$8 Billion budget deficit in WA: Almost as bad as CA

By Evan Rohar

This is where things have been pointing for the past three months. It should come as no surprise to readers of this blog, as we have been saying for months now that the deficit is only going to grow. From the Seattle Times:

Washington state forecasters had previously projected a nearly $6 billion shortfall. Thursday's preliminary forecast shows an additional $721 million gap in the current two-year budget and $1.6 billion more in the next biennium that starts in July. That pushed the overall shortfall to $8 billion. ("$8 billion shortfall forecast for Washington state budget," 2/20/09)

What about the federal stimulus, of which Washington State is expected to receive $6.7 billion? Most of the money is earmarked for very specific projects, two of which (Hanford cleanup and Bonneville power grid modernization) comprise $5.25 billion (78 percent) ("State to get $6.7 billion from stimulus deal," Seattle PI, 2/13/09). Back to the Times:

The state expects to get billions of dollars in aid from the federal stimulus package passed by Congress, but the governor's budget office said the additional money will at best offset the latest round of bad news in the revenue forecast. Additional cuts may be needed beyond what's already been proposed by Gov. Chris Gregoire.

So, old Herbert Gregoire's draconian cuts are going to get deeper. Maybe not. There might be help coming from proposals to increase revenues.

Democratic leaders in the state House said earlier this week they'll likely propose sending a tax package to the ballot this year to help deal with the budget shortfall. And Senate Majority Leader Lisa Brown, D-Spokane, said she expects to bring ballot proposals to her caucus to consider.

No details are available yet, but House Majority Leader Lynn Kessler, D-Hoquiam, said one idea would be to ask voters to increase taxes to pay for subsidized medical coverage to lower-income families.

This would be good news if Washington lawmakers knew how to tax something other than sales. They have no will to utilize the hoards of the 133,812 of millionaire households in Washington State ("More Millionaires," Seattle PI, 1/11/08).

Allow us to paint a picture: about half of Washington's revenue is generated through the sales tax. Regular people (non-millionaires) pay far more as a percentage of their income in sales taxes than those with more money. Levying additional sales tax on those with less money will decrease their spending power, leading them to buy even fewer things. So, the net effect of increasing sales tax would be relatively small. Contrast this with a modest income tax on the top 5 percent of households in the state (which, incidentally, would only tax millionaires); the revenue increase would be enormous. But no one is talking about that because it is politically inconvenient. Meanwhile our schools are facing debilitating cuts and the state health plan is becoming a skeleton of its former self. Libraries are closing and state workers are being laid off.

It takes a constitutional amendment in Washington state to allow for an income tax. Here's an amendment proposal: "Income tax shall be allowed on households with incomes in the top 5 percent of all households in the state." There. Done. Simple.

"To be eliminated" at Evergreen

TO BE “ELIMINATED”

by Ben Gallup


A document that the administration didn't want you to know about was leaked to the Evergreen Committee for Full Funding. This is the only proposed “scenario”; an itemized list of which programs are recommended for “elimination” as of July 1, 2009. Though they assure us that “nothing has been decided for certain”, we will find no comfort in this, the only proposal from the administration.

The following are to be “eliminated”:
Evergreen Tacoma
The Longhouse
Reservation-Based Programs
The CCBLA
The Labor Center
The Washington Center
Evergreen Center for Educational Improvement
NW Indian Research Center
Beginning the Journey
The Computer Applications Lab

Folks, this is less than half of the list! There are severe cuts proposed for many programs such as study abroad, performing arts, etc. Many students believe that programs such as these are absolutely integral to the Evergreen experience. Also, this “scenario” is assuming a 7% tuition increase, and given the worsening state budget crisis, we could see an even worse scenario by the time decisions are made.

I sent this information over tesccrier on January 28 at 10:00pm. Conveniently, the document appeared on the notoriously labyrinthine TESC website the next day. Don Bantz remarks on the web page that he wants us all “to have the same access to this information.” You'll also notice that after my tesccrier posting, the word “eliminate” was changed to the more innocuous term “discontinue”. The document is viewable at:
http://collab.evergreen.edu/budget/files/budget/Academics%20Budget%20Reduction%20Scenarios%201-29-09%20Draft.pdf

