Washington's current budget was "stimulated" by Obama's 2009 stimulus package. Its huge gap was plugged by a generous $3.3 billion in money from people in other states. So we were in a hole and got a one-time shot.
The revenue projections used in that budget are being clobbered by reality. The expected revenue has dropped by $760 million since September.
Still in the hole. So have we stopped digging? That is, spending. Christine Gregoire says it is her duty to balance the budget.
"I will produce a budget balanced to this revenue projection because I am required to by law," Gregoire said. "We all know a budget reflects the values of our state. All options must be on the table to produce a budget that works."She is tempted to raise taxes. But raising taxes will slow our economy. Here are 32 economists commenting on the specific situation in our state this year.
"Leaving earnings in the hands of individuals and businesses is the best way to help grow the private sector, create jobs and lead to higher levels of consumption," the letter states. "Increasing taxes at this time will shift necessary capital from the private sector to the public sector, thereby depriving private enterprise of the source of true economic growth and making Washington state even less competitive for new businesses and jobs."And newspapers around the state are calling for no tax increases. The Columbian in Vancouver.
State law says she doesn't have to wait for the Legislature to meet in January. She can take action on her own, indeed, she must take action. State law prohibits a cash deficit from occurring by requiring the Governor to take action. Here is what RCW 43.88.110(7) says:
If at any time during the fiscal period the governor projects a cash deficit in a particular fund or account as defined by RCW 43.88.050, the governor shall make across-the-board reductions in allotments for that particular fund or account so as to prevent a cash deficit, unless the legislature has directed the liquidation of the cash deficit over one or more fiscal periods . . .She can call a special session in December rather than late until January. After all, what do they always do when they meet in January? They wait for the next revenue forecast.
But don't think she isn't doing anything. She is very active going to D.C. to beg for more money. Also NPR. Before June 30 the trips were in violation of, first, her own, then the legislature's, travel ban.
HT to Jason Mercier at Washington Policy Center.
Posted by Ron Hebron at November 23, 2009 11:37 AM | Email ThisHow much more competitive are we? What have we gotten for the massive increases? (other than, apparently, now some new taxes?)
Posted by: AD on November 23, 2009 12:11 PMWe told YOU so.
Posted by: Medic/Vet on November 23, 2009 12:47 PMIf this is the best Gregoire can do (get money from her broke uncle), then we need somebody else in the gov. mansion.
Posted by: Michele on November 23, 2009 12:48 PMGovernments who follow demo kids advice quickly discover that states can, indeed, go bankrupt.
Posted by: Jonathan Gardner on November 23, 2009 12:51 PMGutting funding? I don't think so. It's gone up.
And if you don't like how funding is going, then you will have to figure out a way to spend even more, while at the same time digging out of the debt and deficit hole that WA is in.
It's tough out there for Democrats when there is no blood to squeeze from the turnip.
Posted by: Jeff B. on November 23, 2009 01:18 PMPeople -- and businesses -- have a right to demand and to expect these services, and to vote for elected officials who will deliver them.
If the demand for services goes up, and there isn't enough money to pay for it, then your taxes will go up. You lot might not want that to happen. It's your right not to want it. It's your right not to like it. And it's your right to elect people who will give you what you want and not what somebody else -- who isn't you or who doesn't think like you -- might want.
Problem for you is, you lot aren't winning any elections around here. The 32 economists Ron cites all work for right-wing think tanks like WPC, EFF, ABC, XYZ, you name it. What else would you expect this lot to say, and why would anybody expect Ron to cite any points of view that he didn't already share?
We're going to tax you till your eyes bleed. I'll be paying it just like you will. Move to Mississippi if you don't like it, or start winning some elections.
Posted by: ivan on November 23, 2009 01:42 PMPfft. I mention that defunding education is a bad thing, and you start bleating about bankruptcy. Education and R&D from universities are part of the regional economic engine.
But then again, conservatives consistently prove that they don't give a crap about anyone but themselves. To hell with anyone else, right?
Posted by: demo kid on November 23, 2009 02:08 PMReminds me of the predatory statement democrat prez candidate Walter Mondale whispered to the guy next to him as he stood before an adoring union crowd:
"Look at them---we're gonna tax their asses off..."
Nice, Walter. Real nice. Sometimes democrats are too honest for their own good; but you can hardly blame them---it's hard to cover up what you really want for that long. Eventually a little too much honesty comes out.
And ivan and dk are once again doing what democrats do: THEY want "all the goodies", forgetting that not everyone else does. We don't want all those goodies and freebies from the state. You forget. Not everyone wants to suck from the government teet as you do.
Posted by: Michele on November 23, 2009 02:11 PMWin some elections, then, and quit your whining.
Posted by: ivan on November 23, 2009 02:27 PMFreebies like clean water? Good schools? A university that is actually competitive and can draw in research money?
