to new tax proposals – things like cap and trade, capital-gains income taxes and so on.”
Democrats justify their tax hike demands via “philosophical arguments.” But, considering the type of revenue increase our state will experience without new taxes, philosophical arguments simply don’t cut it. That’s perhaps why Democrats more and more appear “skittish about the idea.” Angel writes,
“In March and April, when Democratic Party leaders in the state House were calling for the biggest tax increase in state history, Democratic members weren’t willing to vote for it. I think this news about the revenue forecast will make this position even harder to maintain. Already we see Democratic leaders and Gov. Inslee backing away from their previous tax proposals. They’re saying they didn’t need to propose such a large tax increase to begin with. That’s a start.”
For the sake of taxpayers, Democrat lawmakers must “recognize $3.2 billion of increased revenue is enough.” The sooner Democrats accept reality; the sooner lawmakers can perform their constitutional duty and pass a budget.
The clock is ticking…