This message is not intended to demonize TESC administration; they are clearly between a rock and a hard place. They are being forced to make tough decisions. This document also mentions that one Dean is to be “eliminated”. Also, Les Purce (our president) says that he will be taking a voluntary pay cut. I don't believe that the administration is behaving maliciously, but their claims of transparency and student inclusion obviously cannot be taken in good-faith, considering these events. Also, we can't help but notice that people who are underrepresented in our society will suffer from this "scenario" disproportionately. The administration is calling for “prioritizing” programs. This means hacking off a number of programs, such as those listed above, rather than distributing the cuts more evenly. What about the students' perspectives? They say they want our input, but how can we participate in a dialogue if we are being deliberately and systematically denied access to critical information? Maybe they should be informing the students of the situation in some concrete, straight-forward manner, instead of offering only the vague, placating statements they have issued or publishing documents after they have already been leaked. To borrow a lyric from a country song, they're treating us like mushrooms: feedin' us shit and keepin' us in the dark.

Ultimately these cuts are resulting from the combination of an economic crisis and one of the most regressive state tax systems in the country. The (Democratic) governor is not just cutting higher education this year. She is calling for the closure of 13 state parks, the lay-off of thousands of State employees, cutting programs for the homeless, devastating Washington Basic Health, and much more. The struggle for full funding of society's needs will not end with this fiscal year. The programs we need will be sacrificed at the altar of the Market. As our economy slips into the Greater Depression, we will see more and more cuts like this. (Of course, there will plenty of cash for war and bankers) Our true enemy is not TESC administration. The source of these problems is much larger and systemic, but we have to struggle for our interests in any way we can now.

The Evergreen Committee for Full Funding is calling for students to get together in the coming weeks, to express ourselves collectively, calling for full funding of society's needs. There will be a rally against state budget cuts at the capitol on Monday, February 16 (President's Day). We will meet at Tivoli Fountain on the state capitol campus at 10:30 AM. Please spread the word, make announcements in your classes, and bring signs to the rally. There will be another rally at the capitol on February 24. We will be joined at both rallies by other students and workers who will be hurt by the state budget cuts. It is important that we maintain a “NO CUTS TO ANYONE!” message, rather than just fighting for our campus at the expense of the homeless, folks without health care (like me), people in state-run chemical dependency treatment centers, etc. who need funding at least as badly as we do.

In Germany, a national student strike was held by 100,000 people protesting education funding cuts. In Rome, Italy, 500,000 students protested cuts to higher education, yelling “If they block our future, we'll block the city!” In Ireland, 100,000 people (out of their population of just 3 million) came out in protest against education cuts. In 2006, 100,000 Greek students went on strike to protest education cuts, holding occupations of 90% of the universities. In France, as thousands of students came out in protest against education cuts, Sarkozy backed off his plans in fear of “Greek syndrome”. And at Evergreen State College...?

We will not draw 500,000 people, nor will there be a coup d’état at the State capitol, but we are powerful if we come together as a community.

To get involved, please email: EvergreenCFF@gmail.com

Also, look for Evergreen Committee for Full Funding on facebook.

Gregoire: Stimulus will not stop budget cuts

By Evan Rohar

The federal stimulus package (which the House passed and the Senate is now considering and adding to - about $900 billion in total spending so far) won't produce the results many in Washington State and across the country have hoped for - alleviating the draconian cuts to the State budgets. The best we can hope for is a softening of the blow, tantamount to a pillow strapped to the head of a person about to withstand a an assailant with a sledgehammer. From the PI:

Washington's share of a federal economic stimulus package - estimated at perhaps $4 billion - will have plenty of strings attached, and won't be the economic cure-all that some people are hoping for, Gov. Chris Gregoire said Tuesday.

"I think the expectations we heard out there were, everybody was ready to spend boatloads of money - 'I'm going to build this, and I'm going to build that,'" Gregoire said in an interview with The Associated Press.

But "that's not how the money's coming," Gregoire said. "There's not going to be a whole lot of discretion out there for spending the money."

Gregoire's special assistant for the stimulus package, Dick Thompson, said he is estimating Washington's potential share of the federal package in a range from $3.5 billion to $4.5 billion. That estimate is fluid, Thompson noted, because the U.S. Senate is still working on its version of the bill, and the Senate and U.S. House have to negotiate a final package.

Once it arrives, the stimulus money will be channeled largely through a long list of federal programs with different rules and deadlines attached, Gregoire said.

