We are now facing a $5 billion deficit. That's on a budget of $33.6 billion. Which is up more than a third over four years ago.
If only we had listened to Governor Gregoire back in 2006:
Our state budgeting has been a roller coaster. We spend when we have a surplus and we struggle to make painful cuts when the economy slumps. It is time to even out the ride. While the roller coaster is fun at the amusement park, it is no model for state budgeting.
By treating our budget like a Washington family budget -- we will ensure stability and avoid tax increases or Draconian cuts tomorrow.
And by "we," of course, I mean Governor Gregoire.
If she had actually governed this way, we wouldn't be in this mess. She and the Democrats controlling the legislature did exactly what she said we shouldn't do: they spent when we had a surplus, and now we're struggling to make painful cuts when the economy slumps.
She was right that this was no model for state budgeting, and that is why I am confident that the people won't re-elect her.
Oh wait. She won? ... Seriously?
You're joking, right?
I mean, someone screws up this badly, even admitting they know the problem and then doing exactly what they say we shouldn't do, and they can get thrown out of office before their term is even up. No way they'd actually get re-elected.
You cannot be serious.
Cross-posted on <pudge/*>.
Posted by pudge at November 19, 2008 01:31 PM | Email ThisA. Bush's fault
B. I did not anticipate the situation was this dire, so I am going to propose an income tax to bridge the gap.
C. NOW is the time to talk about raising taxes, but not to worry, you'll get to vote on it.
D. The 520/Viaduct solution will have to wait until the state's fiscal problems are resolved
E. All of the above
If you were so stupid as to vote for this women because Rossi is pro life or because you believed that he would cut the minimum wage or because "he reminded you of George W Bush" than to hell with you, you get what you deserve.
Can't wait until Gregoire has to go the unions and say "thanks for your support but you aren't getting a raise for another 3 years."
The S*%^ has hit the fan.
Posted by: jk on November 19, 2008 01:44 PMIf it wouldn't hurt me and everyone else, I could relish in that fact.
But we are the ones getting screwed, and as Palouse points out, she will not accept any of the blame, and as this election season proved, the media will not do much of a job properly assigning blame.
jk: it doesn't matter: everything is Bush's fault. Even four years from now, it will still be Bush's fault. He drove us into a "mini depression" that will take more than four years to get out of, you see.
And Palouse, the answer is E, obviously. Except we won't get to vote on it. Are you crazy? Every tax increase will pass the legislature with the emergency clause.
Posted by: pudge on November 19, 2008 01:46 PMWill the last one leaving the state please turn out the lights!
Posted by: tg on November 19, 2008 01:50 PMYou really think there is any chance at all that she won't raise taxes?
I mean ... I don't even think that is in the realm of remote possibility.
And Palouse, that's a nice idea, but I don't think they can even hope for a majority to support a tax increase, and especially not an income tax.
I hope I am not wrong, and Washingtonians are not that stupid.
I've talked to some people who voted for Gregoire because, for reasons they can't really explain without citing false claims from Gregoire, they just didn't like Rossi. Makes no sense to me, but whatever. I have not talked to anyone who wants higher taxes or likes Gregoire, except for the activists on the left. I can't see the people voting for a tax increase.
From the Yakima Herald:
Paul Berendt, a former chairman of the state Democratic Party, said he thinks Gregoire and lawmakers could put together a tax package that would help balance the budget and support new programs — and send it to voters.
That would allow Gregoire to propose additional spending without signing a tax increase.
The fact that voters agreed to raise sales taxes for a $17.9 billion Sound Transit light-rail expansion suggests that approach could work, Berendt said.
When asked recently if she'd support sending a tax increase to voters, Gregoire said, "I will leave that to my colleagues in the Legislature. I will forever maintain that the voters ought to be able to decide that. ... I wouldn't be involved in it. It would bypass me. It would not be something that the governor would sign on to or sign off on."
