An honest conversation about the crisis

By Robby Stern

Heading into the 2011 Washington Legislative session, we need an honest conversation about the crisis we face, who is responsible, and how PSARA can and should respond. Work in coalition with other groups to address the cuts at the state level and the attacks at the federal level will be at the heart of what we do.

A $6 billion deficit is projected for the budget that will take effect July 1, covering state expenditures through June 30 of 2013. Last session, the legislature went out on a limb and passed some tax increases and, in addition, sent a referendum to the ballot that would have created up to 30,000 jobs and extended the bottled water tax.

The voters slapped them down. Under the influence of huge spending by corporations and wealthy individuals, the voters took positions counter to their own interests. They repealed the candy and pop tax the legislature had passed; they defeated Referendum 53, which would have extended the bottled water tax and created tens of thousands of jobs; they passed Eyman’s initiative making it nearly impossible for the legislature to raise revenue; and they defeated a progressive income tax measure. In general. they made the situation in our state far worse.

It would simply be wrong to blame the legislature for what the voters decided.
On the other hand, the legislature bears full responsibility for the tax breaks they have handed out like candy to some of these same corporations and wealthy individuals. These tax expenditures are now coming back to haunt us and the legislature can only undo them with a 60% majority vote that will be impossible to achieve, given the ideology of the Republicans and what are now self-called the “road kill’ Democrats.

Gov. Gregoire and the Legislature face a devastating situation. A significant shortfall in the present budget cycle requires cuts that will seriously hurt thousands of the most vulnerable among us. Recently, a number of PSARA members attended a candlelight vigil in Olympia to protest the cuts to long term care and to the Medicaid program that are taking place at this very moment. With us were people who will suffer and some of whom may very well die as a result of these cuts.

Sen. Ed Murray, the new chair of the Senate Ways & Means Committee, spoke at our November 19 PSARA Legislative Conference. Surprisingly, his message was one of hope, mixed with a very somber appraisal of the human toll in Washington if we do not address the issue of revenue. He pointed out that in 2002, after voters defeated a revenue package for transportation by 20 percent, the legislature’s Democratic majority raised the gas tax by 5 cents. In 2005, the legislature raised it by an additional 9.5 cents and when John Carlson tried to overturn the revenue increase, the voters rejected the Carlson initiative by 10 percentage points. In other words, things can be turned around, and quickly. Our job is to engage our members in the fight, and to clearly explain what is at stake.

PSARA will do everything we can to make life a little less difficult for poor and working people. We will join with others to see that the corporate and wealthy interests that misled the Washington voters are exposed and held accountable.
We will also join with others to enact the following program for the 2011 legislative session, adopted at our spirited Legislative Conference:

• Work to minimize the human toll resulting from the cuts. We will encourage the Legislature to send a referendum to the people in 2011 to close targeted tax loopholes as a way to raise the revenue needed to mitigate the cuts

.• Support the creation of a State Public Investment Bank that utilizes income generated by state revenue to benefit the people of our state. These revenues are now primarily deposited in multi-state banks, with the largest share in the Bank of America. We are supporting legislation based on a model that has worked for decades in North Dakota.

• Support legislation requiring mediation in foreclosure actions. The object is to reduce the number of foreclosures, and to give home owners a chance to remain in their homes.

• We will also support legislation that mandates a fair screening process for renters, assuring that renters receive a copy of their credit and rental history if such information is required by their landlord. The legislation also mandates that the credit and rental history remain valid for at least 60 days to protect the renter from facing multiple fees for the report.

We have a lot on our plate. PSARA members will be asked to help fight the effort to shift the cost of the federal deficit onto the backs of seniors and poor and working people. We will fiercely organize to stop the effort to cut Social Security. At the same time, we will be calling on our members to help us in holding the corporate and wealthy interests accountable and also engage with us in this state legislative session with phone calls and turn out. We are a feisty organization. Together we can make a significant difference.

Legislative prospects hinge on Nov. 2 vote

By Jerry Reilly

Confounding the pollsters and the pundits, the voters in Washington State defeated a set of ballot initiatives that would have reduced state revenues by $1.2 Billion and another initiative that would have made it impossible for the legislature to close tax loopholes and update a tax on hazardous petroleum products. The voters also approved an initiative to give tax relief to small businesses and property owners and to improve the state’s regressive tax system by installing an income tax on high earners.

If this is the news story on November 3rd, after the general election, the task for the 2011 session of the Legislature will be challenging, but manageable. The Legislature will need to build a budget for the next biennium with an estimated shortfall in revenues of around $5 Billion. But they will not have to cope with the loss of an extra $1.2 Billion in revenue caused by passing initiatives 1107 (rolling back the soda pop and candy tax); 1100 and/or 1105 (privatizing liquor sales) and 1082 (creating a private insurance scheme for worker’s compensation).

If the Eyman/British Petroleum Initiative 1053 is defeated, the legislature will also have the ability to consider, again, closing some of the tax loopholes (in excess of $1 billion) that they were not able to muster the votes to accomplish in the 2010 session. But most important of all, they can expect to see about $1 billion in additional revenue in the next biennium from the passage of Initiative 1098 (taxing high earners). They can also plan to see about $4 billion in additional revenue from Initiative 1098 in the biennium after next that begins in July 2013. Even with some new revenue options available, they will most likely still need to make additional cuts to state services to bring the budget into balance.

The outlook for the 2011 session will be very different if the news story on November 3rd is as follows:

Confirming predictions that the voters were going to “vote their anger”, Washington voters passed initiatives to roll back taxes, privatize liquor sales, bring private insurers into the worker’s compensation system and assure minority rule on tax matters. They also rejected an initiative that combined small business and property owner tax relief with an income tax on high earners.

If this how the election turns out, then the legislature will face a revenue shortfall of over $6 billion, without any real option to raise new revenue or close existing loopholes. They will have no real choice except to make additional cuts of $6 Billion on top of the $5 Billion already made in the current biennium. They will be forced to gut health care and long term care for the poor, disabled and elderly, make additional drastic cuts to higher education, curtail preschool opportunities for children and impose dozens of other harmful reductions. If this turns out to be our future, we should retain Governor Haley Barbour as a budget consultant because we will be on our way to becoming Mississippi.

The outlook for the 2011 Legislative Session all depends on the outcome of the November 2nd election—and that outcome depends on us.