Taxes not answer to state’s deficit

The Washington state Legislature convenes Monday, Jan. 11. Its members face a daunting task the state’s projected deficit is $2.6 billion.

In keeping with state law, Gov. Chris Gregoire has proposed a balanced budget. Her proposal would not raise taxes, but instead would cut a wide swath of programs across the state. Not surprisingly, she doesn’t support her own budget.

That means she will be looking at adding revenue and that means taxes. At a time state residents still are in the grip of a down economy, asking them for more money isn’t the place to start.

She could increase the state property tax, but to do so would put both herself and any legislator who voted for such a move in peril. We’re already flirting with a combined 10 percent sales tax rate in this state and in some instances have already hit it.

The state also relies on a business and occupation tax, but the tax hurts those who are trying to grow their business, making it hard for them and hence the state to prosper.

The B&O tax is levied on gross revenue. That means a company can pay a stiff tax even if it doesn’t make a profit. It’s not surprising that this is one of the most unpopular taxes in the state.

There probably are some places or services that can stand a tax bump, but there’s no way to find $2.6 billion there.

The better answer is to look first at expenses.

State employees enjoy better benefits than most people in the private sector. They generally pay less out-of-pocket for their medical coverage. The usually get step increases in pay, which means more money each year just for remaining on the job. They often, but not always, get a cost of living increase.

For most people in the private sector, it’s been years since they saw any of this. Heck, most people probably would be happy if they could have remained where they were financially three years ago before their medical costs climbed and the pay stayed the same, or even slid.

Gregoire’s budget did make a dramatic case for what could happen if reductions were used to balance the budget. But she did it by showing draconian cuts in such programs as medical help for the poorest of the poor, and moving the state out of ongoing commitment to those among us who, for one reason or the other, simply can not work.

It’s highly unlikely that the Legislature will go to that extreme. The poorest of the poor may not be a large voting demographic, but there’s enough compassion in the rest of us to send lawmakers packing who try that approach.

The budget deficit shouldn’t be an excuse to punish state employees. Far from it. By and large, they do good work. But so, too, those in the private sector.

The difference is that private industry has had to cut pay and benefits to stay competitive. Their employees haven’t liked it, but it’s either that or perhaps lose their job.

Legislators should look at state operations the same way. There’s no such thing as business as usual any more. Private industry has learned that painful lesson. State government should face the facts.