The spending is also being advertised as "use it or lose it," meaning states have to move the dollars out the door, not put them in bank accounts. And in some cases, states won't be allowed to substitute new federal spending for the state's portion of shared program costs. That means a flood of federal money won't necessarily free up gobs of state cash for other uses, as some officials have hoped. (Wash. gov: Stimulus won't be a cure-all, 1/27/09)

So should we call the Governor Chris Hoover or Herbert Gregoire? During the last economic downturn of this magnitude (which occurred in the 1930s), State governors across the country decreased spending on all sorts of programs, including public works and education, in order to balance their budgets. In our current situation, putting more people out of work is insane; an excerpt from an article entitled "A New New Deal Under Obama?" illustrates why:

Federal spending on public works, which has become almost synonymous with the New Deal in popular culture, expanded nearly every year from 1929 to 1938 (see table 1). Yet, total government spending on public works did not regain its 1929 level until 1936, due to drops in state and local public works spending that undercut the federal increases. At first, state and local governments had responded to the deep slump by increasing their public works outlays. However, within a couple of years their resources were largely exhausted and their spending on public works dropped below that of 1929. By 1936, state and local public works expenditures were less than half their 1929 level. (Monthly Review, 12/21/08)

The governors should go to the Obama administration with this telling data and demand more money so they do not have to balance their budgets on the backs of students and workers. We have often pointed out on this blog the contradictions of creating jobs in one sector of the economy while at the same time destroying jobs in another. The argument over federal and state/local spending is a contradiction of a different kind, but it makes about as much sense. Why destroy state and local jobs to make way for federal jobs? This is a wasteful way to do things in a time when we need to focus our resources as efficiently as possible.We ask: why does a common sense approach to this economic downturn have to come from a lowly student group? Whatever the answer, we must organize to challenge the current pretzel logic of Gregoire and the federal government.

Gregoire's Budget

By Evan Rohar

She said it was going to be ugly and it is. Given the speculation, some aspects are surprising. The main thing to remember while reading about Gregoire's budget proposal, however, is that it does not cover the further losses to revenue that are expected in the February forecast. There are $3.5 billion in cuts so far, but this is just a first shot. While K-12 and higher education were not hit as hard as expected, health and human services were cut to the bone. Each of the following selections is from the Seattle Times article on the budget proposal. We'll take them on point by point ("Public safety" is left out for now due to its controversial nature. However, no matter what its fate, workers in correctional facilities, etc. still need good, living-wage jobs).

"Health and human services: $1.4 billion

Reductions include cutting $500 million from state programs that provide health care for children, the poor and the disabled. The cuts could eliminate health-care services for 46,000 people.

"Other cuts include eliminating the General Assistance-Unemployable program, which provides a temporary safety net for people unable to work because of mental or physical disabilities. That would save more than $160 million.

"In addition, the governor proposes a 5 percent cut in the amount of money the state provides to nursing homes to take care of Medicaid patients, saving the state $46 million." ("Gregoire releases slimmed-down state budget," 12/18/08)

This was by far the most surprising element of the budget cuts and the most draconian. In the coming period, the ranks of the working poor will swell, creating greater demand for state health plans and services. The most troubling thing about this is that it hits hardest those who are most disenfranchised. Cutting health services to children, the elderly, and the "disabled" should be completely out of the question even in troubled economic times.

"Pay raises: $682 million

"The governor would eliminate proposed pay increases for state workers and teachers. The state employee pay raises were negotiated between the governor and state worker unions, but haven't yet been approved by the Legislature. Initiative 732, approved by voters in 2000, requires annual salary increases for teachers to be pegged to inflation. However, the Legislature can suspend the initiative with a simple majority vote.

"However the state would provide the additional money needed to continue paying 88 percent of the health-insurance premiums for state employees, as required by their contracts." (Ibid.)

State jobs are some of the few living-wage jobs left in Washington (see the Seattle PI article, "New jobs offer less than living wage"). Reducing the number of good-paying jobs by freezing the wages of state workers makes little sense in this economic environment. Furthermore, the governor already negotiated wages and benefits for state workers during collective bargaining with their unions. The legislature should not renege on contracts that were negotiated in good faith.

Initiative 732 should not be suspended. Teachers are already underpaid for the amount of work they do and the cost of the education required to become certified. The Seattle Times seems to suggest in the last sentence above that state workers shouldn't have good health insurance. All workers deserve good health insurance.

"Public schools: $610 million

"Cuts include a 33 percent reduction in levy equalization payments to public schools. This money helps support about 200 school districts that have small property-tax bases to rely on. It would save the state $125 million.

"In addition, the governor would save $178 million with a 24 percent cut in funding for Initiative I-728, which was approved by voters in 2000 to reduce class sizes. Many schools use the money to hire more staff and pay for training and other programs." (Ibid.)