If you want to live in a fortified compound in Craphole, Mississippi, go right ahead. Personally, I'd rather see the region thrive.
Posted by: demo kid on November 23, 2009 02:59 PMGo ahead, raise taxes some more. Maybe the rest of Boeing will leave then. It doesn't mattter if we have great schools if there is no where for the graduates thereof to find a job.
Posted by: Kato on November 23, 2009 03:28 PMWhy would either of those require MORE money in a down economy? Help me here?
If the economy is down, how does that translate into MORE schoolchildren in schools? For those teachers that are already working?
If the economy is down and they are shuttering factories, less people are driving to work, etc. why would that mean we need more money for clean water?
The fact is that very, very small part of any of the tax increases of the last 10 years went to education (or law enforcement for that matter) and last time I checked, we hadn't experienced any kind of substantial failing in our water supply.
But that won't stop Demo Kid from cheering on another tax increase.
Posted by: johnny on November 23, 2009 03:36 PMWe need clean water and a better educated workforce because people and businesses here will benefit from them, and so that we will attract more businesses here.
This is why candidates who represent your brand of ignorance don't get elected around here.
We're talking about staving off cuts, not increasing funding. I'm guessing that you don't just send your kids into the coal mines instead of to school when the economic times are rough, right? I'm also guessing that you don't drink 10% of the water during a recession, right?
Posted by: demo kid on November 23, 2009 03:49 PMExplain to me why I should not spend the $50,000 to move, improve technology and go to a state where I'll earn that back on business and personal taxation and reduced cost of living? Take my fam, my tax paying ways and my half a dozen jobs and say buh-bye?
There are more and more jobs that are going to be almost completely on-line and there's no reason for those employees and business to locate in WA. Last I checked you can get both clean water and an education in ID/MT/TX/SC. Boeing has the right idea.
Posted by: Cecil on November 23, 2009 04:04 PMDemocrats aren't intelligent enough to understand this quote, but the rest of us are. This state is in financial ruin and yet, still, they attempt to defend the actions of an incompetent Governor and irresponsibile legislature in Olympia. It's the spending, stupid.
Posted by: Rick D. on November 23, 2009 05:09 PMIt IS the spending, stupids.
Posted by: Yosemite Sam on November 23, 2009 05:57 PMYou lot would blame it on Gregoire if you didn't like the weather, or if your dog pooped on the living room carpeting. So spare me your ignorant babble.
Show me that you have the muscle to elect Republicans countywide and statewide and maybe I'll take you seriously. Until then, I can only conclude that most of the voters don't.
If it's not Gregoire's fault, who is at fault?
David
Posted by: David on November 23, 2009 06:31 PMHow would you solve the deficit? What is your suggestion? Or do you just like to snipe and criticize?
Posted by: Shanghai Dan on November 23, 2009 06:46 PMWhat, are you serious? It's Boeing's "fault," who else's "fault" do you think it is? The politicians in this state, bioth Democratic and Republican, did everything for Boeing in the past 10 years except to line up and kiss its corporate a*s.
They gave Boeing tax break after tax break. They rejiggered the unemployment insurance payments to suit Boeing, screwing the building trades in the bargain. They killed the Worker Privacy Act at Boeing's bidding, so that Boeing's subcontractors could force their employees into captive anti-union meetings.
And the list goes on and on. The beancounters from McDonnell-Douglass who had taken over Boeing didn't give a rip that we had the best-educated, most highly skilled workforce in the aerospace industry right here. They didn't even care that the Machinists offered them a 10-year contract. History will determine that Boeing made a dumb move. But you can't cure stupid, and stupid is just what they are.
Of course, to you lot, management of any company is, by definition, all-powerful and all-knowing. Example after example of management stupidity and incompetence means nothing to most of you. It's always the unions' "fault," or ACORN's "fault."
No doubt you lot think Dino Rossi would have saved Boeing. Thank goodness we'll never know.
Why do you suppose they decided to spend millions of dollars relocating to another state, if the state is giving them everything they want?
Why would the company move away from a state that has "the best-educated, most highly skilled workforce in the aerospace industry"?
I find it hard to believe that your best answer is- Stupidity. Not all executives are smart, but if your conclusion is true the executives at Boeing shouldn't be running anything. Why do you suppose the share-holders have not asked for their heads- if the decision is such a complete display is stupidity? Let me guess- they are stupid too...
And why do you feel the need to make conclusions about my political views? Can you tell by a simple question who I voted for? And what does that have to do with the subject at hand?
Posted by: David on November 23, 2009 07:30 PMAs for Gregoire, she'll raise taxes again. Beer and cigarettes first, but that won't be enough. Neither will the "closing tax loopholes", which is always a government favorite. She'll threaten to cut police, courts, parks, and anything else you want unless we pass some general tax increase. It's coming.
