Schmudget Blog

Progress in Focus: Declining Economic Security Is a Big Threat for Washingtonians

With too many hardworking people struggling to get by, state lawmakers must do more to support the investments needed for Washingtonians’ long-term economic security than they did in the recent state budget.

For an eye-opening look at the challenges our state faces, see the "Progress at a Glance" table below and, for more details, check out our full Progress Index .

(Click on the image below to view the entire table)

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Ultimately, state budget writers this year missed significant opportunities to help build an economy where prosperity is widely shared. Their budget did not do enough to rectify the fact that today’s economy is providing gains to a relative handful of Washingtonians, as these statistics dramatically show:

  • Nearly one quarter of all income in Washington state goes to the richest 1 percent – those with average annual incomes of $1.3 million. For perspective, the richest 1 percent held no more than 11 percent of all income during the height of middle-class prosperity from 1947 to 1979. 
  • Between 2009 and 2012, during the recovery from the Great Recession, all income gains went to the richest Washingtonians. The remaining 99 percent saw their income decline.
  • Median household income declined by $4,000 between 2008 and 2013, to $58,405 a year from $62,486. 
  • The share of Washingtonians who make too little to meet basic needs is rising, now encompassing nearly one-third of the population.  

In addition to all this, Washington continues to have the nation’s most upside-down state tax system: as a percentage of what they make in a year, the lowest-paid Washingtonians pay up to seven times more in state and local taxes than the wealthiest 1 percent. 

The disturbing situation these statistics describe should serve as a clarion call to lawmakers that investments need to be made to create affordable housing, connect workers to job training, keep children from going hungry, and in other ways promote opportunity and prosperity for all. Yet Washington state invests just 3 percent of its total operating revenue on ways to help Washingtonians maintain economic stability during an economic downturn or personal crisis.

Further, inadequate state support over the past five years has weakened the forms of assistance many Washingtonians need most. Temporary Assistance for Needy Families and Working Connections Child Care – critical tools to help families find or keep a job – serve significantly fewer children today than in 2008.

The recently adopted state budget did increase support in some key areas, like expanding early learning opportunities for all kids and providing a small increase in cash assistance to families struggling to get by. But those gains are severely threatened by the failure to enact enough new, sustainable revenue sources to protect long-term investments and economic security in the years to come. The adoption of a capital gains tax on the wealthiest Washingtonians in particular would have provided several million dollars a year to meet important needs and take a step toward making taxes more equitable.

This is Part 6 in our "Progress in Focus" series of blog posts highlighting the individual sections of the Progress Index. To read our additional recommendations for how to support a thriving Washington economy, visit the Economic Security section of our Progress Index. See our previous posts: 

Part 5: Healthy People

Part 4: Healthy Environment

Part 3: Good Jobs

Part 2: Education

Part 1: Revenue

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