The levy system is already an inequitable way of dividing up money for public schools. Decreasing money for levy equalization will put currently under-funded rural and inner-city schools into dire straits. Also, with schools and classes already overcrowded, laying off teachers whose positions were funded by I-728 must be taken off the table. Neither teachers nor students can afford a reduction in State funding for public K-12 education.

"Higher education: both cuts and tuition increases

"The governor would cut $216 million — 13 percent — from the budget for four-year public universities. Two-year community colleges would be cut by 6 percent, or $110 million. The cuts are expected to result in larger class sizes and faculty layoffs. Gregoire suggests letting the colleges and universities decide if they need to reduce enrollment to maintain quality.

"Community colleges were spared the deepest cuts because the governor's office felt those institutions will get the brunt of laid-off workers heading back to college for retraining.

"Universities would be allowed to increase tuition by 7 percent, which would raised $128 million to help offset the cuts. Community colleges can increase tuition by 5 percent, which would raise $34 million."(Ibid.)

Raising tuition above the rate of inflation is unacceptable in a time in which it is becoming harder and harder for working and middle class people to attend college (see an earlier post on this blog, "College in WA and across the US becoming unaffordable"). Costs for attending college have skyrocketed in recent years, keeping higher education out of reach for many lower-income people. Laying off faculty and staff will exacerbate already climbing unemployment in the state. Also, if laid-off workers are expected to enter community colleges for retraining, why are their budgets being reduced instead of increased?

"Natural resources: $35.8 million

"The proposed cuts include closing 13 of Washington's 121 state parks, saving $5.2 million, and shuttering some fish hatcheries, saving $6.6 million." (Ibid.)

Closing state parks will not only reduce the quality of life of people who spend their recreation time in the outdoors, it will result in lost jobs for park rangers and staff. Here's a comment from a woman responding to another person on this Seattle Times article:

"'OPEN YOUR EYES== this is all on paper NO real cuts.' Hey Mr. Nice Guy, tell that to the dozen or so Park Rangers who were told today that they will be laid off at the end of January, including my husband. Or the staff at the 13 state parks that are closing and are either losing their jobs or forced to move to other parks."

These budget cuts are affecting working people in real ways already. Workers like park rangers rely on state funding for good paying jobs that can support families. We must not let our quality of life be slashed to ribbons while the banks on Wall Street and the rich investors and corporations get bailed out when they are in trouble. 40 out of 50 states need significant amounts of money to continue providing jobs, services, and education to their constituents. The federal government has the money; we must demand it.

Related Articles:

• Seattle PI Frugal budget wins few friends
• Seattle PI Editorial State Budget: Pain and suffering
  

Washington's deficit not that bad?

By Evan Rohar

Speaker Chopp seems to be out of touch with what working people and students need. He doesn't think the budget deficit that is already causing the government to cut health care, workers' hours, and education is really that much of a problem. From the Seattle Times:

"House Speaker Frank Chopp said Washington's projected deficit may not be as bad as it looks.

"Chopp, a Seattle Democrat, was in the Tri-Cities Friday for a forum with the Columbia Basin Badger Club, a local group that grills politicians and newsmakers on political issues without taking sides.

"Several club members from the audience of about 75 asked Chopp about the state budget, which officials estimated in November would face a $5.1 billion shortfall in the upcoming biennium.

"But Chopp said the doom-and-gloom prophecies include estimates for $1 billion in spending on new programs, which seems unlikely given the current revenue picture.

"'In fact, we won't do that now,' he said.

"Some programs — such as all-day kindergarten — will have to wait until the economy turns around, he said." ("Chopp: Washington's deficit not that bad," 12/14/08)

New programs on the chopping block include increases to health care for children among many other badly needed services.

One-dimensional stimulus

By Evan Rohar

Following are excerpts from two articles published in The Enterprise Newspapers in two days that illustrate the ineffectiveness of a one-dimensional economic stimulus plan:

"From Washington, D.C., and from Olympia, the refrain is the increasingly same: This recession demands a job-creating stimulus package.

"From Edmonds, the response has been quick: If you have money, we have ways to spend it. . .

"Sidewalks, walking trails, lighting improvements on downtown Edmonds' Main Street and more mundane projects are all included in the city's 11 project, $9.2 million 'stimulus package' wish list . . .