Make no mistake...she will raise taxes. She's just going to get the voters to cover for her to do it.
Posted by: Palouse on November 19, 2008 02:04 PMPudge is right, you living a dream.
I take it, you enjoy making really stupid remarks just to see what responce you'll get. dumb?
Posted by: Army Medic/Vet on November 19, 2008 02:11 PMThey can't support healthcare, retirement and jobs without the big car sales.
Posted by: Army Medic/Vet on November 19, 2008 02:19 PM
And there should be a Pers 3 or whatever number they are on for new employees. Cities and counties should do the same.
Posted by: swatter on November 19, 2008 02:28 PMNow that the people of this state have shown they will vote for Democrats regardless of their poor performance in office, what do they really have to fear?
Posted by: Kato on November 19, 2008 02:34 PMI would say the blame for our state's woes would probably be 90% because of Bush, and the GOP, and 10% because of Christine, and the Democrats. It's not like Graham, and Greenspan, the "swaps" lovers /pushers were Dems.
Don't agree? If you think Bush has done a good job running our country, and managing our economy you should find a rubber room somewhere to spend the rest of your days.
Posted by: All Facts Support My Positions on November 19, 2008 03:02 PMSoooo, when Washington state's tax revenues were at record levels (prior to the Democrats taking control of Congress in 2006), was that Bush's doing as well?
Posted by: Palouse on November 19, 2008 03:16 PMUm.
The budget has increased about $8.4 billion under Gregoire ($25.2b to $33.6b). We have a deficit of much less than $8.4 billion.
Even with the bad economy, if we merely had a 13.5 percent increase in spending, which is a much more sane number, we would have no projected deficit at all. With a 15 percent increase, we could have had no cuts or tax increases and just used the rainy-day fund.
No, the problem is entirely the fault of Gregoire and the Democrats in Washington. They did exactly what Gregoire said they should NOT do back in 2006, and spent, and spent, and spent some more.
Nothing like a deficit (when you're obligated to balance the budget) to instill some discipline. Imagine if we had that requirement at the Federal level.
What States are NOT facing decreasing revenues and tighter budgets right now? Any?
Posted by: BA on November 19, 2008 03:25 PMYes, discipline would be a good thing.
That is why Gregoire should not have been reelected, because she has proven she has none. She even preached it in her State of the State, and it never happened.
so just great...
I am sure the Gregoire voters are much smarter than the idiots who voted for bama......right........
stupidity.....democrat voters are stupid.......
Posted by: lee on November 19, 2008 03:34 PMWasn't it just a couple of SHORT WEEKS AGO that Queen Christine assured us we had no budget deficit? The voters in this state are complete DOLTS.
Posted by: Enigmafan420 on November 19, 2008 03:41 PMBut, the path we go down to solve the impending budget issues can be informed by the citizens of this state if we so choose. Higher taxes, lower spending - we'll get what we choose to tolerate.
Alaska - don't they have a problem when oil is below $70 a barrel? If so, oil's been cheaper than that in recent times - they can squeeze their spending too.
Posted by: BA on November 19, 2008 03:43 PMPlease explain how Bush is responsible for the budget mess. He did not force the democratic legislature to burn through a huge surplus, he did not tell the democratic governor to give exorbitant raises to state labor unions or to cut off a revenue source by giving a sweetheart deal to the tribal gaming commission.
The last time we had a budget in this shape, was the last time the republicans controlled any chamber of the legislature and that would be 2003 when one Dino Rossi worked with democrats to balance the budget without raising taxes. Too bad we could have used him now.......oh well, he is pro life so I guess he is evil and should not be governor.
PS...factless, I am assuming you are talking about Phil GRAMM (not Graham) and he has not been a senator since 1998, 10 years ago so how he has anything to do with any budget is beyond me.
Posted by: jk on November 19, 2008 03:50 PMI just don't see it happening.
