Washington lawmakers: Invest in communities, don’t make knee-jerk cuts

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Washington lawmakers: Invest in communities, don’t make knee-jerk cuts

We call on leaders to respond wisely to this economic crisis

June 17, 2020

The Washington State Budget & Policy Center has joined more than 70 organizations and individuals in signing two letters to lawmakers calling for progressive revenue, rather than harmful budget cuts, to respond to the economic crisis. The letters are published in their entirety below.

Letter from the Balance Our Tax Code Coalition

Dear Governor Inslee, Majority Leader Billig, and Speaker Jinkins, 

We have never been faced with a crisis of this magnitude in any of our lifetimes. The COVID-19 pandemic has already cost the lives of hundreds of Washingtonians and is continuing to climb every day. Over half a million are now unemployed. With the predictions of a second wave of infections later this year alongside the usual flu epidemic, and no vaccine on the horizon, we are only at the beginning of an increasingly desperate moment in history. 

We, the undersigned, write to you in urgency asking for your support of new progressive revenue to support our state’s families, communities, and small businesses in this unprecedented time of need. We represent organized labor, refugee and immigrant advocates, women’s rights organizations, direct-service providers, and more. If ever there was a time to act boldly and write a new deal for Washington’s short-term and long-term recovery and resiliency, it is now. 

While thousands of lives have been saved due to the early actions taken, we know that our state now faces the beginnings of a budget crisis unlike any seen in recent history. Unfortunately, the largest tax cuts in recent years have been to the top income tax rate, which disproportionately benefits the highest-income households while middle- and low-income taxpayers feel tremendous losses in areas such as childcare, public education, and healthcare. Additionally, we know that the families who have been hardest hit by the COVID-19 crisis are those furthest from opportunity: immigrant families, families of color, and families living on low incomes. 

Unfortunately, our state’s over-reliance on the sales tax has exacerbated this crisis compared to other states. Washington’s upside-down tax system means Jeff Bezos can reap extra billions from e-commerce during this crisis while millions of families across Washington suffer. This suffering will only be compounded if lawmakers do not take swift action to raise new, progressive revenue and stave off devastating cuts to essential services and programs. But more so, this is an opportunity to make a historic shift in how our state approaches revenue, a shift to make our tax system equitable and just, formidable to economic downturns, and responsive to a 21st century economy where traditional revenue streams are changing.

As you work to build a path to recovery, we request that you prioritize new, progressive revenue and work to build a more just state economy. Further, we ask that you and your colleagues utilize the principles below to guide your decision making as our state navigates this crisis. We are eager to be your partners in the hard work ahead, and we stand ready to support solutions that embody the following principles:

Reject an austerity mindset: Raise revenue to protect services and make critical investments. Even in this time of economic crisis, our state is home to individuals with massive wealth and hugely profitable businesses. We have the resources to preserve essential public services while also making new investments that boost Washington’s economic recovery and mitigate impacts on those most impacted by COVID-19. Making budget cuts that eliminate jobs and reduce essential supports for vulnerable people will only deepen and prolong our economic crisis. Ensuring we have revenue to fund the public services that benefit us all will require adopting sustainable and equitable new funding sources.  It’s time to eliminate wasteful tax breaks for large corporations and impose new taxes on the richest households who have long been given a special deal at the expense of people with low and middle incomes.

Make permanent fixes to underlying structural failures by modernizing our state tax code. The pandemic has surfaced and elevated the ways in which our state systems were structured to benefit certain groups while disadvantaging others even before the public health crisis began. Gaps in wealth, opportunity, and prosperity are getting worse. We cannot afford to go back to the status quo of regressive and inequitable systems. Lawmakers must make bold, permanent structural changes – particularly to our broken tax code that over-relies on low- and middle-income households to fund the investments that benefit us all. Big, visionary solutions – not short-term, incremental changes – are the only way to advance an equitable recovery and to prepare our state for future crises.

Lead with equity. The current health and economic crisis has exacerbated inequities in our state created by past and persistent policy and budget decisions. The recovery efforts must center communities experiencing the greatest health and economic impacts. That includes people with low incomes, immigrants, undocumented workers, communities of color, tribal nations, people with disabilities, rural communities, young workers, older adults, women, domestic violence survivors, and trans and nonbinary people. Many impacted communities are already working in innovative and resourceful ways to meet community needs. We need policymakers to include them in decision-making processes and prioritize resources to these communities first. Without an inclusive and intentional response, the current health and economic crisis will only continue to compound existing inequities.

Provide immediate, impactful, and sustained relief in the form of direct cash assistance and bolstering public services. Hundreds of thousands of Washingtonians have been severely impacted by sudden job loss, income reductions, the loss of employer-sponsored health coverage, and other forms of financial devastation. Many who were already struggling to make ends meet before the pandemic’s onset face the increasingly profound challenges of paying for housing, putting food on the table, and meeting other basic needs. To prevent the economic downturn from being deeper and longer than necessary, leaders must deliver immediate, direct, and sustained relief to Washingtonians most in need, including direct cash assistance. In many cases, this will require thinking beyond our existing services and systems. Lawmakers can’t simply focus on delaying hardship for the short-term, but instead they must truly position all Washingtonians to thrive over the long-term.

Implement policy responses rooted in trust and dignity, not paternalism. As Washingtonians turn to public resources for critical financial support, they’re encountering the many barriers that have been built into our anti-poverty policies and programs for decades. Strict eligibility and work requirements, onerous application processes and reauthorizations, and a lack of information in languages other than English perpetuate inequities and restrict access to vital support, especially for communities of color and immigrant communities. Because our safety net is only effective if communities can access it, Washington state’s policy response must prioritize implementation that is primarily automatic, low-barrier, and inclusive. The same is true for community and nonprofit organizations, tribal nations, and small businesses that are also seeking support – relief to these entities need to be accessible and free from red tape.

