The election will bring change, but the entrenched factors suggest only a few nudges. Here's an agenda for substantive change in our tax system, our spending priorities, our stalemated politics, and the post-Boeing economy.
Our county and local elections this week will create change in policy and politics hereabouts. How much change? My own guess, before ballots are counted, is that only a nudge toward change will take place, since it will take a huge effort of leadership afterward to break policy patterns of a generation.
Changing longstanding policy is compared to changing the mid-ocean course of a great passenger liner: It takes time and is not immediately discernible. But what would significant change look like? Here is my own local agenda.
Reforming our tax system. Our present tax system is destructively regressive, falling heaviest on state, King County, and Seattle taxpayers and businesses least able to pay for the costs of public programs. The textbook solution would be to shift toward the same income-tax system prevailing in most American states. Time and again, however, Washington citizens' level of mistrust about such a shift has blocked such an effort. Ordinary taxpayers and small business owners fear that elected officials will simply add an income tax to existing taxes, thus not creating "reform" but merely heavier burdens of taxation. Tim Eyman's recurring ballot measures to limit taxing and spending find public support, and sometimes passage, because of this voter perception, one which is not wrong.
When I returned home to Seattle nearly nine years ago, I thought public education and political courage could bring Washington voters around to an income tax. I no longer believe that.
But there are things we can do, short of imposing an income tax, to make our tax system more rational. First, we can do away with the b&o tax and the Seattle head tax, both of which penalize job creation. Second, and even more importantly, we can review the huge number of "tax expenditures" (subsidies and loopholes) that have been granted over the years to chosen companies and sectors. Boeing's $3-plus billion break, earlier in the decade, is a prime example. The sum total of these tax breaks amounts to three times the size of our biennial state budget. Gov. Gregoire, in her 2004 and 2008 campaigns, pledged to review these breaks. Instead, she has instituted new ones.
Other notions, such as a flat tax or a Value Added Tax (VAT), also have been floated. Both would generate huge amounts of public revenue, but both would add to the present system's regressivity.
Revising our spending priorities The present state, county, and local financial distress is forcing examination of public spending that we have not undertaken in a long time.
Over more than a decade, Seattle and King County have begun major capital projects without due regard for their costs. The prime example is Sound Transit light rail, authorized by voters in 1996. The light rail "starter line," scheduled to go from the South End to Northgate, is many years behind its construction schedule, has gone dramatically over its promised budget, and has omitted several stations promised to voters when they approved it. Despite this halting start, an all-out campaign last year resulted in approval of a $23 billion expansion that would lay track and build several fixed-point stations in King, Pierce, and Snohomish County over the next several years.
The measure authorizing the three-county expansion contains a provision allowing Sound Transit to increase spending, as conditions might change, so that the $23 billion is almost certain to be exceeded. This amounts to the largest local-level tax increase in American history — and all in regressive taxes. Seattle mayoral candidate Mike McGinn proposes to extend the in-Seattle light rail system to several neighborhoods, thus passing the price tag higher.
(Whenever I write about light rail, I receive howls to the effect that I favor roads over mass transit. That is not the case, however. I strongly favor mass transit, believing that bus and bus-rapid-transit service would take more people to more destinations, far more cheaply, than the planned light rail system.)
Our elected officials, almost certainly, will need to revisit the whole issue of three-county light rail expansion. The money allocated to it could be more efficiently invested not only in bus service but in education, job training, road and bridge modernization and maintenance, care for the homeless, and other pressing public needs.
The same holds true for the Mercer Project, which would cost Seattle taxpayers upwards of $300 million, depending on its final configuration and whether a Mercer West component is added to it. The Mercer Project would not reduce traffic congestion in the so-called Mercer Mess, but would rather increase it. I like Vulcan's plans for redeveloping the area. Over time they should enhance the quality of South Lake Union. But in these tough times they represent too large a chunk of taxpayer funds that are badly needed to meet other public needs. Mayoral candidate Joe Mallahan has said he wants to review the cost-sharing arrangement between the city and Vulcan. Given that the city is facing a $70-million-plus deficit for the coming year, Mallahan's proposed review provides a good starting point for reviewing spending priorities.