Posted by: swatter on November 19, 2008 04:19 PMThat isn't the point for me. What upsets me is that even with growing tax revenues, Gregoire and the legislature still spent the state into a $5b hole. Amazing.
Well, she wanted this problem. So go solve it without new taxes.
Posted by: iconoclast on November 19, 2008 04:36 PMThat isn't the point for me. What upsets me is that even with growing tax revenues, Gregoire and the legislature still spent the state into a $5b hole. Amazing.
Well, she wanted this problem. So go solve it without new taxes.
Posted by: iconoclast on November 19, 2008 04:36 PMROFL
Gregoire would have to shoot someone live on TV for the idiots in the Dem party would allow impeaching her. And even then, the PI would support her.
Posted by: iconoclast on November 19, 2008 05:19 PMOf course they didn't mention that the population in King County grew by only 50% during the same time period.
http://www.governor.wa.gov/contact/default.asp#startform
Posted by: gs on November 19, 2008 05:43 PMit rests on them....all of it....
Forever?
Does "forever" include the gas tax? It didn't seem to.
Well, Washington State, you wanted Queen Chrissy, the Tribal Ho... and you got her.
Of course, Rossi wouldn't have been all that much better I fear, but it would have been much more fun to watch.
Posted by: Hinton on November 19, 2008 05:53 PMWhile that's all nice and easy to type, it's clear you have no idea how Olympia works.
No matter what happens, there will be no 'ramping down'. It's never happened before, ever ... even after the '94 revolution.
Sure, the increases were smaller - much smaller - and minimized the shortfalls in the years that followed, but that's all out the window now with the complete elmination of 601.
There is no way - none, at all - that this gap won't be filled by massive tax increases. The only suspense is how the controlling Dems will blame the GOP for it all.
Posted by: jimg on November 19, 2008 06:33 PMIf that doesn't raise your ire, then much like the congressman, you just don't get it.
Posted by: Rick D. on November 19, 2008 06:33 PMIt's a great time to be taxing your way out of a 5 Billion dollar hole.
Posted by: gs on November 19, 2008 07:33 PMDidn't Gray Davis get recalled in CA because he lied about the budget deficit during his re-election? Just asking.
Posted by: jk on November 19, 2008 08:09 PMsolution--
freezes on govt spending--immediate unless TRUE emergcy for security or health.
then, a WA tax holiday for 1 year--no B&O, all sales tax capped at say 1-2% (or zero) & watch people spend HERE like mad vs. internet or neighbor states;
state helps & promotes "shop WA--it's cheap here!"
then mandate performance audit recommends at every govt agency, esp schools or bureaucrat gets fired;
then, sunset most social programs and cut fluff like art and illegal immigr aid;
tax breaks for private charities to pick up social & "wants"slack;
then, wait & see...
if we're wrong, at least we tried without massive tax increases on already burneded and bailout paying taxpayers;
Posted by: jimmie-howya-doin on November 19, 2008 08:29 PMQueen Christine probably went to the Governator to learn about budgeting.
Posted by: Dengle on November 19, 2008 09:06 PMThis is the perverse ending where ma can't call on Travis to shoot the precious family dog gone rabid, and will have to do it herself.
Republicans should put up some horrific trillion dollar budget giving away the kitchen sink- they say Gregoire cut free health care to everyone in the next election.
This may be morbid, but I really can't help but relish these morons dealing with their own creation.
Posted by: Andy on November 20, 2008 08:49 AM
They are now the party of Tax, Spend, and Blame.
(Yes, I'm lazy and looking to shamelessly exploit the research and resources of others...)
Posted by: Solius on November 20, 2008 01:10 PMBelieve me, if a state income tax would be imposed in this state, small businss owners and retirees would be out of here like a bolt of lightning. There would be another glut of houses on the market at they left for Nevada, Texas and Florida.
Posted by: Clean House on November 21, 2008 12:20 PMWhy yes, they would undoubtedly move to another state, the overwhelming majority of which HAVE A STATE INCOME TAX.