"All told, the city's projects would create a total of 116 full-time equivalent jobs, officials estimate." ("Edmonds' stimulus wish list $9.2 million long," 12/10/08)

"The [Edmonds school] district received almost $9 million in I-728 money last year, which funded about 78 full-time teachers. Mostly it goes to reducing class size, and the rest goes to teacher professional development and extended learning." ("Public school funding picture bleak," 12/11/08)

This is the problem with a one-dimensional economic stimulus program. If funding is taken away from I-728, 78 teachers will lose their jobs. Even if Edmonds gets everything on its bailout wish list (an unlikely prospect by the tone of the first article), it will create only 38 net jobs after subtracting the lost teaching positions.

An approach which pinpoints only certain ailing sectors of the economy will not work in a recession of this magnitude, especially when workers already have a very hard time finding living-wage work. From the Seattle PI:

"Nearly 80 percent of job openings in Washington last year paid less than a living wage for a single parent with two children. And every opening that did offer a living wage for that type of family drew an average of 10 job seekers.

"Overall, the percentage of job openings paying less than a livable wage for different household compositions remained virtually unchanged in 2007 from 2006, according to an annual study on the gap between what families earn and what they need to get by.

"Because the study does not reflect the economic trends of 2008, 'in all likelihood, the numbers are an underestimate, so the picture is even more bleak,' study author Gerald Smith said Tuesday." ("New jobs offer less than living wage," 12/9/08)

Workers' real weekly earnings have been declining since the mid-1970s. We need a diverse array of living-wage jobs in order to boost the living conditions of workers in this country.

CPJ Article: Unite against the budget cuts or we will fail

We're in the current issue of the Cooper Point Journal. The article this time emphasizes the need for unity. Here it is:

We will unite against the budget cuts, or we will fail

By Benjamin Gallup and Evan Rohar

Every sector of spending in Washington State will be under attack during the coming legislative session. The budget deficit for 2009-10 will almost certainly reach $6 billion, while some say it could be as high as $8 or $9 billion. Legislators are now discussing a 23 percent cut to the higher education budget as part of their efforts to eliminate the deficit. Other large items on the long list of cuts are health care, social services, and primary education.

In the coming months, legislators will use “fiscal responsibility” as a rationale for cutting spending to programs that students and workers need most in a recession. Yet economists have said recently that fiscal restraint is likely to make our economic woes worse. The state needs immediate aid from the federal government to continue vital services as well as a progressive tax code which taxes corporations and the wealthy to provide a consistent and predictable source of revenue. This is, in fact, the “fiscally responsible” course. Our elected officials have not yet put forward an acceptable solution to this budget crisis, so we must organize and do it ourselves.

Given the task ahead, students, faculty, state workers, and indeed all citizens of this state must unite against the looming threat to our quality of life. We must build a state-wide coalition based on our common interests. This coalition will need to embrace a variety of tactics to accomplish the goal of full funding for all state programs.

Realizing the interconnectedness of each vulnerable program is the key to creating and maintaining a coalition of all the parties with a stake in this fight: students, faculty, and staff; state workers; and those dependent upon state social and health services. Perhaps most importantly, we must remember how the decisions made in the coming months will effect an already ailing economy, and therefore every person living in this State.

Last week, Governor Gregoire asked for a minimum $600 million from the federal government for infrastructure projects. At the same time, she sought a $600 million budget cut to higher education (which has since been revised upwards to $690 million). Addressing joblessness through a federal stimulus in one sector of the economy while laying off state workers in another makes little sense. We need a holistic approach to this economic crisis, not an injection of funds into one part of our ailing system while others are crippled. The government should not force faculty, staff, and students out of higher education just to seek the infrastructure jobs it is creating to stimulate the economy. Yet we as students cannot say to a laid-off construction worker who would benefit from a state infrastructure stimulus, “Our education is more important than your ability to find living-wage work.” Similarly, the government should not present the construction worker with two bad options: a good education for her child or a living-wage job.

We face a long struggle which could take us until the end of June and the deadline for a new state budget. We must steel ourselves and square our shoulders to the task ahead. Above all we must have faith in our collective ability to make a difference through organizing and mass action, as did those in the 20th century's civil rights, anti-war, and labor movements. Along the way, the governor and lawmakers will make concessions to groups within our coalition. We must build the strongest bonds of solidarity so that when one group gets what it wants, it does not just give up the fight for full funding of all our distinct, yet interconnected, needs.

In this economic climate, tuition hikes and layoffs of state workers should be out of the question. So, too, should a reduction in services to a growing number of people who need them. The federal government gives trillions of dollars in bailouts to banks and rich investors. Students and workers must unite to demand that the federal government fund our needs.