Posted by: Palouse on November 23, 2009 08:05 PMAll we have to do is raise taxes some more so we can properly fund the public employee unions, then everything will be fine.
Would the last company out of WA please turn out the lights?
Posted by: Kato on November 23, 2009 08:32 PMI don't think all Boeing employees are incompentent (after all, I still have friends that work there - who will tell you the same:), but after having worked there in IT for 4 years, I think Boeing has some of the worst employees I've ever seen.
I always blamed it on the union, as no where else have I work that had anywhere near the percentage of leeches that Boeing had (no place else with a Union). AFAIK, Airbus is probably no better (union + highly gov't subsidized), but I don't even know how you could run a smaller company and not do better on average than Boeing. There might be a larger number of more highly skilled employees working there (somebody has to take up the slack), but on average, I think it would not be hard to do better.
Posted by: thecomputerguy on November 23, 2009 08:58 PMI don't think all Boeing employees are incompentent (after all, I still have friends that work there - who will tell you the same:), but after having worked there in IT for 4 years, I think Boeing has some of the worst employees I've ever seen.
I always blamed it on the union, as no where else have I work that had anywhere near the percentage of leeches that Boeing had (no place else with a Union). AFAIK, Airbus is probably no better (union + highly gov't subsidized), but I don't even know how you could run a smaller company and not do better on average than Boeing. There might be a larger number of more highly skilled employees working there (somebody has to take up the slack), but on average, I think it would not be hard to do better.
Posted by: thecomputerguy on November 23, 2009 08:59 PMyou can not run a state with only state workers working..you can try....but you'll have to tax their asses off to pay off other state workers....
nice try....
Posted by: lee on November 23, 2009 09:40 PMNo, because it wasn't. This bill is by the single measure we use to determine deficit neutrality: CBO scores.
How come, just one year ago, the Democrats were pushing a bill to stop the mandated cuts in Medicare?
The GOP has repeatedly passed bills that delayed the Medicare cuts. Here is the fill history of the SGR. The first [Medicare cut being put off] was passed in 2003, when Republicans controlled the House, the Senate, and the White House. The next came in 2005. Then there was one in 2006. Neither party supports the SGR -- it's unsustainable.
In 2008 they were opposed to doing the VERY THING they say they'll do to make this bill revenue neutral?
It is not the "VERY THING." It is a DIFFERENT THING. The payment reforms in this bill are unrelated to that issue.
Why is it bad for the GOP to cut Medicare payments by 10%, but it's OK for the Slavery Party to cut Medicare by 15%?
Strawman argument.
Democrats are not trying to blindly cut the Medicare payment rates, like Republicans proposed with the "sustainable growth rate" (which both parties have subsequently voted to suspend year after year). Democrats are proposing common-sense Medicare payment reforms. Almost no one has serious issue with these reforms, but they sure as heck are being distorted by you and others to scare old folks. Outside of the context of the Obama administration, a bill with these reforms would almost certainly get north of 70 votes in the Senate.
You're a liar and you live in fantasy land, John, if you think that Medicare will be cut as drastically as these plans demand. Not even close.
How can what I think make me a liar, genius?
As I said before, if you think Congress is unable to control the growth rate of Medicare then you might as well give up on this country now because we are going to go bankrupt. But this bill is the most serious attempt at Medicare payment reform since the program was introduced.
The Slavery Party will NEVER cut Medicare because they don't want to lose the votes.
This bill implements hundreds of billions in Medicare savings. What you're saying ignores the reality of the Senate bill.
It's a plan that will never be implemented
How will the bill be signed into law and then not implemented? That'd be unconstitutional.
Are you saying another bill will be signed to overturn the Medicare reforms? Well, I find that unlikely, but even if it does happen in the future if we keep PAYGO rules then it'll have to be deficit neutral. Which means the new bill will help cover the costs of health insurance reforms.
But if all the rules are suspended and Medicare spending goes back to the status quo, then this entire country will be screwed. Because of that threat, Democrats have proposed the more sweeping payment reforms to Medicare ever. What the hell is the GOP doing about it? Instead of offering constructive solutions, your party is just shrugging and saying "won't happen." That's not American idealism at work.
Gary, I think they've been putting off the Medicare cuts every year since 1997.
The SGR was passed in 1997. When you try to talk about policy, Gary, you just embarrass yourself. Stick to question begging and attacking Obama.
KDS, Provide the link to the CBO report to which you claim you refer, otherwise what you are saying is heresay.
I linked to both CBO reports of the House bill and the Senate bill in post #20. Read Table 1.
look at the cost overruns that Medicare has accumulated and the track record.
The CBO didn't exist when Medicare was passed. How can you have cost overruns when you don't have a cost estimate?
