Job creation: Who's got the secret sauce?

Gov. Jay Inslee and Democrats want to target high-tech jobs for state help, including tax breaks. Republicans want tax breaks for all new businesses.
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Gov. Jay Inslee

Gov. Jay Inslee and Democrats want to target high-tech jobs for state help, including tax breaks. Republicans want tax breaks for all new businesses.

So what's the magic formula to create jobs in Washington?

Jay Inslee's "secret sauce?" Or the classic Republican playbook?

Both touted their paths to Washington's economic recovery this week. Both put new jobs on top of their to-do lists, as they have for months. Both have master plans that have been around for ages. And both cited lists of bills currently in play in the Senate and House.

The big question what will actually get done — breaks down in several components. Which Republican and Democratic parts are compatible? Which parts clash like Hatfields and McCoys? Which are fan-boy fantasies, like a sci-fi nerd getting a date with Star Trek Borg babe Seven of Nine? Which ones trip over each other like circus clowns with really big feet?

Sometimes, there are claims of kumbaya bipartisanship. Other times, there are assertions that the other side is in league with the devil.

For example, Rep. Matt Manweller, R-Ellensburg, said: "I see bills ... that essentially criminalize work." He pointed to a complicated bill that recently passed out of the Democrat-dominated House Labor Committee with a party line split that tackled the definitions of an independent contractor and an employee -- and how an employer could be punished for misclassifying such workers. "It sets (employers) to break the law. It sets up (the Washington Department of Labor and Industries) to be judge, jury and executioner," Manweller said.

On the other hand, Sen. Bruce Dammeier, R-Puyallup, pointed to a Republican-originated $544 million schools capital projects budget — a source of construction jobs — that zipped through the Senate in less than two weeks with  a 47-0 final vote.

On Wednesday, Republican legislative leaders said, they pitched their job creation master plan to Inslee that morning — the same master plan the GOP has pushed for years. That master plan boils down to taxes and regulations hurt and scare away businesses.

The planks include workers compensation reforms; streamlining regulations and bureaucracies; requiring some state agency rules to be approved by the Legislature; and requiring new regulations to be checked for economic impacts before they go into effect,  Another plank is to declare hydropower an official renewable source of electricity, which would nullify Washington's legal goal of obtaining 15 percent of its power from alternative renewable sources by 2020. 

Republican leaders also believe that the state's Growth Management Act is economically hurting counties with sparse populations and small county government staffs. They contend the Growth Management Act should be suspended when unemployment reaches specific levels in those counties. And Republicans want a permanent requirement that two-thirds of the Senate and House are needed to,raise taxes, believing the possibilities of tax hikes spook prospective employers.Tax-friendlier Democrats and hardcore anti-tax Republicans have sparred for years over this threshold, which is currently at the two-thirds level.

But the supermajority requirement, faces a possible Washington  Supreme Court ruling on its constitutionality, which has Republican bracing for a negative ruling by floating bills for a constitutional amendment.

Inslee agreed some regulatory streamlining is needed. However, he contended the Republicans are not giving the workers compensation compromises of 2011 a chance to prove their efficiencies. But Republican leaders said one year was all they promised to wait before tinkering some more.

Meanwhile, Inslee believes making hydropower an official renewable power source is an end run around expanding its clean energy capacity — a favorite cause of the governor for generating electricity and as a field to create new jobs. "This is something that would be perfectly built for our skill sets in Washington," he said.

As for passing a bill to call for a public vote to put a constitutional requirement for a two-thirds majority to raise taxes, Inslee and the Democrat-controlled House will never concede that threshold to Republicans.

That threshold could be a factor on a transportation projects budget scheduled to be nailed down toward the end of this legislative session. That budget is also a source of construction jobs, and a gas tax hike would be a factor in how big it gets. Republicans are dead-set against tax increases, including gas tax hikes — and view the supermajority requirement as their bulwark against such increases.

 "You want me to give more money to these people right now, when they can't manage the money they have?" asked House Minority Leader Richard DeBolt, R-Chehalis.  

Democrats are crossing their fingers that the state Supreme Court will nullify the supermajority requirement before the end of the session, enabling them to pass tax increases with simple majorities — assuming those majorities survive Inslee's promised vetoes of any tax hikes.

Inslee has taken a no-new-taxes stance. But gray areas exist. Inslee sees keeping existing taxes from expiring as sticking to his no-new-taxes promise. Sen. Ed Murray, D-Seattle, floated a trial balloon of taking proposed new taxes to public referendums, a suggestion that received a cold shoulder from Inslee. However, on Wednesday, Inslee would not rule out a gas tax hike if the transportation projects budget needs the money.

Also on Wednesday, Inslee talked in some detail about his jobs creation package. His master plan boils down to schools need to train people for the correct high-tech jobs; tax credits will lure high-tech jobs; and clean energy is a ripe industry for growth.

His plan has current bipartisan bills to boost science, technical, engineering and math training for high school, with emphasis on at-risk student. Also, Inslee called for the state help to coordinate aerospace training and veterans-hiring efforts.

Finally, Inslee and Repubiicans have tax break bills stumbling over each other —somewhat similar in board strokes, but different in focuses and scopes.

In fact, Inslee's tax tax credit proposals are playing catch-up to some broader Republican Senate bills that have already had hearings.

In the House, Kirkland Democratic Rep. Cyrus Habib introduced a bill, which Inslee sought, to provide up to $2 million annually for two years in business and operations tax breaks for for new businesses that manufacture industrial machines, computers, software, electronic products and Internet-related products  — as well as providing credits for research in physics, engineering and life sciences ventures. Meanwhile, Republicans are moving two bills in the Senate that would provide B&O tax credits to all fledgling businesses, not just the high-tech ones targeted by Habib's bill. Inslee said his and Habib's approach focuses the state's limited resources on business sectors that have the greatest potential to grow and the greatest potential to sprout satellite industries.

Inslee also pitched expanding Medicaid as a job creation tool. Inslee claimed expanding Medicaid could add 10,000 jobs to the state, in the medical fields directly and from the ripple effects in communities from those jobs.

For exclusive coverage of the state Legislature, check out Crosscut's Olympia 2013 page.


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About the Authors & Contributors

John Stang

John Stang

John Stang is a freelance writer who often covers state government and the environment. He can be reached on email at and on Twitter at @johnstang_8