Does Seattle need a new jail? Dubious. Should public monies continue to be allocated in support of Hempfest, Seafair, and other local lifestyle celebrations? Should Nickels' roster of high-paid city consultants (many his political cronies) be sawed off permanently? These are questions our new mayor and reconstituted city council will need to examine with political courage.
Repairing our tattered political process. Seattle, King County, and our state badly need a reinvigoration of their public processes.
I'd start with the election of at least some city council members by district rather than at-large, as most large American cities do. Our system, in which we elect all nine members at large, is based on the notion that at-large members will be high minded and rise above parochial neighborhood and community interests. In practice, however, it has shifted power away from neighborhoods and communities and vested it mainly with downtown sources of political money and power. (It is hard to imagine, for instance, that a council elected by district would ever have approved Nickels' South Lake Union streetcar.)
Ballot measures, a long tradition locally and in our state, are another problem. They arose in the first place because Western-state reformers were fed up with turn-of-20th-century domination of their politics by railroad, mining and timber interests which bought what they wanted from pliable elected officials. Now, however, ballot measures often represent abuses of power in themselves. Well funded, focused special interests can sponsor and fund measures, especially in low-turnout, off-year elections, that give them what they want just as surely as bought-and-paid-for politicians did a century ago.
They also can cripple the policymaking process, as in California, where successive ballot measures have helped bring that state to its present state of financial ruin. We are headed in that direction here. Witness, for instance, the degree to which state, county, and local leaders here delayed decision over nearly a decade on replacing an Alaskan Way Viaduct, which posed a danger to public safety, ultimately bucking the issue to voters who punted it back. Most public business should be done by the people we elect, after public hearings and studies on the issues involved, through established executive-legislative processes.
Another early-20th-century reformist leftover is the notion of nonpartisanship in public office, as if parties themselves somehow corrupted the policy process. We have seen that notion extended to a ridiculous extreme in the present King County Executive race. Almost all Seattle and King County elected officials are Democrats, although their positions are nominally non-partisan. County executive candidate Dow Constantine is a Democrat; candidate Susan Hutchison says she is independent, although Constantine is trying to hang a Republican label on her. Thus much campaign debate has centered around Hutchison's alleged affiliation — Is she or isn't she Republican (gasp!) — rather than the many tough public issues facing the next county executive.
I find the notion of "nonpartisanship" to be a convenient fiction sustained by would-be good-government advocates. In fact, strong political parties, and party-identified political candidates, help strengthen governance and contribute to accountability. If we should strengthen our parties, we should weaken the single-issue and single-interest roups, on both Left and Right, which have come to dominate our public processes.
Fashioning a Post-Boeing economy. Boeing's continuing shift of its facilities and operations has, over the past few days, resulted in discussion about Who Lost Boeing? or What Could We Have Done to Keep Boeing? This discussion should be extended to the economic future of our region and state.
Boeing, or any other company, will make such shifts when it believes it will serve its bottom line. I think Boeing erred in moving its corporate headquarters, going so whole-heartedly to out-sourcing in aircraft production, and in believing non-union South Carolina workers would do a better job than a unionized Puget Sound-area workforce. Our own earlier $3 billion subsidy to Boeing, in the end, made little difference.
Should fresh public subsidies be offered to keep ongoing Boeing operations here or to lure Boeing replacements? The answer is no.
Our long-term economic health will not flow from entering into bidding wars with other cities, states, or countries to attract new employers. Long-term, sustainable growth flows instead from factors unrelated to company- or sector-specific subsidies. These factors include: quality public education at elementary, secondary, and college level; a tax system encouraging investment, economic growth, and employment, and which is regarded by citizens as fair; modern, functioning transportation systems; adequate sources of water and energy; protection of the natural environment; "quality of life" attributes including the arts, sports, and cultural activity; and, most of all, a well-trained, motivated pool of potential employees.
The basic question is: How are we doing on those fronts? Taken together, these factors far outweigh any short-term financial giveaways to any present or prospective employer.