Smarter commenters, please.
Posted by: billy goat on November 22, 2008 05:15 PMThen prices would come down, and the average person could, mirabu dictu! afford to buy a house.
What an effing nightmare that would be.
Posted by: billy goat on November 22, 2008 05:21 PMWe already have one of the highest tax burdens in the country, and one of the reasons for an income tax is to increase tax revenues, which means increasing the tax burden ...
See, most people get that without having to be told.
Posted by: pudge on November 22, 2008 05:27 PMMost states do NOT have a B&O tax on gross receipts. Add another 10% on top of that effective 15% tax (since it's on gross receipts, it's like having a 15% tax on net receipts like most other taxes are calculated), and you have a perfect reason to drive businesses out of this state.
Smarter commenters, indeed!
Posted by: Shanghai Dan on November 22, 2008 07:58 PMAnd yes, you actually do have to pay for government services. Who'da' thought?
Shanghai Dan: "like" 15% of the net? That must be a highly technical accounting term. I call BS. Show me the figures. Other than that, the B&O tax is a disgrace and should be repealed. So, see. We agree. Replace it, and some other regressive and stupid taxes with a progressive income tax.
Posted by: billy goat on November 24, 2008 01:00 PMWA ranks 35th in tax burden
False. Try again.
http://www.taxfoundation.org/taxdata/show/486.html
Posted by: billy goat on November 24, 2008 04:00 PMhttp://money.cnn.com/pf/features/lists/taxesbystate2005/
Posted by: billy goat on November 24, 2008 04:09 PMFor a service company, the B&O tax is 1.5%. So on every $100 of revenue, you pay $1.50 in taxation.
Now, most services companies - after they cover rent, consumables, and other bills - typically pay 80% for their overhead. Meaning of that $100 in revenue, $80 goes out just to keep the lights on.
So what's your gross profit - what you're left with? It's about $20 of that $100 to start. That's what you live on. And that's what you pay taxes on.
So pay your taxes - 15% to SSI/FICA, and 25% for Federal Income. That's 40% of that $20. That's $8 - leaving you with $12.
Oh, and now you get to pay your B&O tax. That $1.50 you paid on that $100 of revenue? Well, that comes out of your $12 - leaving you with $10.50. That B&O tax - at a "tiny" 1.5% of gross receipts, becomes 12% to 15% of your after-Federal-Tax profit.
That clear enough for you? It's pretty obvious you've never actually paid B&O tax, you really don't know about it, do you?
Now, back tht original subject - Gregoire's deficit. Getting caught up on some reading, and I noticed in this last Sunday's Herald, the budget deficit is now up to $6 BILLION. Hey, we're at 20% right now, and growing. Gregoire's doing a WONDERFUL job!
Of course, she probably thinks about economics like you do...
Posted by: Shanghai Dan on November 24, 2008 04:14 PMWA taxes per capita 18th
WA taxes per $1,000 income 28th
Looks pretty middle of the road to me.
You wantta' win this argument you have to bring numbers, not hot air.
http://www.researchcouncil.org/publications_container/State%20-%20Local%20Taxes%202005-06.pdf
Better call Rush for help.
Posted by: billy goat on November 24, 2008 04:19 PMGranted. But then you built a straw man and destroyed it nicely. Boy, you are one tough dude. Business profitability varies, and some businesses can pass this tax through, some can't (because they are not very profitable). Your example demonstrates your ignorance of economics.
Show me some figures that conclusively demonstrate that a 1.5% tax on gross receipts translates into 15% of the net before taxes, interest, and depreciation (an accounting term--look it up) and I shall concede the point. Taking it off net income (after all other taxes) is simply not meaningful.
Posted by: billy goat on November 24, 2008 04:30 PMLocal taxes are excluded, such as property taxes and local sales taxes.
Also, read this.
There is only one trustworthy source of data regarding state tax burdens, and that's the US Census bureau, and the final report for 2007 is due out in December.