It would be plausible if a concerted effort to reduce waste from Medicare had taken place before and Tort reform was included. Just because reducing waste is buried in the 2,000 + pages does not mean that it will be enforced.
This bill does a significant amount to reduce Medicare waste. It is not "buried," but actually a significant amount of the bill. People don't talk about it very much because it's not as sexy or divisive as the public option or universal health care, but there are some really good reforms in there. (Nearly every health care economist would agree with that assessment -- you can find that out with your own research.)
I'd love to see more on tort reform. (The bill does fund different state projects to see how to best handle tort reform.) If the GOP would give us a single vote in the Senate, I'm sure they could have nearly anything they wanted. But when they're not at the table, they're not going to get whatever they want.
Governmemt has a mediocre at best record at enforcing cost cutting measures. Yet, leftist hacks like you parrot talking points and obfuscate at will about how this can work.
Look, we have two options:
1) We can just give up now and accept that America is going to go bankrupt because of health care costs.
2) We can try to honestly address the problem to the best of our political capacity.
I'll go with number 2.
Posted by: John Jensen on November 23, 2009 10:29 PMI will say that 70% of the remaining state budget is protected/mandated by state constitutional requirements or federal statue.
That means only 30% of the budget can be modified in any way. The shortfall represents about 28% of that remaining section.
I don't think taxes should be raised in a recession, but I also don't think there is a responsible way to cut nearly a third of the state's appropriations after so many deep cuts earlier this year.
Posted by: John Jensen on November 23, 2009 10:36 PMAnd everyone sees the unfairness of a union that protects employees regardless of their performance and merit. Eventually the culture of mediocrity lowers morale and productivity even as labor costs rise.
It's good to see Americans in another state who are glad to work for the voluntary employer - employee relationship and a reasonable market salary and not because they know they have a strong arm to back them up. Those in SC are much truer to the real American spirit of hard work, personal responsibility and individualism than the overpaid softies here in WA. And thus, they should get the business.
Posted by: Jeff B. on November 23, 2009 10:50 PMDo you hear the country now, democrats? They don't want your "Health Deform". Stop trying to ram it down everyone's throats. They're gagging on it as it is.
Posted by: Michele on November 23, 2009 11:56 PMThe belief that the government has a right to impound wealth whenever it wants necessarily means that the citizenry is not secure in their persons or property. The subservience of the individual to the interests of the state is a form of bondage and a foundational theory of collectivism in all its forms.
Now, I'm not so rigid as to be against all forms of taxation. I think there is a compromise somewhere in between no ability to tax and the government owns you and your property. I just think the compromise is much closer to the no ability to tax than most people.
I wish I could explain this farther, but I've gotta run to catch my train.
Posted by: blindman on November 24, 2009 05:31 AMI know, I know. You gotta pay if you want quality. That's BS. These A holes aren't providing any quality except poor quality. You can look through the public employee salaries everywhere and find similar outrageous dollar amounts for these "public servants". That is one place to start cutting the cost of government.
Posted by: REBEL on November 24, 2009 08:22 AM"No doubt you lot think Dino Rossi would have saved Boeing. Thank goodness we'll never know."
Well Here is what we do know. The person masquerading as governor currently knows nothing about reduced spending. And Boeing is building planes in SC on her watch.
Any solutions offered? How would you get us out of this deficit?
Posted by: Shanghai Dan on November 24, 2009 08:58 AMThe law does not require that the governor continue funneling tax payer dollars to special interests in order to be re-elected.
Now you tell me, who exactly is self-serving?
Posted by: Smoley on November 24, 2009 09:20 AMAs usual, little that benefits working taxpayers and small business owners and much that benefits welfare recipients, illegal aliens, public-employee unions, the tribes and leftist special interest groups.
Posted by: Saltherring on November 24, 2009 10:30 AMThe quote you used came from ivan, not me...
Posted by: David on November 24, 2009 11:18 AMI guess so... Seeing how the resident cabal of leftists is mute about how to solve the deficit. I wonder why they're afraid to speak up?
Posted by: Shanghai Dan on November 24, 2009 03:08 PMBut if the "our brand" is so terrible, why is it leading by 24 points amongst not just right wing clean water and children hating wackos, but independents, on the generic ballot?
Could it be that the likely voters polled are focusing on Democrats that have brought more trillion dollar debts, huge new deficit spending plans, a congress that is ignoring unemployment and trying to ram a healthcare bill supported by only 38% of Americans down our throats, and a President who still hasn't done any better with the military than his predecessor, and yet still continues to blame him for everything?
It was a bait and switch. We got the change, but now Americans have lost all hope in our leadership.
Posted by: Jeff B. on November 24, 2009 08:45 PMASNWER THE QUESTION:
Did you ever serve in this nation's military???
Posted by: pbj on November 24, 2009 11:24 PM