Building an Economy that Works for Everyone

Our state can lay foundation for prosperity

Reprinted from the Everett Herald

I woke up this morning, made the coffee and walked out to get the Seattle Post-Intelligencer. And I walked back in, empty-handed. The P-I is no more.

As of today, thousands of P-I readers are victims of the latest out-of-state corporate cost-cutting decision. And who knows which will be the next business to be taken down? The loss of the P-I showcases our powerlessness in this great recession. We are unsure of our jobs, our mortgages, our credit card balances, our health coverage, our kids’ college tuition. If it isn’t the stock market roller coaster, it’s Boeing cutting back employment, airlines canceling 787 orders, Microsoft laying off workers, and boarded up store fronts from local businesses gone bust. The demise of the P-I fits right into this era of hopelessness and fear.

The governor and the Legislature are not stepping up to lead the way to economic recovery. We could be laying the foundation for the next round of innovation and broad-based prosperity. Instead, our elected officials in Olympia are raising tuition, cutting K-12 education, eliminating vaccinations, and dismantling basic health coverage.

In our state we have a long history of problem solving for the public good. During the Bush era, the Snohomish County PUD exposed Enron for its manipulations of electricity pricing. Group Health Cooperative delivers health care to state residents, not profits to corporate shareholders. Credit unions like Boeing Employees and the Washington State Employees Credit Union do banking the old-fashioned way — with solid bottom lines and no “derivatives.” Just last fall the Machinists union led a strike at Boeing to protect middle class jobs from being outsourced to other countries. So what gives now? Is this recession so bad that we have lost our mojo to figure out how to make things work?

Well, here is some mojo. A group of citizens is coming together to fix our upside-down tax system and provide a solid base to fund education from pre-kindergarten to K-12 to the community college and our four-year higher education system. Washington has the most regressive tax regime in the country. Middle-class and low-income families pay much more in taxes proportionally than the wealthy. Our over-reliance on sales taxes and property taxes also results in lagging public revenues. We can’t fund the public services, especially education, that 21st century Washington citizens and businesses deserve and demand.

We are 46th out of the 50 states in our student-teacher ratios in public school. Out of every 100 ninth-graders, only 69 receive their high school diploma on time. We fail to provide high quality pre-kindergarten for the vast majority of Washington’s young children. Twenty-nine states are ahead of us in funding for higher education academic research. Public college tuition has tripled in the past 30 years, while at the University of Washington the state has reduced its responsibility to less than half of tuition costs, offloading more expenses to middle-class and low-income families.

There is a solution to this public failure. We can pave the way for a more prosperous economy with a “high incomes” income tax. It would be offset with an across-the-board cut of the state property tax. The new net revenue would be dedicated to public education. The vast majority of middle-class families would get a tax cut. The 4 percent of families with incomes over $200,000 would pay a 5 percent tax. If your family made $225,000, you would pay $1,250 in a state income tax (you’d only pay tax on the amount of your income above $200,000, and you would deduct that from your federal taxes). The children and students of our state would get a boost of more than $1 billion every year for their education, laying the foundation for their future well-being and prosperity, while giving businesses the skilled, creative workers they need.

Can we realize this in our state? The better question is why not. After all, King County is the fourth wealthiest county per capita in the country. We have no excuse to prevent us from reforming our tax system to provide for high quality education.

If we succeed in these efforts, we will lay the foundation for the advancement of our state, our economy, and our citizens in the 21st century. If we fail, we will be left behind. I would pick the mojo.

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