Posted by: Palouse on November 24, 2008 04:32 PMI have provided some cites of evidence to the contrary, even though the burden of proof rightly rests with him.
He has not even tried.
Posted by: billy goat on November 24, 2008 04:48 PMLocal taxes are excluded, such as property taxes and local sales taxes.
The study was referring to the Census methodology which the Tax Foundation, for good or ill, tries to overcome by taking a stab at local and property taxes.
Posted by: billy goat on November 24, 2008 04:54 PM"That clear enough for you? It's pretty obvious you've never actually paid B&O tax, you really don't know about it, do you?"
You know, it's difficult to hold a discussion with someone whose chief tactic consists of gratuitous insults, but I shall persevere.
I am a hard bid public works general building contractor. When I build an estimate, the B&O tax is included as a "cost".
Look the term up. It might help you to come up with an actual, you know, business model.
Posted by: billy goat on November 24, 2008 05:00 PMNo, it's not.
As Dan points out, it does not include costs caused by high taxes for businesses.
And it does not include all of our local taxes, which have been rising dramatically (and under Gregoire will go up more, if she is a woman of her word, since she said we have a "revenue problem").
As to assertions, you did not ask for evidence, you simply made a counter-assertion, and it was incorrect, as demonstrated.
Heads have been removed from their bodies for less. The level of taxation in this country, the complete disrespect of basic human rights, is treasonous.
Oh, Pudge, please, please, please, provide some evidence. Please, please, please. Pretty please with a cherry on top.
Nothing supporting your assertion has be 'demonstrated'. No 'counter-assertion' was made, but counterfactuals were presented.
Bottom Line: Bring evidence. Otherwise, you are just bloviating (and you actually do not even do that very well).
Here's the rankings from 2005 from the non-partisan Census bureau, and Washington at that time was 15th. Since then, Gregoire has raised the gas tax to one of the top 5 in the nation, property taxes have gone up, Sound Transit taxes have been imposed, ferry district taxes, flood levies, park levies, increased cigarette and liquor taxes, etc, etc, etc. My guess is that we are currently in the top 10.
Posted by: Palouse on November 24, 2008 08:34 PMWashington has the fifth-highest tax burden in the U.S. for 2008.
From the same Tax Foundation.
Now, yes, part of the reason for the discrepancy is because of our higher federal income tax burden, but another part of it is that the number you quoted includes out-of-state tax payments, making the final number almost completely useless, since we're talking about our burden to the governments of the state.
As Palouse notes, the Tax Foundation methodology simply doesn't work well in many ways, especially for Washington.
Posted by: pudge on November 24, 2008 08:49 PMAs stated in the methodology explanation, the Tax Foundation attempts to include property and local sales taxes, which the census data leaves out. As you say, local property taxes are significant, so why do you rely on data that leaves them out?
The governor did not "pass" the recent gas tax. The people did. They also passed Sound Transit. Good for them, I say. You are free to disagree as to whether or not this is good policy, but you can't blame Gregoire. To state or imply that she "did" these things is simply dishonest.
Posted by: billy goat on November 25, 2008 05:35 AMOn that score, I am proud of our state. We must be doing something right, wouldn't you agree?
Posted by: billy goat on November 25, 2008 05:41 AMFalse. The legislature passed the 5 cent and 9.5 cent gas tax increase and she signed it. The people only voted not to repeal the latter one.
which the census data leaves out
No, it doesn't leave it out. They just don't have the most recent numbers compiled yet. You can find the total taxes collected, including property taxes here. They don't have the state rankings and per capita data yet however.
Posted by: Palouse on November 25, 2008 07:24 AMYou apparently didn't read my comment.
The study YOU cite includes OUT OF STATE taxes with IN STATE taxes.
Even if we are to believe the Tax Foundation's methodolgy, BOTH studies are skewed.
Posted by: pudge on November 25, 2008 08:00 AM