by Marilyn Watkins
Washington’s legislature launches a 60-day session January 11. As in the past several years, their biggest challenge will be money – how to adequately fund schools without slashing the other services necessary to protect the health and safety of our state’s people.
The Legislature and State Supreme Court have agreed that our K-12 education system must be improved to educate our kids for today’s economy and global society, including with smaller classes, more hours of instruction and higher level classes in upper grades, and equitable funding across the state.
Republican leaders, who control the Senate, have been perpetrating the fiction that we don’t need more money to accomplish these goals, just more accountability and efficiency (that is, more testing, less pay). Democrats, who control the House, have accepted that we need more money if we’re going to have more teachers and facilities, but claim we can get it by tinkering with the current system –closing a corporate loophole or two, shuffling around school levy money, or a modest capital gains tax on the wealthiest.
But the new revenue the governor and Democrats did propose last year would not have come close to paying the full cost of K-12 improvements.
Despite our relative wealth as a state, we’ll continue to face the school funding problem year after year until Washington’s elected leaders and voters finally accept the obvious – we have to tax the people with the money. And that means an income tax.
Over half our state general fund budget comes from the sales tax, which is based on an ever shrinking share of our state economy. General fund revenue has shrunk from over 6.5% of state personal income through the 1980s and 1990s to about 4.5% today.
Forty-three states already have an income tax. Most of them surpass us in the level of education funding. Because Washington does not base tax responsibility on income, we have the most regressive system in the country. The wealthy here contribute less than in other states for education, basic health and safety, a functioning democracy, and the economy that is serving them so well. Low and moderate income people, on the other hand, pay more.
Meanwhile, income inequality continues to expand and take its toll. The top 1% take the lion’s share of economic growth, and the top 10% do very nicely. Pretty much everyone else struggles to cover the basics and worries about whether they’ll be able to afford decent childcare or college for their kids, or what will happen if someone gets really sick or injured.
Our divided legislature does not promote reasoned discussion and decision-making. A handful of legislators do openly espouse an income tax, but they get silenced pretty quickly. Leadership on both sides won’t push any policies they think voters in the swing districts will oppose, hoping to hang on to the seats they have and win a couple more in the next election.
The only elected statewide officials who openly talk about an income tax to fund education are Treasurer Jim McIntire and Superintendent of Public Instruction Randy Dorn. McIntire also proposed cutting the sales tax and making business taxes more fair. That combination would make our system less regressive, more stable, and better able to fund education in the long run. But both Treasurer McIntire and Superintendent Dorn have decided not to run for re-election.
Tim Eyman’s latest successful initiative will make the Legislature’s job even harder this year. I-1366 will reduce the sales tax and make the funding situation worse unless the Legislature approves a constitutional amendment requiring a two-thirds vote of the Legislature to close tax loopholes and institute new progressive taxes.
It would sure be nice if the Legislature would spurn Eyman’s harmful initiative and instead pass along to the voters a whole new tax system that is fair and will amply fund a full education system for all our kids, from preschool through college. But legislators are afraid of voter rejection, so don’t count on it. They are more likely to kick the can down the road another year or two or four. And no telling how many kids we lose in the process.
Marilyn Watkins is policy director of the Economic Opportunity Institute, a nonpartisan policy center focused on building and economy that works for everyone.