We stand ready as individuals, organizations, and coalitions to aid you in this work to support all Washingtonians. Together, we’ve got this. 

Sincerely,

Balance Our Tax Code Coalition: 350 Seattle; Adriana Senior Housing Residents; AFT Washington; All In For Washington; Alliance for a Healthy Washington; Anti-Hunger & Nutrition Coalition; Carbon Washington; Catholic Community Services of Western WA; Coalition of Immigrants, Refugees and Communities of Color; Communities of Concern Commission; Economic Opportunity Institute; Faith Action Network; Firelands Workers Action; Food Lifeline; Fuse WA; Islamic Civic Engagement Project; League of Women Voters of WA; Legal Voice; MomsRising; Multicultural Community Coalition; NAMI Washington; NARAL Pro-Choice Washington; National Association of Social Workers — WA Chapter; North Sound ACH; Northaven; Northwest Harvest; Northwest Health Law Advocates; Northwest Progressive Institute; Our Climate; Partners for Our Children; Planned Parenthood Advocates of Greater Washington and North Idaho ; Planned Parenthood Mt. Baker; Planned Parenthood Votes Northwest and Hawaii; PolyRev; Progress Alliance of Washington ; Rainier Valley Greenways Safe Streets; Retired Public Employees Council of WA; Seattle/King County Coalition on Homelessness; Sierra Club Washington State Chapter; State Innovation Exchange Action; Statewide Poverty Action Network; Tech4Recovery; The Arc of Washington State; The Auburn Food Bank; University District Food Bank; Washington Association for the Education of Young Children; Washington Community Action Network; Washington Low Income Housing Alliance; Washington Physicians for Social Responsibility (WPSR); Washington State Association of Head Start and ECEAP; Washington State Budget & Policy Center; Washington State Labor Council, AFL-CIO; Washington State Parent Ambassadors; Washington State Senior Citizen’s Lobby; Washington’s Paramount Duty; West Consulting; Worldbridgers; YouthCare

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Letter from economic and policy experts

Dear Governor Inslee, Speaker Jinkins, Majority Leader Billig, Senators Frockt and Rolfes,  Representatives Ormsby and Tarleton: 

Washington will likely see one of its worst economic forecasts in the state’s history due to the coronavirus lockdown and record high unemployment leading to a collapse in consumer spending, and record low revenue projections as a result of our state’s over-reliance on consumer spending to generate revenue.

Drawing upon decades of sound economic theory and observation of other economic cycles, we believe the best response to the looming recession is to increase long-term investments in education, health care, infrastructure, and economic security. According to the Center for American Progress, states that keep money flowing during recessions recover faster than those that lay off employees and stop money from circulating among families, businesses, and communities. And these investments will build a more productive, secure workforce that will be the foundation for a stronger economy in the long run. 

Washington has the opportunity to enact new taxes on the wealthiest Washingtonians and profitable corporations, avoiding deep and damaging cuts to community investments that would only worsen the downward economic spiral. New revenue sources are needed to save families and small businesses from bankruptcy, to ensure quality education and health care, and to keep communities from falling through the cracks. Significant cuts in government spending and investment in public projects and infrastructure will especially impact workers and families of color. Those who faced financial instability before the pandemic will feel the greatest impact, setting Washington’s communities back for years to come.

Tax and spending cuts often fail to stimulate spending as promised. Ensuring the wealthiest pay for investments is the most productive and effective way to kickstart economic recovery and rebuild the state’s economy.

We commend you for considering the full range of options available during this unprecedented crisis. 

Signed,*

Christian Anderson, Associate Professor of Society, Ethics, and Human Behavior, School of Interdisciplinary Arts and Sciences, University of Washington Bothell

Katie Baird, Professor of Economics, Division of Politics, Philosophy and Public Affairs, University of Washington Tacoma

Katherine Beckett, Chair and Professor, Law, Societies, and Justice Department, University of Washington 

Kyle Crowder, Blumstein-Jordan Professor, Department of Sociology, University of Washington 

Alexes Harris, UW Presidential Term Professor, Professor of Sociology, University of Washington 

Heather Hill, Associate Professor, Evans School of Public Policy & Governance, University of Washington 

Dan Jacoby, Economics Professor, Emeritus, University of Washington Bothell; UW Harry Bridges Endowed Chair in Labor Studies, Emeritus

Marieka Klawitter, Professor of Public Policy and Governance, Evans School of Public Policy and Governance, University of Washington

Jessie Martin, Lecturer, Economics Department, Central Washington University (and Executive Director of Carbon Washington)

Melissa L. Martinson, Associate Professor, School of Social Work, University of Washington

Andy Nicholas, Senior Fellow, Washington State Budget & Policy Center

Robert Plotnick, Professor Emeritus, University of Washington 

Sarah Quinn, Associate Professor of Sociology, University of Washington

Becki Smith, Director of Work Structures, National Employment Law Project 

Alexander Rist, Economist, King County 

Jennifer Romich , Associate Professor, School of Social Work, University of Washington

Marilyn Watkins, Policy Director, Economic Opportunity Institute

Nathalie Williams, Associate Professor, Department of Sociology and Jackson School of International Studies, University of Washington 

Thomas Womeldorff, Member of the Faculty, Economics, The Evergreen State College 

* Titles for identification purposes only

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Note: These letters will continue to have additional signatures after the time this blog post is published.